You have a point however what is the alternative? Let depositors lose all their cash? At least in this case you would get issued shares in the bank. Before the government guarantee, that was the previous situation. Or do they just leave the government guarantee in place so all taxpayers pay the bill? I don't think they are saying banking is inherently risky particularly in the case of the Australian banks, but what they are saying is, that they are too big to fail & that the consequences of failure are just too big for the government or the economy to ware. What they do need to do is make the consequences of white collar crime more severe & if bankers take risk they shouldn't beer worse they go to jail. At least there are examples of that in Australia such as the NAB fx options scandal, when people did go to jail. However not so much over debacles such as Opus Prime as far as I'm aware & a lot of dodgy behavior that went on in 2008 went unpunished. (not enough jail cells perhaps lol)
The alternative is to then break up the banks so if one does fail its not as big an impact. There has been mooted divorcing the retail bank from the business / insto bank to separate different risk exposures. I was looking at the make up of the ASX200 the other day & something like 60% or even 65% is weighted toward finance companies! So it just shows what a massive part of the Australian economy financial services has become & some might say they have too much influence. And like the US & Europe perhaps Australia should break down the various sectors & regulate what areas a retail or business bank can be involved in. I'm not saying they should do this, but they are options.
All4one, its easy for the banks to identify who the client is. Its the one you are trying to scam! LOL Just kidding, sometimes I have to remember that not so long go I was one of them! And I saw a lot of bankers do some very good work, others not so much.
I saw gold just got crunched $5 in minutes. It could be an interesting night ahead. The last couple of times we have seen gold smacked, its bounced back higher very sharply, so it will be interesting if we see this again.
