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RBA 'too little, too late' to stop home loan fall

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Australian Broker | 15 Jan 2013, 07:00 AM Agree 0
An industry figure has pointed a finger at the RBA for failing to act quickly enough to stop a fall in home loan approvals
  • sidbroker | 15 Jan 2013, 08:08 AM Agree 0
    Its good to see someone pointing the finger at the RBA apart from myself. I agree with John here. RBA have been playing with rates since 2003 trying to control property prices but instead have been very destructive to our economy and well being.
  • Wilko | 15 Jan 2013, 09:59 AM Agree 0
    Aussie, AFG and most of the Aggregators have been doing this for 12 months and now Kolenda ha joined the chorus. The RBA is out of touch.
  • Local Broker | 15 Jan 2013, 10:02 AM Agree 0
    The real question was why they ever went so high after 2009? Just when the economy was starting to see some small recovery the RBA sent the cash rate through the roof unjustifiably.
  • Maria Rigoni | 15 Jan 2013, 10:41 AM Agree 0
    The cash rate is the interbank lending rate and is "independent" to any retail rate of interest.
    The RBA is not a retail lender and cannot dictate retail rates of interest.
    The RBA is responsible to the government for Australia's monetary policy which the governor is required to discuss with the Treasurer from 'time to time'.
    Question that the RBA needs to be asked is "Is Australia's monetary policy working effectively?"
    The banks are taking advantage of the situation because they can!!!, due to legislation that protects them from being competitive, fair, efficient and honest.
  • Dean | 15 Jan 2013, 10:45 AM Agree 0
    This seems hogwash to me, seems an attempt at seeking publicity. The REALITY is that consumers are extremely cautious at the moment. Even if rates dropped another 1.00% I don't think it will lift home sales very much at all.

    People have decided to stay put in their homes, very few have plans to upsize ormove.

    For the most part, any rate drops are being pumped into the home loan. Just ask the RBA and ABS for their stats to prove that. Then ask your clients what they will do if the rates drop further !!!
  • Bob | 15 Jan 2013, 10:57 AM Agree 0
    Can't believe that you all think that the RBA has got it all wrong! Wow, maybe you should apply for a job at the RBA and show them how it should be done! We have one of the best functioning economies in the world with low unemployment. The RBA has been praised globally for it's ability to traverse the last few years as well as they have. There is a very fine balancing act when using interest rates as a stabilizer for the economy. Go and live in Europe or US to see what it is like when the property market goes pear shape...not nice. Don't forget that the majority of home owners own outright and are net savers. Every time you cut rates, you take funds out of the hands of net savers...who have less to spend etc, etc. House prices have been too expensive for years...what we are seeing is a very welcome correction in housing prices....well overdue. Affordability is what is required...not boom bust scenarios caused by cheap credit.
  • David | 15 Jan 2013, 11:30 AM Agree 0
    The RBA has to balance a large number of variables, not just property prices and, in the main, does a reasonable job. It's hands are tied by its charter and is now only left with interest rates as the vehicle to control the economy. It's main issue is its dependence on historic economic statistics, and history has shown that it has a poor record in predicting the future, even very short term. For instance, prior to the GFC many of us could see what was starting to happen and the RBA kept doggedly increasing rates with its fixation on inflation. I believe that the real problem with the property/finance industry is not interest rates but consumer confidence - or lack thereof, and most of this is due to the pathetic mediocrity of of our political system. Just look at our Federal and State governments and opposition. The polls show that the majority of people don't want and have no confidence in any of them. On Federal level, if K. Rudd remained PM, and M. Turnbull remained Opposition Leader, I believe we would have a real choice and consumer confidence levels would be higher. So don't just point the finger at the RBA - look also at the standard of politics and the media that continues to perpetuate political mediocrity in their quest for a headline.
  • GB | 15 Jan 2013, 12:09 PM Agree 0
    yeah! its really the RBA's fault people dont want to leverage up into a falling property market! Interest rates are at 50 year lows! What a joke! brokers getting desperate much?
  • PS | 15 Jan 2013, 12:09 PM Agree 0
    It's one-sided views like this that fuel consumers weary perceptions of the financial services industry. Always calling for credit growth and government help makes us all look greedy and untrustworthy.

    We need to provide a much higher level of education to customers about why the RBA moves rates and the impact it has on the broader economy and in turn their financial goals. If Mr Kolenda wants to start helping consumers, and in turn his brokers, he should aim to education not provide misguided thoughts and views.
  • Wilfred Mendez | 15 Jan 2013, 02:01 PM Agree 0
    The RBA alone cannot be blamed. The 4 major banks too has to share the responsibilty for the economy. Well whenever RBA focussing on economic growth & stabilty varies the interst rates, the 4 banks not co-operating with the RBA. The 4 greedy banks keeps/holds to themself a major portion/fair portion of the interest rates to themselves. This greed will not have the 100% result on RBA TARGET & AIM. The 4 greedys must understand the Rba & nations economy and have a fair go , but not to be greedy for only their capitalisation but be Wise.
  • Positive Broker | 15 Jan 2013, 04:41 PM Agree 0
    The two biggest problems:

    1. Confidence, Confidence, Confidence! The public are not prepared to borrow because the incompetent federal government are taxing us out of existence.

    2. We are back in the bad old days where most banks are looking for reasons to decline loans so people who want to borrow can't. I'm not suggesting a return of lo doc or "just approve everything" but simply a preparedness to assess risk rather than ticking boxes!
  • sidbroker | 15 Jan 2013, 05:13 PM Agree 0
    To Bob, You surely must work for the RBA to write this and I bet you are a protected species being paid by us the Great Australian People.
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