“This rally is all bull” says Alan Kohler

Alan Kohler at the Business Spectator writes:

The stockmarket rally is now being driven by the same force that set up the excesses that led to the bust in the first place – an abundance of liquidity.

The world is awash with government money, both central bank “quantitative easing” (money printing) and budgetary stimulus, and this is, in turn, driving a re-run of the hedge fund speculation that popped the market in 2007.

What do you think? Is there more turbulence ahead? Or is the worst behind us now?

Read Alan’s complete article at http://www.businessspectator.com.au

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168 Responses

  1. So far it looks good as long as it does not get to the stratospheric heights experienced before the big bang.

    I was sure it was going to hit the fan March, last year but the Fed pumped heaps of cash into the system that is now lost to prevent the inevitable for six months.

    Sounds familiar?

    There is still the housing bubble to be dealt with here and I would keep an eye on the crude price as it could get up to $100 plus a barrel in the space of a few weeks.

    People forget that we are yet to go into a technical recession…confidence is shot out there due to the negativity promoted by the government and the MSM.

    Due to a link I put up on another thread on credit card debt, there is no problem with thrift that I can see in the immediate future.

    In fact the culture of debt and living above one’s means is well and alive so expect carnage if another economic shock arises in the near future!

    The problem being if this eventuates it could destroy our nation’s chances from emerging from debt for generations.

    I’ll steal a quote from Huxley’s novel, ‘A Brave New World…”A gram in time saves nine!”

  2. Is the housing bubble about to burst?

    http://www.theaustralian.news.com.au/story/0,25197,25517238-12377,00.html

    Not really whilst the government is pumping money into the FHOG scheme…when it does go down to a respectable level there will be some very unhappy people that have already purchased.

  3. Its far too early to call the bottom.

    I like to think of it this way……………..!

    We all ate so much and consumed so much that we got really really full just like a Sunday afternoon shovin’ prawns and lobster down our throats and drinking the best wine day after day.

    Then one day a few of us realized we’d eaten even the bad prawns and a lot of them.

    So many of us just started throwing up firstly in the kitchen (projectile vomiting), which is the heart of any home, then in the lounge room……………then the bedrooms……………..then the bathroom…………even the people in the backyard managed to somehow grab a handful of the bad prawns and were at least retching.

    So anyway as a result there are pools of vomit all over the floor of every room and it absolutely stinks.

    In walks Mummy with buckets and buckets of water (liquidity) and a broom (its all she has). Some piles of vomit are so thick and stinky that all she can do is push those piles into a corner of the room.

    With the other piles she throws heaps of water (liquidity) over them to at least disburse the vomit and the absolutely foul smell.

    Then she leaves the house and us to our own devices for a while.

    But before leaving she says she’ll be coming back with a big mop to mop up all the liquid after its dried off a bit.

    Well she still has yet to return to mop up whats left (reduce liquidity) and she’s just hoping the stuff in the corner does not get wet again.

    But we know she will be back but we dont know when.

    Easy to understand I think

  4. Well put walrus…now where is that bucket?

  5. Easy to understand I think

    Was there a point in there somewhere…?

  6. Reb, go stand in the corner!

  7. Thanks scaper !

    I think I’ll be in the running for the Nobel Prize for Economics
    or at least Good Hygiene after that effort………!

    BUUUUUUUUUURP……………….!

  8. Its far too early to call the bottom.

    I disagree. I reckon the worst of it is behind us..

    There isn’t anymore panic selling like we saw 12 months ago.

  9. I don’t believe a word any of these so-called experts regurgitate. Where were they in July 2008 and Nov-Dec 2007 if they’re so good at calling tops and bottoms? I reckon if they’re all saying it’s over, then…watch out below!

    From a stock market view, we’re still in a bear market and will be until the All Ords hits 5200 by my reckoning. Although I’ll be marginally happier if we take out last weeks high which sits right on the 200 day moving average.

    Wait for the rash of positive economic new front page articles worldwide to reach a crescendo in the next week or two. Then watch the sell-off.

    I have been wrong before though…

  10. House prices collapsing!

    Where’s John McPhilbin…??

    http://www.news.com.au/business/money/story/0,28323,25517239-5013951,00.html

  11. reb, on May 21st, 2009 at 4:47 pm Said:

    Its far too early to call the bottom.

    Sorry reb, badly phrased……………………….I think we will bounce around for a while yet and perhaps test the 10 March lows on a few indices.

    If you look on the ASX almost every blue chip company’s share price hit its lowest on 10 March

  12. True Fugitive.

    It’s anyone’s guess really…

  13. I think the profit takers will have a field day soon.

  14. Besides…………there are still quite a few capital raising to come especially amongst the REITs (commercial property sector).

    The spot to avoid is still discretionary retail .i.e Harvey Norman, David Jones.

    Guys will make the girlfriend/wife go without the newest fashions or a better dining suite but as far as updating to the newest electronics….?……………Well that’s not “discretionery”……………….that’s as essential as a loaf of bread………………….!

    So hello JB Hi Fi

    The REITs wont go to market unless desperate. Otherwise they’ll wait for a bit more recovery in their share prices then they wont need to deeply discount their share prices in any offering (cost of capital always counts)

    BHP Billiton is lookin’ mighty hungry and so is QBE and probably Woolworths (watch JB Hi Fi I think) as that rumour has been constantly recurring.

    And so many of the lesser ranked miners need to repair their balance sheets with cash.

    Too much still to happen yet before we see the proper start of the next Bull market

  15. LOL!

    The rain has stopped in Brisbane too!

    No more droughts…yippee!

    Though it has always struck me that when a serious drought breaks – there’s a boom just around the corner…all anecdotal of course…bit like Alan Kohler’s comments actually…

    …AK is my favourite financial commentator and I suspect his, “the ‘bear market’ is over” comment, may just be tongue in cheek…

  16. TB..was hoping that you were choofing ok with the floods and storms. The worst for us was a knocked over grevillea and stranded worms which I rescued this afternoon, putting them under the cane mulch. They said thankyou.

  17. Min,
    Only drama was neighbour’s pool overflowing into our yard … sent The Minister out to build dams (born in Holland) she loved it! (…and redirected the water from our two ponds…)

    The “big drama” here, was emptying cupboards and shifting furniture on Tuesday, for carpet replacement yesterday (yep, in the biggest deluge) and putting it all back today (my back, legs and bumpsa daisy’ll tellya!)…took me ages to replace all the grog in the cocktail cabinet…

    Last week was lugging the new computers about and setting them up (still not finished) …

    …almost out of “the hole” and will be back to Blogocrats soon…

    =====================

    …really pleased to see Mobios Ecko back…some real talent on this site and good fun posters, g’day Neil, er, Neal, er, Niel – sorry mate us leftoids are lousy spellers…can’t handle money very well either but who GAF!

  18. TB..hubby is off taking the kelpie for a walk so am able to clock on. Likewise, an overflowing pool and Jeff forgot to turn the pump off before going to work this morning. And so this was another small drama..I was able to lever the gate to the pump house up using a pitch fork.

    I am certain that The Minister being Dutch was in her element stemming the flow.

    Good timing TB..replacing carpet just before a major flood.

    If this blog isn’t careful, we will start to outnumber the faceless ones..hehehe.

  19. can’t handle money very well either but who GAF!”

    Good to see you finally admitted to it TB. Daffy Ducks first budget last May is now a deficit of $35B and this years is going to be $58B.

    Thats $93B of debt in Labors first two budgets. Surely this is a record even for the ALP.

  20. Thanks for the link TB…

  21. Happy days are here again
    The skies above are clear again……

    Well, mebbie not quite yet.

    Kohler is an odd sort of a dude.

    In his appearances on the ABC to discuss the Market he speaks in this sort of oily half-hushed voice that reminds one of a bloke in a trench-coat offering boiled lollies to the kiddies at the level crossing after school gets-out. Pure coincidence, of course, but he sounds, well, creepy.

    Also, I see the Liberal Contingent is here, still banging-on about the Deficit.

    Geez, fellas, can’t you come-up with anything else? Strippers, living-away-form-home allowances, anything at all?

    It’s like listening to Love Is In The Air.

    Its a nice little ditty, but once you’ve been subjected to it over-and-over-and-over, you end-up feeling that perhaps something awful should happen to John Paul Young.

  22. Neil of Sydney, on May 21st, 2009 at 6:38 pm

    Maa-ate, do you know “tongue in cheek” means?

    Had John Howard & The Private School Bullies spent the $314 billion SURPLUS, from the mining boom on infrastructure and building the nation – the ALP wouldn’t need to do it now…

    …pork barrelling (FFS look it up!), going to war, tax cuts, middle class welfare, phfft – there goes the 12 years of surplus…

    …as for handling money – SFR at 57 isn’t bad I thought…

    …what about you…situation? Age?

    Evan, Evan – so cynical… 😀

  23. Oh Neil you do know that the opposition has shown it would have had more or less the same record deficit?

    Now that for the umpteenth time you have gone on about Labor government deficits how about telling us how they would have avoided them, when even the Liberals would not have avoided them, in the light of $200 billion in loss revenue if they do nothing whatsoever? As the RBA, Treasury and just about every economist and financial spokespersons have stated if nothing were done and no stimulus’s where put in place, that is deficit spending, then the whole economy would be in a much worse state.

    That would suit you fine Neil for then you would have a go at the government for being terrible financial managers and not taking action to stop the economic crisis. Sorry Neil there is nothing this government could do that would satisfy you even if its exactly what the Liberals would do or tell the government to do.

    The other problem is the Howard government grossly neglected infrastructure and services for 11½ years. so instead of leaving a great legacy they could have been praised for over a long time they left a great neglect that needs to be fixed along with him leaving a huge dependency of people on middle class welfare they must be weaned off.

  24. We are not babies!

    The government should have stated in the Budget that there will be a massive reduction in middle class welfare and laid out a programme commencing next year so people have one year to prepare.

    We can’t get through to the next economic shock with that waste stunting our budgetary recovery!

  25. Ha and that would have been political suicide, a one term government and a return to one of giving out massive middle class bribes and tax cuts that have been proven not to stimulate economies, but do make the rich much richer.

  26. Mobius Ecko, on May 21st, 2009 at 8:39 pm Said:

    massive middle class bribes and tax cuts … but to make the rich much richer

    Indeed! But this ‘middle class welfare’ jibe is invariably directed against the ‘other’ because my (generalised) ‘assistance’ in the form of private school subsidies, health rebates, concessions to the laughably named self-funded retirees. and so on are simply natural, right and justly deserved. After all I always work(ed) hard, pay taxes and so on.

    Saying that the Emperor has no clothes has its political problems. The unabashed truth is usually politically unpalatable.

  27. Maa-ate, do you know “tongue in cheek” means?
    TB Queensland, on May 21st, 2009 at 7:54 pm

    I thought thats what your current post was.

    The Libs saved plenty. The ALP does not have a record of saving and would have saved nothing. They had a chance in their first budget last May to do something and did nothing.

    Furthermore as far as i know this mining boom is still going on. Prices so far have not changed much and we are exporting more than ever to China.

    Even furthermore you cannot win. Some leftoids said they should have saved more and some leftoids said they should have spent more.

  28. Q&A: Abbots slips and says Lib’s approach would only be $20 billion less than Labor’s.

  29. Yes, they’ve sobered-up Bob Ellis and dusted him-off for the occasion.

    He’s in form too: “20 Billion is only 20 times the bonus of the average ENRON executive”

    Niiiice. Gotta remind these Libs of exactly what the Market has achieved.

  30. Not sure how sober Bob.

  31. is.

  32. Abbot or Wong. Who’s the holiest?

  33. A tie.

  34. Predictively normative. Deviance is never a political strength.

  35. Good line from Bob re the ‘trials’ of being a politician. Enduring all those ‘ethnic dances’. And let’s not forget those speech night, fetes, reunions, openings and the like. Certainly not for the money.

    Maybe for the status, prestige, power and the like but not the dollars.

  36. I’m believin’ Penny tonight. She’s being herself.

  37. Oh Neil you do know that the opposition has shown it would have had more or less the same record deficit?
    Mobius Ecko, on May 21st, 2009 at 8:07 pm

    Adrian you have returned. Good to see you back. Still saying the same crap however.

    Hey Adrian guess what. We have a new government and this new govt has abolished a lot of programs and changed some IR laws of the old govt.

    Therefore the equation no longer applies. Furthermore there is no way the Libs would have given billions in cash handouts. They would have some deficit spending but different and therefore the results would be different.

  38. Another great waste of time? Lol.

    But the rep of the NRMA came across rather well and should be invited back perhaps.

  39. and yes Neil – the new government is still high in the polls, seems that the public actually like what they are doing

    BTW – finally have a decent (?) red wine to enjoy. Never did consume that dreadful one in India.

  40. Sorry for joining late Reb, housing prices falling fast? In some cases up to 20% declines in asking prices (it seems everyones sniffing for bargains – and that’s the way the entire market seems to be heading), Prof Keen will no doubt be keeping a keen eye on what’s happening.

    Walrus,

    Stuffing ourselves to the point of vomiting? Great piece. Completely agree.

  41. Indicates a real tug-of-war with credit card debt. The addiction’s going to be a hard one to break.

    Credit card spending, repayments higher
    http://www.news.com.au/dailytelegraph/money/story/0,26860,25516664-5015795,00.html
    * Spending on credit cards up
    * But credit card repayments jump 17pc
    * More cash advances

    THE total value of credit and charge card transactions, including advances, rose by 9.6 per cent in March, figures from the Reserve Bank of Australia (RBA) show.

    Australians spent $18.78 billion on their credit and charge cards in March, up from $17.13 billion the previous month and the second straight monthly increase.

    The rise in spending was matched by an increase in repayments, the RBA’s monthly bulletin says.

    Credit card repayments rose 17.5 per cent in March to $19.72 billion – the highest level since December.

  42. These are another set of nasty numbers that don’t auger well for households or banks. The make-up also seems to have drawn the attention of the RBA for the first time?

    Banks reap $1.16bn in overdrawing, late payment fees
    http://www.theaustralian.news.com.au/business/story/0,28124,25516710-643,00.html
    AUSTRALIANS are paying banks almost $1.2 billion a year in penalties for overdrawing their accounts or falling behind on their credit card and loan repayments.
    Banks make a killing on penalty fees

    Figures released today reveal that banks gouged almost $1 billion in extra fees from customers last year, taking their total take to $11.6 billion even as they received unprecedented support from taxpayers to help deal with the global financial crisis.

    For the first time, the Reserve Bank has broken down the “exception” fees paid when bank customers breach the terms of a product, such as making a late payment or exceeding their credit limit.

    The figures reveal that households and businesses paid $1.16 billion in exception fees in 2008, with households making up the bulk of the number.

    Households paid $415 million in exception fees on credit cards, mostly for late repayments, and $490 million for breaching the terms of deposit accounts. Customers paid $38 million in exception fees on home loans.

  43. “and yes Neil – the new government is still high in the polls, seems that the public actually like what they are doing- Joni”

    Joni do you know what a lemming is???

    “Sorry for joining late Reb, housing prices falling fast? In some cases up to 20% declines in asking prices”
    John Mcphilbin, on May 21st, 2009 at 11:22 pm

    John- so a $4 million dollar house in Vaucluse is now worth $3,200,000. Thanks for the information

  44. Got some spare cash Neil?

  45. Here’s a tip Neil, offer $2m, you never know.

  46. Here’s a tip Neil, offer $2m, you never know.
    John Mcphilbin, on May 21st, 2009 at 11:48 pm

    And where would i get the $2M from???

  47. Neil of Sydney, on May 21st, 2009 at 10:23 pm Said:

    “Therefore the equation no longer applies. Furthermore there is no way the Libs would have given billions in cash handouts. They would have some deficit spending but different and therefore the results would be different.”

    That’s right, Neil, they would have jacked up the baby bonus, increased tax cuts for the wealthy and the private health rebate for poor devils earning over $250,000, who can barely make ends meet.

    Neil of Sydney, on May 21st, 2009 at 11:41 pm Said:

    “Joni do you know what a lemming is???”

    Yes we do Neil and we also know what an ostrich is.

  48. Even I who remain positive of the future, am not prepared to declare the bear market over.

    The US market dropped 121 points over night.

    Yet a new share which debuted on the NASDAQ yesterday rose 60% over the issue price of $20 to $31.

    England has faced a downgrade from Stable to Negative with a possible downgrade of their AAA rating in the future.

    Having said that I still continue to purchase shares and takes rights issues.

  49. jane, on May 22nd, 2009 at 1:35 am

    Jane the word I am thinking is strategy. You have a different strategy for different problems. The ALP has only one strategy. Throw money at the problem. It would have been interesting to see what the Libs would have done.

  50. Neil

    Do you have any strategy yourself other than one sided blind right wing ideology that never ever sees any alternative. ?

    Many of us here criticise both sides of politics.

    You simply call us all leftoids and parrot Liberal ideology. Do you actually think for yourself ?

  51. Mobius Ecko, on May 21st, 2009 at 8:39 pm Said:
    Ha and that would have been political suicide, a one term government and a return to one of giving out massive middle class bribes and tax cuts that have been proven not to stimulate economies, but do make the rich much richer.

    You’ve nailed it!

    This government has not made one hard decision because it is all about popularity to maintain power at any cost, not service for the welfare of the nation.

    This government risks being a one term wonder because the people are starting to see through the spin and no substance, Queensland will determine if they survive and it ain’t looking good out there for their future prospects.

    Just about every policy they formulate turns to shit, look at their proposed ETS, even their guru, Garnaut believes it is badly constructed!

    Their handling of the Murray has been atrocious, the NBN has no detail and they pulled the $43B price tag out of thin air, the Internet Filtering is a joke, they want to dabble in standard contracts that will muddy the water on business and create another carcass for the legal industry to feed on, every department paper goes through the PM’s office for sanitising and I won’t even bother going into their inept handling of the economy and their Budget projections that look like wishful thinking at best!

    They are doing a great job of political suicide without making the hard decisions as it is, the PM has shown no leadership qualities at all and seems to have a muddled ideology and displays no conviction!

    I like the comment on what the opposition will do if it regains power…fuck me dead, that is some crystal ball you have there or is it that Adrian knows best???

    The hero worship of the PM you display astounds me!

  52. Wonder no more,Neil. They were going to lower the petrol excise by 5 and 3/4 cents a litre to spur the distribution of the growing pies they grew. It was going to be a pork pie-led recovery under the Liarberals. Oh, and they would try to re-create the success of Circus de Par-tay Pie to keep everyone distracted and amused in the meantime with soundbites. Grow the pie, grow magic pie, grow. 300 party pies up against the wall, 300 party pies, if the economy should stall, and one had the gall to promote the fall, there’d still be 299 party pies up against the wall. I’m talking billions, Neil. Billions of reasons why the porky party pies of the Liarberals are a Turn(bull)-off.

  53. Neil of Sydney, on May 21st, 2009 at 11:52 pm Said:

    Here’s a tip Neil, offer $2m, you never know.
    John Mcphilbin, on May 21st, 2009 at 11:48 pm

    And where would i get the $2M from???

    Very funny, Malcolm ‘Neil’ Turnbull

  54. scaper

    I agree that this government may well be a one hit wonder. But as for the term SPIN it is not exclusive to the current government.

    Both sides use spin and yet it seems to be the word of the moment by the Liberal Party. The SPIN of the previous government was just as blatent and bad as this mob. The SPIN on workchoices was amazing and at times blatent lies. The prosecutions which continue demonstrate the absolute and despicable actions of employers under this legislation. Yet we had $400 million spent on it to try and convince us it was the best thing since sliced bread.

    Lets call them all what they are. Featherbedding politicians who look to the next election. What I can say of the current government is that even though they are at times getting things wrong, they actually have a vision for infrastrucutre and have plans. But as we all know even the best laid plans sometimes don’t come to fruition the way they are forecast.

    And regarding figures, budget figures, deficits and cost estiames are just that, estimates based on forecasts which are nearly always wrong, but this happens in private budgets and estimates as well. To see that, look no further than projections by companies on the ASX 2 years ago compared to their projections now. The truth is in the actuals as they come to hand.

    The previous government did nothing but blame State LABOR governments for everything that was in a mess ( and sometime rightly so). They did nothing but complain and never had a plan to fix things. They simply let everything that was being run by the states fall to pieces in the name of blind ideology. This went on for 11 1/2 years, oh so boring in the end and a major reason along with workchoices that swinging voters like myself decided for a change.

    We have ring wingers and left wingers and we also have middle of the road swinging voters like myself who actually change the government in power.

    Politicians always state that they will serve for ALL. If that is the case then sit down and talk rather than disgree on everything for the sake of blind rhetoric.

  55. I think it’s wishful thinking for anyone to expect a speedy recovery either here or globally. We simply have not seen the bottom yet.

    WALL STREET stocks tumbled overnight after weaker-than-expected unemployment data and public debt worries clouded the outlook for recovery from the prolonged recession.

    The Dow Jones Industrial Average of 30 blue-chip stocks sank 129.27 points (1.53 per cent) to 8292.77 at the market close.

    The tech-rich Nasdaq dropped 32.59 points (1.89 per cent) to 1695.25 and the broad-market Standard & Poor’s 500 index shed 15.24 points (1.69 per cent) to a preliminary close at 888.23.

    Charles Schwab & Co analysts said news that Britain may lose its top AAA credit rating because of ballooning debt delivered a painful reminder of the depth of the global recession.

    International ratings agency S&P said it had downgraded its outlook on Britain’s economy, to “negative” from “stable”, because of the country’s “deteriorating public finances”.

  56. Well, it’s nice, John, that the Washington Consensus countries’ news media keep reporting about the Washington Consensus countries, but I do wonder what’s happening in the rest of the global economy; particularly all the little countries that only had real economies and none of the buffer of quantitatively easing their ways into disguised inflation.

  57. Legion

    Exactly, I imagine it’s very nasty.

  58. Shane, I strongly disagree that this government can be commended on their infrastructure initiative!

    Every project has been on the table for years and it is just a matter of playing catchup, not nation building at all, as the hard hatted media tart keeps exclaiming.

    I know what has been going on behind the scenes in regards to this and I tell you, it disgusts me.

  59. scaper

    Please tell me what infrastructure the previous government built in 11 1/2 years. Whether or not it was a state or federal issue what exactly did they build.

    Do share your behind the scenes knowledge.

  60. They built a pie factory and grew pies.

  61. If the projects have been on the table for years then they were on the table for 11 1/2 years of the previous government. Why were they not built during this period when we actually had $314 billion from the mining boom ?

  62. Had John Howard & The Private School Bullies spent the $314 billion SURPLUS, from the mining boom on infrastructure and building the nation – the ALP wouldn’t need to do it now

    TB Queensland, on May 21st, 2009 at 7:54 pm

    TB do you have a link for this number (314). I have seen Caney say this to. Mining boom didn’t start until 2003. So this means that Costello got an extra $314B in his last 4 years. So this is an extra (314/4) $78.5B/year for his last 4 years. Mining companies must have been making huge profits to produce this much extra revenue.

    Furthermore the mining boom has not ended

    http://www.rba.gov.au/Statistics/commodity_prices.html

    We are exporting more than ever to China

  63. shaneinqld

    I know people are going to find this hard to believe but those who know me know this to be true, in my life I have voted Liberal more than Labor especially at the State level, and once I voted Democrats.

    As the deprivation of the Howard government, who I voted for to kick Keating out, began to reveal itself, quite rapidly as it turned out, and the internet became a place for conversation and debate instead of the pub, I let my displeasure at what Howard was doing be stridently known. I thought he had betrayed my vote in breaking just about every promise he made and being a very different nasty person than the affable one he had attempted to portray.

    Just as I stridently debated against Howard and his terrible policies I am now starting to rail against some of Rudd is doing and his government’s policies.

  64. Because the 314 went into making the pie grow, duh. Who needs to upgrade a pie factory or expand the diet when there’s a temporary slice o’ growing pie to be had? See, it’s all about calories, and growing pies are calorie-dense, and nobody needs to worry about nutritional value, nor the indigestion later. Yes, party pies and sweets are what aspirational Australians need to grow healthy and strong long into the future.

  65. Shane, please don’t attempt to use the last government’s inaction to justify this government’s performance, it is time people realised that the last government is not in power and this government should be held to account on their promises and the handling of such.

    They built the Ghan that is not paying for itself, that’s it!

    I’m in no position to elaborate on what has been happening, either take it on face value or dismiss my claim…I don’t really care which way.

  66. Mobius Ecko

    I too have voted Liberal more than Labor and voted Democrats twice.

    Regarding infrasctrucutre, does everyone know that despite our drought problems for many years in all states the ONLY new dam constructed in the last 20 years was Paradise Dam in QLD which was officially opened in 2005.

  67. scaper

    Sorry can’t agree with most of what you’re written, especially this furphy the right always like to raise over and over and over and over, yet has not one skerrick of statistical data to back it up, in fact the opposite.

    This government has not made one hard decision because it is all about popularity to maintain power at any cost, not service for the welfare of the nation.

    This government risks being a one term wonder because the people are starting to see through the spin and no substance

    ,
    What you’ve done is just regurgitate the opposition’s and their rabid media mouth pieces lines that they hope if repeated often enough, even if not based in reality, something might stick.

    This government in no way risks being a one term wonder, more likely the opposite in they’ll increase their lead. Read Possum’s great article on how the Liberals are dying as their support base whittles away beneath them and bit by bit they lose sponsorship and corporate support. This is getting so bad Barnaby Joyce has stated he want to completely differentiate the National from the Liberals.

    So unless the Rudd government does something really terrible, which they haven’t so far making most of the correct policies for the circumstances, then they will be in power for a long time to come.

  68. shaneinqld

    Shane dams are a problem and must be very carefully planned for and thought through in the long term before one is built. Every dam built causes major environmental damage elsewhere and large dams actually shift local weather patterns.

    Also up to a third of water is lost from a dam and its water delivery systems before it gets to the customers the dam services. They are very inefficient and costly ways to ensure a water supply.

  69. “Read Possum’s great article on how the Liberals are dying as their support base whittles away beneath them and bit by bit they lose sponsorship and corporate support”

    And here’s the link. http://blogs.crikey.com.au/pollytics/2009/05/15/gen-blue/#more-4715

    I’ll bet every thinking LNP member has. Lol.

  70. Neil

    Mining companies must have been making huge profits to produce this much extra revenue.

    Disingenuous. You attempt to put the whole of the economic gains on just mining without accounting for all the peripherals that spun out of that, including whole towns and supporting businesses. Why do you think the WA Liberal government is having economic troubles and have waived the environmental laws that prohibited uranium mining in that state?

    The mining boom didn’t just start in 2003, it was building up before that. But the economic boom started under the Keating government and you read any major economic paper from both government and the private sector and they have economic boom starting around 1993 to 1994 because of economic reforms Hawke/Keating had put in place. The economy was rapidly improving when Howard took over, a fact he acknowledged when in 1996 he said he was handed an economy better by half than he had expected.

  71. We simply have not seen the bottom yet.

    John Mcphilbin, on May 22nd, 2009 at 8:42 am Said:

    My God………..I agree……………….I just dont agree with how deep it will be………!

  72. By that I mean some areas have bottomed but others will retest the lows

  73. I’m not sure I can handle conceptualising a pie with a crenellated crust edge or a shifting, sagging bottom. All I know about growing pies is that when the bottom falls out of them it’s not pretty, especially if they’ve been overheated when it happens and nobody thought to grab a serviette.

  74. Walrus, we seemed to have turned a corner in our relationship. I though the reference to vomit was very effective, by the way (Lol)

  75. But Hey………………….there is always a silver lining to every dark cloud.

    If Standard & Poor lower the UKs credit rating I think we will be in for some very cheap holidays to the UK since the British Pound will sink through the floor.

    That Singapore Airlines 380 Airbus that is constantly parked Monday to Friday at Sydney Airport will start to get a real workout !

  76. Walrus, we seemed to have turned a corner in our relationship

    John Mcphilbin, on May 22nd, 2009 at 10:05 am Said:

    Dont say that………………………………….your’e making me feel really queazy

  77. Here’s the thing Walrus, for those who can spot bargains the future looks really bright, but for the majority who have no idea the pain of loss has been pretty bad.

    I struggle to reconcile my feelings knowing on the one hand that there are some real opportunities to make big money (although I’m not exactly in a position to exploit the opportunities myself), however, on the other hand I know that those opportunities have and will continue to come about as a result of many ‘ordinary’ people who’ve experienced some major losses.

    I learned long ago the need to avoid ‘tips’ from so-called professionals, just as I have no doubt that in your line of work, you’ve learned to spot opportunities when they arise without having to rely on the advice of so-called financial gurus.

    Much of my cynical view comes about because of so much reckless advice and poor financial management thats been allowed to prevail for far too long.

  78. Walrus

    It would be interesting if you ran a few blogs on accounting issues such as taxation laws on capital gains and losses etc for blogocracts as well as answer some of those pesky questions that arise over concerns about future wealth accumulation and protection.

    What strategies are available and what questions people need to ask etc.

  79. …I think it could be surprisingly valuable information and feedback form someone who has the level of expertise and ability to communicate in simple terms what is an often baffling subject.

  80. “……….It would be interesting if you ran a few blogs on accounting issues such as taxation…………..”

    Are you kiddin’ ?

    Maybe the midnight shift for the insomniacs amongst us !

  81. I have to also say – your “bad prawns & vomit” analogy was really good. Nice way of creating visually (& olfactory) images with which to compare the financial crap still floating around in the computers of banks & financial corporations the world over.

    Much appreciated. Especially given I cannot really agree with either side of the current “Boo Labour” / “Boo Liberals” debate going on.

  82. Come on Walrus ….You could make it quite entertaining…. okay, forget it, it would be a big ask (Lol) just thinkin out loud (wink).. How about those Cronulla Sharks?

  83. John,

    My personal “Wealth Creation Strategy” today is to somehow assemble a truck bomb and drive it over to Randwick Racecourse where all this week the Institute of Chartered Accountants have ben holding their annual group wankathon telling each other how great their standards of ethical behaviour have been over the last year.

    If I can get rid of a couple of thousand of them it will make me more valuable………………………I think !

  84. “………How about those Cronulla Sharks?…………….”

    No comment………as B Tolputt is now out of bed

  85. Taxation is wrong. We need to grow the pie. Taxation doesn’t grow the pie. We need to shrink taxation. Borrowing to cover a shortfall in taxation is wrong. This will lead to more taxation later. Taxation is wrong and doesn’t grow the pie. That’s all anyone needs to know. Have some pie.

  86. Legion, on May 22nd, 2009 at 10:59 am Said:

    Ahhhhhh ! but Legion……………….the reason the Pie is not growing might be because the oven (infrastructure) is too small and cant accomodate a larger pie tray.

    Perhaps we need a bigger oven !

  87. You’re making me hungry Legion 😀

  88. Mobius Ecko, on May 22nd, 2009 at 9:31 am

    So Adrian you put down the halving of the unemployment rate and paying off all the Federal govt debt with some also in the kitty to Hawke and Keating.

    Talk about disingenuous. Listen mate if Labor had been in power from 96-07 they would have saved nothing and unemployment would not have dropped below 6%. It is not in the DNA of Labor to save and have low unemployment. The ALP only knows how to spend money and create unemployment.

  89. This has been bugging me for a while.

    Can someone tell me why our Airports are under Federal control and can be duly sold off to the wankers at Macquarie but our Sea Ports are under State Government control. After all an Airport is a “Port”

    Hence the constant retort from the LNP side that the Labor states are responsible for upgrading Ports

    Was it just accidental since aircraft were not envisaged at time of Federation ?

  90. Walrus

    It seems I might be returning to the books to do a degree in applied social science (management). Lol I’m thinking my major focus will be on role and functions of corporate, finance and accounting management within society – I’m thinking I’ll have loads of material to work with. Not sure about the ‘bomb solution’ though. I think you might be on to something though (wink)

  91. Talk about disingenuous. Listen mate if Labor had been in power from 96-07 they would have saved nothing and unemployment would not have dropped below 6%. It is not in the DNA of Labor to save and have low unemployment. The ALP only knows how to spend money and create unemployment.

    The problem you are having here Neil is two-fold.

    First, you make claims about what someone would have done if in power. Like the “Interest rates will always be lower under a Liberal Government” statement – this is unfalsifiable and hence rests in the same category as religion (i.e. a matter of “faith”).

    This is not as bad as the second issue, which is making claims that favour vehemence over rational discourse (“The ALP only knows how to spend money & create unemployment.”). This can only have the effect of dragging the discussion down into the mud.

    The first issue is OK as religion, sport, & politics are equally guilty of creating the same irrational thought processes (for both sides). This is why guys in sales & marketing are generally taught to avoid these subjects in their small-talk. A single slip (supporting/denigrating the wrong team/faith/party) throws off the whole pitch from then on in.

    The second issue though throws off any effort in trying to discuss things with you. I’ve already had my slanging match this week (Hi Walrus!) and am not interested in proving “my gods are better than your God” so soon after than one.

  92. “First, you make claims about what someone would have done if in power.
    B.Tolputt, on May 22nd, 2009 at 11:17 am”

    Well I am just looking at what happened. From 1983-1996 the ALP created 1. the largest federal debt in our history (18.5% of GDP), 2. the largest state govt debt in history in Victoria and 3. the highest unemployment rate since the great depression.

    I am just looking at the facts. Adrian tells me that the success of Howard was due to policies implemented by the ALP during 83-96. How come they are not working so well now??

  93. Because Howard in 11½ squandered it Neil and I’ll play your god game back at you.

    If these Hawke/Keating reforms had not been put in place then we would be in the same position US/England is now in. Read up on what’s happening there Neil and they are about to lose their AAA rating, ours is safe directly because of policies Rudd is implementing.

  94. “ours is safe directly because of policies Rudd is implementing.”

    Now I know you are insane and a blind dead tribal loyalist. Rudd is about to destroy our country. Where is he going to get this $300B from??? Will the Chinese lend it to him???

    Keating deregulated the banks remember. Costello brought in APRA.

  95. Nature 5, on May 22nd, 2009 at 9:24 am. Very interesting one Nature. From my mother’s recollections, one could start off life as a working person (and therefore vote Labor), but as one rose in one’s station in life one was expected to vote Liberal.

    However, the current ‘almost’ blue rinse set (myself included) grew up during the rise of the working classes, Women’s Lib and all that and so are a different thing happening.

  96. Where is the opposition going to get their $295 billion from Neil? So I guess you are saying they would also destroy the nation.

    And where is the $200 billion of that going to come from, which is lost revenue that will happen no matter what is done, who does it and how they do it?

    And so many other what ifs this whole line of argument is meaningless, as are much of your lines of argument. When the nation is actually down the gurgler and the cause can be directly attributed to Rudd then you will have a case, in the meantime you’re just ‘mongering and throwing out red herrings for all they’re worth.

    —————————–
    The framework for ARPA was Keating’s idea Neil and it was Keating who drafted the up the letter of intent, we’ve had this debate previously and I posted the link. I know I’ve been away a while but surely your selective memory isn’t that bad?

  97. The “big drama” here, was emptying cupboards and shifting furniture on Tuesday, for carpet replacement yesterday

    You have carpet laid in your cupboards?

    We are not babies!

    The government should have stated in the Budget that there will be a massive reduction in middle class welfare and laid out a programme commencing next year so people have one year to prepare.

    No, but people are crying like babies ‘cos their welfare has been stemmed (not stopped). Imagine the sobs if the government had actually done some real reform of universal health care and completely ceased the tax churn to the middle/wealthy classes?

    Did workers get a year to prepare for WorkChoices?

    Adrian tells me that the success of Howard was due to policies implemented by the ALP during 83-96. How come they are not working so well now??

    Howard reigned over an economic boom which yielded never before seen profits and in some people’s opinions, wasted the opportunity for growth.

    Turnbull is wrong, it is not the size of the deficit that matters, but how it is used.

    The Howard government paid off (Labor’s) debt by a slash and burn policy on higher education, public schooling, training and hospitals, as well as the privatisation of Telstra, airports and virtually all government office buildings…

    …This contributed to the destruction of manufacturing know-how and capacity and the blow-out in foreign debt from about $150 billion in 1996 to about $600 billion now.

    And, despite the erosion in services that added to household expenses, there was no tax relief. The tax burden rose from 22 per cent of GDP under Labor to a peak of 25 per cent between 2004 and 2006.

    Labor inherited a GFC (which Howard/Costello the economic idiots, apparently could not foresee), a budget with ongoing tax cuts provided for the wealthy, ‘aspirationals’ addicted to tax churn welfare, and a nation in desperate need of infrastructure and growth.

  98. “which Howard/Costello the economic idiots, apparently could not foresee”

    That’s the best laugh I’ve had all day!

    This government formulated a Budget based on fighting inflation…the GFC happened on their watch and they never saw it coming.

    What even makes the whole thing sadder is their advisors in government departments didn’t either and they are the people that assisted in formulating the Budget just handed down…SHEESH!

  99. Labor inherited a GFC (which Howard/Costello the economic idiots, apparently could not foresee),
    kittylitter, on May 22nd, 2009 at 12:11 pm

    Well now kittypoo. If Howard is an economic idiot for not forseeing the GFC what about Daffy Duck??

    Last Mays budget and DD’s first was all about fighting the inflation genie that Howard let out of the bottle. Labor was totally unaware of the GFC until it hit them in the rear end.

    talk about being a blind dead tribal loyalist

    “The tax burden rose from 22 per cent of GDP under Labor to a peak of 25 per cent between 2004 and 2006.”

    I believe it is now at 29% of GDP

    “The Howard government paid off (Labor’s) debt by a slash and burn policy on higher education, public schooling, training and hospitals,”

    Got any better suggestions of getting out of debt????

  100. Neil

    I think I’ve mentioned just recently the Chinese’s reluctance to continue paying premiums in the past and the big squeeze is on. This extends to government revenues.

    http://www.theaustralian.news.com.au/story/0,24897,25517820-643,00.html

    CHINESE steel mills are seeking a 45 per cent iron ore benchmark-price cut from Rio Tinto and a 40 per cent cut from Brazilian miner Vale do Rio Doce, the official Xinhua news agency reported today.
    Rio Tinto mining activity

    Silence is broken: Chinese negotiators have until now not divulged how deep a cut to iron ore prices they would expect from Rio Tinto, BHP Billiton and Vale. Picture: Bloomberg

    The China Iron and Steel Association will soon make a statement calling for these levels of cuts from last year’s benchmark rates, the report said, quoting Shan Shanghua, the association’s secretary-general.

    The Chinese side has called for a cut of about 40-50 per cent, but until now have never been specific about how much it would demand, or had demanded, of each miner.

    The report did not specify how much of a cut the Chinese would ask from BHP Billiton, but both BHP and Rio Tinto got the same price-increase last year, of about 88 per cent; in contrast, Vale got a 65 per cent raise.

    The mining majors are locked in negotiations with the Chinese over iron ore prices.

    Two areas where Peter Costello bragged about record profits responsible for healthy surpluses were; mining and banking. Both sectors are now entering a period of greater uncertainty and possibly significant deterioration to their ‘bottom line’. The possibility is more reality than fantasy.

    The world has changed and supply and demand side of economic reality are being rebalanced globally. Private enterprise has been relied on to boost coffers, however, it’s been this over-reliance private enterprise that’s left us short as a nation. What are the Rudd Government doing by injecting billions into our economy? Attempting to provide a much needed stabiliser whilst the global economy undergoes the most damaging contraction since the Great Depression.

    We all but forgot about the ‘demand’ side of the economic equation whilst the increasingly deregulated free – market (which also provided greater expansion and bumper profits) grew unchecked.

  101. Neil

    Where did you get the 29% from?

  102. Chinese banks are not exactly as stable as many would hope either.

    Fitch warns on China banks
    http://www.theaustralian.news.com.au/business/story/0,28124,25520937-36375,00.html

    Fitch has long argued that figures such as low levels of non-performing loans compared with total bank assets don’t tell the full story. It has pointed to items such as special mention loans and a lack of transparency in the way banks categorise loans as poorly recognised risks. The latest report notes that the credit boom, coupled with the poor economy, is exacerbating those risks.

    Fitch said any impending credit crisis will be hard to spot in the short term given the high volume of lending. China’s banks tend to roll over loans, or extend their maturities, when debts come due, distorting any assessment of lenders’ asset quality, Ms Chu told analysts.

    Over time, though, the global economy’s weakness and China’s still nascent domestic demand will take a toll on the banks, as corporate borrowers earn less and the likelihood of defaults rises, she said.

    “At the heart of these concerns is the recent steep rise in corporate exposure amid a concurrent decline in enterprise profits,” Ms Chu said. “Ordinarily, falling corporate earnings are met with tightened lending, but in China precisely the reverse is evident.”

  103. That’s the best laugh I’ve had all day!
    …This government formulated a Budget based on fighting inflation…the GFC happened on their watch and they never saw it coming.

    What a load of rubbish! The GFC was apparent in August 2007, before Howard/Costello even went to the people for re-election, spending like drunken sailors all the way and delivering unfunded tax cuts! How come conservatives think global means Australia is excluded?

    The crisis, which has its roots in the closing years of the 20th century, became apparent in 2007 and has exposed pervasive weaknesses in financial industry regulation and the global financial system.(wiki)

  104. And I think the fact that the RBA increased rates to combat inflation actually has helped us in the long run, as it meant that the RBA had more room to move with interest rate cuts to stimulate the economy. Whereas some other countries did not (and do not) have much room to move in cutting interest rates – as they are now nearly zero. At least we have some room to move.

  105. Speak about rubbish, why did the government say they never saw it coming, eh???

    By the way…your last comment looks like it was written by three different people!

  106. What’s the use in lowering rates if the banks don’t pass the full amount on?

  107. Neil

    The No 1 Tribal Loyalist on this site would be your good self.

    Are you able to even stop and rationalise that both sides of politics make mistakes and stuff things up at times.

    Or is your all glorifying Liberal Party perfect.

  108. In 2004, Australia’s tax burden was 31.2 per cent of GDP (source – budget.gov.au)

  109. By the way…your last comment looks like it was written by three different people!

    What a dickhead!

    Would that be because i used italics to differentiate quotes from different sources!

    1- yourself
    2-wiki

    The middle non-italicised print is my own words.

  110. kittylitter, on May 22nd, 2009 at 12:11 pm Said:

    Kitty..this is the best summary that we have had to date. Hopefully Mobius will clock in with additional to add to your very excellent input.

    The government should have stated in the Budget that there will be a massive reduction in middle class welfare and laid out a programme commencing next year so people have one year to prepare.

    No, but people are crying like babies ‘cos their welfare has been stemmed (not stopped). Imagine the sobs if the government had actually done some real reform of universal health care and completely ceased the tax churn to the middle/wealthy classes?

    If people did not realise that by voting for a Labor government that middle and upper class rorts would be on the agenda..well, TUFF.

    So far it’s a toe in the water. And these reforms will happen, but the Labor government has to be re-elected. We already have it from Turnbull that trying to drag the wealthy (as in over $250g pa) off the welfare teet is going to mean Class Warfare.

  111. Got any better suggestions of getting out of debt????

    How many do you want?

    How about this one that was suggested to Howard/Costello many times but they ignored. Spend on long term infrastructure building which creates jobs and supports businesses across the board and thus increases government revenue.

    The Howard years were all about shifting debt from the public sector and onto the private sector by encouraging unsustainable consumerism at a hectic pace, and to ensure it continued propping it up with billions in middle class welfare. All of which was the wrong policy and as he was warned many time, totally unsustainable.

    Costello realised this and attempted to get Howard to stop but Howard only ever had eyes to winning elections, everything he did was based on that. It was Costello who was the first to flag the good times were coming to an end even while Howard was saying we’ve never had it so good and intimating this would continue forever under his stewardship.

    And what about the current account deficit Neil, you always neatly gloss over that. In a time of a world wide economic boom and a resources boom to boot Howard managed to rack up one record current account deficit after another, after promising in the 1996 campaign he would get rid of it.

    There is no greater example of Howard shifting debt than that woeful record of his.

    I believe under Rudd the current account has improved slightly at a time of financial downturn but I stand to be corrected.

  112. The GFC was apparent in August 2007, before Howard/Costello even went to the people for re-election,
    kittylitter, on May 22nd, 2009 at 1:02 pm

    Then why didn’t the ALP, Ken Henry and the Treasury do something about it in the May 2008 budget????.

    I have retired friends whose assets have been frozen because of Swans bank guarantee.

    “I believe under Rudd the current account has improved slightly at a time of financial downturn but I stand to be corrected.”

    Yes Adrian- we have just had 9 months of trade surpluses and are now exporting more to China than ever. So why this loose of revenue?

  113. How about this great legacy Howard left, yet another infrastructure thing he could have used to advance this country and bring in additional revenue to pay off Labor’s debt.

    OECD’s report on the state of our broadband . In a nutshell by world standards, utterly woeful.

    There’s another stuff up of Howard’s that Rudd has to spend billions to put to right or we’ll be left on the scrapheap. That neglect by Howard is more damaging in the long term to this country than any debt Neil.

  114. Neil

    We may be exporting more to China but at around 50% less than the price was 12 months ago, even you should know that. The contracts for the purchase price of our minerals has been negotiated down. Therefore future revenue for the Govt will be less.

    With the less price came the layoffs in the minig industries.

    Having said that this has happened 4 times since I 1980. Mines expand and contract with the mineral export prices prepared to be paid by the countries.

    Our exports have risen as a result of agricultural exports. Also why was the current account deficit screamed to the highest heavens by the Howard Opposition when the Keating Government was in power. Yet it abruptly stopped once the Howard Government was elected. The current account deficit was then deemed a non issue, yet it grew at an horrendous rate during the Howard years as we rapidly imported everything under the sun rather than support our own farmers and industry in the name of cheap imports from China to fuel our drunken borrowing binge.

  115. Therefore future revenue for the Govt will be less
    shaneinqld, on May 22nd, 2009 at 2:42 pm ”

    Maybe in the future but not right now.

    China helps us to second-best trade surplus

    http://www.theaustralian.news.com.au/story/0,25197,25440881-2702,00.html

    “However the export story would have been very different were it not for the contribution of China, whose purchases of Australian goods leapt from $3.5billion in February, itself a record, to $4.4 billion in March. China’s purchases from Australia had never exceeded $3 billion a month until last August.”

    Until August 2008 we had never exported more than $3B/month to China. We now regulary do this and exported $4.4B in March 2009- a record

  116. Neil

    After considerable thought, I’ve decided I’m going to cross over to the Liberal Party
    http://www.news.com.au/dailytelegraph/gallery/0,22056,5053923-5010140-2,00.html

  117. I’m not happy with the quality over in Labour’s camp

  118. …just joking Neil, the Libs will be in the political wilderness for decades.

  119. John, if the libs are to be in the wilderness for decades we will have effectively a one party state.

    That is not democracy!

  120. …just joking Neil, the Libs will be in the political wilderness for decades.
    John

    I think you are correct. The ALP has the hearts and minds of the Australian people. Not too sure why but people like the ALP and overlook its faults.

    Labor lied about ETS, lied about education revolution, spends less on infrastructure, increases unemployment and debt and their vote is still high.

    i don’t get it. Buy the way i saw the Govt spending now at 29% of GDP in Joe Hockey’s budget reply speech and other comments by Liberal pollies. i don’t think an ALP person would mention it.

  121. John,

    I have it on good authority that Liberal girls shave under their arms (unlike those overall-wearing-union-loving-doc-marten-wearing-femo-nazi-leftists you’re used to).

    *ducks flying protest signs*

  122. Tony, watch it or you will be the next target.

  123. Neil,

    While there are faults with the current Labor Government, and past Labor Governments, ask yourself honestly, what did the Howard Government do that was actually ‘nation building’? I asked myself that today and couldn’t think of anything. Yes they paid off the Gov’t debt (not hard given the surpluses delivered by the resources boom and something Labor probably would have done given Keating’s economic views), and introduced the GST but they are hardly nation building. The tax reductions are good for us but not great for the budget bottom line when the arse drops out of corporate profits and capital gains – not really nation building at any rate. So aside from that, what can you point to?

    BTW, I’m not saying this from a partisan Labor POV but rather a centrist questioning one. The only reason most of my posts are pro Labor is because they are actually looking at building productivity and infrastructure which IMO has been overlooked by the past Government for far, far too long.

    BTW2: Kohler has gotten it wrong far too much to listen to (like most economists). I hope he’s right (and actually think he probably is this time) but I’ll reserve my judgement for a couple of months; the upwards movement of the $AUD is a good sign at the moment that confidence is returning to the market and this is a good thing.

  124. Dave, my indicator is the price of crude.

  125. I asked myself that today and couldn’t think of anything.
    Dave55, on May 22nd, 2009 at 5:43 pm

    maybe your right. i think what the Libs needed was a big idea/project. Yes the debt has been paid off but what next.

    having said that, other than fuelwatch and grocery choice what has the ALP done in 18 months???

    “Yes they paid off the Gov’t debt (not hard given the surpluses delivered by the resources boom”

    This i don’t agree with. People always want govt to spend money.

  126. Neil of Sydney, on May 22nd, 2009 at 6:21 pm Said:

    This i don’t agree with. People always want govt to spend money.

    That’s what governments are supposed to do, spend money, not horde it and waste it.

    The point is not that they spend money but how and when they spend money, and that includes borrowing money to spend when it warrants it.

    It’s where the Howard government failed so miserably, spending it mostly on pork and middle class welfare instead of infrastructure and services. Infrastructure spending dropped 20% under the Howard government, yet they more than any other in our history had a golden opportunity to really do some great things that they would have been remembered for over many decades if not in perpetuity if they had built some great and necessary things with their dedication plaques attached.

    So instead of being remembered for doing great things with a record windfall they are remembered as a government who given a golden opportunity did nothing and wasted it.

    Neil do you believe the largest defence spending based on the most targeted and comprehensive Defence White paper in modern times is wasted money?

  127. Min your boy must be happy with the great swag of money the Navy is getting?

  128. they would have been remembered for over many decades if not in perpetuity if they had built some great and necessary things with their dedication plaques attached.

    Well, dear deputy is certainly not falling for that mistake:

    To receive funding under BER, there is a requirement to recognise and acknowledge the
    Commonwealth’s contribution. As a minimum, schools must adhere to the procedures and
    requirements set out in these Guidelines.

    Recognition ceremonies: Schools receiving funding under the Primary Schools for the 21st Century and
    the Science and Language Centres for 21st Century Secondary Schools elements of BER must hold
    recognition ceremonies as part of their conditions of funding:

    1. the Deputy Prime Minister must be invited to all opening ceremonies;

    2. a convenient date for the ceremony for all parties should be chosen. Schools are required to choose three dates to allow greater flexibility for the Deputy Prime Minister or representative to attend;

    3. ceremonies should not be scheduled on Parliamentary sitting days;

    4. for assistance with organising an official opening, schools must contact DEEWR to arrange an
    Official Recognition ceremony through the BER website at:
    http://www.buildingtheeducationrevolution.gov.au;

    5. provide the Deputy Prime Minister with at least two months notice of any openings and public events relating to the projects;

    6. hold an official opening or ceremony within three months of the completion of the project, unless
    otherwise agreed by the Deputy Prime Minister; and

    7. make provision in the official proceedings for the Deputy Prime Minister or representative to speak.

    Once it is established that the Deputy Prime Minister or representative is to open a facility, this arrangement cannot be changed without the Commonwealth’s agreement.

    Publicity: Schools should acknowledge the Commonwealth’s assistance in publicity issued by the
    school regarding its BER funded project such as newsletters, web sites, articles in the local media,
    school outdoor signs and any other form of advertising available to the school.

    Plaques: Schools will be required to affix a plaque, to be supplied by the Commonwealth, to all
    completed projects. This includes, but is not limited to, new buildings and substantially refurbished
    buildings.

    Where a plaque cannot be attached to a project because of the nature of the project, then a plaque
    must be placed in an appropriate location in the school, such as the front foyer or administration area.

    Roadside signs: Schools will be required to affix a roadside sign, to be supplied by the Commonwealth,
    in front of the school for projects being funded under the Primary Schools for the 21st Century and
    Science and Language Centres for 21st Century Secondary Schools.

  129. Tony, that’s scary shit!

    What next?

    A picture of the Chairman in every classroom?

  130. Just like Howard’s policy and similar to the ones run by State governments of all persuasions going back for a long long time.

  131. But a Deputy Prime Minister to attend every opening?

    I thought she has more important issues to deal with.

  132. But I will add I think it’s wrong and the government should be made to retract much of their requirements for BER.

  133. Mobius Ecko

    Just like Howard’s policy and similar to the ones run by State governments of all persuasions going back for a long long time.

    That’s right – just ask Tony Windsor.

    Actually Tony,

    Apart for the publicity part, is there anything wrong with the actual program?

  134. scaper…

    She doesn’t have to attend, just be invited and be given two months notice and a couple of dates to see if it can be arranged. Most towns are stoked to have a senior pollie attend a launch of something – they get to air their grievances about other things. The kids are usually stoked as well.

    It’s not as if the official opening delays the building of the works or the funding availability. If the funding was tied to that then there would be something wrong.

  135. I’ll also add that the teachers got the Howard government to wind back much of that government’s requirements (for the pissant amount they did for them) and looking at some of the teachers sites they look like putting pressure on this government to wind back some of their stuff as well.

    Let’s see how this pans out.

  136. Back to my original point though, imagine if Howard had spent money on infrastructure instead of throwing it at middle class welfare to buy votes and pork to buy votes?

    With the amount of money he raked in Howard’s name and dedications to his government would be strewn across the nation on plaques affixed to major projects and in film footage of Howard officially opening the infrastructure or building for a service.

    Wonder where these plaques and film footage are, that’s right there’s very little because he did bugger all?

    Thing is if he had done that I have no doubt he would have won the election, yet completely misguided he thought pandering to greed and bribing the voters would do that. Just how wrong he was.

    Hope Rudd learns from that and listens to the people when they say they would rather infrastructure and services to personal tax cuts. So far Rudd has been 50/50 on this front.

  137. Dave,

    It’s not as if the official opening delays the building of the works or the funding availability. If the funding was tied to that then there would be something wrong.

    Then, by your definition, there is a problem:

    To receive funding under BER, there is a requirement to recognise and acknowledge the Commonwealth’s contribution. As a minimum, schools must adhere to the procedures and requirements set out in these Guidelines.

  138. I’m with Tony. I have read the document and the requirements are over the top and need to be retracted. A dedication plaque and opening is more than enough, and is the standard. This government is asking for way more than that in a large publicity exercise.

    OK they are spending well over 14 billion on this and need to be recognised for doing it. This is a very good and deserved program, but they don’t need to go on a chest thumping exercise to implement it.

  139. Tony and ME,

    I agree that it is unnecessary (sorry, the last post was a bit tongue in cheek but didn’t make that known) but all the same, what’s the harm (regardless of which party do it). What principle or State Government would deny these services solely because a politician wants to be at the opening – bit short sighted (and political) IMO.

    Yes it would be good if this money could be given and there was no requirement to notify politician who would attend the opening of an envelope if they could but lets face it, they are voted in to deliver on their promises, it is reasonable to allow them to take credit for that delivery. I have more of a problem with the sign and plaques – they cost money and deliver exactly swat (other than as a reminder of all the past corrupt politicians we’ve had over the past – I always get a chuckle from seeing signs saying – opened by Russ Hinze, Wal Murray, Eddie Obeid etc)

  140. I remember listening to parliament on the radio when this very issue was raised by Prissy Pyne, he was highly indignant that the Opposition were not getting invitations to attend the school events.

    But when The Coalition was in power, Labor levelled the same accusations at them, because Labor were not allowed to attend all those flag raising ceremonies.

    This column brought to you by the limelight hogs in Canberra

    …As far as the Investing In Our Schools program goes, the former government had some pretty stringent requirements there, too.

    While their guidelines stopped short of forbidding the participation of non-Government MPs, they were much more interested in labelling, and demanded that PVC plates praising the Howard government be affixed to anything for which the government had paid, including “digital whiteboards, audio visual equipment, desks, chairs, mowers, fences etc”.

    Stickers were to be attached to “all books and smaller library resource items”.

    The guidelines further dictated that “other sources of funding must not be acknowledged” on any such plaques or stickers – a delightful little “up yours” to the Parents & Friends, as well as to the local state governments at whom one imagines this crotchety little clause was aimed…

  141. Hey Kittypoo I see you have shown up. You didn’t answer my question.

    “Then why didn’t the ALP, Ken Henry and the Treasury do something about it in the May 2008 budget????.”

    You know when you said “Labor inherited a GFC (which Howard/Costello the economic idiots, apparently could not foresee),”

  142. Back to Politics, The blame game; Who crashed the economy? – It wasn’t us! (Wed, Oct. 15th, 2008)

    …And this leads us to Turnbull’s statement that “Rudd’s Government missed the warning signs at the beginning of the year and talked up inflation, and consequently interest rates, at precisely the wrong time”.

    Is Turnbull really saying that this crisis started at the start of this year? Off course not, it has been brewing for years, many on which was under the leadership of the Liberal Government. Surely Investment Bankers are smarter than that, even if they have entered politics. Why didn’t the Liberal government realise household debt was spiraling out of control, household savings started to go negative in 2002 and households were spending more they earn especially at a time when Howard was saying that the Average Australian has never been better off?

    Why now is Rudd “rewarding greed” by propping up house prices and encouraging first home buyers into a life of excessive debt?…

  143. Hi Kittlitter

    Thanks for the link. i will have to think about the article before i see what trick you are trying to trap me in.

    All I know is that Rudd/Swan/Henry were trying to bash inflation on the head apparently completely oblivious to the storm that was about to hit.

    They had no idea in March 2008 when they were framing labors first budget what was about to come.

    Our financial institutions are strong thanks to Howard/Costello with the usual problems that life always brings.

    I noticed your link finished with “Why now is Rudd “rewarding greed” by propping up house prices and encouraging first home buyers into a life of excessive debt?”

  144. As I said earlier Neil – the attention of the RBA (who are the ones who set the rates) on inflation actually worked to our advantage?

    Because they were high (relative) it allowed more room to promote stimulus? So maybe they did see it coming and raised them to allow more room to cut?

    Did you ever think of that?

  145. hehe, no trap neil 🙂

  146. So maybe they did see it coming and raised them to allow more room to cut?
    Joni

    mate you have totally lost it. So this was the plan, keep interest rates high so we have more room to move.

    No- i never considered this.

    Our economy was booming. We have not experienced 4% unemployment for 30 years. When people are spending inflation tends to be a problem.

    Remember the NAIRU question that Daffy Duck was asked. How low can the unemployment rate go before inflation starts to take off???

    They had no idea that the GFC was about to happen. Neither did anyone else around the world otherwise people would have made plans to stop it.

  147. So – then you cannot again blame the government nor the treasury then for missing the GFC?

    There goes one or your arguments against the government – and I will keep referring you back to this statement:

    They had no idea that the GFC was about to happen. Neither did anyone else around the world…

  148. So – then you cannot again blame the government nor the treasury then for missing the GFC
    Joni

    No I don’t think I ever have blamed Showpony for missing the GFC. I actually feel a little sorry for him. I think he thought govt would be easy. You know Howard just got lucky and i will be lucky to.

    I think he has found that it is easy to throw mud in opposition but he now has to find solutions to problems. He can’t throw mud anymore.

    What he does try to do i have noticed is blame everything on the GFC.

  149. Let’s see Neil – at 1229pm today you said:

    Last Mays budget and DD’s first was all about fighting the inflation genie that Howard let out of the bottle. Labor was totally unaware of the GFC until it hit them in the rear end.

    And you say that you never blamed them for missing the GFC?

  150. And you say that you never blamed them for missing the GFC?
    Joni

    Yes thats is exactly what i said. They had no idea that the GFC was coming.

    I am unclear at the point you are trying to make

  151. Kitty

    Why didn’t the Liberal government realise household debt was spiraling out of control, household savings started to go negative in 2002 and households were spending more they earn especially at a time when Howard was saying that the Average Australian has never been better off?

    In a nutshell, Howard believed the Australian economy could continue to grow and prosper as long as people remained positive. He forgot the ‘economic reality’ aspect of the problem associated with record levels of personal debt and near zero savings.

    Julie Bishop, Malcolm Turnbull and Joe Hockey also seemed to have forgotten their party’s role as cheerleaders of a ‘new and permanent prosperity paradigm’ they kept pushing. Galbraith labeled it as ‘financial idiocy’ if I’m not mistaken.

    Failures catastrophic for US economy
    Julie Bishop blogs exclusively for BusinessDay
    http://blogs.watoday.com.au/business/juliebishop/2008/09/29/failurescatast.html?page=2#comments

    Julie

    Running up to his electoral defeat last year Mr Howard kept repeating the same dangerous mantra “interest rates are lower and people can borrow more.”

    John Howard said the heavier debt burden reflected rising affluence.

    “It is the case that people are buying ever more expensive houses, and they are doing that because of a number of factors,” the Prime Minister said. “One of them is that interest rates are lower and people can borrow more.”

    Yes, our hero was pushing a dangerous mantra indeed. In his opinion, it seemed as though a new era had arrived under his leadership.

    He then went on to say: “Debt levels are rising, but we are choosing to use the debt more productively to buy assets that traditionally rise in value, like shares and property.”

    At around the same time the Reserve Bank’s figures on household finances showed that assets were rising faster than debt (in spite of many Australian’s carrying record levels of debt). Households, they claimed had assets, including housing, superannuation and other investments, that are equal to eight times their annual income.

    I guess now it’s all Kevin’s fault that the bubbles have burst?

    And to imagine J.K. Galbraith raised his concerns about the markets and US economy (which is also applicable here) in 1998 by saying:

    There’s one thing that should warn everybody. If you forget everything else tonight, remember this, that when you hear someone say, “We have entered a new era of permanent prosperity,” then you should immediately take cover, because that shows that financial idiocy has really taken hold and that history, all history, is being rejected.

    This is the warning of the present time. We had a slight indication of that in August and September. It’s a warning that everybody should have in the back of her or his head. The effect of the speculative collapse is something which economists have not yet, even to this day, fully appreciated, because it is not the collapse that causes the trouble, but the further effect on investment, and also the further effect on consumer spending.

    A very large part of our present consumer spending is based on debt creation, credit cards, or the impression given by stock market gains or real estate gains. If and when the end comes, the economic effect will be the drying up, the slump, in consumer expenditure and, of course, the economic effects of that.

  152. And the cash handouts/stimulus has created lots of jobs our vital casino and poker machine industry.

    The poker machines are in such high demand that additional repair and servicing people will no doubt be employed.

    Our taxes at work.

    http://www.theage.com.au/national/stimulus-poured-into-the-pokies-20090522-bic8.html

  153. Neil

    The point is that you blame Swan for missing the GFC, but then admit that no one around the world saw it coming. The RBA saw that inflation was a problem and increased rates (which started under Howard). But you keep saying that Swan missed the signs. You have now removed that argument by your own admission.

    You also keep on with the meme that because commodity prices are high and that our exports to China are at an all time high- that revenue should also be at a high – and when the detail that not all company profits come from exports you continue to ignore those facts.

    The truth is that – irrespective of whoever is in power – government revenue has fallen – and fallen dramatically. And that the deficit is NOT the result of overspending by the current government. Which is why Turnbull admitted that a coalition government would have a deficit in excess of $175 billion. But those facts you chose to ignore. And how the revenue fall is mainly because of the fall in company profits.

    And when we point out that that Australian deficit will be the lowest in GDP % terms you continue to sprout the one meme, that of the deficit. Ignoring the reality that the coalition have admitted that they would have a deficit of the same order of magnitude as the government.

    Now – I admit that having a big deficit is not ideal – in fact it is bad, but to eliminate the deficit (because of the fall in revenue) there would have to be major cuts to spending. And those cuts would increase the effect of the recession.

  154. I think there is something to be said for Ron Paul and his vocal opposition to the neo-cons and their big government financial policy as opposed to true Conservative (minimalist govt. and minimal taxes) policy.

    Seems Howard and the world’s greatest backbencher, Costello followed the neo-cons big time and turned their back on true liberalism.

    The Dangers of Neo-Conservative Economic Policies” by Ron Paul

    …So, while the liberal economic agenda includes more taxes and spending, the neo-con economic program simply looks to target some tax cuts to preferred groups, but ignore the economic big picture. The neo-con economic agenda is to ‘borrow and spend’ and it is that agenda, even more than the tax and spend ways of many liberals, that has cast us in economic peril at this time…

    …The fiat monetary policy we now follow is the most significant factor contributing to our economic peril, and it is central to the neo-con agenda. As we hear new calls to empower the Federal Reserve Board, we should be aware that underlying all neo-conservative policies is the idea of monetary inflation. Inflation is the technique used to pay for the regulatory-state and the costs of policing the world.”

  155. The point is that you blame Swan for missing the GFC
    Joni

    really??? please show me where i have said this.

    Kittylitter said this “Labor inherited a GFC (which Howard/Costello the economic idiots, apparently could not foresee),”

    I then said that a little bit later in May 2008 Swan/Showpony/Henry also missed it.

    Everybody missed it.

  156. Fair enough Neil – I appreciate that.

    But what about the other issues?

  157. But what about the other issues?
    Joni

    What other issues are you talking about??

    Apparently you have been in India. Did you bring up one of your favourite issues- Haneef???

    You know did Indians say how evil Howard was in the way he treated an Indian citizen???

    I actually would be interested. i work with some Indians and they agreed with what howard did. But i suspect they came from a different religion to Haneef

  158. No – the fact that your other meme that the revenue fall is a result of the governments policies and not the GFC.

    Nice attempt to change the topic. And I will post on India and Heneef.

  159. No – the fact that your other meme that the revenue fall is a result of the governments policies and not the GFC.
    Joni

    Well i am just asking the question. Unemployment is low, inflation is low and exports are booming.

    But we have lost $300B.

    I am just asking. Perhaps you can tell me the answer.

    I will assume it is due to ALP stupidity until proven otherwise

  160. See – there you go again. Saying that the global downturn in revenue is due to ALP stupidity,

    On one hand you admit that the ALP is not responsible for the GFC, but that they are responsible for the fall in revenue.

    You chose to ignore the facts – which are that company profits are down (less tax), the stockmarket is down (less capital gains tax), unemployment is higher due to the downturn (less income tax) because you continue to say that exports are booming – which is NOT the case. The balance of trade is in surplus because we are NOT spending.

    We supply these details but you continue to want to ignore them.

    And when we show you that Turnbull has admitted that the coalition would have had $275 billion of that deficit you choose to ignore that as well.

  161. Well i am just asking the question. Unemployment is low, inflation is low and exports are booming.

    The fall of the Aussie dollar?

  162. You chose to ignore the facts
    Joni

    And we are also exporting more than ever to China.

    “We supply these details but you continue to want to ignore them.”

    A 0.5% decrease in our GDP leads to a $300B Federal debt. I am a little suspicious.

    “exports are booming – which is NOT the case”

    O.K. I thought our trade was doing O.K. Our exports are not booming?? Please give me a link.

  163. What recession?

    The definition of recession is two consecutive quarters of negative growth…that has not eventuated as of yet.

    I see a crisis of confidence out there due to the constant blathering by the government, MSM and all the other economic parasites that earn a living through looking into their cloudy crystal balls!

    It is OK that the people charged with overseeing our finances did not see the crisis coming because the rest of the world didn’t just does not cut it with me…It is just as disingenuous as referring to what the last government did to justify the woeful performance of this government.

    A cop out!

  164. It looks like Workcheeses is not far removed from what was in place previously.
    ——————————————————————–
    “The report, commissioned by the ACTU executive after pressure from union leaders, found the Fair Work Act replicated provisions of John Howard’s Work Choices that breached international law, and introduced new provisions which were unlikely to comply with Australia’s international obligations.”
    ———————————————————————

    Another policy blunder by the government that will require further work in the near future, meanwhile business will suffer uncertainty, especially with this proposed ETS.

    http://www.theaustralian.news.com.au/story/0,25197,25524992-601,00.html

    Burrow is obviously a government stooge and many of the unions are more than not happy with the situation.

  165. Mobius Ecko, on May 22nd, 2009 at 6:43 pm Said:
    Min your boy must be happy with the great swag of money the Navy is getting?

    Apologies for the delay in replying. Yes, it’s excellent that the RAN are finally (!) being given the tools and equipment to enable them to do the job. Plus of course the recognition that Australia as an island nation needs a 21st century Navy and not the mid 20th century one that we currently have.

    Did you see that HMAS Tobruk is currently working out of Darwin? The old girl was supposed to have been pensioned off about a decade ago, however the previous government never organised a replacement…but then this wasn’t their priority, the priority being desert warfare.

    Son was on the HMAS Bundaberg when they picked up the 2nd load of asylum seekers. He said that they were very nice people, polite.

    All that the RAN now needs is people..and how are they going to recuit more when they’re losing so many of their AB and LS personnel..another story.

    Would you believe that they now have to have ‘contractors’ working in active service just to put boats to sea.

  166. Whoops, knuckles rapped. I meant HMAS Bundaberg and not THE HMAS Bundaberg.

  167. All hopes are now pinned on China. Neil, you’ll note that recent record trade figures have been ‘spike’ rather than a reliable indicator that all is fine.

    We’re Sunk If Commodity Prices Fall

    http://www.theaustralian.news.com.au/business/story/0,28124,25531187-16965,00.html
    THE spike in commodities prices in the past three months has been driven by speculation that, if not supported by fundamental forces over coming months, could have dire consequences for the Australian economy and the Government’s budget.

    Both Treasury and the Reserve Bank expect Australia to hold on to the bulk of the gains it has made from commodity prices during the boom, despite the ferocity of the global downturn.

    Both expect further falls in the terms of trade (the ratio of export to import prices) as new coal and iron ore contracts take effect, but are drawing confidence in their forecasts from the recent strength in the exchange traded markets.

    The Commodities Research Bureau’s benchmark metals index has soared almost 40 per cent from the low point reached in December. The price of copper has leapt from its low of $US1.30 to $US2.10 a pound.

    However, levels of production and consumption for all major resource commodities are still in global decline, with inventories high and, in most cases, rising.

    Investors are punting on a strong global recovery in industrial production led by China.

  168. If there are any doubts that the big squeeze on pricing is on, look no further.

    http://www.theaustralian.news.com.au/business/story/0,28124,25531186-643,00.html
    CHINA will launch an iron ore trading platform today as a prelude to starting an iron ore price index.

    This is an another sign of the waning influence of the benchmark iron ore pricing system that locks in a huge portion of Australia’s export revenue annually.

    The Rizhao International Iron Ore Trade Centre will open today at China’s top iron ore import port, Rizhao, to provide an exchange point for steelmakers and producers, according to state news agency Xinhua.

    “The iron ore trade centre will promote orderly iron ore imports and standardise activities of trading partners and gradually facilitate China to launch its own iron ore price index,” said Bai Wenhui, an executive of Shandong Huaxin Trading Co, which is heading the project.

    Big Australian miners Rio Tinto and BHP Billiton are holding annual negotiations with Asian steelmakers. Settlement is expected before the end of June, when contracts can be cancelled, raising the stakes substantially.

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