RBA Rate Rise & Our Greedy Banks

May 3, 2006

After 14 months of steady interest rates, the Reserve Bank of Australia (RBA) has lifted its benchmark interest rate to 5.75 per cent This is a 25 basis point lift and was done in a effort to keep inflation at bay. View the official statement.

The RBA came to this decision based on; growth in the world economy, strong commodity prices, domestic spending, company profits, increased share prices and increased consumer/business borrowing. Fair enough – I would have thought that the recent petrol price increases had been doing a good job at keeping inflation/spending steady, but obviously there are many factors to consider.
Ok, so the RBA raises the cash rate and what do we see? Immediately the 'Big 3' of Australian banking (CBA, Westpac & ANZ) confirming that they will be 'reviewing their home loan rates'. Or as Paul Edwards of ANZ's head of group media relations so eloquently put it:

"It's inevitable that there's going to be a flow-on to lending rates."

It's inevitable when you're talking about banks, Paul, that's what it is! When the official cash rate increases, banks pass on this increase faster than a participate in a game of Hot Potato. However, when the official cash rate falls, well… that's another story all together. We're talking months before the banks home loan rates fall.

Here's the thing though – each of Australias major banks have posted profits of more than $2 to $4billion each last financial year. All the while making staff redundant (cost cutting they say), increasing charges & fees, closing branches and offering loans to people that are in no way capable of meeting the repayments.

I personally loath the banks and while I acknowledge that they provide a much needed service (finance), I really think the way they go about it is all wrong. The Bendigo Bank however is a good example of a social conscious bank that is putting back into the community rather than sucking it dry.

Oh and the rate rise, it's around about $14 extra a week (or fortnight, even monthly depending on which newspaper figure you believe) for the average home loan.


Do The Crime, Do The Time

April 28, 2006

 The Bali Nine amaze me, especially Renae Lawrence. Yesterday her life sentence for trying to smuggle $4million dollars worth of heroin (with 8 other accomplices) out of Bali and into Australia was reduced to 20 years.

Listening to ABC on the radio this morning I heard an interview done with her last night / this morning. And I was amazed at some of the things she said. The Age has an article on this interview here.

Referring to her original life sentence:

"I mean I don't (feel) happy with that sentence it should never have happened."

You must be joking? It would never have happened if you hadn't decided to try to smuggle heroin out of Bali – simple as that. Or is it?

"I apologise to the Australian public if I've disgraced Australia or anything else. But I think as I said … they would have done exactly as I did if put in the same situation."

If put in the same situation eh? Well, personally I don't believe the whole cock and bull story about being forced to do this drug run under threat of harm to her family. However, lets believe her story for arguments sake. The thing is this, most Australians wouldn't associate with people that are involved in drug smuggling – full stop. You spend time around criminals and you will become involved in their world, be it in a small way or a big way as the Bali Nine found out. So basically, most Australians wouldn't have been put in your situation Renae because they wouldn't be hanging around drug smugglers.

"No," she said when asked if the government supported her. "I prefer not to go into the government side of it."

Seriously, what could the Australian government do when you chose to get involved in drug smuggling within an Asian country – where sentences for drug related crimes are harsh and heavy. Australia doesn't have jurisdiction to interfere with other countries legal systems. They can place diplomatic pressure but that rarely achieves anything in these cases. Of course she is bitter at the Australian Federal Police (and thus the Australian government) for tipping off Indonesian authorities about her and her cohorts plans. 

There's a saying that's been around for years and rings in my ears everytime I hear one of the Bali Nine complaining, whinging and justifying their actions: Do the crime, do the time. 

Rising Oil Costs

April 27, 2006

Yesterday the price of petrol hit $1.45 a litre. $1.45 a litre! I remember when I was a young'n and the price of petrol was $.64 a litre (gas was around $.12 a litre), even 2 or 3 years back it was only $.80. Go back 8 months and we're talking $1 – but $1.45!? Crazy.

Rising oil prices are of course the reason. Pure supply and demand they say. The story goes that India and China's economies are experiencing a boom and thus their desire for oil has increased hugely, this putting a strain on world oil supplies resulting in the price of crude oil going up, up, up. Of course the fact that the OPEC, Organisation of Petroleum Exporting Countries (read oil cartel), frequently decides to manipulate oil supply doesn't help (and wouldn't you know it, it's decisions are usually to cut supply).

Apparently the Americans aren't too impressed with the recent increase in fuel costs either. Meanwhile our own Treasurer defends the fuel excise (roughly $.38) that we Australians pay on our petrol (as well as the $.038 GST on this fuel excise).

It's surely made me consider the option of selling my 3.8 litre V6 car and getting something a little more economical. As fate would have it, we now require this larger car so that isn't an option that can be taken up. Until our little baby comes along though, most of my driving is done in our smaller 2.2 litre 4 cyclinder car.

As the prices of oil continue to escalate, hybrid (electric & petrol) and hydrogen cars will become more and more viable as cars of choice for the fuel conscious buyer.

I'll finish this rambling off by showing you some interesting stats: Comparative prices of petrol globally and how far $20 USD worth of fuel will get you various countries around the world. I had a much cooler website for the second link, with a graph and everything, but I can't find it now. C'est la vie. UPDATE: I've found it – go here to check it out!

The Clever Country Gets A Clever Card

April 27, 2006

Ok, so it's really called a "Smartcard". Had I said that though my clever play on the "clever country" comment by the then Prime Minister of Australia, Bob Hawke, won't have been so… what's the word… clever.

This article in The Age gives an overview of what it is and what it isn't. It will replace, apparently, 17 cards that exist at the moment for health care & social security. One of the major cards it will replace is the Medicare card – the card which gives one access to the free public health system of Australia. They estimate it will save $3billion over 10 years in health/social security fraud at a cost of $1billion over 4 years.

Now, here's the interesting thing. This "smartcard" is not compulsory and that is the difference between it and an "identity card", or so says the Minister for Health & Aging Tony Abbott (or it might have been another one of his colleagues) this morning on 3AW to Niel Mitchell (or was it the ABCs John Faine?). An identity card is something you must carry on you at all times, produce it on request by authorities and must be a part of (you can't "opt out") etc. Whereas the "smartcard" is just something you need to access certain government departments and if you don't want one, you don't have to get one.

Here's the thing though, and so rightly brought up on the radio. Lets consider the ability for one to legally drive a car on the road. For this, you need a drivers license. Now, it is not compulsory for every person in Australia to have a drivers license, but without it you cannot drive on the roads. Likewise, it's not compulsory to have a "smartcard" but if you plan to claim health costs on Medicare (and nearly every person in Australia is put of the medicare health system and claims on it), well, you'll need a "smartcard".

Be interesting to see if this leads down the path of an identity card and further Big Brother antics, as civil liberty groups fear. I'd also be interested to see what architecture (pc or *ix) they'll be running this system off – at a cost of $1billion to implement, someones making a killing somewhere.


April 26, 2006

Yesterday was ANZAC, Australian & New Zealand Army Corps, Day in Australia and New Zealand. It is a national public holiday to remember the ANZACs who have served in battle for Australia or New Zealand. "Lest We Forget" is it's immortal slogan. Typically the day remembers the ill fated landing of ANZAC forces at Gallipoli, Turkey during World War I (or The Great War as they called it back then), but it is also a day for ANZAC WWII, Korean, Vietnam soldiers as well our current soldiers in Iraq, Afganistan and various other peace/humanitarian forces around the world.

My day started at 4:15am as I got up in preparation for the ANZAC Day Dawn Service, held at the Melbourne Shrine of Rememberance, my 2nd Dawn Service in as many years. I picked up a friend at 5am and we proceeded into the city. I must say, it is a marvelous site to see so many people turning out for the Dawn Service – 30,000 were the media estimates and it sure felt like there were that many. The older generation was there, as to be expected, but it was the younger (my age and younger) that were out in force yesterday. Young lads, young girls, families with babies, gray haired bikies, couples, grandparents – all were there.

A moving preservice tribute was read and then the actual Dawn Service started. Was very touching as a young year 12 (I think) student described her trip to the fields of the Western Front and mentioned a comment a local made to her as she was leaving. "Thank-you for having us", she had said and this old gentleman had replied, "No. Thank-you for your country's sacrifice, we would not be here today without you." There were a few sniffles in the crowd.

After the service had finished, around 6:30am, I waited 45 minutes in line as the crowd shuffled through the actual Shrine and laid down poppies. It was a terribly cold morning, but well worth it. Headed back home before coming back into the city to watch Essendon vs Collingwood in the ANZAC Day Match (Australian Rules footy). 91,000 screaming fans, the majority of whom seemed to be Collingwood fans, were not disappointed as it was a close game all day til the final five minutes when Collingwood broke away to eventually win by 17 points. Was not a happy ending for me, I barrack for Essendon, but was still a great ending to a great day.

I have a few photos that I took of this years Dawn Service, as well as lasts years, that I'll be posting on my Pbase account shortly.