Comments on: No one blameless in the Great Bank Guarantee Kerfuffle

By: Terry SImons

Terry SImons — Thu, 01 Jan 1970 10:00:00 +0000

Bernard is right about those outside of Canberra. In early October, I was out on the water with no mobile phone covereage, no laptop, no TV and no radio and I do remember that the sun came up and went down while the tide ebbed and flowed, strangely untroubled by the happenings on Wall St. I guess the real lesson is that a stockmarket investor is the last person you would want beside in a tight situation - all flight and no fight response.

By: Julie

Julie — Thu, 01 Jan 1970 10:00:00 +0000

Listening to Malcolm Turnbull say that the fee on accounts over a million is actually a new tax is viewed with contempt on Struggle St. People with over a million in the bank are getting those funds guaranteed by the rest of us - a small fee is a small ask for someone so wealthy . By playing to the millionaires’ club he may be strengthening his own constituency and looking after himself but I echo the view put by Bernard Keane - noone cares. Trying to hang Ken Henry out to dry has been a most unpleasant look from both sides.

By: Graeme L

Graeme L — Thu, 01 Jan 1970 10:00:00 +0000

Yes Bernard - you are on the track in this piece today.

But the point that is still being missed is that Rudd Swan and Henry expect us all to tug our forelocks and say "Well done boys." What is unfortunate though is that what they have done is so controversial and unconventional that every one of us should be asking "Why?" And anyone who does ask is branded a traitor.

Sorry guys - not about scoring points. It's about wondering why this stupid Government received and accepted advice (if indeed they did) to do these very dangerous things. What was that advice and from what authority. We have already seen the folly of the unlimited guarantee, and in due course we will see the folly of the $10billion handout. Are we not entitled to be told why these things have been done. Is that not the democratic way in our democratic country. Only in war are we expected to take what the Govt decides without question - or that is what I thought, until now!

At the end of the day, I heard Henry say that he heard Stevens say that Stevens agreed with "the direction" the Government was taking. And he said that AFTER the announcement - not before.

By: Frank Birchall

Frank Birchall — Thu, 01 Jan 1970 10:00:00 +0000

A very good, balanced piece. It’s also a salutary reminder to the government that the opposition will do “whatever it takes” to score political points (or at least attempt to), whatever crisis the nation might face. A far cry from the bipartisanship offered a couple of weeks ago.

By: JamesK

JamesK — Thu, 01 Jan 1970 10:00:00 +0000

The media reorting on this has much to do with the perception in the general community.

I notice on the ABC that it was Turnbull and Bishop given a 'grilling' rather than Swan.

Turnbull was right in his original suggestion of a guarantee to $100,000 in deposits.

Governor Stevens might reflect on that.

This fiasco will cost the economy very real money and also confidence in Australian financial institutions.

In other words it can be made real and relevant with good reporting; something we have not had thus far.

By: plp15

plp15 — Thu, 01 Jan 1970 10:00:00 +0000

The Funds – AXA, Perpetual, etc., have chosen to lock down funds, blaming the Government for it. I think that matters to anyone with Super in one of those funds.

These Funds have been on easy street since the inception of compulsory Superannuation. They have not had to work hard to generate capital inflow – all they had to do was open their doors for business. This has led to an amazing degree of arrogance on their part.

I pulled most of my savings out of one of these funds several months ago. The Fund withheld part of the moneys against taxes. So I asked for a statement for the last year. I am still waiting.

This lack of transparency is endemic in the Financial Services Industry in Australia. Given that lack of transparency allowed the US Investment Banks to get so far out of control as to bring the Global Financial System to its knees, surely this is a cause for concern – and action.

It would be silly to let these businesses go to the wall because the Government had to act quickly to provide Bank Guarantees. But I think we are a long way off that. However, for the Funds to sit back and say “not our problem – we’ll just shut off withdrawals” is deliberate blackmail.

These Funds need to convince Investors, Regulators and the Government that they are sound. Transparency is a key part of that. If the Funds are not prepared to do that, then maybe the Government should respond by locking down all Fund assets in Australia until they do.

Rather than play “my stick is bigger than yours”, these Funds need to convince us that they are sound. Only then should we consider their interests with respect to guarantees. The ball is in their court.

Plp15

By: Tim

Tim — Thu, 01 Jan 1970 10:00:00 +0000

The collective noun ‘Financial Institutions’ suggests that all those who dwell in that pond are of equal standing and repute. As the waters recede, the flotsum at the edge will be exposed and start to reek. Those who felt blessed worshiping the God of Success must also submit to the Wrath of Failure. There are some institutions whose faux respectability no one should have faith in. The more things change …

By: John White

John White — Thu, 01 Jan 1970 10:00:00 +0000

I thought that Malcolm did a good job this morning trying to get the point across to Chris Uhlmann
The unlimited guarantee is not what is required and is causing massive distortions among funds
Chris did not seen to have his head around the question

By: Tom McLoughlin

Tom McLoughlin — Thu, 01 Jan 1970 10:00:00 +0000

I got an early start today so at 4.30 am I calls up the local abc as we bloggers are prone to do with our inspirations (called the 1:9:90 rule by some) and told them about this:

7 April 2007 More than enough dirt under his fingernails - Opinion - smh.com.au

by Alan Ramsey quoting that covert 'greenie' ... Ken Henry ..... such that the Coalition might just be a bit too willing and giving their mixed motives away. The long brown Howard tail indeed!?