Is the Federal Treasurer’s “head in the sand” over rate cut?

Yesterday’s rate cut has left a lot of people in shock wondering what it means for their money, and even

Yesterday’s rate cut has left a lot of people in shock wondering what it means for their money, and even for Australia’s future.

Treasurer Scott Morrison admits that the federal budget could lose billions of dollars because of the economic environment that has caused the interest rate cut but insists that it is not a sign of a bad economy for Australia. Scott even took to Sky News to claim “We are growing at 3.1%. Name me five advanced economies that are doing better than that – you won’t”.

While the Federal Treasurer says that this is just a small bump in the road the Shadow Treasurer Chris Bowen says that it sends a darker message. Chris told The Guardian “Scott Morrison has surrendered economic leadership in this nation to the Reserve Bank”. Chris also believes that the Reserve Banks rate cut overshadows the Coalitions election platform of “jobs and growth”. “The treasurer needs to provide more leadership. The treasurer needs to provide a real plan for our economy. The Reserve Bank cannot do all the heavy lifting.” Chris stated.

It was CommSec Chef Economist, Craig James, that put it in context saying, “The Reserve Bank is generally seen as a reluctant rate cutter. While central banks in other parts of the world have been forced to reduce rates to near zero, Australia has never been in that position. But these are extraordinary times with technology, ‘disruption’ and an environment of conservatism driving global inflation rates lower.” Craig concluded “The Reserve Bank may be uncomfortable with interest rates at current super-low levels, but these are unusual times. It may end up that interest rates of 1-2% become the norm rather than the exception.”

What does this mean for you and your financial situation? Is it time for the Government to step in and do something? Is it time to go back to putting cash under your mattress?


  1. Truth 13  

    Scott Morrison may be happy, about the cut on interest rate, by the Reserve Bank. Morrison & members of the RBA, doesn’t seem to have any clue about the people who are retired & struggling, many without a government pension, trying to live with the interest earned on their deposited money in the Banks. Why should they be worried, when they get a FAT PAY, and living very comfortably, with the money, paid by the people of the country, for ever. They also seems to be utterly ignorant of the way the retirees live. Most of them may have a house worth a lot, only because the politicians never had brains to develop housing in a country, where ONLY 10% of the land is occupied. Land & house prices have gone up, not because of any effort made by the house owners, but, ONLY because of utterly useless politicians, never wanted to plan for the future. Every time the interest rate is cut, what RBA does is to hit in the stomach of the retirees. If the members of the RBA has no brains to realise that, it is time to appoint people who has some brains, to understand the life style of ALL people, & not few. From the 1st Jan. 2017, if a retired couple has over $823,000 TOTAL ASSETS, they loose the pension. If that couple has a car, contents in the house, a bit of money in the Bank, that value is also taken off, they will be left with assets of less than $750,000. If any politician or the member of the RBA has any brains, that money will buy a house about 60 kms from Sydney, 50 kms from Melbourne, and at least 30 to 40 kms from any other capital. In Canberra or NT, it is not better. That type of investment will bring a NET revenue of only $400 a week or less, after all the costs, and they will be left with about $20,000 a year, FOR THE COUPLE. BUT, IF THE SAME COUPLE CAME IN A BOAT, WITH A COCK N BULL STORY, THEY WILL GET ABOUT $850 A WEEK EACH, OR $ 44,200 A YEAR, PLUS RENTAL ALLOWANCE & SEVERAL OTHER BENEFITS, AND ARE ALLOWED TO STAY AT HOME & IF THEY ARE YOUNG, TO HAVE MANY CHILDREN AS POSSIBLE, CHILDCARE SUPPORT PAID, CHILD CARRYING PAID, PLUS MANY OTHER BENEFITS. Doing that, the politicians & the RBA is happily carrying on their agenda, without a clue of what is the real life of the retirees is, who paid taxes, worked hard to build the country, brought up children, saved a bit for the old age, is now to be denied a life, till they die. IS THIS THE LUCKY COUNTRY OR THE COUNTRY THAT REWARD PEOPLE WHO HAS NO CLUE, OF WHAT TO DO FOR RETIREES, FOR THEIR CONTRIBUTION IN THE PAST. NOW THEY ARE TREATED LIKE RUBBISH. TIME FOR THEM TO GET OUT & SEE AROUND.

  2. John Carter  

    His boss has just slammed the banks for not passing on the full interest rate cut but will he be willing to cut the deeming rate. I guess not.

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