‘’There are two ways to reside in a house. Rent the house from a landlord or rent the money from a bank and become your own landlord. What happens when these prices are out of whack prices will change in the housing market to make them equal again. So if you put interest rates up, the cost of renting money goes up compared to the cost of renting a house and to make them equal again the price of the house must drop”. So any way you cut it, the cost of residing in a house is likely to remain the same before and after these interest rate rises.
Higher interest rates are on their way
Further interest rate rises are expected, with Governor Lowe saying that: “The Board is committed to doing what is necessary to ensure that inflation in Australia returns to target over time. This will require a further lift in interest rates over the period ahead.” With these rises, banks with billions in their exchange settlement accounts will see higher and higher risk-free profits.
Source: RBA’s rate rise gives free billions to Aussie banks – Michael West
This is the definition of “Insanity” and irresponsible lending.
Banks Are Still Willing to Lend to Trump March 9, 2022 at 2:03 pm EST By Taegan Goddard 76 Comments “A bank’s decision to loan Donald Trump’s company $100 million is the latest evidence the former president might survive fraud investigations and a business-world backlash over his efforts to stay in office after losing the 2020 election,” the AP reports. “San Diego-based Axos Bank finalized the loan with the Trump Organization on Feb. 17.” “That’s just three days after public revelations that the Republican’s longtime accountants had disavowed a decade’s worth of his financial statements amid allegations by New York’s attorney general that they had exaggerated his wealth.”
Source: Banks Are Still Willing to Lend to Trump
Many claimed early in the pandemic that COVID-19 would flatten inequality in a deeply unequal world. Luckily for the ultrarich, central banks stepped in, making the global elite richer than ever.
Source: The Central Banks Made the Superrich Even Richer During the Pandemic
Much has been written about the taxpayer-funded windfalls to some companies provided by the A$90 billion JobKeeper scheme. Their gains have come from grants given to them to offset projected COVID-19 losses — with no obligation to pay that money back when the losses didn’t eventuate. Australia banks may have reaped a similar (albeit much smaller) windfall via the Reserve Bank’s Term Funding Facility (TFF). This loan scheme handed banks A$188 billion at extraordinarily cheap interest rates to help them “support their customers and help the economy through a difficult period”. But it appears this cheap money may have given the three biggest banks — Commonwealth Bank, National Australia Bank and ANZ Bank — the opportunity to enrich their shareholders through funding share buybacks rather than repaying the cheap loans.
Source: Australia’s banks got $188 billion in cheap loans from the RBA. Now they’re funding share buybacks
Westpac has continually failed to answer questions about the extent of its short-changing of customers through its superannuation entity BT, writes Anthony Klan.
Source: Westpac and ASX silent as BT gouged over a billion from customers
Like the muddy hand from the grave, Macquarie is suddenly circling Sydney Airport again. Michael West reports on the ultimate circus of privatisation, where Macquarie pillaged the most prized asset in Australia, the unregulated monopoly which is this country’s gateway to the world, and is shaping up to do it again.
Source: Vultures’ Reprise: MacBankers bob up in takeover battle for hapless Sydney Airport – Michael West
Despite being aware of the Westpac superannuation gouging scandal, ASIC failed to take any action resulting in the loss of billions in super funds. Anthony Klan continues his report.
Source: ASIC fails to act in Westpac scandal
Budgeting for being caught and ensuring your too big to fail (ODT)
The Wall Street giant is also facing the prospect of another settlement with the DOJ which threatens to raid its profits. The staff are no doubt ready, and additional money is already being put aside for regulatory reasons. With supreme insincerity, the bank promises to reflect about this latest chapter in international financial kleptocracy. “There are important lessons to be learned from this situation, and we must be self-critical to ensure that we only improve from the experience.” The sinner, chastened, readies for the next transgression.
Mahatma Gandhi, in one of his more quoted remarks, observed that “the world has enough for everyone’s need, but not everyone’s greed.” The Goldman approach has a different take to his sagacious observation: the greed will always come before the need and there is ample amount to be had. It is a philosophy that has enabled it to escape the calamities of the subprime market collapse in 2009 and survive such catastrophes as the Wall Street crash. While it has received something of a battering, the company has seen worse. Expect much and more of the same: greed sells, and while stumbles are bound to take place, budget for them.
via Mephistopheles of Wall Street: Goldman Sachs, 1MDB and the Malaysian Settlement – » The Australian Independent Media Network
Most key savings and term deposit rates are below the inflation rates, eroding savers’ purchasing power
Standard savings accounts returns at major banks drop to around 0.1pc once introductory rates expire after a couple of months
Looking for better returns for savings means taking on higher risk
via Bank deposits are being eroded by inflation as banks continue to slash rates – ABC News (Australian Broadcasting Corporation)
Australians are carrying the 2nd most personal debt burden in the world will they now be paid to increase it? Wages are and have been stagnant for years production is up so who has profited from growth if personal debt has increased so much? Not the average Australian. Immense effort is being made to force fixed savings into the market. The banks dont lose by the way they continue to charge for their services. Debt is a good way to keep a nation’s work force obedient and compliant while income and wealth gaps grow. It’s what appears to be a respectable form of human bondage under the surface but human bondage nevertheless. (ODT)
Denmark’s third largest lender, Jyske Bank, is in effect paying home owners to borrow at the moment, with a standard mortgage of -0.5 per cent; now that’s value.
Jyske can do this by borrowing money from institutional investors at a negative rate — and there’s plenty of negative interest rate paper floating around at the moment, somewhere north of $US15 trillion ($22.37 trillion) in value — and passing it on to their customers, who then can pay back less than they borrow.
The bank clips the ticket with the usual fees and charges, but leaves the customer gruntled and still makes a tidy profit on the loan.
via Banks aren’t passing on the RBA’s full interest rate cut, and while the Treasurer might be furious, there is a reason why – ABC News (Australian Broadcasting Corporation)
A recent IMF blog entitled “Cashing In: How to Make Negative Interest Rates Work”, explains its motive in wanting negative interest rates — a situation where instead of receiving money on deposits, depositors must pay regularly to keep their money with the bank.
“Without cash, depositors would have to pay the negative interest rate to keep their money with the bank, making consumption and investment more attractive,” it said.
But one year on from the banking royal commission, faith in our financial institutions — and the regulators who failed to police the banks’ bad behaviour — isn’t exactly at an all-time high.
TOTAL CONTROL FORCED SPENDING INCREASED DEBT
via Banning cash so you pay the bank to hold your money is what the IMF wants – Politics – ABC News (Australian Broadcasting Corporation)
Our nation sighs with relief this week. Our banks are safe. Federal Treasurer, former Minister for resources and Northern Australia, energy, environment, serial failure and currently unelected Prime Minister, Scott Morrison’s Deputy, Josh Frydenberg, will not get tough on financial companies just because a Royal Commission uncovers incompetence, theft, forgery, impersonation, fee-gouging, usury amongst other criminal conduct while regulators looked the other way.
“Getting stuck into banks could hurt the economy”, he warns. Ah, yes. The economy – that lonely little petunia which blossoms on the dung-heap of consumption. As Richard Denniss observes, Australians have been told for decades that as long as the amount of stuff bought is growing we must be doing well. Yet it’s clearly never been the case.
via Business as usual for banks despite Frydenberg’s faux outrage and finger-wagging. – » The Australian Independent Media Network
As the world marks the 10th anniversary of the worst financial crash in recent history, it’s worth looking into who was held responsible for knowingly issuing fraudulent mortgages that led to the crisis.
via Wall Street bankers never punished for massive fraud leading to 2008 financial crisis — RT Business News
Two of Australia’s financial powerhouses face the threat of class actions for ripping off their superannuation clients.
Plaintiff law firm Slater & Gordon on Tuesday revealed it was seeking expressions of interest for a class action against financial institutions in the wake of damaging revelations about their treatment of customers.
via CBA and AMP first targets in bank class action from Slater & Gordon
The Commonwealth Bank has spent seven years denying and covering up the role of its staff in a $76 million loan fraud that has left unwitting customers homeless.
via CBA still in denial as fraudsters sentenced to a decade in jail
Australia may be rank outsiders to make the football World Cup final, but we are global finalists when it comes to household debt.
As things stand, it would take a year and 79 days of Australia’s total economic output to pay off what we owe — and that doesn’t include the interest we’re accruing. That’s more than twice as much household debt as Greeks have.
Only the Swiss are more indebted and, while we may not beat them on the football field, we’ve now got the Danes licked for household debt.
With so much debt, Australians also have high repayments, averaging 15.5 per cent of incomes, second only to the Dutch at 16.6.
via Chart of the day: Australia pipped by Switzerland for debt world title – ABC News (Australian Broadcasting Corporation)
Rejecting banks’ excuses for paltry raise proposal, union leaders say ordinary employees shouldn’t have to pay to price for bad loans
Decrying Defaulted Loans of Deadbeat Corporations, One Million Indian Bank Workers Hold 48-Hour Strike
Macquarie’s top 10 executives collectively received $119.4 million, which puts even the CEO pay packets at the Big Four banks to shame. This will be the case for some time if the banking royal commission is anything to go by.
You think the 4 Banks overpay their Execs. Coupled with millions in payments we each and every Australian citizen guaranteed that they wouldn’t go broke. Tell me why there wouldn’t be a high risk culture that believes it’s untouchable? The sharehoders might be able to move the who sits in the boardroom chairs but they haven’t managed to change the operational culture which has simply become Wall St (ODT)
Millionaires’ factory churns out the $10m-plus pay packets
Austrac may or may not have given CBA assurances that it would warn it ahead of any action but it is consistent with what we know of the banks and their regulators that they expect to be forewarned of any regulatory action and they expect to be given – and almost always are given – the ability to negotiate an out-of-court settlement on any issue of substance.
via Dirty little secrets: why banks need to be more transparent
From the man who can’t keep his mouth shut, Abbott’s advice
The Abbott government’s 2014 budget set in motion $120 million of cuts to ASIC’s funding over four years, leading to the loss of more than 200 staff. At the time, the government emphasised a greater role for self-regulation instead of government intervention.
Former ASIC chair Greg Medcraft was vocal in his criticism of the budget cuts and pushing for tougher penalties for misconduct.
Former prime minister Tony Abbott.
In 2016, the Turnbull government restored the funding and boosted the regulator’s investigative powers.
via Banking royal commission: Regulators should be sacked, Abbott
The Liberals were right. There’s no need for a banking Royal Commission. It’s just fostering ill will and leading to a lot of complaints from people. Ok, not perhaps, the dead clients that the Commonwealth Bank continued to charge for advice even though they knew that they’d died. Let’s be real here, people. Dead people aren’t in the best position to make their own decisions so they probably needed the advice more than anyone. I have it from a source that in many cases the advice was: “You should stop paying me now that you’re dead.” Not one of these dead clients are complaining that the advice was wrong, even if it wasn’t heeded.
via African Gangs Makes Melburnians Afraid To Go Out, But AMP And The Banks Make People Unsafe In Their Houses – » The Australian Independent Media Network
“I’ll organise it with the banker,” Arico was recorded telling his mate. “You come in the Commonwealth Bank, we see Hasan* the bank f—ing guy, give your details, sign the documents, to go for the loan and let me worry about it.”
“Even better … We go and see Peter*… [he] is a hundred percent. This guy is the best … and whatever he’ll need to do, he’ll do.”
via Bankers for a gangster: Commonwealth lenders help mafia boss do laundry
At 71, Linda Schmidt should be enjoying retirement.
But for the past two years the Perth nurse has been crippled by debt, and fighting the banks.
“I just survive from day to day, black dog trotting around behind me,” she told 7.30.
She owes more than $3 million to half a dozen lenders.
The loans cover her own home and, not one but 11, investment properties.
Her superannuation has plummeted from more than $500,000 in 2012 to just $540.
Now she is faced with the prospect of losing her home.
Growing mortgage stress has led to consumer advocates calling for the banking royal commission, which meets for public hearings in Melbourne tomorrow, to examine irresponsible mortgage lending and the way banks assess whether loans are affordable.
‘I feel like a punchbag’: Schmidt
via Nurse’s $3 million in loans raises questions about banks’ lending practices – ABC News (Australian Broadcasting Corporation)
42 per cent of home loan customers told banks they had incomes in excess of $500,000 last year
Westpac is the first bank to face ASIC court action over irresponsible lending allegations
Mortgage contracts can be voided if the bank provides credit to someone who cannot afford it
via A focus on responsible lending will uncover huge problems for the banks – Analysis & Opinion – ABC News (Australian Broadcasting Corporation)
Remember when banks provided a service and didn’t just service the customers?
Well that’s when they were reminded it was a free market and the governments got out of the banking business (old dog}
via Landmark inquiry finds Australia’s banks are exploiting their most loyal customers
The Commonwealth Bank is locked in the early stages of damage control as it confronts allegations it allegedly breached anti-money laundering rules.
Source: Commonwealth Bank in damage control over anti-money laundering allegations – ABC News (Australian Broadcasting Corporation)
Market Forces conducted a detailed survey of the big four banks’ project finance – lending to a specific mine or project, rather than a corporation – since the big four supported the Paris agreement to limit global warming to no more than 2 degrees.
Source: Big four banks slash lending to coal miners
Leaked news of a budget bank levy wiped $14 billion from the banking sector in one day — will anyone be investigated for insider trading?
Source: Budget 2017: The bank levy, leaks and insider trades
The president is set to scale back the 2010 Dodd-Frank financial-overhaul law and roll back an Obama-era financial regulation.
Source: ‘Spectacular Betrayal’ as Trump Rolls Back Wall Street Regulations – Truthdig
An investigation into the role of one of the most influential banks in the world.
Source: Goldman Sachs: The bank that rules the world | Greece | Al Jazeera
A first home buyer has lost a $41,000 deposit on a St Kilda apartment after the National Australia Bank walked away from the loan at the last minute due to the property’s size.
Source: First home buyer loses deposit after NAB backflip over apartment size
As Ian Narev fronted the first annual grilling of the banks, who held the power was clear. And it wasn’t the government.
Source: Ian Narev, the man who earns $12.3 million a year, held all the power during first banks test
Wheelchair-bound Brandon Tomlin has lodged a complaint with the Human Rights Commission over his treatment at the hands of Westpac Bank, which has banned him from all its branches.
Source: Customer can’t walk or talk, but Westpac bans him as staff ‘fear abuse’
Dr Evan Jones continues his analysis of corrupt self-regulation in the banking sector, demonstrating the critical need for a Royal Commission.
Source: Self-regulating banks rob us blind: The need for a Royal Commission (Part 2)
Dr Evan Jones tracks the criminal history of self-regulation in the banking sector, demonstrating the critical need for a Royal Commission.
Source: Self-regulating banks rob us blind: The need for a Royal Commission
Banks are exploiting the fact that we are bad money managers.
Source: How banks make a packet from credit cards
Labor is pushing for a banking royal commission, while the Coalition has promised increased funding to Asic. Here, we’ve collated some of the scandals in the banking and financial sector over the past seven years
Source: Timeline: banking scandals in Australia since 2009 | Australia news | The Guardian
Dr Evan Jones recounts the war of words at the current banking inquiry between the criminally corrupt CBA/Bankwest and its fraudulently foreclosed borrowers.
Source: Bank bastardry and sadistic criminality laid bare in loans scandal (Part 2)