Why doesn't the banks pass on a reserve rate cut to the consumer? Are we dumb to think that banks are are best friend and look after us. ?

Banks have more stakeholders than just mortgage holders like us Buster.

Share holders want profits & dividends (your super fund), plus there are Reserve Capital requirements that can be improved.

If you can't beat em join em. Buy some shares and start collecting the divs.

They still need a margin to run the business and their cost of obtaining money to then lend to you for your mortgage is also influence by international factors.

Yeah and if they fail just get the government to bail them out .
so they need massive profits when its good times to cover there losses. Lmfho
They don't pass on any rate reduction on credit cards.
Its why people are asking for a royal commission into banks

It's why the reserve bank is shaking it's head, it's a toothless tiger, they can't really affect monetary policy even though its their reason for being there.
They should change the song from fk the police to fk the banks.
On another note re credit cards if you're that dumb to max the card and live beyond your means then you deserve the ridiculous rates.
Um rant out

Oh, 'poor bugger me'

Stop playing the victim. Banks are there to be used, not the other way around. If you think they are the enemy then learn how they work and you'll be a lot better off.

Stop looking for for someone else to blame when you have a closer look at you own performance in your undoing.

Creditcards, now there's a 'No-Brainer'

Select to expand quote

actiomax said..
Yeah and if they fail just get the government to bail them out .
so they need massive profits when its good times to cover there losses. Lmfho
They don't pass on any rate reduction on credit cards.
Its why people are asking for a royal commission into banks

I can't remember the specifics but did the govt bail out our banks during the GFC, or did they bail out the Australian economy? there is a big difference between the two. As far as I can recall our banks didn't need the bail out that most other countries needed because of the regulatory controls and good management they already had. They're still operative the same way now as they did then but now they're being bashed (again) for it.

I'm one of those bunnies that never pays off my credit card but I don't blame the bank for own financial management, or lack of.

You all need to read phill Andersons 'the secret life of real estate and banking' get a 200 year perspective by going through through all the cycles during this time. Easily the most important book I've ever read.

And more importantly understand the real reasons behind moving from a gold standard to fractional reserve lending and of course the central banks role since then.

Its a mess fellas, end of story. For the 95 percent anyway...

...and even more importantly the role of land in all of this. Understand land, you will understand banks And the economy.

then questions above are easily answered, but Yu wouldn't believe me if I just told you.

All i can say is the truth about debt serfdom slavery will set you free...inside your prison anyhow bahahahahahaha

bene313 gives the best advice although buying their shares is only a small part of joining the Ponzi scheme And winning.

I've ordered it, at vast expense. Not available in electronic.

Select to expand quote

busterwa said...
Why doesn't the banks pass on a reserve rate cut to the consumer? Are we dumb to think that banks are are best friend and look after us. ?

You need to shop around to get the best deal and not get complacent. There's been a lot of discussion on Performance Forums recently about banks giving further discounts on their interest rates if people call up and complain, compare etc. People are getting solid discounts after a quick phone call.

My personal situation is that i'm paying 4.6% on 500k with ANZ. 3 weeks ago NAB and Westpac offered me 4.0x% straight off the bat. ANZ weren't willing to budge (for me) so i'm continuing to look around.

Don't waste time trying to get a good deal with your bank. Use a finance broker who will hunt down good deals at no costs to you...

Select to expand quote

MDSXR6T said..

busterwa said...
Why doesn't the banks pass on a reserve rate cut to the consumer? Are we dumb to think that banks are are best friend and look after us. ?

Westpac offered me 4.0x% straight off the bat.

They aslo have a 3.75% p.a. rate. I think the effective rate is 4.15%

I'm with CBA. So I'm not spruiking Westpac.

The GFC was caused by banking greed simple as .
Ruined the world economy for there own gain .
Didn't take responsibility for there actions and still don't
Comes a time when were trying to put the pieces back together they still ripping the guts out of everybody for there own benefits .
Australia might not have had to bail out our banks but they were certainly part of it .
If there was any responsibility at all from banks in view of the suffering they have caused they would not be getting record profits but a moderate profit and helping the economy grow by passing on these rate cuts .
The simple fact that they are recording record profits before we have even recovered from the GFC that is disgusting .
Bring on a royal commission at the very least .
I personally think that anyone who is trying to defend the banks are sick in the head considering the amount of pain & suffering they have caused .
In every aspect of life & business there has to be a moral responsibility .
The banking sector has proven they have none

Select to expand quote

busterwa said..
Why doesn't the banks pass on a reserve rate cut to the consumer? Are we dumb to think that banks are are best friend and look after us. ?

Australians have such a thurst for usury, that the countries money supply doesn't meet the retarded demand. So they go to the international money markets to borrow more, and when the d1cks @ the RBA lower their interest rates it doesn't really affect them to the exact amount it's been lowered.

Select to expand quote

japie said..
I've ordered it, at vast expense. Not available in electronic.

Who is LIBOR?

Select to expand quote

slammin said..

On another note re credit cards if you're that dumb to max the card and live beyond your means then you deserve the ridiculous rates.

Surely you're not advocating that people take responsibility for their own finances?? It's the government's job to do that.

Select to expand quote

actiomax said..

I personally think that anyone who is trying to defend the banks are sick in the head considering the amount of pain & suffering they have caused .
In every aspect of life & business there has to be a moral responsibility .
The banking sector has proven they have none

Oh yes Australians are doing so badly and it's all the banks' fault! We're all being used! LOL!

Have a look outside mate - you're living in one of the most prosperous societies that has ever existed in the entire history of humanity. Stop whining and enjoy it.

Select to expand quote

AUS1111 said..

actiomax said..

I personally think that anyone who is trying to defend the banks are sick in the head considering the amount of pain & suffering they have caused .
In every aspect of life & business there has to be a moral responsibility .
The banking sector has proven they have none

Oh yes Australians are doing so badly and it's all the banks' fault! We're all being used! LOL!

Have a look outside mate - you're living in one of the most prosperous societies that has ever existed in the entire history of humanity. Stop whining and enjoy it.

I looked outside... I cant GO outside though... cant afford it due to the mortgage I pay to cover the extra margins that the banks are making.

Can you imagine how much better it could be if we weren't?

You are all in super, its compulsory!

Therefore you are all bank shareholders, unless you opt for only cash type investment.
The problem is not the banks, its those that NEED everything without saving first.
The big house
The holidays
The new cars
The appliances
The toys, clothes , meals out, entertainment etc.

The whole country needs to moderate spending, live within your means!
The current system will collapse because it had no foundations, yes
even labor and green voters will have to pay more tax eventually.
It needs fixing now,but it will take a crisis to sort it.

Im not whining about it .
Its a total fact that the gfc has lowered the living standard of the whole world &its a fact it was caused by banks &before countries economy's have even over come this they are posting record profits before the boosting of the economy which they wrecked is totally disgusting.
Your right in I live in a great country &I totally appreciate that but the gfc hit my industry pretty hard I was lucky to get through it but a few of people i know of .hit the wall Lost there business then house then the stress caused divorce .
That happened in this country .
It might not have happened on the scale of over seas but it still happened &if the reserve bank is trying to stimulate the economy &they hinder that so they can post record profits Its just criminal

Select to expand quote

boofta said..
You are all in super, its compulsory!

Therefore you are all bank shareholders, unless you opt for only cash type investment.
The problem is not the banks, its those that NEED everything without saving first.
The big house
The holidays
The new cars
The appliances
The toys, clothes , meals out, entertainment etc.

The whole country needs to moderate spending, live within your means!
The current system will collapse because it had no foundations, yes
even labor and green voters will have to pay more tax eventually.
It needs fixing now,but it will take a crisis to sort it.

But the farking government(s), central banks and banks are activily penalising savers.

Like most things, there are pros and cons. The lowering of interest rates has been good, to a degree, to home buyers and businesses. I said "to a degree" because the banks only passed on a portion of the 0.25% to mortgagees.

If you paid enough attention to what is going on, there is a rise in folks who are in arear in mortgage repayments, even at the record low interest rates. Put simply, people believe that at such a low interest rate, they can borrow more and afford to repay. As soon as they lose their jobs, or copped a pay cut, things go downhill. So it is a combination of deteriorating economic climate, and false optimism thanks to record low interest rates.

As for banks not passing on the full 0.25% cut, I can see both sides of the arguments. For a start, my bank deposit is earning buggar all because of the low interest rates. So what should I do with my money? I can pull it out and buy shares. Shares, if you have keen eyes and sharp brain, can earn a lot more return for your money.That is what the banks are worry about...that savers are pulling their money out to do something else with it. So banks are trying to hold on to their customers by offering a better deal, while keeping some of the 0.25% to pay for the largess.

Sure, the banks had been shown to be dodgy in the insurance and investment businesses. In the investiment dealings, I believe the people who bought into the deals also ought to share some responsibility. If you are foolish, or optimistic enough to throw all your eggs in a single basket, just because you think there is a pot of gold to be won, as the dodgy brokers spruiked, then you need your head checked.

Use the banks as a tool to help you get somewhere, but not to expect a quick fortune by involving in some get-rich-quick schemes/scams. Ultimately, you are responsible for your own money. Failure to take cautions, someone else will take it from you.

Select to expand quote

Chris6791 said..

actiomax said..
Yeah and if they fail just get the government to bail them out .
so they need massive profits when its good times to cover there losses. Lmfho
They don't pass on any rate reduction on credit cards.
Its why people are asking for a royal commission into banks

I can't remember the specifics but did the govt bail out our banks during the GFC, or did they bail out the Australian economy? there is a big difference between the two. As far as I can recall our banks didn't need the bail out that most other countries needed because of the regulatory controls and good management they already had. They're still operative the same way now as they did then but now they're being bashed (again) for it.

I'm one of those bunnies that never pays off my credit card but I don't blame the bank for own financial management, or lack of.

I saw a good story on what happened, but I can't remember exactly what the mechanism was. I think it was that the government provided a guarantee on funds that covered the local banks liabilities. This allowed the banks to continue to operate and continue getting funding.

There definitely was a guarantee to support the banks, but it is the fact it is there that provides the reassurance, so it was not actually called upon.

I think in reality they bailed out the banks and the economy together, as nothing good would have happened with the banks exposed.

I would also argue that the banks only had the minimum ratios that they could get away with. Lower ratios mean being able to lend more, which is what they always want to do, and I am not sure a bank cares about a run on itself, because at that point its kaput anyway.

I think if the banks are recording record profits, open up the banks to compete with international lending. Is that already possible or is there still some protection going on? The downside to that is what happened when people borrowed in foreign currency and then our dollar went down.

Surely thats criminal. www.couriermail.com.au/nocookies?a=A.flavipes for plebs like you and me It pays to stay well clear of any debit. Live within your means. ! Banks don't really produce anything apart from selling loans.

I like Allan Bonds take on banks.
If you owe the bank 100,000 $ its your problem if you owe the bank 1,000,00O its the banks problem.

Well they do produce income, via interest, to those that deposit money in the bank.

But to be honest if you're feeling the pinch at these interest rates, it's time to leave the table.

Select to expand quote

kk said..
Well they do produce income, via interest, to those that deposit money in the bank.

But to be honest if you're feeling the pinch at these interest rates, it's time to leave the table.

? They produce absolutely nothing apart from you need a bank to put your money in. ?Make no miss understanding kk. I know how this system works im not an idiot. Your deposit is worth Absolut ****. Whats the going savings interest RAPED?
Its criminal. Need to look into a independent governing body or open up overseas banks for competition. Time for mediation/change.

Perhaps someone can answer me this. Why can't the Reserve Bank lend citizens money? Rather than going to the 4 pillars?

I would like to see first home buyers have the opportunity to get into the market. The RBA can have security against a persons super.

Just got home to a letter from my bank dropping my rate from 3.91% down to 3.81%.
Happy days.

Select to expand quote

Underoath said..
Perhaps someone can answer me this. Why can't the Reserve Bank lend citizens money? Rather than going to the 4 pillars?

I would like to see first home buyers have the opportunity to get into the market. The RBA can have security against a persons super.

I agree with that 100 percent mabe the reserve bank can be run by the government and set standards. . ! Correct me if im wrong Unhooked but that interest rate seems to be dependent on the percentage of equity? . They advertise that interest rate but with conditions Interest rates are low but there not offering that to new home buyers. I guess its important to give your kids a good stepping stone in life. Just seems like if you cant get a jump on banks now days Your gona get left behind. Its become evermore clear marry for life stay together and set your kids up!

please don't suggest overseas banks offer more competition.
Some of the mortgages being offered to get mugs away from the major
banks are being funded by foreign currenciy, i.e. yen,euro, etc being
converted to aussie dollars then lent at ever decreasing rates in
competition to aussie dollar loans. These loans are usually only
given to higher equity borrowers, these lenders are smart!
But the problem is eventually the downward pressure on the
aussie dollar and our interest rates causes the madness of negative
rates and screwed up economies. The so called system is not
sustainable, its the equivalent of what happened in 1929. people
thinking they can continually profit from cheap loans to buy
assets. In 1929 it was shares, now its property, but it will end
exactly the same way. The borrowed money will be called.
The dodgy lenders will panic when the aussie dollar crumbles,
then they call in all the cheap loans, read the fine print especially
on fixed rate/ fixed term loans.