Enquiry into the banking system

I haven't got a clue who's going to win the Melbourne Cup... It would have to be the worst race to pick a winner with so many horses in it.  I can however make a prediction that the RBA will announce today that tomorrow it will be bringing forward its announcement of a rate decision and it will be one hour earlier so that it gets the jump on the Melbourne Cup.  Although the rate cut should be 0.75% it will be, as usual, too little too late and it will be 0.25%.

According to the minutes of the Reserve Bank Board minutes for July, in considerations for monetary policy:

'the flow of recent information suggested both that there was more time to assess the likely strength of inflationary pressures in Australia and that it would be prudent

If interest rates are steady, unemployment is low, and relative to other nations our economy is strong, why aren’t Australian’s spending?

In April 2010 the Rudd government increased the excise on tobacco to the extent that the average pack a day smoker now pays $3000 not $2400 in excise duty. According to the minutes of the Reserve Bank Board meeting in February 2011, 'the increase in tobacco excise in 2010…increased the CPI by nearly 0.4 percentage points'.

The official figures have come in that the banks are winning in the race to get people to fix their rates. 

Now half of their loans are getting fixed at two years.  I am strongly of the opinion that rates are coming down and that these people will be left on a high rate of 7%

My tip to hold off fixing your rates is proving sound advice despite rate city coming up and saying my advice was wrong and the fix rates. 

I believe the RBA will lower rates by 0.25% before the end of the year because of a worsening domestic economy.

For several months, the financial services industry, including banks, have been predicting interest rates will rise and this is encouraging home owners to fix their interest rates for several years at world high interest rates.

A resource-based economy such as Canada has an official interest rate of only 1%, compared with Australia's 4.75%.

We have achieved more progress in our campaign to lower interest rates. Click here to read our media article 'Don't fix interest rates: property club' reported by Australian Associated Press (AAP) and published in ninemsn Finance and Trading Room and the Canberra Times.

The recommendations from the Senate Economics Reference Committee have given us the petition signers a win! They are recommending a broad ranging enquiry into the Australian financial system covering the role of banks and other financial institutions.*

‘With the four major banks holding around three quarters of Australia’s deposits and assets, and 87 percent of home loans, the lack of choice between financial institutions for consumers effectively means that the “big four” have free reign to do as they please’ Senator Xenophon **