“Throughout world history, there has never been a situation so bad that government can’t make worse.” … Author – Anonymous.
When pummelled by crashing markets and extreme volatility most members of society decide to work a little harder to regain credibility and economic viability.
Amidst the ruins left (economically and politically) of the past few years, many Australians have been ‘minimized’, but with good grace they are soldiering on knowing that, in the long run, honest endeavour will win and return them to a comfortable sense of normality.
However, not so our Australian Federal Government, who appear to be ‘crying out to be laughed at’.
Everything they touch ‘turns brown’ and the only sector of Australian society who are richly rewarded are our daily cartoonists.
Through our investments, our careers and our super funds, we are all carrying the burden of this ongoing Canberra Circus.
As so well put by one of Australia’s most respected financial writers, Charlie Aitken, Bell Potter Securities – Sept. 2, 2011:-
“This Gillard government is so on the nose with the equity market and corporate Australia that any hint, be it even betting being suspended on a website, is an excuse for a ‘hope rally’ in Australian equities, but particularly in sectors that have been de-rated by the anti-business, anti-productivity, income redistributing policies of the Gillard minority government.
The relationship between corporate Australia and the Federal Government remains non-existent. In every conversation I have with leaders of corporate Australia, I ask about their engagement with government. The universal answer is ‘none’. To me that is a totally unacceptable situation, but one that worsens by the day as the government gets more desperate.
I have written before that I believe a change of government in Australia will trigger a minimum +10% rally in Australia equities, led by the mining sector. Even the rolling of the Prime Minister, which appears imminent, would be worth +5% to the sectors that have been pressured by unnecessary regulatory change proposals.
Australia’s biggest problem at the moment is a confidence one. Confidence is a derivative of leadership.
…You simply cannot underestimate the damage successive Labor governments have done to our international investment reputation. Remember it was only a few months ago when I was in Hong Kong and a Chinese investor said that now famous line to me, “would you invest in a company where the CEO is Gillard, the CFO is Swan, the independent directors are Wilkie, Oakeshott and Windsor, and the executive chairman is Bob Brown?”
All I know is there is a tidal wave of international investment capital, both pension fund, hedge fund and corporate capital waiting for a change of government in Australia. That capital is already flowing into the Australian Dollar because the currency has no regulatory risk.”
One regrettable aspect of this dissonance coming out of Canberra (they are in harmony only with the cartoonists), is that we see a level of frustrated anger, unseen in my long memory.
Truck drivers from all around Australia, making a major investment in driving to Canberra to get a hearing were rebuffed and insulted by ‘our government’. In every capital city there are ‘no confidence rallies’. Perth’s date is Sunday 18th September, 2011 (click here for more details).
Business executives are fearful of speaking their mind for fear of political retribution, which has reached a peak surpassing even the Keating era.
Any business leader that does stick his / her head up receives fan-mail from other executives exclaiming that, “I wish I had the courage to say that’ (I will write separately quoting examples).
Our only hope is the next generation.
The young people we are in touch with, through Mannkal’s scholarship programs, look on in astonishment at the tolerance of fatigue exhibited by the current 45 – 65 y.o. generation.
Our younger generation can see much more clearly that the current financial and political mess is being placed firmly on their shoulders.
There will be a backlash (youth uprising) as we are seeing in so many countries and for me, it can’t come soon enough.