Kevin Rudd gives everyone $950 (Australian Stimulus Package)

[mr friendly guy]

Meh, I am only entitled to a small amount anyway, so it doesn't matter that much to me. It does amuse me however, the political shenanigans going on in regards to the stimulus package. I would be more interested in the government bringing house prices down - and the government can start by cutting the first home buyer's grants, increasing supply (by working in conjunction with the states etc). Of course thats not going to be a priority since Kevin Rudd has stated he wants to stabilise house prices, which lets those greedy real estate agents / builders charge extra (ie the increase government grant).

Personally with my limited knowledge, I would prefer the government spending be in the form of projects where the money is paid to people for doing a job (so it creates jobs) rather than just giving it to us and hoping we spend it (and create jobs that way). At least in the former, all the money is going into creating jobs while in the latter according to ABC news, 80% of the first stimulus package was saved. For any one interested, Wayne Swan is still claiming that 20% had an effect based on ABS stats.

Oh and here is an infrastructure project we need going, fixing Lucas Heights nuclear reactor. Apparently the hospital I work at gets its nuclear material for various tests overseas rather than at our crappy lone nuclear reactor. Surely we can do better than that.

[weemadando]

You want to make housing affordable in Australia? Kill negative gearing. Kill it now. Kill it dead. And don't have a grandfather clause.

If you can't make a profit on your investment property, then that shouldn't be a fucking tax deduction, that should just be tough shit.

Kill negative gearing and oyu'll be looking at a MASSIVE spike in "For Sale" listings along with a corresponding price crash because taking a ridiculously high sale price in order to take the full effect of negative gearing will no longer be an option.

Oh yeah - and stop fucking approving and financing bullshit developments out in the boonies with no jobs there, no services, no education, no public transport, no infrastructure and a 1.5 hours minimum commute to the city. How about we start doing high-density living in Australia. It'll be better for all of us.

[J]

Just let the free market do its work as it has in America, the UK, Spain and many other countries which experienced a real estate bubble. Once the banks start losing money on their loans the loan standards go up and all those negative-amortization & interest only mortgages disappear, and they start demanding substantial downpayments before they'll approve a mortgage. Also, once people start defaulting in large numbers and the foreclosures start picking up, it puts dramatic downward pressure on home prices as the banks try to sell their empty homes on the market to recoup part of the bad loans they made. It takes a little time to get rolling but once it starts nothing short of helicopters dropping buckets of free money for everyone can stop it, and homes start losing 20%-50% of their value every year.

[weemadando]

Just let the free market do its work as it has in America, the UK, Spain and many other countries which experienced a real estate bubble. Once the banks start losing money on their loans the loan standards go up and all those negative-amortization & interest only mortgages disappear, and they start demanding substantial downpayments before they'll approve a mortgage. Also, once people start defaulting in large numbers and the foreclosures start picking up, it puts dramatic downward pressure on home prices as the banks try to sell their empty homes on the market to recoup part of the bad loans they made. It takes a little time to get rolling but once it starts nothing short of helicopters dropping buckets of free money for everyone can stop it, and homes start losing 20%-50% of their value every year.

The problem is that in Australia housing prices are still going UP. And NINJA loans are STILL getting approved.

The Real Estate industry in Australia has one of the most amazing lobby and PR setups in the world. Every day there is a new "research report" or "industry analysis" or something else headlining papers showing how IF YOU DON'T BUY A HOUSE RIGHT NOW YOU'LL BE LOCKED OUT FOREVER BECAUSE THE ONLY WAY THIS MARKET IS GOING IS UP! WOOOO!

Never mind that median house price : median wage comparisons for Melbourne (where I live) have shown it to be the LEAST affordable city in the OECD.

[Surlethe]

Every day there is a new "research report" or "industry analysis" or something else headlining papers showing how IF YOU DON'T BUY A HOUSE RIGHT NOW YOU'LL BE LOCKED OUT FOREVER BECAUSE THE ONLY WAY THIS MARKET IS GOING IS UP! WOOOO!

Are you fucking kidding me? I mean, do you have a source or something recent that says this or documents housing prices still going up? Because that just blows my mind; it's not even like it was in the US three years ago: all you Aussies have to do is look across the pond and see what happened to our housing bubble.

[weemadando]

Every day there is a new "research report" or "industry analysis" or something else headlining papers showing how IF YOU DON'T BUY A HOUSE RIGHT NOW YOU'LL BE LOCKED OUT FOREVER BECAUSE THE ONLY WAY THIS MARKET IS GOING IS UP! WOOOO!

Are you fucking kidding me? I mean, do you have a source or something recent that says this or documents housing prices still going up? Because that just blows my mind; it's not even like it was in the US three years ago: all you Aussies have to do is look across the pond and see what happened to our housing bubble.

News.com.au - the problem is idiots who buy into this stuff. I know the crash is coming, and my wife and I are prepping to pick up a nice foreclosure somewhere.

[mr friendly guy]

Ando is right. Over in Perth we were hearing that the market will plateau instead of falling. Now we hear that its only fell a little bit, and it will steady. Supplement this with people saying I can afford to hold and refuse to sell beneath a certain price, and one would be forgiven for thinking that we are different from the US.

Also note in the same article Ando linked to, there was a comment that someone thought house prices would stay steady now because of interest rate cuts. Yeah, but they forgot about the numerous job losses, especially through the mining industry.

I am waiting this one out, but I would not be displeased if these people who causesd the rise in house prices by willing to pay inflated prices and buy several investment properites are forced to take their "free market" medicine. Too bad Rudd has got it in his head to try and stabilise house prices.

[Stark]

It doesn't help that people are watching housing/investment shows from the UK in 2003 and NOT FUCKING NOTICING. They hear people talking about the amazing real estate industry ... in ANOTHER FUCKING COUNTRY five years ago BEFORE THE ECONOMY EXPLODED and think 'wow I need to do that now lol'.

People have HONESTLY told me that now, right now, is a good time to buy a house rather than waiting for the market to disintegrate. RIGHT NOW! Keep the bubble going!

[mr friendly guy]

Rudd is turning up the heat

Turnbull 'playing with fire' over stimulus block

By Online parliamentary correspondent Emma Rodgers

The Prime Minister and Treasurer are ramping up their attack on Opposition Leader Malcolm Turnbull's decision to block the Government's $42 billion economic stimulus package.

Mr Swan accused Mr Turnbull of "playing with fire" and Mr Rudd demanded he "get out of the road" and allow the package, comprised of infrastructure funds and cash handouts, to pass the Senate.

Prime Minister Kevin Rudd has spent the day in meetings with around 200 business, community and education representatives about implementing the package immediately.

"They all have projects which are shovel-ready; what's standing in the road of those projects beginning is Mr Turnbull," Mr Rudd said.

"I would say to Mr Turnbull and the Liberal Party, get out of the road of the Government getting on with the job of nation building and supporting jobs at a time of national economic emergency.

"When we have organisations such as the IMF [International Monetary Fund] ... saying loud and clear to governments like Australia that it is time to act through stimulus, and when necessary borrow for that stimulus, that is counsel enough for this Government to get on with that business of doing it."

Treasurer Wayne Swan says Mr Turnbull is playing with people's lives by putting payments to low and middle-income earners at risk.

"I say to you there is no certainty that all of the minor parties and independents will vote for this legislation and therefore no certainty without the Liberal Party's support that this will pass in a speedy way," he said.

Mr Swan says the Government will be talking to the Greens and independent senators about the package, which is now before a Senate inquiry.

Mr Turnbull is standing firm on his position, despite admitting today that the Coalition will probably be "hammered in the polls" over its stance.

"I thought it was going to be poisonously unpopular, frankly," he said.

"And we all felt we are going to get hammered into the ground in the opinion polls, and we probably will be."

Last night Treasury head Ken Henry told the inquiry that a large stimulus package was needed to keep the country out of recession.

But Mr Turnbull believes the package should be much smaller and tax cuts should be brought forward instead of the use of cash payments.

A vote on the package is expected late next week.

Lets see how long this lasts. I suspect changed legislation would pass parliament, it just depends on how much is changed.

And back on the Housing thing, I have heard people planning to use their first home buyers grant which totals $21,000 to use as their initial deposit for the home. Whats the betting they haven't saved a freaking cent nor demonstrated that ability in any way. What is going to happen when they find they can't afford to live how they have been accustom to, while paying the mortgage at the same time. Are we in for another round of drops again?

[tim31]

There continue to be interest stories in various newspapers about young, single people who are happily giving up the second job they held down just so they could afford the mortgage payments, and given that those second jobs are going to be harder to claw back what with unemployment on the rise, you're probably on to something.

[weemadando]

There continue to be interest stories in various newspapers about young, single people who are happily giving up the second job they held down just so they could afford the mortgage payments, and given that those second jobs are going to be harder to claw back what with unemployment on the rise, you're probably on to something.

My wife and I are in the situation at the moment where we pay a high enough amount of rent that we might as well be paying a mortgage.... But because we pay that much rent we can only save a pitiful amount of money for a deposit each month.

And this is two people with a combined income of 100K+ and jobs that are HELLA secure in this economic climate.

We're seriously considering moving in with parents for a year just to save the money to get a deposit.

[mr friendly guy]

Like I said before, some lenders are letting you use the first home buyer's grant as the initial deposit. Of course if we both suspect the housing market will drop further, there isn't a rush to get the first home buyers grant while its high, and we can simply wait the market out while saving more for that initial deposit.

I wonder how many lenders are still letting you borrow with 0% deposit?

[aerius]

My wife and I are in the situation at the moment where we pay a high enough amount of rent that we might as well be paying a mortgage.... But because we pay that much rent we can only save a pitiful amount of money for a deposit each month.

And this is two people with a combined income of 100K+ and jobs that are HELLA secure in this economic climate.

Wow, that's insane. For us, renting is only about $3000 more a year than the property tax, basic maintenance and utilities costs of owning a home, add in the mortgage payments and my wife & I would be pretty close to maxed out, and we have about the same combined income as you guys.

[weemadando]

My wife and I are in the situation at the moment where we pay a high enough amount of rent that we might as well be paying a mortgage.... But because we pay that much rent we can only save a pitiful amount of money for a deposit each month.

And this is two people with a combined income of 100K+ and jobs that are HELLA secure in this economic climate.

Wow, that's insane. For us, renting is only about $3000 more a year than the property tax, basic maintenance and utilities costs of owning a home, add in the mortgage payments and my wife & I would be pretty close to maxed out, and we have about the same combined income as you guys.

Renting in Melbourne is a fools game. Sadly, buying in Melbourne is a RICH fools game.

And it's mostly artificially inflated too - RE Agents encouraging "rental auctions" and the like so people are bidding up the weekly rent on places. The only reason we found this place at such a good rate was because we knew the person who was leaving and got onto the RE Agent early. Even then, we're paying ~350pw for a 2br unit. But that's still about $100 below the average for such a property.

[Korto]

...there'd be an extra $950 for any child that you receive FTB for...

There was no mention of that in the newpaper when I was checking out the package (Fin Review). Not that I mind, it doubles our money, but are you sure?
Incidentally, anyone else really loving this financial crisis? Interest on my mortgage has plumetted, inflation likely gone bye-bye for a while, my job's possibly even more secure (according to the newspaper, enrollments are up), and Rudd's falling over himself to give me money. At present, we're on line to pay off a thirty-year mortgage in seven.

[weemadando]

I'm not minding it as it's making it more likely that my wife and I can buy a house, we both work for Centrelink so our jobs are fairly damn secure and really the people who seem to be affected most are idiots who failed to plan their finances and drank the kool-aid offered by their advisors.

[mr friendly guy]

The financial crisis has so far mixed results for me.

My monthly interest earnings has been significantly effected, due to lower interest rates.

Property prices have dropped, but this only partly makes up for it.. so far.

The reason is
1) I am not going to buy a house yet, but maybe later on in the year
2) they haven't dropped that bad...yet

Kevin Rudd won't be giving me that much money anyway.

Also the Australian dollar drops. For someone who buys stuff from overseas, mainly from the US and UK via ebay that hasn't helped. Also since I am most probably planning another overseas trip, it hasn't helped me much either. Good thing I still kept my foreign currency.

But hey, if property prices take a big drop and I buy a house that would more than make up for the liabilities.

[Lusankya]

Well, it looks like there's a good chance that the stimulus could be blocked in the senate, because Xenophon won't vote for it unless it does more to save the Murray. (For any non-Australians reading this, Nick Xenophon is a South Australian independent senator. One of the primary issues that he campaigned on was saving the lower Murray, because that area's going to shit. Incidentally, SA also seems to be one of the areas least affected by the current crisis at the moment because we have lower household debt (due to an older population and lower housing prices) and some other handy things, such as the lion's share of the world's uranium and a decent amount of defence spending. SA's biggest concern is getting enough water from the Murray, which provides 1/5 of Adelaide's drinking water. So he can afford to put the economy behind the Murray. It will only earn him more votes, as though he needs them. In the last state election, he almost outpolled the Liberal party.)

And if it does get passed, they're only letting PM Kev give everyone $900 instead of $950.

Also, the government hurt Steve Fielding's feelings, and he almost cried yesterday, and hasn't shown up today. I find that funny.

"Unlikely" Xenophon could stymie stimulus package
12/02/2009 3:09:00 PM
The fate of a $42 billion economic stimulus package remains unclear after a key senator backed away from supporting the Rudd Government plan to head off a looming recession.

The Government has five of the seven crossbench votes it needs to have the package pass parliament after the Australian Greens announced they would support Labor.

But South Australian independent Nick Xenophon and Family First's Steve Fielding have yet to indicate which way they will vote later today.

A spokesman for Senator Xenophon told The Australian Online he was "very unlikely to support the package", after the Government rejected his proposal to fast-track $3.1 billion in funds already allocated for water buy-backs and irrigation projects in the Murray-Darling Basin.

If Senator Xenophon votes against the Government, the package will be defeated, an outcome government frontbencher Nick Sherry said would be unique to Australia.

"We would be the first country in the world to reject an economic stimulus package," he told parliament.

Senator Xenophon has told parliament he will not "resile" from his commitment to the people of the basin.

The Government also rejected a similar proposal from the Greens which included more water for South Australia's ailing Lower Lakes.

Senator Fielding has not appeared in the chamber today.

His absence comes after an impassioned speech yesterday when, close to tears, he attacked the Government for treating him like a chess piece rather than a genuine party in negotiations.

The Government gave ground to the Greens earlier today when it agreed to change its package by reducing the amounts it will pay in tax and cash bonuses.

The $950 payments to eligible taxpayers, families, students and farmers will be reduced by $50 to $900.

Instead, $435 million will spent on programs the Greens say are about "job creation and nation-building infrastructure".

"Many projects which are shovel ready will now get the funding they deserve," Greens leader Bob Brown said.

He also hinted at the beginning of a deal to build extra bicycle paths across the country.

"Bikeways are now at a premium, bicycles are becoming a matter of new attention," he said, adding $40 million would be spent on cycleways across the country.

Somewhere between 500 and 700 jobs would be created by construction of the paths.

[tim31]

Xenophon's really rolling the hard six, isn't he? I have to admire that conviction in a politician; it really seems to take an indie to get actual representation in this country. No wonder the Coopers set love him.

[Lusankya]

... and it's been blocked.

Australian Parliament rejects $28 billion stimulus package
Reuters
Published: February 12, 2009


CANBERRA: The Australian Parliament rejected the government's 42 billion Australian dollar, or $28 billion, economic stimulus plan on Thursday, dealing a major blow to Prime Minister Kevin Rudd and delaying the timing of cash payments to millions of workers and families.

The vote in the upper house Senate was tied, leaving it short of the necessary votes to be passed. The government said it would re-introduce the stimulus immediately to the lower House of Representatives, and would recall the Senate to debate the plan again from Feb. 23.

The Australian dollar fell from $0.6580 to $0.6540 after the Senate vote, which the government said would lead to a drop in domestic confidence in the Australian economy.

"Fundamentally, defeat of the package is a huge decision, a decision that calls into question confidence in the Australian economy, puts at risk more jobs, puts at risk more businesses," Chris Evans, the Government Senate leader, told Parliament. "This government is absolutely committed to get this package through."

If the Senate rejects the legislation again after an interval of at least three months, it would give Rudd a legal basis to allow him to call an early double-dissolution election.

The stimulus package fell short in the Senate over a relatively minor issue, with an independent senator, Nick Xenophon, wanting the package to include measures to speed up the spending of 3 billion dollars to support the ailing Murray-Darling river system.

"The government has said no, and so I must say no to this stimulus plan," Xenophon told Parliament.

The result is a major defeat for Rudd, who said the stimulus spending was needed to protect Australia's economy from falling into recession

Rudd announced the new spending on Feb. 3, with about 12.7 billion dollars in cash payments to workers and families as immediate stimulus, and 29 billion dollars for longer-term infrastructure projects.

But the proposed cash payments to millions of workers and families will now be postponed, delaying any impact the spending would have on the slowing economy.

Sorry everyone. No $950 for you.

What will happen to Australia now? I'm guessing Rudd will try to push something else through. And if he's really keen on getting it through without giving more money to the Murray, then he'll be forced to deal with the Coalition.

[thejester]

Jeez, Labor would be brave to call a double-dissolution. They'd win but with a reduced majority, you'd think...

[Lusankya]

I dunno. Apparently Kevin Rudd became more popular in the polls when he bribed offered everyone $950. Depends. If the Liberals decide to draw up some kind of better stimulus plan then maybe they'll gain a few seats. Despite PM Kev's stellar popularity ratings, I think that quite a few former Liberal voters will be brought back into the fold by Malcolm Turnbull.

What would be interesting is the fact that if a double dissolution election was held, Xenophon will have enough votes to not only get himself reelected, but also one or two running mates. That would be an interesting state of affairs. If only he didn't always seem to choose shithouse running mates.

Of course, we don't have to worry about a d-d for at least three months, and surely Kevin Rudd won't be stubborn for that long. He wants to give everybody hundreds of dollars, and he wants to do it now. And if he has to spend a few billion dollars saving a river system that they're going to spend money saving anyway to do it, then he'll just have to pony up and do that.

[weemadando]

I think a double dissolution could be an option. There's a good chance that Labor can win it again, and Malcolm Turnbull is still too weak to win as a Liberal leader...

[Stark]

To be honest, now that the Liberals have taken several steps deliberately away from Howard-esque madness, I wouldn't be unhappy to see them win. Maybe not right now; let them go further away from stupid crap and closer to sensible, but since being forced to play without their 'I lie I win' button they've taken several reasonably sensible positions.

[Lusankya]

They need to get some positive feedback for their move though. That way the right-wing will know that they're relying on the left-wing for their votes. At the moment, Abbott, Costello et al still have too much influence.

One thing I have liked, though, is the fact that Malcolm Turnbull has straight-up said "I know this will lose us votes, but we think it's the right thing to do." It actually does seem like he's being honest about the whole thing. If it was the Howard government, or even Brendan Nelson, they would have squirmed around trying to make it seem as though they were the ones doing the popular thing. That would have looked ugly. Especially if Nelson was still in power, because he wasn't as good at the whole lying thing as Howard was.