A strange kind of respect. A member of the Exclusive Brethren Church who felt aggrieved about comments made by Greens Senator Christine Milne was given permission by the Privileges Committee of the Senate to have included in the Hansard yesterday a correction that she thought appropriate. It is a very proper process to give people such a right of reply but I was taken by the Church’s concluding sentence: “As we greatly respect the Australian Parliamentary system [my emphasis] and all that it stands for, we feel that it is only right that a balanced account should be on record of what the facts actually were in the years that Senator Milne refers to in her address.” The truth is, you see, that the respect of the Exclusive Brethren for parliamentary democracy does not go as far as allowing its members to actually vote in it.

No clear cut decision in Israel. With nearly 90% of the vote counted at midday Melbourne time it was clear that Israel is in for a lengthy wait to find out who will be its next Prime Minister. For the purpose of calculating the results of the election, the entire country is considered a single electoral district with people casting a ballot in favor of a list of candidates. No party has got even close to the 61 seats needed to govern in its own right with the Kadima party of the outgoing Prime Minister doing best under the leadership of the Foreign Minister Tzipi Livni. Kadima looks like winning 29 seats with the Likud Party led by Benjamin Netanyahu on 27. Normally the party with the greatest number of seats is given the first chance to develop a governing coalition but this time the third largest party — Yisrael Beitenyu — is hinting that it will join with the Likud.

A fighting chance of avoiding recession. While gloom and doom dominates the economic statistics from around the world, Australia continues to get the occasional ray of hope. This morning it is generated by the Australian Bureau of Statistics housing finance figures. In December both the value and number of dwelling commitments rose in trend and seasonally adjusted terms. This strong performance, clearly influenced by the last Government stimulus package with its increased new home buyers bonus, must increase the chance of the country at least postponing the onset of recession and perhaps even avoiding it altogether.

The statistician reported that in trend terms, the total value of dwelling finance commitments excluding alterations and additions increased 0.8% compared with November Owner occupied housing commitments increased 1.7%, while investment housing commitments decreased 1.3%.

In seasonally adjusted terms, the total value of dwelling finance commitments excluding alterations and additions increased 5.9%. Owner occupied housing commitments increased 7.1%, while investment housing commitments increased 2.9%.

Comparing the number of December dwelling commitments with November saw, in trend terms, the number for owner occupied housing finance increase by 1.3%. The number of commitments for owner occupied housing finance excluding refinancing rose 1.6% with the number of commitments for the purchase of new dwellings increasing 4.7%.in trend terms.

In original terms, the number of first home buyer commitments as a percentage of total owner occupied housing finance commitments increased from 23.6% in November 2008 to 25.4% in December 2008, the highest proportion since December 2001. In original terms, the number of fixed rate loan commitments as a percentage of total owner occupied housing finance commitments decreased from 2.5% in November 2008 to 1.9% in December 2008.

A gloomy reception. Barack Obama’s efforts to stimulate the US economy are clearly not faring as well. Overnight our time Treasury Secretary Timothy Geithner announced a wide-ranging financial sector rescue plan that could send $2 trillion coursing through the financial system. The plan, which The Wall Street Journal says is designed to involve a mix of government and private capital, aims to stabilize the US financial system by injecting capital into banks, helping to determine prices of toxic assets weighing on firms’ balance sheets and stemming foreclosures. The financial newsagency Bloomberg reported that stocks slumped, led by financial shares, as investors expressed concern about a lack of specifics on plans for addressing the distressed assets choking banks’ balance sheets.

Has Barack Obama’s presidency already failed? That is the horrible thought from one of the world’s great economic commentators. Martin Wolf of The London Financial Times is no scare monger but the fact he asks that question is enough to frighten me. In normal times, this would be a ludicrous question, Wolf writes. “But these are not normal times. Hoping for the best is foolish. He should expect the worst and act accordingly. Yet hoping for the best is what one sees in the stimulus programme and — so far as I can judge from Tuesday’s sketchy announcement by Tim Geithner, Treasury secretary — also in the new plans for fixing the banking system.” You can read the full Martin Wolf column on the website of our associated publication Business Spectator.

Peter Fray

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