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BFCSA investigates fraud involving lenders, spruikers and financial planners worldwide.  Full Doc, Low Doc, No Doc loans, Lines of Credit and Buffer loans appear to be normal profit making financial products, however, these loans are set to implode within seven years.  For the past two decades, Ms Brailey, President of BFCSA (Inc), has been a tireless campaigner, championing the cause of older and low income people around the Globe who have fallen victim to banking and finance scams.  She has found that people of all ages are being targeted by Bankers offering faulty lending products. BFCSA warn that anyone who has signed up for one of these financial products, is in grave danger of losing their home.


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BFCSA: Mandarins at RBA blowing the Mother of all Bubbles!!! Our files prove that is true

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By Houses and Holes in Australian Property, Australian recession

at 12:45 pm on June 5, 2015


Chris Joye doesn’t mince words today:


There’s only one party to blame for Australia’s unprecedented house price bubble. And it’s not buyers, vendors, developers, immigrants or local councils restricting new approvals. While they have all contributed to the underlying demand and supply dynamics, the unsustainable price growth across Sydney and Melbourne since January 2013 is squarely the responsibility of the monetary policy mandarins residing in the Reserve Bank of Australia’s Martin Place headquarters.

It is these folks who dismissed our repeated warnings that they were blowing the mother of all bubbles and instead decided that the cheapest mortgage rates in history—enabled by cutting the cash rate a full 100 basis points below its global financial crisis nadir – is the elixir required to maintain “trend” growth. Never mind that this might actually be bad, productivity-destroying growth based on distorted savings and investment decisions that will have to be reversed when the price of money normalises.

And let there be no doubt this bubble is without peer. The dollar value of our homes, mortgage debt and house prices measured relative to incomes, and the share of speculative investors purchasing properties, have never been higher. So as far as valuations and interest rates are concerned, we might as well be exploring the surface of the Sun.


I more or less agree though would spray blame around a little more widely, most especially at successive governments. Nor is the problem that the RBA slashed interest rates. A dollar at parity would just as assuredly be killing the economy now as any bubble will in the future.

No, the RBA’s mistake was not to not corral its rate cuts with macroprudential after the following:

·         no other property bubble has ever had such a clear warning in advance of its blowoff. Just six years ago, the world writhed as a multitude of property bubbles spectacularly imploded. We saw it and it scared the bejesus out of us. Yet here we are, well short of a half generation later doing exactly the same thing.

·         we have only just had the same long term property bubble bailed out by the biggest mining boom in history. Post GFC we rebuilt denuded savings and reliquified banks as mining poured billions into projects and jobs, while international markets collapsed all around. The serendipity was gigantic, easily big enough not just to protect us from the GFC but to redefine the basis of the economy towards sustainable prosperity for generations. But instead of being grateful and prudent we succumbed to the hubris of exceptionalism.

·         the deteriorating economic circumstances of the commodities bust that we currently face have been obvious for three whole years (if not all along). We knew the boom was narrowly based in China. We understood the magnitude of investment. We knew the size of the supply expansion. We knew prices were going to fall a long way. We knew a capex cliff was coming. But authorities did nothing to prepare for the end point except to deliberately reinflate a housing bubble supposedly to float us blithely over the carnage.

Certainly the history of capitalism has seen bigger bubbles than Australian property. There have been stranger bubbles too. But none is more dumb than the RBA’s current monstrosity.



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