myproblem.....some of us were certain the rates would be dropped....the question was by how much.... swan has this huge ego to sustain...that he alone saved australia from the gfc...so he cannot allow rates to be dropped, lest it hurt his ego....
lets revist 2008.....they kept raising them on the same fallacy as we are in now....then when the mud hit the fan...they dropped them to 3% after raising them incessantly....
the .25% is not enuff to save the xmas sales season....nor will it satisfy most consumers...they will not dash out now to spend the $50 saved on the 300k mortgage.... no it needed a 1% rate cut to provide any confidence....
now we have to wait until Feb, when the rba meets again...by that time they will have their diasastrous Dec qtr figures in...which should spook them into sanity...
did none of them catch the news this morning.... where S & P dropped the credit ratings on whole countries,,,,???
this 2nd leg of the GFC mark 2, is far more profound, compared to the mild first leg...
the rate drop is nothing to crow about...it should have been much higher.... it will be a much larger cut come Feb/Mar 2012...and rightly so retailers will have to slash pre xmas sales, just to keep cash flow....it will decrease their profits, which in turn decrease the tax they pay, which decreases govt funds....get the picture... and it will not entice anyone into the construction industry.... just prolonging the pain...until they get it right cheers
