Aussie dollar--jumping kangaroo or paper kangaroo?
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AUD and NZD cheapened so much and so quick.
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...due to "carry trades" ... now is a good time to get into those two...
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To use your ANZ Online Saver account, you must be registered for ANZ Phone Banking or ANZ Internet Banking. -
Hi I am back.
two bad news or good news,depending which side u are in--
depositors or borrowers?rate most likely to be cut and no free
lunch for wholesale deposit etc
1.rate to be cut?
Another big rate cut on the way
In-depth: The latest interest rates news and features
2.who will pay the fee for bank guranree ?
http://www.guaranteescheme.gov.au/rules/pdf/schedule-5.pdf
132 Guarantee Scheme for Large Deposits and Wholesale Funding of Deposit-Taking Institutions
28/11/2008Long Term Credit Rating of ADI1 Fee (in basis points per annum)
AAA to AA- 70
A+ to A- 100
BBB+ and below and Unrated 150hey,
if u believe interest rate in the world will drop to very low,
the insurance premium will be a big cut from deposit interest
or bank profits,depending who pay the fee!!
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3 cheers and kowtow to MAS for free of charge bank gurantee!!
If u have confidences,u will not ask for collateral if your fren
ask u for loan.If u have confidences,u need not buy
insurance or ask for insurance premium.
Fee is another term of insurance premium which the latter
is a very dirty word.Premium means there is a RISK!!
Oh Dear-- Risk!!
1.cut
mm
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good or bad news?one % cut more today!
"THE Reserve Bank cut rates by a full percentage point today, extending the biggest round of reductions since the early 1990s. RBA cuts rates to 4.25pc
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have u seen any Central Bank cutting interest rate like buggy jump?
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Good news Oz is not yet in recession.
But GDP growth is 1.9% for a year ending Sept quarter!!
GDP increased by 0.1 per cent in the September quarter to be 1.9 per cent higher through the year.
134 National Accounts - September Quarter 2008
03/12/2008see the past few yrs data here.
http://www.tradingeconomics.com/Economics/GDP-Growth.aspx?Symbol=AUD
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Oz $$ may falls to 56 US cents!!
Consultant predicts Australian recession in 2009 - Analysis
Access expects the Reserve Bank to cut its cash rate to an all-time low of 2.5 per cent this year "in order to take out insurance," allowing the standard variable mortgage rate to fall to an all-time low of 5.25 per cent.EOQ
http://wotnews.com.au/like/recession_access_economics_breaks_the_dam/2942790/
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Consultant predicts Australian recession in 2009
CANBERRA, Australia - The Australian economy will slide into recession this year after an unprecedented 17 years of growth, an economic consultant said Monday. The report by the respected Australian consultant Access Economics contrasts with predictions by the International Monetary Fund in November that Australia would likely be one of the few economies in the world to grow in 2009. The Access Economics report predicted that Australia's central bank will soon slash the benchmark cash interest rate from 4.25 to 2.5 percent and that the Australian dollar will slump this year from 68 U.S.
cents to 56 cents.--EOQhttp://www.istockanalyst.com/article/viewiStockNews/articleid/2963049
I think many are holding oz $$ or thinking to hold for watever reasons.
Pl read how OZ assess their $$,not from this lion!!
Budget 'buggered', recession looms in Australia, Access Economics ...
http://www.news.com.au/business/story/0,27753,24930433-462,00.html
http://www.theaustralian.news.com.au/story/0,25197,24929812-2702,00.html
NSW: State in recession, sinking fast WA: Property in freefall as job losses mount Andrew Main: Trouble ahead if banks call in debtwww.accesseconomics.com.au
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With a heavy heart,i have to share with u these warning signs
of Asian Economics Crisis.Oz is currently show some of the signs,
if not most of the signs!!
u can read 27.10.2008 posts,among other postings.
u can read
http://www.rba.gov.au/ChartPack/index.html
to vertify my statement here.Pl tell me if i am wrong.
No empty words.Pl share your evidences here.
I list below the MAS's assessment on causes of AFC
and the current Oz situation references in this chart pack---
Download Complete set of graphs (PDF 2M).
http://www.mas.gov.sg/download/eco_research/Present3_files/v3_document.html
Where were the warning signals?
Sources of Macroeconomic Vulnerabilitiespage 8 and 23,24
Pl read my opening post in this thread.
Debts from Residential ,Personal and commercial owing to Oz banks
amounts to 1483 billion,or 148 % of GDP!!
pl read 27.10.2008 postings.
Persistent current account deficits
p 17---between 3 to 6 % deficit from 1992 to 2008!!
The Role of Foreign Capital Inflows
p 20--high Foreign net debt and liabilities.
Oz banks need to refinance A$75 billions from foreign sources in the next 2 years
read 21.01.2009 posting.
Net Foreign Liability 599953 millions A$!! or A$600 billions or 60% of GDP.
Impact of large, volatile capital flows
38
Net Private Capital Inflows to Asia, Developing Countries
High ratios of short-term foreign debt to foreign reserves
40
Financial Sector Vulnerabilities
p 36.
.Net national debt is 47.5% of GDP.
Low net official reserve in relation to imports
Net official reserves increased by $A 4 billion in the year to June 2008 and remained at about 1¾ months of imports.
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Oz banks need to refinance A$75 billions from foreign sources in the next 2 years.
PM Rudd said:
reopen the private lines of government to business, to get blood flowing through the arteries of the economy..
http://www.businessspectator.com.au/bs.nsf/Article/PM-says-govt-ready-to-help-plug-75bn-corporate-fun-$pd20090121-NH5BY?OpenDocument
PM says govt ready to help plug $75bn corporate funding shortfall
My question is where does Rudd to get the funds?
CIA says official reserve of Oz is only
Reserves of foreign exchange and gold:
US$26.91 billion (31 December 2007 est.)Ytd i tell u that oz possessing some,if not most ,of Asian Financial
symptoms.I hope she need not see doc in these few years.
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references
http://www.businessspectator.com.au/bs.nsf/Article/PM-says-govt-ready-to-help-plug-75bn-corporate-fun-$pd20090121-NH5BY?OpenDocument
Reuters
CANBERRA - Australia's Prime Minister Kevin Rudd said he was ready to take "whatever action is required" to stabilise markets, warning of a funding gap for business if foreign banks did not roll over loans due in the next two years.
Mr Rudd said foreign banks represent more than half of the $285 billion in syndicated loans issued to Australian businesses since 2006. Of the total loans remaining, $75 billion were due over the next two years.
"If foreign banks do not roll over their share of these loans, it will be difficult for Australia's four major banks to fill the gap on their own," Rudd said in a speech on Tuesday night.
"The withdrawal of foreign bank lending, the tightening in domestic bank lending and the dramatic falls in stock markets are all hurting the real economy."
Foreign banks were cutting back their financing in smaller markets like Australia after the global credit crunch. -
:
Acrobat (PDF)
Economic Roundup - Issue 4 2008 903.95kb -
u can know more of oz situartion in this report,especially around page
80,saving and debts etc
Household saving in Australia 183.63kb
Economic Roundup Issue 4, 2008
Date:
Wednesday, 17 December 2008 -
SINGAPORE PM LHL alreday told us this is the biggest crisis in few decades.
This is also the case in Oz--
2009 set to be the toughest year in decades
A new Australian Industry Group (Ai Group) – Deloitte survey of over 480 CEO’s in the manufacturing, construction and services sectors, has found that 2009 is shaping up to be a tough year
Wednesday 21 January 2009http://www.aigroup.com.au/mediacentre
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Every country will suffer,just bigger or smaller!!
Another factor is how much reserve (food) to pass this long winter!!
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Many here still fell Oz is in a better shape than SG.
I dunt know.What i know is so far,touch wood,there is no major
retail chain shops close shop recently in SG.
In Oz,there are few.Of course,we have to bear in mind Oz
population is about 4 times plus of SG.
In the past five weeks, footwear chain Shoobiz has been earmarked for closure by parent company Figgins Holdings, discount chains Go-Lo, Crazy Clark's and Sam's Warehouse have fallen into receivership with debts of $213 million, businesswear chain Herringbone went into administration and women's retailer Noni-B has forecast a halving of its first-half profit.
Myer, Australia's biggest department store chain, yesterday warned that sales in the six months to January 24 were expected to be down 3.8 per cent from the same period a year earlier.--EOQ
No sector spared as shoppers abandon malls
Blair Speedy | January 22, 2009
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http://www.shoobiz.com.au/------abt 30 shops -
I have added info to 20.01.2009 post.
Pl bear with me to repeat this comparsions here:
http://www.imf.org/external/np/exr/facts/asia.pdf
pl refer to data for Thai,Indonesia and Korea in this link.
I take 1996 and 1997 average for all the 3 countries.
.................3 countries 1996/97 average......Aussie in 2007
Real GDP growth....................4.65%....................2.7%
Consumer price .......................6.85.....................4.2
below--all in % as GDP
central government balance......0.2........................-0.2
current account balance...-3.48.(for Oz 2004 to 2007)-6
External debt....................63................................48
Net foreign reserve.........??...............................2 months
as Imports in month
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U can read some where in this thread that i have posted
info about the consistant and gradual decline of Oz
Federal debts.It is amazing!!I cant say Oz cook the books.
But i have never seen a country can reduce her debts in this
uniform manner,just like every year reduce by a same %!!
Out learned frens here can remember Oz current account deficits
has been running for at least 2 decades.
2.Have they treated expenses as investment to reduce deficits?
If so,where did Oz get the funds?
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Oz Commonwealth will cut staff!!
Most federal government departments have been forced to cut their own spending to meet demanding efficiency dividends - worth $4 billion, including the loss of 3,000 jobs - in the government's current fiscal year budget.
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U can explain why Oz need to issue bonds.I find their explanations is
very strange,including---
involve any net cost to Government.
Media Release of 15/12/2008NO.142
Increasing Commonwealth Government Securities to Support Australia's Financial Markets
Today I am giving a Direction to the Australian Office of Financial Management (AOFM) to increase the issuance of Commonwealth Government securities by up to a further $5 billion, to $60 billion......
The proceeds of the increased bond issuance will continue to be invested by the AOFM in financial assets which best offset the cost and risk of the additional issuance. This includes bonds issued by state and territory governments. As a result, the increase in borrowings is not expected to involve any net cost to Government.
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It may incurr no cost to Federal gavaman,but sure the state and Territory
gavaman,ie the debtors,will incurr cost!!
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Do u think a country with consistant current account deficit
can keep the budgets balance and even with some surplus?
From Fig 4 below,u can see the accumalative cash balance
is abt A$90b .The current official reserve is
Reserves of foreign exchange and gold:
US$26.91 billion (31 December 2007 est.)or A$43 billion.
Have the remainder of the funds gone to various funds,like Future Funds etc?
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Why does Oz taxpayers have to pay A$3 b pa as interest expenses
,when Future Funds get so much cash A$31 billions looking for
safe and good retun?
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So far ,i am confused on
Reserves of foreign exchange and gold,
official foreign reserves etc of different countries,including SG.
Say,PRC get US$ 2 T foreign reserve.Is it the surplus of centrla gavament?
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Back to OZ.
Future Fund 's balance is A$63 b as at Sept 2008.
http://www.futurefund.gov.au/__data/assets/pdf_file/0020/2495/Portfolio_update_30_September_08.pdf
But A$31 b or 56 % in cash!!
This is interesting to note that the investment of FF seem very slow.
May be they play safe!!
http://www.futurefund.gov.au/investment/portfolio_updates
Since inception in mid 2007,FF's cash portion dropped from 75% in
Jan 2008 to 56% in Sept 2008.
I hope not all cash is in Oz dollars!!
Why http://www.aofm.gov.au/ still have to issue bonds when Future Fund
get so much spare cash looking for safe return?
AOFM is authorized to issue A$60 b in bonds.Pl read my today posts.
Say a interest of 5% pa.Taxpayers have to bear A$3 billions interest
pa!!
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AOFM is tasked to buy Assests Back Security!!
Is this the reason that FF dare not to buy ABS?
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Index Code: XJO
Description: S&P/ASX 200
Feb 2007 to Jan 2009 Oz Stock Market
http://markets.businessday.com.au/apps/mkt/interactiveChart.ac?idx=XJO
Oz market is different from HK,SG and PRC.Oz just recovered not more
than 15 % since the crisis.
The latter 3 recovered 40% and above,though now falling again.
What does it imply?
http://www.marketwatch.com/
Tokyo7,745 -306.49Hong Kong12,673 15.39Sydney3,300 -131.60 -
23.Jan 2009
Oz Shares hit new 5-year low
5:52pm | Aussie shares are battered again, losing about 4% and dragging the main index to its lowest close since February 2004. -
Mayday! Mayday!Mayday!
Oz bank gone!!
One of top Oz Home grown Investment bank gone!!
18 months ago,it worths A$10 billions
At end of Dec 2007,net assets was A$25 billions.
Today,nothing to shareholders!!
The striking fact is Directors suffer not much pains!!
The pain for shareholders, however, will not be felt as widely by the board of the company, where the directors have limited exposure to financial obliteration.
Chairman Liz Nosworthy, according to the last annual report, holds just 101,750 B&B shares, which are worth just $32,000 at the last traded price of 15c before the stock was suspended.
The sole remaining original director, Ian Martin, owns 102,539 shares. Babcock founder Phil Green, who was paid $50 million over four years, stepped down as chief executive officer last year.---
Babcock shares worthless as banks bleed
Scott Murdoch | January 24, 2009
Article from: The AustralianSHAREHOLDERS in Babcock & Brown, were yesterday told their shares were worthless.
The investment bank , which just 18 months ago held a stake in a company worth $10 billion, became the biggest stock market victim of the financial crisis.
The news came as shares in Australia's major banks crashed to their lowest level in a decade amid deepening concerns about the global banking system.
The already fragile confidence in the domestic banking system was dealt another blow when Babcock, Australia's second home-grown investment bank which made its name as one of the market's most aggressive deal makers, revealed there would be nothing left for shareholders after its lenders took their cut under a plan with its bankers
EOQ
http://www.theaustralian.news.com.au/story/0,25197,24954423-643,00.html
Annual Report 2007
http://www.babcockbrown.com/
u
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GOOD NEWS!!
747 Rudd at last do the right thing by staying at homw to fix the falling
markets.He cancels his trip to WEF and other countries!!
This is the first time i regain confidence on oz.
PM Rudd may alreday wake up to the reality!!
Help the commercial properties
cancel overseas trip etc
KEVIN Rudd will attempt to protect 50,000 construction jobs by creating a $4 billion partnership with the major banks to finance office buildings, shopping centres and other commercial property projects.
The partnership would not lend money for new projects, but would refinance existing syndicated loans, if a member of the syndicate pulled out.
It will focus on completed and partly-completed shopping centres, office buildings and industrial property projects which have secured pre-commitments.
To prevent the banks from passing on underperforming assets to the Government, one of the banks would have to be a member of the syndicate prior to the partnership, and maintain at least its existing level of financing.
Moves by the Government to become a lender of last resort to the commercial property sector were slammed yesterday by Malcolm Turnbull, who said it would simply prop up bank profitability and do nothing to protect jobs.
"From what we've read about it, this has got nothing to do with jobs," the Opposition Leader told ABC radio.---EOQ
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WriteFlashContent(hasFlash,764,150,'/media/255818/bnbbanner220507.swf','best','opaque','Welcome to Babcock & Brown','/media/91233/untitled.jpg');Latest News Headlines
23.01.09Update on Negotiations with Banking Syndicatehttp://www.babcockbrown.com/media/398160/23%20jan%2009%20bank%20syndicate%20update.pdf
the Board believes that in the
current market environment and based on continuing discussions with the
banking syndicate there will be no value for equity holders under the revised
business plan and balance sheet restructure of Babcock & Brown International
Pty Ltd and negligible or no value for holders of the Company’s subordinated
notes.