Category: Politics

Only A People’s Bank Will Tame The Savage Beast: With Robbie Barwick

Robbie Barwick and I parse the latest from the Regional Banking Inquiry. The Senators are on the scent now, and Bankwest got a right pasting…

Here’s the press release this is from:

https://citizensparty.org.au/media-releases/bankwest-betrayal-west-aussies-test-government

Here’s the details. What you can do: Call and email WA Labor MPs to demand they stand up to BankWest and CBA and tell their boss Anthony Albanese to re-establish a People’s Bank:

Member for Tangney Sam Lim Ph: (08) 9354 9633 Email: Sam.Lim.MP@aph.gov.au
Member for Hasluck Tania Lawrence Ph: (08) 6245 3340 Email: Tania.Lawrence.MP@aph.gov.au
Member for Pearce Tracey Roberts Ph: (08) 6500 6499 Email: Tracey.Roberts.MP@aph.gov.au
Member for Swan Zaneta Mascarenhas Ph: (08) 9355 0099 Email: Zaneta.Mascarenhas.MP@aph.gov.au
Member for Cowan Dr Anne Aly Ph: (08) 9409 4517 Email: Anne.Aly.MP@aph.gov.au
Member for Burt Matt Keogh Ph: (08) 9390 0180 Email: Matt.Keogh.MP@aph.gov.au
Member for Perth Patrick Gorman Ph: (08) 9272 3411 Email: Patrick.Gorman.MP@aph.gov.au
Member for Brand Madeleine King Ph: (08) 9527 9377 Email: Madeleine.King.MP@aph.gov.au
Member for Fremantle Josh Wilson Ph: (08) 9335 8555 Email: Josh.Wilson.MP@aph.gov.au

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Look No Home Loan! Another Market Distortion!

PEXA just released their second edition of their Cash Purchases Report which highlights residential property transactions that were funded entirely with cash. That is, residential properties purchased without a home loan. The share of mortgage-free transactions rose by 2.9 percentage points to 28.5 per cent of all home sales.

And this is important, because it helps to explain the apparent contradiction between the rise in property prices at a time when mortgage interest rates have also risen, a weird combination to say the least.

Some migrants, from the near 1 million arriving, come with sufficient cash to buy, as well as many downsizing Australians who have enjoyed the capital growth in recent years. So there is an ever larger portion of buyers that will be relatively unaffected by rising interest rates. This is another example of unequal access to housing, at the expense of mortgaged borrowers, especially in a higher interest rate environment.

Mortgage borrowers are being punished for the exuberance in demand for cash buyers. And more broadly, interest rates will remain higher for longer, because the interest rate lever is less powerful which gives the RBA and every Australian an inflation headache.

http://www.martinnorth.com/

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Today’s post is brought to you by Ribbon Property Consultants.

DFA Live Q&A HD Replay: Household Financial Stress Analysis: Deep Dive

This is an edited version of my live discussion about the latest from our surveys, as we look at mortgage, rental, investor and financial stress across the country, down to a post code level.

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Its Edwin’s Monday Evening Property Rant!

Another chat with our property insider Edwin Almeida, as we look at the latest from the market. More supply questions, as construction costs rise, while some plan to offer zero deposit loans to attract voters.

Meantime the rental crisis deepens and opinion is divided in the WeeChat sphere.

The craziness continues…

http://www.martinnorth.com/

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Today’s post is brought to you by Ribbon Property Consultants.

“Deaf” Bankers Called To Account!

The Commonwealth Bank subsidiary Bankwest, the 130-year-old former Bank of Western Australia bank announced last Wednesday that it was moving to become a digital-only bank and would close 45 locations in the state. The 45 Bankwest branches that have been earmarked for closure will close their doors by October this year. There are 28 locations in Perth and 17 in regional WA. A further 15 branches will be rebranded under the Commonwealth Bank banner and are expected to finish their transformation by the end of the year.

Yes, this is the same CBA whose CEO Mat Comyn on 20th September 2023 in a statement to the Senate Inquiry into regional branch closures promised not to close more branches until at least 2026, even though they specifically excluded Bankwest from their statement, while saying “we recognise the unique and important contribution that regional Australia makes to our country”. “Our decision to pause regional branch closures is also predicated on customers and communities valuing our decision to stay”.

Committee member Senator Richard Colbeck said the Senate committee has been hearing plenty of people raising concerns about the vital banking services being lost.

“Every week in our hearings we hear from local communities how important these essential services are and how their communities are affected, yet those who are given a license to provide those services, the so-called service sector, continuously ignore those pleas and withdraw services – it is as though their ears were painted on,” he said.

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Its Edwin’s Monday Evening Property Rant!

More from our property insider Edwin Almedia, as we look at the latest from the property markets, as markets show signs of stress into Easter.

Things on the ground are rather different from the stories reported elsewhere.

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Today’s post is brought to you by Ribbon Property Consultants.

The Aussie Housing Supply Shortfall: With Tarric Brooker

Our latest Friday afternoon chat with journalist Tarric Brooker focussed in the great housing debate, which has become a touchstone for debate in Parliament at the moment.

And using the great charts which Tarric presents we look at the issue from multiple dimensions, as well as a quick look at China’s property sector.

You can find Tarric’s charts here: https://avidcom.substack.com/p/dfa-chart-pack-1st-march-2024

Tarric’s news.com.au article here: https://www.news.com.au/finance/economy/australian-economy/property-investors-are-swallowing-up-even-more-of-the-housing-market/news-story/54a4f06b683cc936ae78f4df7c128fc2

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RBA Update: Is The Democracy Sausage Still Sizzling? With Robbie Barwick

An important update relating to the Section 11 power at the RBA with Robbie Barwick from the Citizens Party. In some really good news, it appears this change will be resisted in Parliament, so we explore how this came about, and the broader issues which this whole episode represents.

Yes, the democracy sausage is indeed still sizzling, largely thanks to individuals making their views known to our Politicians and the influence of social media on public discourse to positive effect!

See my show A Question Of Democracy! https://youtu.be/R8GNp1hYdq8

https://citizensparty.org.au/

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Its Edwin’s Monday Evening Property Rant!

More from our property insider, Edwin Almeida, as we look at the latest in property news across the rental and sales markets.

The rental sector continues to weaken, even as properties listed for sale rises, but Sydney and Melbourne are headed in very different directions.

https://www.ribbonproperty.com.au/

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Today’s post is brought to you by Ribbon Property Consultants.

A Question Of Democracy!

This week the Senate held hearings into the proposed changes to the way the RBA works. The original review was led by three Technocrats included a recommendation to remove the overrule power. This power specifically, section 11 of the Reserve Bank Act 1959 enables the federal treasurer to “overrule” an action taken by the Reserve Bank in extreme situations, via a clear and determined process, and even though no Australian government had used it in the more than 60 years it is important. It’s supposed to be a democratic fail-safe.

The Technocrats recommended the overrule power should be removed from the act. Their reasoning was that there was a risk that the federal treasurer, and by extension the federal government, might abuse that power. But what if the RBA abuses their power? The proposed change was not supported by the bulk of those who appeared in the Senate hearings, so today we look at the evidence provided.

At the heart of the issue is this. How accountable should the RBA be? And if there is no democratic override from the section 11 power, what happens if the Economists at the RBA set monetary policy in a way that badly impacts ordinary people, bearing in mind that another recommendation was to strike safeguarding the “welfare of all Australians” from their objectives. The focus will be on inflation and employment, only.

Central bankers are not infallible, sometimes makes mistakes, and frankly are already not accountable for their decisions, right or wrong. It’s a question of democracy.

So standing back, it seems it was the Technocrats and Economists who wanted to remove the section 11 power, but those with real lived experience, from both the Central Bank, and Government, as well as many respected observers, all agree.

Democracy would be sacrificed, and the Central Bank would be even less accountable if the power was removed. In other words, it is a question of democracy. And more broadly the idea of unelected Central Banks, being able to impose monetary policy decisions without question should terrify us all.

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