Believe me,Please, I am haveing trouble finding the words.
Words to describe why I think this thread is a window on the very thing doing so very much harm,to our chances of dealing with any issue.
We have, as always,taken sides.
No middle path, true look at the issues, we have taken the side of shock jocks or paid commentators.
Socialist minority's or red necks.
If not this movement, then who, how, when?
When do we get answers to global financial crisis.
To gigantic Ponzie schemes that fell, as they must,.
I too love my capitalism, show me another path that serves us better.
But on every issue,every single one confronting humanity, we fight dust storms ignoring the massive hurricane we are wandering in to.

Wait for the Messiah.
Seriously,what we should expect next is to see someone pushed forward by the Elites and anointed as the global face of the resistance.

*Unfortunately the big end of town often decries any suggestion of collective interest until there are bail outs on offer then the become the biggest Communists of them all. :)*

Pelican, at least you can be amused by your own comments, which
is a good sign :)

Who is the big end of town? Employees of large corporations? There
is no doubt in my mind, that the smart ones arn't working in Govt,
more likely in business and some of them will extract money from
well meaning Govts, some of whose officials are easily duped.

Some of the dirt of what really happened in America, is finally
emerging. Gretchen Morgenson, a well respected journalist has just
published "Reckless Engdangerment", according to the Economist.

It seems that there was a well meaning Congress, keen to see poor
people buy houses and James Johnson who ran Fannie Mae, a semi
Govt institution, more then keen to oblige. Johnson openly bragged
about his underwriting experiments (read lending to ever dodgier types)
all Govt guaranteed loans, whilst mortage lenders of various
types flogged the loans.

Politicians were thrilled to see all these poor people buy houses,
Govt employed no safety checks to the funds they were underwriting.
Voila, we landed up with a disaster.

Which raises the point that Govt clearly did not have the expertise
to even be in the mortage business. Well meaning politicians can
be easily hoodwinked by smart business employees. Best to keep
Govt out of business altogether, for one way or another, they
invariably land up peeing taxpayer dollars up against walls

Dear Yabby,

Fees and commissions delivered nearly $15 Billion to the big four last year. To take a 1% cut in that would deprive them of $150 million dollars, a figure they could we afford so when you said “if they paid an extra 1% on deposits or charged consumers 1% less, they would earn nothing” I'm assuming you are referring only to interest on deposits and loans.

“Commonwealth, Australia's largest bank by market capitalisation, recorded a ROE of 18.6 per cent, making it the second-most-profitable in the world after the giant Canadian Imperial Bank of Commerce.”

While Banks may not be the highest POE corporations for a service industry that makes it money from skimming you and I they do very well. As an industry they are only second behind mining in this country.

You seem to be spouting the banker's line. This is from the association's website;

“Bank profits are large numbers – that’s because banks are large businesses and the total asset base required to earn those profits is gigantic. The total assets of our big four banks is $1,170 billion. The profit performance of our major banks is equivalent to earning $1.40 profit return on $100 in assets. If banks earn $6.40 worth of income from the $100 worth of assets, they pay out $5 in expenses before delivering the $1.40 in profit.”

Let's spell this out. If little worker bee csteele wants to buy a factory for his business at a $1 million dollars the bank says fine, “We will loan you the money, house is all paid for? Great! Lets have that as collateral”. They now have two pieces of my assets under their control. They stick me for lets say 7% interest then they go to an oversees lender to borrow the million at 3.5%, slip a credit default margin to AGI for 50 basis points and make a sweet 3% on the deal. Book asset of $1 mill, equity zero! 3% on zero outlay is pretty good in anyone's language.

Cont'

Cont'

How do they do it even when their deposits are only 5% of their loans? By holding down a AAA credit rating giving them access to cheap money. Do they do any work besides paper shuffling for this money? Not really, that's my job.

Skimmers!

Please don't nitpick the figures, they are purely approximations. But when you and the banks talk about return on assets it is a pure furphy.

Where it gets really insane is in the derivatives market. Over $1,200 trillion dollars in book value when the entire world economy is worth 5% of that. Paper shuffling monkeys putting our economies at risk with stupid little games.

Cenk explains it a little better here. http://youtu.be/N_XtXhiekQk

Then you go and use the Pokie industry's argument to justify it.”So where do most of those profits land up? In super funds, for the benefit of nearly all Australians and their retirement. I don't think that is such a bad thing.” reads just like “The gaming industry supports local sporting clubs'.

So that is why we should be allowed to exploit weak and vulnerable problem gamblers because without them we would go broke. You are asking me to support the gouging of all Australians by the Banks to edge up your Superfund returns? Why would I want to do that?

The issue of greed is so evident in the notion that the avarice of banks and Pokie venues should be protected because I might lose out if they aren't. How have we ended up with this mindset?

*Please don't nitpick the figures, they are purely approximations*

Lol Steele, that is the problem, you don't understand the figures
and they are coming clean out of your butt :)

If only deposits were only 5% of their loans. More dreaming on your
behalf.

If only banks could borrow so cheaply from overseas. There would
be no need to pay those pesky Australian depositers 6% on their money.
You forget that somebody has to carry the exchange risk and insuring
the Australian $ at markets rates costs money.

You'll find that banks worked on a spread of a little over 2%,
over all loans and deposits. Then they raise money from fees.
But it costs huge amounts to run banks. From wages to rents to
IT systems, to advertising, to all the rest. Then there are write
offs due to bad loans. It all has to be paid for. What is left
as net profit, is around 1% of what they lend out, after all costs
involved. So they would indeed land up with nothing, if they dropped
their interest rates by 1%, for costs are still there.

I actually googled return on equity of Australian companies after
your last post. Manufacturers like Matrix Composites came in at
30%, some of the miners were higher, some of the internet companies
even higher. So banks are indeed just average in terms of return
on equity, when it comes to Australian companies. Personaly I'd
have my money in a healthy bank, then in a bank on the verge of going
broke. For we see how overseas banks turned tail and abandoned Australia
during the GFC. Those silly enough to have loans with them
paid a heavy price as loans were cancelled and forced sales the
result. Time to do your homework about banking, Csteele.