The "independence" of the RBA in setting interest rates is a great help to our economy. Notice how the banks are extremely quick to apply RBA interest rate rises, but extremely slow to apply RBA interest rate falls.... that's because "true" competition between the banks just doesn't exist.

Well we already knew Hockey was part of the lunatic fringe. :) Nick Minchin and his free market comrades must have been squirming in their lounge chairs after that faux pas.

Abbott won't say anything because he is hoping it will all go away - maybe he can bring up Afghanistan again. It worked to distract from the shaky audit debacle.

Hockey is totally unbelievable. Have you noticed whenever he makes a statement he betrays his own incredulity with himself and the usual Opposition spin without substance. I can almost hear a little voice in his head saying "what the hell am I saying it is a load of hogwash but my mouth is working so I have to keep going" and on he ploughs. He did the same with defending WorkChoices with the same lack of sincerity which was confirmed by his admissin that WC went too far.

Nothing like an opposition who wants to keep the government honest but can't get their own house and costings in order nor can they coordinate their own spin.

So Pelican,Joe Hockey is part of the luntic fringe because he has a differing opinion? Kevin Bracken is also part of the lunatic fringe according to Julia Gillard because he looked at scientific facts.

What still remains is that while everyone is condemning Joe Hockey for wanting to regulate interest rates, he never called for this at all. Everyone is condemning him for a straw man set up by Wayne Swan.

We see the headlines in the media "Wayne Swan warns the banks on raising rates", but when Joe Hockey urges him to actually do more than puff and spin, Wayne twists his words.

After receiving a whipping from the miners, the last thing Wayne wants to do is make enemies of those who could really show him up as a financial newbie.

GrahamY:>>The reason that bank interest rates are running higher than the ones set by the RBA, is that the RBA rates are not properly reflecting the borrowing costs of the banks.<<

Graham a lovely thought, but let us look at why credit ratings were implemented. The better the credit rating the lower the risk factor and the cheaper the money. Australia is AAA+ yet the funds our banks source attract a third world credit cost, which is passed onto us. The poor banks, bless their cotton sox are just keeping their heads above water here in Oz, thanks for your thoughtful consideration of an issue that is of concern our banks.

*Joe Hockey called for Wayne Swan to take action on the gouging by the big banks which could include legislation.*

Well that is the first question. Are the banks really gouging?
25% of the ASX is made up of bank values, simply because its such
an enormous industry, with around 2 trillion $ in loans outstanding.

When you add it all up, after all costs, the banks are left with
around 1% net. So if their margin between what they charge and what
they pay were to change by just 0.5%, their profits would halve.

*because during the GFC, the loan guarantees the Rudd government gave only to the banks wiped out the competition.*

Not so. Fact is many overseas banks packed up and left, as they no
longer had access to cheap overseas money. The Govt was prepared
to guarantee funding for any institution that came under the
durestriction of the banking regulator, which is fair enough.
Guaranteeing funds to just any financial institution would have been
full of risk, not a wise thing to do with taxpayers money.

As it turns out, banks payed for this and AFAIK the Govt pocketed
an extra billion $ or so, at no cost.

Banks, in their time of need, turned to shareholders to cough up
billions of $ of extra tier 1 capital. Those shareholders are
entitled to a return on that investment. As it happens, the largest
shareholders are in fact super funds, so profits go into the accounts
of most working Australians, even if they are not aware of it.