The merging of two monopolies, ASX and
SFE Corp, produced a predictable celebration from shareholders
yesterday but there was barely a whimper from the customers of the two
businesses who face even greater gouging to make the union pay.
The AFR’s John Durie at least gave the consumer angle a bit of a run but The Australian’sBryan Frith
bought the monopolists’ line in pointing out all the other mergers
around the world between stock exchanges and derivatives markets since
former ACCC chairman Allan Fels knocked back the original merger
proposal in 1999.
Frith is merely running the old “national
champion” argument – that local players should be able to beef up to
give them the critical mass to expand overseas.
Yeah, like the
Big Four banks with their record $210 billion market capitalisation
don’t have the firepower to expand overseas without merging to create
even more powerful financial conglomerates to gouge Australian
consumers every which way.
The Australian produced an interesting table today showing where the combined ASX-SFE business will rank amongst global exchanges.
Does anyone else think it a little odd that an $800 billion economy
like Australia will boast a $5 billion exchange, ranked nine in the
world, which is only marginally less valuable than the NASDAQ and the
London Stock Exchange. Doesn’t that tell you Australian customers are
getting ripped off blind?
Don’t expect the SFE’s customers to complain because they are still
largely the same investment banks that have enjoyed a spectacular
windfall from the demutalisation of their once not-for-profit operation.
The same goes for many of the ASX’s major customers. Why would UBS or
Macquarie Bank care given their profits on the merger deal as SFE
shareholders? However, it is incumbent on the likes of AMP, David
Murray’s Future Fund and the big super funds to finally take a stand
and insist that ASX stop abusing its privileged position by jacking up
fees every other year.
As for the ACCC and Peter Costello, you can only shake your head and
wonder why a 300-fold return for the original ASX equity holders
doesn’t spark some interest in a formal price monitoring regime that
would protect ravaged Australian customers of the ASX, who are
primarily the superannuants of Australia.