The asset market is now in complete meltdown while the pollys cackle over $900 cheques.
When will they realize that the real wealth destruction is occurring in the equity markets?
When will it dawn on them that all asset vehicles that are carrying debt that needs to be refinanced in the next year or two are being priced for bankruptcy despite underlying earnings?
Now we have the infrastructure sector in meltdown! What will the next polly's cracker plan be? To nationalize the infrastructure again??!!
Maybe this is the intention now they have flogged all the assets, blown the wad on public servant salaries and become reliant on capital gains taxes that they wont be seeing again for many a year.
Unless this lot pull their finger out - on BOTH sides of the parliament, Australian owned assets are going to be confiscated by foreign debt stresses banks looking for assets to gut.
This will wipe out generations of savings from the Australian economy.
Why can't they see there is a simple solution?
A solution that will immediately arrest declines on the stock market and allow those asset vehicles to recover.
And what will that do perching Polly?
That will return confidence to Australians because their net worth will start increasing again, and then they will start spending again. Amazing.
It is not hard!!
All we need is a new Interim National bank capitalized to maybe $300b to provide bridging finance for less than 10 years. Finance to be provided to Australian companies where they are having difficulty obtaining reasonable terms from foreign banks.
The bank should only make loans to viable businesses capable of repaying loans from earnings or gradual asset sales with a view to the likely state of asset markets in 5 years time.
Not like the USA bailout boondoggles like GM, AIG which is tantamount to burning cash.
In under 10 years, if the loans are made wisely, every cent will be returned to the treasury, along with interest, and the temporary minted money can be destroyed.
And Australian owned assets can be saved.
We need to save viable business, assets and banks, and as far as I am concerned the entire quadrillion dollar derivatives market can be wiped out.
But what would I know? I am just a two-bit stock trader.
