Government Pushing Banks to Offer More Debt Solution Options

There has been widespread perception by many Australians that they’re being gouged by the major banks. The familiar refrain is that the banks are quick to raise interest rates when the Reserve Bank raises the cash rate, but painfully slow to lower their rates when the Reserve Bank lowers its rates. The banks have argued that their overseas funding costs have risen and have been slowly trying to create an understanding that what the Reserve Bank does is only one factor in their decision. The recent decision by Westpac and ANZ to raise their mortgage interest rates after the Reserve had kept its rates steady is part of this attempt.

CREDIT CARD APPLICATIONS DOWN – HOUSEHOLDS STRUGGLING

New figures from Veda Advantage have shown that requests for new credit cards over the Christmas period were down 9.9% on the previous year. Coupled with the fact that Australia has one of the highest levels of household debt relative to income, the figures partly reflect the fact that many households have reached their debt limit and are now trying to deleverage themselves.

They also reflect concerns people have about job security and earnings given the instability and sluggish growth in many parts of the global economy, particularly in Europe.

Bankruptcy Can Strike Anyone

Kodak files for Bankruptcy After 130 years in business, Kodak this week has filed for bankruptcy protection.

The company has been a rock in retailing for much of the last century, eventually even blending into the language like all great companies do. After all, no one speaks of beautiful scenes as Canon moments or Fuji moments.

Despite that outward stability however, the company has been chipped away by a slow succession of wrong turns that lead up to this dramatic end.

Chief among them was its failure to cement its place in the digital camera market, despite having invented the technology.

Roof Industry Bungle

7000 small businesses are facing bankruptcy and 6000 workers are likely to loose their jobs after the collapse of the insulation installation scheme.  When the government introduced the home insulation scheme it dramatically increased demand for home insulation. This false demand was met by a dramatic supply side increase in the number of “insulation installers”.  This false demand was bound to end at some point it’s just happened a lot quicker than many people expected.