Down here we have no problems with our banks due to prudent regulation. Cost of funds for banks is up due to USA crisis.
Our exchange rate is down 30% which has wiped out any savings on fuel as we buy our oil out of Singapore in U.S. dollars.
The stock market is [email protected]
A new development last week which will hit our automotive industry hard was that GMAC has decided to withdraw from Australia and so did GE for motor and mortgage lending . A case of circle the wagons as they are both in deeeeep shit back home.
This will leave probably 30% of the nations car dealers looking for a new supply of wholesale and retail funds. GE have given them 60 days to repay all floor plan.
Im not sure where the other providers of wholesale funds will find that sort of money in the current market and if they do at what price?
Our domestic interest rates are coming down quickly to try and ward off recession but this is also keeping our dollar soft as investors bail out of the $A for stronger returns. Our superannuation (retirement) funds have been decimated.
We are reasonably placed here overall due to 10 years of strong government and a buoyant economy largely driven by the resource industry. But we now have a Labour government who have just pumped half of our budget surplus into the economy to try to stimulate spending.
The only problem is that its going to cash payments for old age pensioners who will mostly only pay their bills and buy essentials with it and a generous $21k first home buyer bonus that will get eaten up by developers.
Its not a horror story here but the wall street genius`s would not enjoy a private chat out the back with most Aussies.