The Citizens Electoral Council Of Australia see; www.cecaust.com.au want new Bill enacted that stops banks foreclosing and let home owners/farmers pay reasonable reduced loan repayments.The logic being this is that panic makes our economy spiral backwards and assets then become under valued.

Lyndon H LaRouche, Jr.says that the US bubble is in reality $20 trillion and the crisis is far worse than the Great Depression of the 1930's.Australian home owners have an annual earnings to debt ratio of 175% compared to the US of 130%.

I would like some imput from readers on the pros and cons of such a Protection Bill and what the reality is concerning our economic security.Many of you may not be aware that banks when strapped for funds can call in a loan at a moments notice even if you don't default,and thus you will be forced to sell up your house in a very depressed market.

There are some who have already sold their assets in anticipation of a total collapse and thus be able to buy assets at bargain basement prices,but the fallout from this will destroy the lives of millions.The capitalised vultures and hyenas are already talking down the market.

Is this proposed Bill by the Citizens Electoral Council of Aust a good idea?

No not a good idea I would not give value to either of your opinion givers.
In fact I am surprised a conservative could ask the question.
Yes the over valuation of homes is about right.
But how many bought and sold at a profit?
How many times did they do that? some own 5 homes now.
Who got the benefit of that profit?
Right now we are seeing requests that the very people world wide who put us in this place be bailed out by the rest of us.
A question for those in trouble.
Why have we as a nation more than halved building of welfare housing in the last 20 years ?
If we can not house our homeless why bailout those who suffer self imposed problems?

Arjay “want new Bill enacted that stops banks foreclosing and let home owners/farmers pay reasonable reduced loan repayments.”

That is lunacy and will not prevent anything.

The only outcome would be banks would no longer lend to home owners/farmers.

Ultimately you cannot protect people from their own folly (which such a bill seeks to do) by denying a Lender redress in the case of default by the borrower.

Such proposals skew the balance of rights against the lender, to the point that future borrowers will find it impossible to meet the requirements of the lenders and thus will not be able to borrow to buy property.

That would cause a collapse in home building and an economic recession far worse than anything thus far experienced combined with sky-rocketing house rental prices (due to no one being able to afford to move out from renting).

Arjay, IMHO you should be pretty careful about what you believe,
that comes from the LaRouche movement. They seem more like a cult,
with some pretty wierd ideas.

Yes LaRouche predicted that the US financial system of ever increasing
debt and financial gymnastics was not sustainable and bound to crash,
but the Economist has been saying the same for years.

What actual solutions we should take is another story and that is
where LaRouche goes off the deep end, IMHO. I certainly do not
take him seriously and I don't know anyone else who does, apart from
a few of his devoted, cultish kind of followers. They will even
bring out their bibles to convince you :)

What is happening in the US Markets has been foreseeable for years. Two years ago at a wealth management seminar in HK, in front of 200 people, I recall becoming locked in debate with the HSBC's HK Chief Economist, whom denied that the current situation would occur. I left wondering whether he was a fool or merely a sleazy salesman. He even said that Bank profitability would have no influence on the US economy!

The other matter we exchanged words on was "maturity transformation". That is, if interest rates fall, Banks still will have to pay interest on IBDs Term Deposits captured over the past four years, pressing squeezing margins.

Banks have made it clear that they wish to ignore the RBA. Herein, any bailout should go direct to home owners and not the Banks.

Moreover, given their chants of independence from Government; perhaps it is time, that is if Banks fail, was pulled, and the Banks allowed to fend for themselves.

O.

Correction:

Moreover, given their chants of independence from Government over interest rates; perhaps it is time, if Banks fail, that the RBA's protection of "Lender of Last Resort" was pulled, and the Banks allowed to fend for themselves. (That is okay. Someone from oveseas will take them over and their debts securitised.)

Besides why should a capitalist want a socialist style bailout? Let the Free Market work. It is their right to inves, to win or loose.