Prime Minister Kevin Rudd has accused Opposition Leader Malcolm Turnbull of irresponsibility for contradicting the Reserve Bank governor about the financial crisis. Mr Turnbull today appeared to criticise Glenn Stevens’s choice of the words when describing Australian banks’ position in relation to troubled overseas institutions.
Opening question time today, Opposition Leader Malcolm Turnbull challenged the Prime Minister to explain what he was doing to fireproof the economy in the wake of the crash of Wall Street giant Lehman Brothers. But Treasurer Wayne Swan accused Mr Turnbull of vandalising the surplus by blocking budget measures in the Senate.
Senators Barack Obama and John McCain each cite the mess at Fannie Mae and Freddie Mac as a consequence of the corrosive coziness of lobbyists and politicians that they promise to end. But each man and his party also have ties to the fallen giants that will complicate the next president’s job of reshaping the mortgage finance companies that have been essential to the economy. And neither man has a record of directly challenging the companies they now criticize.
The United States must acknowledge that its deep indebtedness is especially dangerous in times of economic crisis. The level and stability of American interest rates and of the dollar are now dependent on the willingness of foreign central banks and other overseas investors to continue lending to the United States.
The bailout plan for the companies, Fannie Mae and Freddie Mac, a seismic event in a year of repeated financial crises followed by aggressive federal intervention, places the companies in a government conservatorship, much like a bankruptcy reorganization. The plan also replaces the management of the companies.
Wayne Swan today called the news that Wizard Home Loans had cut its variable rate from 9.54 to 9.29 per cent a “wonderful weekend surprise” and said other banks would soon have no choice but to follow. Mr Swan said banks had passed on previous official rate rises “in a nano-second” and should pass on any cuts just as quickly.
A man who chose “Lloyds is pants” as his telephone banking password said he found it had been changed by a member of staff to “no it’s not”. He said he was then banned from changing it back or to another password of “Barclays is better”.
The computer, which was sold on eBay for £77, contained sensitive information on several million bank customers. The information is said to have included account details and in some cases customers’ signatures, mobile phone numbers and mothers’ maiden names.
Although he ruled out a direct challenge for the Liberal leadership, the former treasurer did not answer any questions on whether he would accept an overture to accept the leadership if Brendan Nelson quit. Mr Costello had previously indicated to colleagues that he might enter the fray if Malcolm Turnbull launched a challenge against Dr Nelson.
Wisely, former Victorian Premier Steve Bracks has advised the Rudd Government to ignore self-serving pleas from the car industry, trade unions and state governments for continued tariff protection. If adopted, the report’s recommendations would see the tariff cuts foreshadowed by the Howard government proceed, with a reduction from 10 per cent to 5 per cent in 2010.