Welcome Guest [Log In] [Register]


Reply
Real After Tax Term Deposit Returns for Australian Savers are Negative; Savers Punished. Debtors Rewarded. Tax and Inflation Work for Borrowers and Against Savers.
Topic Started: 6 Mar 2012, 11:00 AM (20,809 Views)
genX
Default APF Avatar


So you took the YoY CPI, but average of 'all terms' for the interest rate?

For the duration to be comparable, you could have taken the 1Y rate:
1 yr
RBA
FRDIRBTD10K1Y
Dec-2011 : 5.00%

You could have taken the quarterly rate:
3 mths
RBA
FRDIRBTD10K3M
Dec-2011 : 5.05%

You could have even taken the average 'special' rate for all terms.
Average
'special' rate
(all terms)
RBA
FRDIRBTD10KASR
Dec-2011 : 5.45%

And yet your chart clearly shows the Average Term Deposit Rate for Dec-2011 below 5%.

So you made a duration mismatch to fit the numbers to your story.

Quote:
 
Maybe it's too late for you... are you 'tired' again. :re:

It's true, occasionally I get tired. You, on the other hand, are always a liar.

Quote:
 
Incorrect. In this 100 post thread, you are the only person to have any difficulty interpreting the chart.

You've had them running scared for a while now haven't you? It's the only thing that explains your non-nonchalance at posting bullshit and have no one call you on it.
Profile "REPLY WITH QUOTE" Go to top
 
Shadow
Member Avatar
Evil Mouzealot Specufestor

genX
9 May 2012, 10:40 PM
you could have taken the 1Y rate:

You could have taken the quarterly rate:

You could have even taken the average 'special' rate for all terms.
I 'could have' done lots of things, but I chose to use the average of all term deposit rates, and I marked this clearly on the chart.

If you want to cherry pick a particular TD rate to fit your story, feel free to do so, and post your chart. Pick the highest possible TD rate if you want. Your chart won't show a representative outcome for the average person, but it will show the best case scenario for a saver lucky enough to be on the best possible rate for the duration of the chart. If that's what you want to do, then do it, instead of whining about my chart.

Quote:
 
It's true, occasionally I get tired. You, on the other hand, are always a liar.
I never lie.

Quote:
 
You've had them running scared for a while now haven't you? It's the only thing that explains your non-nonchalance at posting bullshit and have no one call you on it.
No, I think everyone else is just a bit smarter than you. Not my fault you can't read the axis on charts, or look up ABS CPI tables.

Get some sleep...
Edited by Shadow, 9 May 2012, 10:50 PM.
1. Epic Fail! Steve Keen's Bad Calls and Predictions.
2. Residential property loans regulated by NCCP Act. Banks can't margin call unless borrower defaults.
3. Housing is second highest taxed sector of Australian Economy. Renters subsidised by highly taxed homeowners.
4. Ongoing improvement in housing affordability. Australian household formation faster than population growth since 1960s.
Profile "REPLY WITH QUOTE" Go to top
 
genX
Default APF Avatar


Quote:
 
I 'could have' done lots of things, but I chose to use the average of all term deposit rates, and I marked this clearly on the chart.

No. The spreadsheet contains two columns with an average, one is named "Average rate (all terms)" and the other is named "Average 'special rate' (all terms)'. Your series is labeled 'Average Term Deposit Rate (RBA Table F4)' which is neither of those, and does not exist as a column on the F4 spreadsheet. So contrary to your claim that it is marked clearly, it is marked ambiguously.
Quote:
 
instead of whining about my chart.

Oh, I'm whining am I?
Quote:
 
I never lie.

You did it again!
Quote:
 
No, I think everyone else is just a bit smarter than you. Not my fault you can't read the axis on charts, or look up ABS CPI tables.

Your CPI series on your chart is clearly labeled 'CPI (ABS 6401.0 Consumer Price Index)', but the values of the series are rates (the axis is Percent, and no, I didn't have any trouble reading that).
So even though you have mislabeled your series as CPI, which is an index, when the series is clearly a rate, you don't specify what rate it is. Is it inflation? is it YoY change?

Despite completely your completely misleading and erroneous labelling of the chart series, you claim I am unable to look up ABS CPI tables. It's funny, because I did look up the CPI on the table, BECAUSE THAT IS WHAT YOU HAD LABELLED YOUR SERIES.

If you had labelled your series CPI (YoY Percentage Change), that is, WHAT THE SERIES ACTUALLY IS, then I would have spotted both of the errors on the chart much sooner!!!!!
Quote:
 
Get some sleep...

blah blah blah ...
Profile "REPLY WITH QUOTE" Go to top
 
Shadow
Member Avatar
Evil Mouzealot Specufestor

Quote:
 
blah blah blah
You seem angry GenX. You're also the only person to have had so much difficulty understanding the chart. CPI is generally reported as the annual percentage change. The chart says 'percent' on one axis, and the other axis is marked with years. Seems pretty straight forward to me (and everyone else here).

Instead of bleating about my chart, why don't you post your own 'new and improved' version? Maybe you can write 'percent' in bigger letters, and write 'Year' below the x-axis so that other people with your level of intelligence understand that the labels 'Dec 83' to 'Dec 11' represent years.
Edited by Shadow, 9 May 2012, 11:29 PM.
1. Epic Fail! Steve Keen's Bad Calls and Predictions.
2. Residential property loans regulated by NCCP Act. Banks can't margin call unless borrower defaults.
3. Housing is second highest taxed sector of Australian Economy. Renters subsidised by highly taxed homeowners.
4. Ongoing improvement in housing affordability. Australian household formation faster than population growth since 1960s.
Profile "REPLY WITH QUOTE" Go to top
 
genX
Default APF Avatar


Quote:
 
You're also the only person to have had so much difficulty understanding the chart.

Sure sure. Deflect, deflect.
Quote:
 
CPI is generally reported as the annual percentage change.

By who?
Quote:
 
Instead of bleating about my chart, why don't you post your own 'new and improved' version?

Deflect, deflect. You posted some complete bullshit, I called it bullshit, and now your (childish) response is 'Well, if you think you can do better, make your own chart.'
You can deflect all you want, the fact is you deliberately mismatched your term and inflation duration, and then attempted to hide the fact by deliberately mislabelling your chart.
Quote:
 
Seems pretty straight forward to me (and everyone else here).

Yes, I agree.
Profile "REPLY WITH QUOTE" Go to top
 
Shadow
Member Avatar
Evil Mouzealot Specufestor

genX
9 May 2012, 11:38 PM
you deliberately mismatched your term and inflation duration
There is no mismatch. All the figures on the chart are annual.

genX
9 May 2012, 11:38 PM
By who?
The media, the government, and even the ABS headlines feature the percentage change figures...

http://www.abs.gov.au/AUSSTATS/abs@.nsf/Lookup/6401.0Main+Features1Mar%202012?OpenDocument

How often do you ever see CPI reported as 179.5 (the latest raw index figure). Ever? No.

CPI is always reported as a percentage change. That's what I used, and that's how the axis are labelled.

But as I said, if you don't like the chart, post your own version, instead of whinging incessantly about mine.
Edited by Shadow, 10 May 2012, 12:10 AM.
1. Epic Fail! Steve Keen's Bad Calls and Predictions.
2. Residential property loans regulated by NCCP Act. Banks can't margin call unless borrower defaults.
3. Housing is second highest taxed sector of Australian Economy. Renters subsidised by highly taxed homeowners.
4. Ongoing improvement in housing affordability. Australian household formation faster than population growth since 1960s.
Profile "REPLY WITH QUOTE" Go to top
 
Admin
Member Avatar
Administrator

Quote:
 
Lenders rate and see

John Collett
May 9, 2012

Stiff competition for depositors' cash should keep interest cuts down for term deposits.

Most lenders are unlikely to drop their term-deposit interest rates by the full 0.5 percentage point cut to the cash rate. They need to compete for depositors' money - their cheapest source of funding - as they move to be less dependent on overseas wholesale borrowings.

Term deposits have won favour with investors, particularly retirees who have been able to earn good interest rates while sharemarkets have struggled.

ANZ has cut its term deposit rates by about 0.2 percentage points on some of its terms up to five years. NAB has cut 0.1 percentage points from its longer terms and from its six-month term. At the time of writing, Westpac had left its six-month rate unchanged, while trimming rates on some other terms.

These moves are likely to be an indication of the sorts of cuts in term-deposit rates that investors can expect. Most of the new rates are sitting between about 4.5 per cent and 5.5 per cent over all terms. A year ago, rates of up to 7 per cent were available.

Read more: http://www.smh.com.au/money/saving/lenders-rate-and-see-20120508-1y9ll.html#ixzz1uSp1BxL4
Follow OzPropertyForum on Twitter | Like APF on Facebook | Circle APF on Google+
Profile "REPLY WITH QUOTE" Go to top
 
Admin
Member Avatar
Administrator

Quote:
 
Deposit rates to feel pinch of margin stress

May 16, 2012

PENSIONERS and retirees living off bank interest payments can expect further cuts to deposit rates over the next year as banks try to offset funding cost pressures to maintain margins in a sluggish business environment.

Analysts from Deutsche Bank say there is ''still scope for further downward moves in term deposit rates'' as deposit rates ''have been slow to fall''.

While the major banks have been holding on to part of cuts to official interest rates from the Reserve Bank, they have so far been jostling over deposits, which are making up an increasing part of their funding given the cost of wholesale funds offshore.

Term deposit rates have fallen on average 35 basis points since the end of March, according to Deutsche analyst James Freeman, with around 20 basis points cut before the RBA lowered rates earlier this month and another 15 basis points since.

Mr Freeman calculates that banks could keep their margins flat in the second half of 2012 and into financial year 2013 with a 10 to 20 basis point cut in deposit rates, he wrote.

But he forecast they could be expected to cut as much as 30 basis points from the current term deposit rates to meet some market forecasts.

Read more: http://www.smh.com.au/business/deposit-rates-to-feel-pinch-of-margin-stress-20120515-1yoxt.html#ixzz1uz5FdEEM
Follow OzPropertyForum on Twitter | Like APF on Facebook | Circle APF on Google+
Profile "REPLY WITH QUOTE" Go to top
 
Admin
Member Avatar
Administrator

Quote:
 
A deposit war to trump the euro battle

Robert Gottliebsen
Published 7:01 AM, 16 Jul 2012

While German Chancellor Angela Merkel is optimistic that German aid to the Spanish banks will gain approval, around the world banks are now starting to prepare for the real possibility of a euro split in the next 12 to 18 months, which is adding to funding pressures and intensifying the European credit squeeze. People no longer trust many European banks which is why bond yields in countries like Germany are so low.

In Australia the action is also in the deposit market.

A month or two ago banks tended to put the euro split possibility aside because the losses were too great. Stock markets, currently enjoying a flush of liquidity, are ignoring the euro split risk and look set for a period of higher prices as the American dollar eases. But the risk is now real and no banker can afford to ignore it. Many European banks are moving to match their lending and deposits in individual countries.

Given the warning, Australian banks should not suffer the big losses that the European banks face on the euro split. Any Australian bank CEOs who get caught in a major way will lose their job given the warning.

The Australian risk is that the overseas wholesale deposit market, which funds about 40 per cent of Australian bank loans will dry up over the next three years, and will need to be replaced by local deposits and/or reductions in lending.

We are currently seeing the big rural Dutch bank Rabo roll out Australian television advertisements offering 5.8 per cent for five years and a string of shorter-term deposit rates that are all over 5 per cent. Rabobank is one of the few well-capitalised European banks and in Australia lends to farms and agriculture. Given its European exposure, the parent will need to be preparing for a euro split, but Australian deposits with Rabobank below $250,000 are Australian government guaranteed. You wonder how long the local Australian banks can afford to allow Rabobank to cream the market.

We are starting to see some term deposit aggression from NAB via its UBank arm with a 5.3 per cent rate being offered, and Westpac is offering 5.2 per cent for 5-year deposits. But there is a big gap. What is happening in the deposit market is becoming more crucial to long term banking than events in the mortgage market which get all the publicity.

All this happening while bankers are undergoing a rethink of their business models. Too often global bankers think one dimensionally and so they do deals without any thought of down stream consequences. That applies to US sub-prime; lending to bankrupt European governments, Libor rigging, or the enormous risks still being undertaken in trading.

In Australia the deposit war is going to play an enormous part in what happens to our banks.

Read more: http://www.businessspectator.com.au/bs.nsf/Article/banking-debt-European-crisis-Australian-banks-bank-pd20120716-W8S6X
Follow OzPropertyForum on Twitter | Like APF on Facebook | Circle APF on Google+
Profile "REPLY WITH QUOTE" Go to top
 
Admin
Member Avatar
Administrator

Quote:
 
Deposit diversity needed soon, advises RBA

19 September 2012 7:11am

Banks may care to get a wriggle on and develop a more diverse funding profile ahead of the introduction of stiffer regulations on liquidity in 2015, Guy Debelle, assistant governor of the Reserve Bank of Australia, told a Finsia lunch in Adelaide yesterday.

Banks need to develop liability products that conform to the 30-day liquidity stress scenario, Debelle said.

He also predicted that banks would cut the interest rates they offered on at-call deposits before too long.

"The incentive for ADIs to issue short-term debt to other financial institutions will be considerably reduced under Basel III," Debelle said, since "funds borrowed with less than 31 days to maturity would need to be invested entirely in liquid assets."

"Thus, there will be a marked decline in the provision of such debt by banks.

"It is quite probable that new funding instruments will emerge that seek to accommodate the new regulations. In some other jurisdictions, a greater reliance on debt with 31-day notice periods (given the 30-day liquidity stress scenario) has already been observed."

Debelle cautioned, though, that "regulators and financial institutions will need to ensure that this does not create a new stress point at 31 days as funding piles up at that maturity."

Turning to at-call deposits, Debelle said they were "one product… yet to see the effect of the new liquidity regulation on pricing."

"Relative to other types of deposits, these products are very expensive from a liquidity point of view, but they still offer interest rates that are a large spread above the cash rate.

"As banks focus on the liquidity costs of such products, I would expect to see these rates decline relative to those on other types of deposits. Indeed, it would be surprising if the re-pricing doesn't occur fairly soon given the liquidity regulations take full effect at the beginning of 2015.

"Our liaison with banks suggests that these deposits are particularly sensitive to changes in pricing, so there is a big disadvantage in terms of losing deposits to your competitors if you are the first to re-price for the new regulations.

"But if an institution has a large reliance on this source of funding, it won't be able to change that reliance overnight on the 31st December 2014. Just like supertankers, funding structures take a long time to change direction, and that change of course needs to be occurring around now."

Debelle also used his speech to touch on a subject favoured by senior bank executives: the supposed shortage of funding whenever credit demand rebounds.

This concern was "misplaced", he said. "In an environment where the demand for credit has picked up, because the world is a better place, funding conditions for intermediaries are also likely to be much easier.

"Moreover, from a macro perspective, there is unlikely to be a funding problem for the system as a whole when the world is a happier place, even if an individual institution is not 100 per cent sure where the next funding dollar is coming from."

Read more: http://www.bankingday.com/nl06_news_selected.php?act=2&stream=1&selkey=13768
Follow OzPropertyForum on Twitter | Like APF on Facebook | Circle APF on Google+
Profile "REPLY WITH QUOTE" Go to top
 
1 user reading this topic (1 Guest and 0 Anonymous)
ZetaBoards - Free Forum Hosting
Join the millions that use us for their forum communities. Create your own forum today.
Go to Next Page
« Previous Topic · Australian Property Forum · Next Topic »
Reply



Australian Property Forum is an economics and finance forum dedicated to discussion of Australian and global real estate markets and macroeconomics, including house prices, housing affordability, and the likelihood of a property crash. Is there an Australian housing bubble? Will house prices crash, boom or stagnate? Is the Australian property market a pyramid scheme or Ponzi scheme? Can house prices really rise forever? These are the questions we address on Australian Property Forum, the premier real estate site for property bears, bulls, investors, and speculators. Members may also discuss matters related to finance, modern monetary theory (MMT), debt deflation, cryptocurrencies like Bitcoin Ethereum and Ripple, property investing, landlords, tenants, debt consolidation, reverse home equity loans, the housing shortage, negative gearing, capital gains tax, land tax and macro prudential regulation.

Forum Rules: The main forum may be used to discuss property, politics, economics and finance, precious metals, crypto currency, debt management, generational divides, climate change, sustainability, alternative energy, environmental topics, human rights or social justice issues, and other topics on a case by case basis. Topics unsuitable for the main forum may be discussed in the lounge. You agree you won't use this forum to post material that is illegal, private, defamatory, pornographic, excessively abusive or profane, threatening, or invasive of another forum member's privacy. Don't post NSFW content. Racist or ethnic slurs and homophobic comments aren't tolerated. Accusing forum members of serious crimes is not permitted. Accusations, attacks, abuse or threats, litigious or otherwise, directed against the forum or forum administrators aren't tolerated and will result in immediate suspension of your account for a number of days depending on the severity of the attack. No spamming or advertising in the main forum. Spamming includes repeating the same message over and over again within a short period of time. Don't post ALL CAPS thread titles. The Advertising and Promotion Subforum may be used to promote your Australian property related business or service. Active members of the forum who contribute regularly to main forum discussions may also include a link to their product or service in their signature block. Members are limited to one actively posting account each. A secondary account may be used solely for the purpose of maintaining a blog as long as that account no longer posts in threads. Any member who believes another member has violated these rules may report the offending post using the report button.

Australian Property Forum complies with ASIC Regulatory Guide 162 regarding Internet Discussion Sites. Australian Property Forum is not a provider of financial advice. Australian Property Forum does not in any way endorse the views and opinions of its members, nor does it vouch for for the accuracy or authenticity of their posts. It is not permitted for any Australian Property Forum member to post in the role of a licensed financial advisor or to post as the representative of a financial advisor. It is not permitted for Australian Property Forum members to ask for or offer specific buy, sell or hold recommendations on particular stocks, as a response to a request of this nature may be considered the provision of financial advice.

Views expressed on this forum are not representative of the forum owners. The forum owners are not liable or responsible for comments posted. Information posted does not constitute financial or legal advice. The forum owners accept no liability for information posted, nor for consequences of actions taken on the basis of that information. By visiting or using this forum, members and guests agree to be bound by the Zetaboards Terms of Use.

This site may contain copyright material (i.e. attributed snippets from online news reports), the use of which has not always been specifically authorized by the copyright owner. Such content is posted to advance understanding of environmental, political, human rights, economic, democratic, scientific, and social justice issues. This constitutes 'fair use' of such copyright material as provided for in section 107 of US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed for research and educational purposes only. If you wish to use this material for purposes that go beyond 'fair use', you must obtain permission from the copyright owner. Such material is credited to the true owner or licensee. We will remove from the forum any such material upon the request of the owners of the copyright of said material, as we claim no credit for such material.

For more information go to Limitations on Exclusive Rights: Fair Use

Privacy Policy: Australian Property Forum uses third party advertising companies to serve ads when you visit our site. These third party advertising companies may collect and use information about your visits to Australian Property Forum as well as other web sites in order to provide advertisements about goods and services of interest to you. If you would like more information about this practice and to know your choices about not having this information used by these companies, click here: Google Advertising Privacy FAQ

Australian Property Forum is hosted by Zetaboards. Please refer also to the Zetaboards Privacy Policy