The mother of all bailouts
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Source: The Age
Anybody keen for a loan of $380 billion at, let’s say, an interest rate of 3.4 per cent? Sounds nice eh? Well, you the taxpayer are in the process of actually making such a loan. Or at least you will soon extend, most kindly if as yet unwittingly, such a credit facility to the big banks, to be used at any time, at their discretion.
To put this in perspective, bank loans to small businesses now average 8.45 per cent. Secured by the businessperson’s residential property they are priced at 7.6 per cent. The average mortgage holder is forking out 5.65 per cent fully discounted.
Yet the biggest businesses in Australia – CBA, Westpac, National Australia and ANZ – will be able to trot down to the Reserve Bank, lodge a bunch of their own loans – car loans if they like – and march off with billions at the bargain-basement interest rate of 3.4 per cent for 12 months or more.
Read more: http://www.theage.com.au/business/banking-and-finance/mother-of-all-bailout-funds-20130306-2fkfq.html
And the problem is fixed, economy is fine, just doing this because, eh, um, the bankers eh, um, didn't ask for it, it was the unemployed who asked for it and we're simply appeasing them, the unemployed & pensioners.
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Are you certain you know everything that's going on behind the scenes? The government just happened to come up with this plan over the complete indifference of banks? I don't believe it. It didn't happen that way in the US with TARP, and it's not happening in Australia now without bankers asking for it. Not publicly, mind you. That would be a public relations disaster.
What if, instead, they had given that money to the unemployed? Wouldn't that have been just as big a kick to the economy? And the government would have been able to collect it back with interest through taxation in the stimulated economy.
As TARP was going on, there were some of us who thought the money should have been granted to consumers to pay their loans, and not to banks who then foreclosed on them anyway. That's what the unemployed and pensioners really wanted, but knowing that was a non-starter, they don't ask.
Not only did they foreclose, but the unemployed got a very meager uptick in jobs, while pensioners here are still in the process of getting screwed. It seems that to help people out necessities these days, we have to make the rich richer. Purportedly, no act of human kindness is effective without doing that. 
