How about rather than let banks dictate things, link inflation/deflation to income tax. If things are slow drop the rate by 1%, if hot raise it. That way it dosent just benifit home loan owners and screw retirees or vise versa. Still controlled by the reserve to stop a govt money grab.

****, how hard is it.

I'd prefer it if the banks were treated like any other business. IE they can prosper or fail based on their decisions. It is unbelievable that such profitable businesses are so protected as they are.

Banks should be given a choice. Either accept their market will be deregulated and in return they lose their protection and are free to do what they like or they keep their protected status and in return they are heavily regulated, including limiting the renumeration of their executives to something like five times the amount a teller earns in their bank.

And nationalise the mines whilst they're at it.

Back in the middle of last century,..I seem to recall Whichbank used to be owned by the guvmint. It was full of guvmint employees all doing f. all because it was a govmint bank so they were free to do f..all for better pay and conditions than all the other banks.
Same as PMG back then which later became Telecom which later became Telstra. And numerous other govmint owned businesses which were eventually floated off as private companies because the country was becoming bloated with public servants who didn't really give good service.
To pay them all, it offerered the lowest interest on deposits and charged higher interest on loans. I think the interest on savings was a whole 2.5 percent per annum.

On the face of it, it would seem like a stupid move to get back into bankng after spending many years trying to get out of it.
But then, after spending many years getting out of the telecommunications business by selling Telstra back to the public, (who owned it in the first place), and then getting back into it by starting up the NBN, I suppose it would be entirely consistent for the present government to get back into the banking business.
After all their other successes at handling things, like pink bats, live cattle exports, immigration and border protection, why not give banking another try.

Aust Post ran me over on the foot path... damn them to HELL!

The issue with credit unions is their staff have strict rules to follow and cannot bend them to make a deal. Banks staff on the other hand can bend the rules a bit to do the deal. They are rewarded to do this. However sometimes the proverbial hits the fan and the bank is in trouble with too many workers bending the rules.

felixdcat said...

Easy fix! bring competition in the industry............ Japs banks???? That would send the bastards in a interrest drop frenzy![}:)]

I agree, open the industry up. Allow foreign banks to operate without restriction in Australia. Just like QANTAS. Why is their domestic business protected? Why can't foreign airlines transport passengers in Australia?

More competition is the answer, not a state owned and state subsidised industry competitor. The state owned company may offer better rates or whatever but the cost will be born by all the taxpayers whether they like it or not. So in effect a few benefit with lower mortgage rates at the expense of the many.