August 17, 2007

Duck Friday


  1. That is a beautiful photo.

  2. Anonymous7:15 AM

    Much prefer your pic to Harry's, Caz.
    A rear view of Gillard is certainly an improvement!

  3. Anonymous7:28 AM

    A penguin sitting on the head of a teddy bear?

    Cute. Bizarre. But cute.

  4. Anonymous2:37 PM

    A very classy Duck Friday this week, Caz. Thanks!

  5. Anonymous3:12 PM

    The name's Duck. Insouciant Duck.

    Eggs warmed, not incubated.

  6. Anonymous9:39 PM

    So... Caz..

    What say you, of the latest global development, and how it will impact on Howard and Rudd?

    Interested in your thoughts mate.

  7. Anonymous10:05 PM

    Nice photo, Caz.

    I couldn't help but notice the head, though. Cutting the body off and it looks to me like a penguin. See here. Penguin Friday?

  8. Anonymous10:16 PM

    Pretty good likeness I reckon Dylan!

  9. OMG - Dylan is photoshopping the ducks!

    Officier de police, arrest that homme!

  10. Kath - tough one to call.

    The "crash" is a particular financial niche segment, and unless people panic, it will stay that way.

    Don't forget that market reactions are emotive, not driven by objective facts. Even "The Depression" would have been almost a doddle if everyone hadn't shit themselves for no reason. It's a little bit: monkey see, monkey do. Everyone should sit tight, wear some momentary losses, and it will blow over by the time they have their next roast dinner.

    The whole thing will very likely blow over before our election, and our own interest rates will be more pressing, not this little American glitch. That's my thought right now.

    It might play well for the coalition, to the extent that they can run with the fear factor: stick with us during these turbulent times, 'cause Rudd has no experience in worrying his little head about big boy matters like this. They would be right too, but the message may not resonate with a snarky, disgruntled audience.

    It's not something that Rudd can use to his favor, though he might be silly enough to give it a shot. Personally, don't see how he can convincingly slate the blame to Howard though, given that neither of the buggers have any control over international markets or American lending practices (der!)

    (Any claim from the ALP that Howard's gov't didn't "protect" our economy from this sort of thing would be an appalling manipulation of the truth of the situation.)

    Mind you, neither of them have control of our local interest rates either - do'h! - do they both forget to mention that?

    Of course, the funny thing is, when interest rates were up in the whopping double digits under the ALP, people could still afford to buy houses, and still had no trouble paying their mortgages; they were paying a far lesser percentage of their income in mortgage payments too, compared to today.

    Voters don't understand economics, they don't understand that you have to convert dollars to net present value, or look at a range of measures (converting them all to NPV) in order to be able to compare apples with apples. They get suckered by the political spin, which compares apples with camels. The pollies know how to push the right buttons, with simple and false information.

    The other funny thing is, even though we keep getting told that our interest rates are low, and have been for the whole period under Howard, the FACT is that it's relative, not absolute, and relative to international standards - well, guess what, you know where I'm going with this, don't you? - yes, we have one of the HIGHEST interest rates.

    But, heck, try explaining that to voters in a ten second sound grab. Good luck, with it, hey?

    Anyway, sorry for the ramble, back to the point: I don't think either party gets any obvious advantage, it's a line ball, somewhat a marginal advantage to the gov't.

    With any luck it will blow over, otherwise it will be a distraction, rather than anything useful, or constructive, in terms of our election.

    Both sides would be wise to "forgetaboutit".

  11. Anonymous11:30 PM

    Can vouch for the low interest rates outside of Australia, Caz. We just bought an apartment here on a 20 year loan at 4.03% fixed for the entire term of the loan.

    My grasp of economics is such that I can't really understand how this can happen when unemployment is about 10% and the national budget is in the red for the n-th consecutive year. What it does suggest to me, however, is that defining the health of an economy by the level of interest rates alone (and running on this as the central election issue) is pretty silly - though it seemed effective last time round, didn't it?

  12. A number of other major economies (eg, I think Japan?), have even lower rates Dylan. Can't believe your rate is locked in for 20 years, how cool is that?

    Yep, worked a beaut last time, and it was all a total crock then, and will be again this time around.

    The Reserve Bank sets the rates, and is politically independent, period.

    The best that a gov't can hope to do is heat up or slow down the economy with their own spending, or at least that used to work, often badly.

    However, as much as gov't spending is mega, there are now mega-buckets of superannuation and mega-buckets of private equity (local and from O/S), sloshing about, and, arguably, drowning out any effect the gov't could hope to have with their own spending.

    Sure, they can claim that they also influence the economy with their "economic settings" (whatever they define them to be), and to some extent that's true, but mostly in the negative, not the positive. Really, they don't have a lot of control anymore, the national and international economies are a law unto themselves, they are their own engine.

    Once upon a time the concept of low unemployment, low inflation, and low interest rates was an economic fantasy; it wasn't possible according to the economics books. My, how times have changed since the 1960s.

    Another interesting little grenade could be waiting for the gov't in the lead up to the election: unemployment increase.

    Despite tossing disabled people and single parents onto the unemployment list - implemented on 01 July - nothing has hit the numbers yet; even Costello was surprised a few weeks back. However, turns out that Centrelink is struggling to "process" a few hundred thousand people to move them over to their new, and decreased, unemployment benefits. Of those that have been processed, many are already doing their required 15 hrs of work a week, or more, so they don't hit the numbers.

    Anyway, the point is, during the next couple of months, all of that processing should be done. If the unemployment rate is effected, even a temporary increase, a glitch - bang - the gov't will be toast. Might not happen, but then it might too. That, coupled with the fact that gov't departments and private sector both tend to put a halt on recruitment in the lead up to a Federal election.

    Rates up? unemployment up? ... there's a third key economic factor ... what the hell is it ... can't think!! Three key factors that generally determine if a gov't holds, or is tossed.

  13. Breaking:

    "The US Federal Reserve has cut the discount rate governing direct Fed loans to banks by a half-percentage point in a surprise move aimed at keeping credit flowing and calming jittery global markets."

    They'll keep managing this until there's a firm lid on it.

  14. Anonymous12:00 AM

    You are right on Japan. They are at 0.5%! See here for a comparison table.

  15. Good god you're an adept researcher Dylan!

    How do you do it? What's the secret?

    I can never find exactly what I want, and certainly not with the speed that you do.

    No matter the occasion ... interest rates in Japan, pics of Gillard seductively draped on a beach ... you seem to have it all at your finger tips.

  16. It's all like water off a duck's back.

  17. In the US, this is a great opportunity to buy mutual funds (4 or 5 star funds only, mind you) because the market was low.

    I like to buy low, & sell high.

  18. Anonymous1:39 PM

    Loans with 4.03% interest rates capped for twenty years?

    I'll be in a nursing home with a stash of red and cunning kick of black beer by then...

  19. Yes Cube, very much like water off a duck's back, although our papers today are saying that the markets might be volatile for the next 12 months. Still "volatile" isn't the same as crashing through the arse.

    I've been reading a bit about your Hillary lately, and what I find interesting is that she is quite negative in her approach - "this will cause pain" - "this will be hard". She's not painting a rosy picture of what life would be like under Hillary. (Yeh, okay, just ask Bill how tough it is! :-D )

    The thing about that is, voters invariably vote for the optimist, the one who tells them that every thing will be alright, that the future is good, all will be well, and anything is possible.

    Hillary makes it all sound like a really hard, depressing, slog, and I guess that's how she would run a Presidency, leaving Bill on the sidelines to try to perk everyone up, despite the tedium and dullness of it all.

    Some years back a study was done in America, with a subsequent book released: Americans vote for the person with the most "positive" messages; they want the person who tells them that the glass is always half full, not half empty.

    Of course, Hillary is not being seen as a "negative nelly", instead we get the rhetoric that you've mentioned; how smart she is, how savvy, how she accommodates all sides (ha!), and so on.

    Perhaps her negativity will become more apparent when (if) she is the nominee, and she is being compared up-close to the G.O.P candidate.

    A way off yet, but we'll see.

    You'll have to hope the G.O.P nominate one very upbeat fella Cube!

    Of course, it will be quite a different story if Obama is the Dems nominee, that would be a far more intriguing campaign.

  20. I take a long view on the market & don't worry to much about the day to day ups & downs.

    That is, unless, God forbid, Hillary is elected because she will wreck, really wreck, the economy. Her positions are marxist & marxism doesn't bring economic growth, but a depression of growth.

    Obambi is making many basic mistakes in his campaign. He is just too green yet.