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EYE-BALL Guru on – BANKS – WBC’s Gail Kelly the first to dig a hole …

December 14, 2011 1 comment
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Title:
BANKS – WBC’s Gail Kelly the first to dig a hole …
T he recent RBA interest rate cuts and the media pressure and speculation  over whether the ‘big four’ Banks would pass on the full .25% to borrowers – have given the Banks a reason to become defensive on future RBA interest rate cuts.

WBC CEO Gail Kelly came out today and made the following statement:

WBC CEO Gail KellyUPDATE 5.14pm 14th Dec 2011:

[full story linked here]

WESTPAC has warned future rate cuts may not be passed on in full to mortgage holders as a result of funding pressures.

Westpac chief executive Gail Kelly says the European debt crisis is threatening to drag down Westpac’s revenue from its markets and treasury business putting pressure on profit margins.

The bank wants to get greater “flexibility” to deal with the problems surrounding rates – providing some support for the ANZ’s decision to set interest rates on a monthly basis regardless of the Reserve Bank’s official cash rate.

Following last week’s 48-hour delay by the big four banks over passing on the full 25 basis point rate cut, Ms Kelly said interest rate decisions must be balanced against the best policy for the bank and country.

“We are very mindful of the impacts of interest rate decisions on customers, but these must be balanced with what is economically responsible,” she said.

There is a reason for Banks to disconnect from the RBA’s monetary policy management – its called Shareholder profits. The following Graph paints a picture on Bank profits –

To gauge something more real is a chart on staff expenses as a percentage of overall expenditures – both these charts pertain to the ‘Big Four’ Banks and can be compared with the ‘Other Banks’ numbers.

[Note – the drop in ‘Other Banks’ was due to the high paying Macquarie Bank CEO jumpin’ ship and his replacement Executives having a struggle to maintain the gravy ride.]

Yes the ‘big four’ Australian Banks are very profitable – and they enjoyed the Federal Government guarantee during the GFC that gave them advantage over the ‘Other” Banks when it came to raising funds and the cost of those funds.  There is major stress throughout the mortgage market in Australia – as there is across the globe – particularly in the home borrowers market.  All Banks are cutting expense expenditures across the board – delinquency levels are on the rise – debt collectors like ‘Collection House’ and the like are being asked by the Banks to ‘cool’ the write downs on their own books rather then let them come back onto the Banks books and force Banks to write down debts against their own capital.   These are known ways to avoid realising capital losses.

The Banks have delayed passing on the RBA cut by an additional 10-12 days after the Banks agreed to pass on the RBA cut.   The 15% return on equity – [see above chart] – and the fully franked shareholder distributions make shareholders in the ‘Big Four’ Banks pretty happy.  Yet it is at a cost when RBA monetary policy is disrupted by the Banks and their profit triggers that ignite the Big Executive bonus payments.

There is a conflict of interest involved here – Bank Directors and Executives want and need profits to trigger their bonus clauses.  Their borrowers are the ones that generate the profitability when rate cuts are not passed on and Banks strive to extract every advantage by delaying rate cuts and holding back on passing on the full RBA moves.

This behaviour warrants ASIC and ACCC attention into the matter and it should become an ongoing and regularly monitored investigated.   Borrowing costs to fund long term mortgages that are lent against a variable rate – should reflect the RBA rate decreases and increases in full.  WBC CEO is the first to come out and try to break the link to RBA monetary management on these mortgages … this is a big deal – yet financial commentary on the issues at stake is limited.

True and investigative Financial Journalism in this country is at the low end of importance – take Laura Tingle from the Financial Review and the next best journo is perhaps a blogger – or Alan Kohler.  It seems that any attempt to shame Banks over their disruptive attempts to derail the RBA’s monetary policy  management, or the Treasurer’s and RBA’s obsession over inflation and ongoing cost of the ‘high dollar’ value – fails with every attempt.

WBC’s CEO Gail Kelly should be carpeted and exposed on the under current of her comments made today.  Bank CEO’s Executive salaries in the $10’s of millions is beyond the pail given the level of mortgage stress and the Banks want to maintain its profit margins.  This will be a big and continuing story all through 2012 – and when RBA rates move to the 2-3% range – how will Banks be able to hold their profit margins at the 1% level – something will give … maybe mergers, failures – and perhaps even a conscious decision by Bank CEO’s and Senior Executives to take massive pay cuts to reduce Banks costs that will deliver some rate relief to borrowers.

The Banks defense is the higher cost of raising wholesale funds in a global market becoming ever more difficult to compete in.  There is one simple answer to this – rather than risk all borrowers having to pay higher borrowing costs – Banks should reduce their dependence on offshore funding – i.e. skrink the balance sheet – and become more prudent in managing their business from resources they can rely on.  There is only one excuse for the current funding cost problems – the over extensions in Bank Balance sheets in chase of profits and shareholder returns that all lead back to the level of ‘big’ bonus payments to BAnk Executives and CEO’s.

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EYE-BALL Opinion on – The EGG on Duchess Julia’s Face … what will her strategy on the Carbon Tax be now ?

December 14, 2011 Comments off
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Title:
The EGG on Duchess Julia’s Face …
– what will her strategy on the Carbon Tax be now ?
In recent days the World Climate conference ended in Durban SA – after that Conference broke up with little agreement except to push the whole carbon and climate change binding debate question to 2020 – Canada’s Environment Mminister has come out and announced his Governments intent to withdraw from the Kyoto Protocol.

The ABC reported this story yesterday – [read here] – other reports from the World have been largely critical of Canada’s position and many of those stories can be read searching Google with ‘Canadian Kyoto protocol’ search phrase.

This story is a big deal – critics of the recently passed ‘Carbon Tax’ legislation in Australia will grow arms and legs.  The Government has ‘egg’ all over its face and as the fallout creates a smell and bad blood between Nations – the real issue of ‘Climate Change’ is no closer to being resolved.

One might ask why Canada made the move it did – [Canada story linked to image or here] – many ask the same question about what Australia flew solo on the ‘Carbon Tax’ legislation.

The EYE-BALL Opinion became a sceptic earlier this year when the research undertaken in all seriousness to try and prove ‘climate change’ was found wanting.  It only proved that the opinion held was crowd level acceptance – the opinion now can go either way because the debate is so clouded and each side can provide compelling argument.   The debate has not provided compelling evidence one way or the other and The EYE-BALL Opinion remains unconvinced and therefore remains a sceptic.  Until someone can prove definitely that ‘climate change’ is a changing because of the human imprint – then the belief is that mother nature is more powerful and knows how to take care of itself.

For  the Canadian Government to bail and jump ship on such an important issue – turns a population on its ear.  All Canadians are now confused and have no idea what to believe.

Australian’s must now think Duchess Julia jumped too early and did so for political and economic reasons rather than pursue a prudent and sensible decision process.  The ‘egg’ on her face and the Climate Change Minister Combet – is visible.   Business and Industry must have questions as to why Australia has its position and no Canada has gone the opposite way completely.

How the Australian Governments respond to this will have the luxury of several weeks to prepare.   In the meantime – please use the links below to write your local Minister and Senator and give them your opinion on ‘Climate Change and the Carbon Tax.    You will most likely receive an ‘out of office response’ – if you do – keep sending them until you get someone at the other end of a phone or a written response by someone real.

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The EYE-BALL Opinion …

EYE-BALL Opinion on – NSW Premier O’Farrell – an idiot and a putz …

December 14, 2011 Comments off
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Title:
NSW Premier O’Farrell –
an idiot and a putz …
T his mornings joint press conference by Premiers of Victoria [Baillieu] and  NSW [O’Farrell] – and as presented on ABC 24 – was to announce a joint task force to tackle the challenges to promote the commerce and productivity output of both States.

It was a political talkfest and the political agenda in excluding WA from the axis is still to be disclosed.  Whyboth Premiers elected to hold the press conference and talk about the joint agenda a week or so out from Xmas ponders the thought about what they were trying to acheive.  The content was unimpressive as were the individuals – what was noticable was they spoke above their station and experience levels.  One smells a rat that the two Liberal States talking about themselves as representing more than half Australian Polulation and economic output – yet the other Liberal State WA – and the driver of the mining boom was excluded.

There was a statement made during the telecast by O’Farrell that needs to be clarified  – he stated  that under the new PM the COAG meetings have become more ‘focused’ toward  State issues.  He then made the comparison how this differed from the previous PM.

During the questions period Mr O’Farrell was not asked what experience he had at COAG under the previous PM – or how would he would know of the differences in the PM’s contribution if he never attended these meetings as the Opposition Leader.  It is a fact that his only experience with COAG meetings and sitting through their proceedings has been since March this year and after he became Premier when PM Gillard was the PM.

I crap on the Journalists at this press conference for not exposing O’Carroll’s gaf – he should be made to explain his ‘extensive’ experience and why he casts opinion on matters he has no exposure or real time experience.

There were several other instances throughout the press conference where O’Farrell made judgements where he also overstepped his exposure and experience.   This is a developing stroy and deserves follow-up … stay tuned.

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EYE-BALL JokeZone – ‘Xmas Morning at the Playboy Mansion’

December 14, 2011 Comments off
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EYE-BALL JokeZone – ‘Xmas Morning at the Playboy Mansion’
Posted 14th Dec ’11
SmilingXmas Morning at the Playboy Mansion

The image below is a portrayal to what Hugh Hefner wakes up to on Xmas morning … it is a ‘gif’ format – all the ladies titties should jiggle – if you’re not seeing that version – all I can say is that you are only viewing the ‘man in the street’ version – Hugh’s version is much better.

To send this image as a Christmas Postcard to your friends via E-Mail – [click here]  – and include/paste the following Link into the body of your message …

[ https://bleyzie.wordpress.com/2011/12/14/eye-ball-jokezone-xmas-morning-at-the-playboy-mansion/ ]

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Click here to see the EYE-BALL JokeZone Index:

SmilingMost Popular/Visited EYE-BALL JokeZone links as at – 2nd Dec 2011:

  1. Stand Alone Joke – Little Johnny and Sis’
  2. YouTube Post – ‘Charlie Sheen and his Goddesses’ – as real as it gets …
  3. Stand Alone Joke – Santa Clause – an Engineer’s Perspective
  4. Stand Alone Joke – Moral Story – Bullshit’s Reward –
  5. Various – More ‘Little Johnny’ Jokes – 1
  6. Stand Alone Joke – PM Gillard and some of her Cartoons – 
  7. Stand Alone Joke – A Deserted Island Joke
  8. Stand Alone Joke – One night stand court case –
  9. Stand Alone Joke – Some Blond Jokes – I –
  10. Stand Alone Joke – Anger Management –

If you want to contribute and send content – please use this E-Mail Address: – be sure to include your ‘handle’ or name for accreditation purposes … all messages will be reviewed for suitability – no Porn, explicit violence or abuse please.

Click here to see the EYE-BALL JokeZone Index:

SmilingThe EYE-BALL JokeZone Index is an Australian produced site and presents a collection of Australian and International humour alike. You’ll find the content either in Joke format, a Video or YouTube upload, or in some stunningly beautiful Nature and other Worldly images presented in PPS format. You’ll also find some inter-active stuff if you’re so inclined. Bookmark the site and come back often as content is continuously being added and highlighted with “NEW”. Hope you smile a lot – it is about the only thing that keeps this World together … let humour do it for you and be happy !!!  If you want to contribute and send content – please use this E-Mail Address: – be sure to include your ‘handle’ or name for accreditation purposes … all messages will be reviewed for suitability – no Porn, explicit violence or abuse please.
Categories: The EYE-BALL JokeZone

EYE-BALL Guru on – Will Price reductions apply across the board?

December 14, 2011 2 comments
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Title:
Will Price reductions apply across the board?
T he outcome of a prolonged and deep recession is hurtful to all sectors of an economy.  Yet – in all past examples of recessions I have never heard or read about Public Servants taking a pay cut – Departmental budget cuts happened – but those cuts were retrenchments rather than wage reductions …

With warnings out today about the US Fed Reserve announcing there will be no more stimulus intervention activity in the coming year – whether that be calender or financial year is not clarified – and Europe have already acknowledged a long and economic downturn is coming – and Japan has been in a 20 year recessionary environment – and China announcing and having economic numbers predicting a significant slowdown – the world is bracing for an unknown and uncertain future.

Private sector wage levels above and beyond the Fair Work Australia set wage levels depend on performance – public sector wage rates are a range for level of classification and length of tenure.   Has anybody heard or experienced a Public Sector wage reduction for existing employees?  There have been wage freezes – but Politicians generally seem to be exempt from these procedures. There was an exception in recent times when the Ex-PM Mr Rudd – imposed a freeze on Politician wage index increases during the early phase of the GFC – but as soon as he was ousted the new PM Gillard reinstated the index increases.

The recent Federal Politician salary exchange for travel perks yield has the base salaries of Backbenchers increasing by $100k – and the PM’s salary went up by $200k.   This is wanton greed and can not be explained to the electorate in any justifiable way.  The tribunal who promoted the increase recommendations is as out of touch with workforce practices as any could be.  For example –

  • Employees in all sectors are being asked to work unpaid hours to do their job – no overtime is paid – but to complete the job asked of employees they have to work after hours to get the job done.  These unpaid hours are similar to the reasons offered to the Tribunal that reviewed the Politician’s work ethic that produced 30-50% type base level wage increases.  Does the goose and gander analogy apply?

Through the eyes of this blogger – the world is a sad sad place – yet within all the suffering and poverty – there are pockets of prosperity – they are mostly in Government positions.

Nobody realises or reports on the dreams of students that are being crushed as this recession continues to bite  – this has been evolving for many years and decades – higher education qualifications have gone unrewarded and graduates have had to work or seek further education outside their chosen field to find employment.  These new graduates having spent the money for their education – and the best part of 15 of their 20 odd years  gaining their education – their prospects now rest on a failing global economy.

Growth industries are the aged care, nursing and health related industries – yet that compassionate requirement to work in these areas has escaped the modern youth – the world has become selfish and disassociative in its want to help others who mean nothing to them.  This trait is real and no Government spends any time trying to correct the trend.

Wage expectations are askew – increasing costs of living – i.e. child minding, mortgage, food, electricity, insurance, registrations, bank fees, public transport, and almost every human need – the supply and demand cycle applicable to price calculations seems to have frozen when it comes to wage levels verses cost of living.  The inflation cycle indexation formula no longer works.

A tomato grower and farmers in general have many natural and commercial hazards to navigate – i.e. varied seasonal influences, changing weather, import and currency navigation, and storage issues to deal with before a wage can be determined.  Many other industries face similar challengers – yet public servant wages never have to face these types of exterior influences.

Look and understand the responsibilities of a Centerlink front desk employee – the welfare clientel are more aggressive and demanding – the emotional drain in performing in that job extends and overflows to their emotional wellbeing after hours.  They are offered counselling to help deal with the stress – the point being is employers demand more from employees for the increased workload and emotional investment they are required to outlay to keep their employ.

The cost of goods oscillating with the ‘supply and demand’ equation is the basis for the global economic performance over the last 100 odd years.  Unions have fought hard during those times for wage demands work conditions.  We are now on the backside of those conditions as they are continually eroded by the fear of losing or maintaining employment.

The question is whether the business model for the past 200 years is broken or can still serve the economy of the future?

From reduced education expectations to real employment in a chosen field – to the reality of failing medical and health care everywhere – to the highs and lows of seasonal climate influences – to the forecast budget modelling system as opposed to the economic changes that are happening in real time – what can come from a tunnel vision on budget forecasting when global economic conditions render the past modelling outdated?

The unanswerable questions are random and haywire – they cannot be condensed nor confined – we are all living the change and it is happening before us.

Leaders are unable to deal with the reality these changes represent – they are not qualified to deal with the ‘new order’ where sovereign debt cannot be serviced without cutbacks that reduce wages and reduces the quality of life and reduced Government services.  The end of an era is upon us and the future us as clouded as it has ever been.

Perhaps a start point should be that Politicians should work for free – that their easy earn should be taken away and allow them to experience the ‘unpaid overtime’ reality that most workers endure now.

Any change has to come from the top – CEO’s and their $10’s of million in bonus’ – the shareholders tax incentives and perks – the list is endless – and it all amounts to the ‘haves’ and what they expect from their position as opposed to the ‘have nots’ who are often the volunteers who bridge the gap to help those in need.

Money can never really make you happy – it’s a saying as old as time – yet the world today is all about money and that to me is the ‘bellhop’ getting to tip to buy shares.  Get out now …

 

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GuruThe EYE-BALL Guru …

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