Why not raise taxes to slow inflation?

[Madas]

Banks should be forced to pay insurance to enable them to be recapitalised during financial crisis rather then rely on the government to pay for it. And the insurance amount should be tied to the level of speculation they make. If so the speculation by banks would fall greatly and governments would never pay a cent to keep the banking system going.

I think the world would be a better place if we had a say in these things
Big end of town pretty much does as it pleases then just says sorry when it gets caught
No accountability whatsoever

 

[nut]

Banks should be forced to pay insurance to enable them to be recapitalised during financial crisis rather then rely on the government to pay for it. And the insurance amount should be tied to the level of speculation they make. If so the speculation by banks would fall greatly and governments would never pay a cent to keep the banking system going.

Who owns the insurance companies? I’m guessing the banks

 

[Madas]

Who owns the insurance companies? I’m guessing the banks

And superannuation funds

 

[DaBarz]

Congratulations to commbank earning 10 billion dollars fighting inflation…

Question : Will those commbank dividends cause upwards pressure on inflation?

What a fantastic transfer of wealth from mortgage holders to commbank share holders….

I would imagine the smart shareholders not yet retired would be availing themselves of the DRP.

Those that take the dividend in cash are probably retirees in which case they are saving the govt money.

 

[Seeds]

With the Australian dollar in free-fall the rba has to boost rates. A 0.5 percentage point rise would be good. Would help with the housing price problem as well (admittedly in a disastrous way). Australia's economy looks stuffed from where I'm siting. Invest all your super overseas.

 

[Seeds]

Who owns the insurance companies? I’m guessing the banks

Well no that would be moral hazard. The insurance would need to be offerered by someone else. But not the government.

 

[DaBarz]

And superannuation funds

And guess who invests in blue chip companies ?
So anyone with super will be benefitting.

 

[nut]

Well no that would be moral hazard. The insurance would need to be offerered by someone else. But not the government.

The same people that own the banks own the insurance companies and most of the blue chip shares…

 

[kranky al]

nut wants the financial burden to be shared by all taxpayers rather than people with mortgages. I presume he has a mortgage and wants his burden to be shared by others, so it's a selfish thread.

Afaik I didn't support or contribute to policies that resulted in runaway inflation, so I feel no responsibility for it.

I'm sitting back enjoying the shitshow from the sidelines of the home I own. It's glorious.

More I’m right Jack.

 

[Seeds]

The same people that own the banks own the insurance companies and most of the blue chip shares…

The Australian public owns these companies through their super funds.

 

[nut]

The Australian public owns these companies through their super funds.

A very small percentage…

 

[DaBarz]

A very small percentage…

With regards ownership you may be right



But it’s a considerable amount of profit returned to shareholders and super fund members.
Roughly 80% of profit is returned to shareholders.

I realise bank bashing is the flavour of just about every month but we are fortunate to have a strong banking system.
This is a bit out of date but you get idea.

“For example, say the fund invests in the largest 200 companies on the ASX, and invests in proportion to the companies’ size (that is – the largest companies get the largest investment). Then, the big four banks would be four of the fivelargest investments.”

“But it is fair to say that “millions of everyday Australians who own bank shares through their super funds” benefit from dividend payouts. – Mark Humpherey-Jenner”

FactCheck: do bank profits 'belong to everyday Australians'?

The Australian Banking Association says ‘nearly 80% of bank profits go straight back to shareholders’, the majority of whom are ‘everyday Australians’. Is that right?

theconversation.com

 

[Seeds]

A very small percentage…

every single worker in australia who doesnt have a self managed super fund has super invested in the banks and blue chips.

In any case it doesnt matter who own what for the purpose of insurance. If the banks needs a bail out its the insurer who pays. And if that insurer is owned by the same people who owned the bank it doesnt matter. In fact now I think about it again thats actually even kind of better. the government doesnt bail out the banks like during the gfc. Its the insurer who will.

 

[nut]

every single worker in australia who doesnt have a self managed super fund has super invested in the banks and blue chips.

In any case it doesnt matter who own what for the purpose of insurance. If the banks needs a bail out its the insurer who pays. And if that insurer is owned by the same people who owned the bank it doesnt matter. In fact now I think about it again thats actually even kind of better. the government doesnt bail out the banks like during the gfc. Its the insurer who will.

No, we do … insurance is a bigger scam
then the banks…
Trillions of dollars in premiums and when they have to pay up they just increase premiums.

12millon houses paying $120 a month…
A few thousand house get burnt or flooded and the premiums double.

Massive scam.

 

[DaBarz]

No, we do … insurance is a bigger scam
then the banks…
Trillions of dollars in premiums and when they have to pay up they just increase premiums.

12millon houses paying $120 a month…
A few thousand house get burnt or flooded and the premiums double.

Massive scam.

It’s spreading the risk

You don’t have to pay insurance if you don’t want to - apart from third party bodily I can’t recall any insurance that is compulsory (once you own what you are insuring of course).

 

[nut]

It’s spreading the risk

You don’t have to pay insurance if you don’t want to - apart from third party bodily I can’t recall any insurance that is compulsory (once you own what you are insuring of course).

Of course you have to pay insurance … just like we have to pay taxes…

The difference between taxes and what taxes pay for compared to insurance premiums is, that just like banks, there is a monopoly of insurance wholesalers that own the market…
They then off load “products” to Retailers that give the impression that there is competition . And idiots fall for it.

 

[evolved2]

No, we do … insurance is a bigger scam
then the banks…
Trillions of dollars in premiums and when they have to pay up they just increase premiums.

12millon houses paying $120 a month…
A few thousand house get burnt or flooded and the premiums double.

Massive scam.

It's a scam that we're allowed to drive on our roads without third party liability insurance. It should be compulsory.

 

[evolved2]

More I’m right Jack.

I've dealt with mortgage repayments and RBA interest rate changes, and I accepted the pain. This generation seems weak.

 

[DaBarz]

I've dealt with mortgage repayments and RBA interest rate changes, and I accepted the pain. This generation seems weak.

Agree 100%

Try getting through life without a bank or insurance

 

[kranky al]

I've dealt with mortgage repayments and RBA interest rate changes, and I accepted the pain. This generation seems weak.

How much as a multiple of your income, was your first house?

 

[evolved2]

How much as a multiple of your income, was your first house?

From memory, approx $26k income and 95k purchase price in 2001, so 27%. I was in my early 20's at the time.

 

[kranky al]

From memory, approx $26k income and 95k purchase price in 2001, so 27%. I was in my early 20's at the time.

How much would it be worth now compared to someone on a similar income

 

[evolved2]

How much would it be worth now compared to someone on a similar income

A comparable 2Br/1Ba unit in Dandenong Vic is probably worth 350-380k now.

Someone doing the same job I did back then is probably earning 65k now.

Interest rates were above 7% when I bought.

We're not in 2001 anymore. I hope you take that into consideration.

 

[DaBarz]

How much as a multiple of your income, was your first house?

We weren’t buying houses with home theatres, en suites and garaging for 4 cars
We were (and this is true of my siblings and in laws at the time) buying war service and ex housing trust homes.

There’s one reason houses are dearer now.

Our mortgage was based on my income alone and repayments could not exceed 30% of gross monthly income.

 

[kranky al]

A comparable 2Br/1Ba unit in Dandenong Vic is probably worth 350-380k now.

Someone doing the same job I did back then is probably earning 65k now.

Interest rates were above 7% when I bought.

We're not in 2001 anymore. I hope you take that into consideration.

3.6 vs 5.4 times the wage.

Let’s extrapolate that.




You would repay a total of 7.55 times your yearly wage at 7% interest rates





The total repayment calculated at 3% interest is 11.41 times $65000