clive palmer lashes western banking for decade

http://www.theaustralian.news.com.au/business/story/0,28124,25009190-36418,00.html

Clive Palmer lashes Western banking for decadence

Cath Hart | February 05, 2009
Article from: The Australian

BILLIONAIRE businessman Clive Palmer warns the Australian economy faces hardship because it is linked to the "decadent, corrupt" Western banking system.

The Queensland-based entrepreneur said he expected Australia's economic situation to continue to deteriorate over coming months under the weight of the global economic crisis before turning around in August.

In a speech to the Australia China Business Council in Perth last night, he talked about the importance of China to Australia historically and in coming months as the global economy absorbed the reverberations of the market collapse.

"The lasting effect of this will be the realignment of the world's economic powers and the recognition that China has a much more important role to play in the world economy," he told The Australian before his speech.

Mr Palmer said he thought China would deliberately slow down its economy for the next six months to try to take advantage of cheaper commodity prices "in the second half of the year for the benefit of the Chinese people".

"There is no slowdown in the Chinese economy -- there are still the same levels of consumer demand," he said.

"China is still growing at 7 per cent today, it has had a 30-year growth rate of 10 per cent and I am sure that in the second half of the year it will return to its growth rate of 10 per cent or more.

"The West generally reacts in timeframes a lot quicker than the Chinese mind does -- six months to them is like a day to us, there is a different way of looking at things.

"But overall there are too many roads to build, too many bridges to cross, too many mountains to climb in China for the people to give up at this stage, and the Government has got too much money."

Mr Palmer, a strong financial supporter of Queensland's newly merged Liberal National Party, was also highly critical of the current federal Labor Government's response to the global financial crisis.

"Australia is caught between two worlds," he said.

"We are caught between exporting our commodities to China and our allegiance with the Chinese but we are also caught in the financial system of the West, which has been shown to be corrupt, decadent and incompetent and ... has collapsed. China's banking system, on the other hand, has been shown to be a solid, stable system," he said.

"I see the Australian situation getting worse until about August and then slowly recovering with our exports and resources.

"I don't think that the bailouts that we are doing are the right sort of bailouts -- they are just once-off handouts really. It is disappointing to see the nation's wealth disappearing when previous governments had put money aside to look after the social security benefits and health care of individuals."

Pursuing initiatives such as the emissions trading scheme were worthwhile in the long term but "wishful thinking" in the current environment, Mr Palmer said.

"Certainly I don't think the Australian economy or Australians at this time are under the hardship that they will experience or that they have experienced in the past that would justify the national Treasury being depleted," he said.

Mr Palmer said China would recover to a 10 per cent growth rate by the end of 2009.

"The following year will be a good year for China and a much better year for Australia," he said.

"August will be the time Australia starts to recover but it won't be until the following June that people realise it and the confidence comes back."