Fraud

Before we rush to bash the bankers!

Bankers have worked hard to stay one rung above lawyers. Yet is anyone surprised? Before we embark on a “bash the banker” tirade, at what point do we cast aspersions on the regulators? If you leave a child unattended with a box of matches don’t be surprised if the house burns down.

None of this is new. Before the housing crisis engulfed America, a group of certified home appraisers raised the alarm in 2003 by signing a petition to present to Congress. They claimed many unqualified assessors were in cahoots with mortgage brokers to jack up property appraisals because of the higher fees that were attracted. What was done by the authorities? The square root of jack. So the $750,000 mortgage taken out was actually against a $500,000 property. $250,000 in negative equity before the new home owner moved in. Regulators could have clamped down but didn’t.

Charging dead people fees is of course a bit much and gouging advisory fees without actually offering service is poor form. However at what point does the customer bear some responsibility to accepting the status quo? Getting access to lower cost providers is/was always there but the opportunity costs were such that many just sucked it up. It wasn’t enough to devote time to when the half yearly check up came around.

CM was one of the ones that questioned the big bank superannuation advisor’s usury fees. So poor was the explanation that after minimal effort, a new advisor was found with fees cut in half and investment flexibility rising exponentially. We shouldn’t have been hanging out for a Royal Commission to whump the banks.

Indeed, should any laws have been broken then the perpetrators deserve to have the book thrown at them. If boards willingly accepted that certain divisions were deliberately acting in unethical ways then they deserve to be accountable.

Corporate governance is not helped by hiring a majority of independent directors. The US experience has shown that to be a failure. It is all about corporate culture. If boards have not been setting the highest standards why should we be surprised if the underlings follow suit. We only need look at the debacle that was Cricket Australia or the recent shenanigans at the ABC to see examples of a poorly run board leading to a culture beneath that ends up seeing staff “cheat” or making decisions that flagrantly contravene the charter.

Do we jail bankers for 25 years? Depending on the extent of actually “breaking the law” that maybe a deterrent. WorldCom CEO Bernie Ebbers was sentenced to 25 years based on nine counts of conspiracy, securities fraud and false regulatory filings to the tune of $11bn. Enron’s former CEO Jeffrey Skilling was convicted on 35 counts of fraud, insider trading and other crimes related to Enron and sentenced to 24 years prison and fined $45 million. Madoff 150 years, Stanford 110 years jail. This has not necessarily stopped corporate crime but it should throw a flag in the minds of those considering it. If the consequences are too soft then clearly the risks profile diminishes for the perpetrator.

Look at the advent of whistleblower laws in America. The SEC now encourages whistle-blowing by offering sizable monetary awards (10 to 30% of the monetary sanctions collected). Successful enforcement actions as a result of whistle- blowing has led to awards as high as US$30,000,000. As a result the SEC has seen a 10 fold increase in claims over the last few years. Would boards be more inclined to act ethically if whistleblowers were granted protections?

Plenty of ways to improve what has transpired but what the Royal Commission should make painfully clear is that consumers need to wise up and become more savvy about how they make choices. We can’t forever complain and wait for governments to rescue us when it is them in the first place not acting responsibly to ensure good behaviour.

The free market should be the first to benefit from filling this clear void. Tying up banks in more red tape and onerous regulation isn’t the way forward. All it will do is drive costs for compliance higher which will ultimately hit the consumer. The larger the institution, the easier such regulations will benefit their ability to squeeze the little guy!

Making the punishments for bad behaviour enforceable and putting the onus on boards to act ethically will make all winners.

Hottest temperatures ever in Australia?

Jo Nova puts together a simple summary of the history of heatwaves in Australia. It is worth reading. Even our Bureau of Meteorology ignores records going back to the 1890s because it fails to fit a narrative. Worse, South Australia (SA) is suffering from blackouts thanks to loony green renewable policies which have seen spot electricity prices surge to $14,500/MWh. Wretched coal fire powered states, NSW & QLD, are in the $105-$110/MWh range. What was the rationale that renewables are cheap, affordable and reliable? The irony is that SA is relying on diesel generators for back up. Thank God for fossil fuels!

Not to worry. We have the world’s elites on 1,500 private jets landing in Davos to tell us we need to save the planet! Their cooler heads will surely prevail.

 

Langer should tell selectors to keep Warner out

Just do it? There are two options. Aussie cricket coach Justin Langer knows a thing or two about opening batsmen. He was one of our best. Yes, if we want a better chance of winning sooner we could easily insert David Warner post his ban. However at 32 years and 64 days (154 days when the ban ends), isn’t there an argument to develop new talent for the long term? This is merely putting expedience ahead of principle.

We can argue that Warner will have served his punishment but does the team need to risk diluting its rebirth by reintroduction of a toxic force? Are we to believe Warner will return to the team as a reformed choirboy or play his hand at being the same ruffian who believes in his own mind he’s still a rightful veteran? Proof of the pudding was his trademark celebration after scoring a century in local grade cricket. He has changed not a jot.

Yes we lost the 3rd Test today but despite the woeful batting efforts in the 1st innings, Pat Cummins (who deserved man of the match) showed what grit means. 9 wickets and approaching 100 runs with the bat. We deserved to be flogged when bowled out for 151 runs but Cummins took out the top order including India’s highest scoring batters in the 1st innings for zero in the 2nd. He single handedly rallied his team to believe mentally it wasn’t over when they would have otherwise folded. He made Aussies proud.

Justin Langer has worked some miracles with the gutted side after taking the reins from Darren Lehman. Aussie team captain Tim Paine has also been impressive. Stephen Smith has none of Paine’s tenacity. Smith was made captain for being the best batsman in the world. Ability and leadership aren’t axiomatic. Smith’s weakness was evident. He allowed Warner to bully him into burying his judgement. It speaks volumes of why Smith should never captain again. His only real crime was to be a wimp.

It is also questionable whether Smith has the mental side to regain his top spot. He may well succumb to the pressure. He wouldn’t be the first gifted sports star to fall into a deep and prolonged slump post a scandal.

Warner can play 20 over big bash leagues (BBL, IPL) to earn his keep and feed his family but do we really want to send a message to kids that cheaters can prosper in our national side? His actions were disgraceful. Cheating is cheating and no rush of blood to the head is acceptable when earning millions let alone representing one’s country. It is a privilege to wear a baggy green, not a right.

CM would prefer to lose honorably than win with players who were only ever in it for themselves. Matches like today bear out how fighting as a “team” is so much more admirable. The taste of victory will be that much sweeter. No better opportunity to cast the net wide for sleeper talent who would probably have been overlooked otherwise. Make sure current players are kept on their toes to earn their spot.

It should be impressed upon incumbent players as a deterrent that cheating means life long bans. It would also be a stronger signal that the terrible governance of the farcical former Cricket Australia board is over.

Time to start afresh. Langer should take the option of keeping Warner out of the dressing room. It’s the only sensible choice.

The Katowice Kindergarten

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While Swedish 15-yo Greta Thunberg deserves absolutely no criticism for presenting in front of a COP24 audience for something she has been made to believe, the deliberate use of children to behave as political pawns is disgraceful, although hardly surprising from a body which has such dreadful ethics. Climate alarmism hit new lows when UN Secretary General Guterres and a collection of hand picked delegates fawned over Thunberg’s catchphrases like she was smarter than all of those there. Honestly if kids are so smart, why bother with pursuing tertiary education? Although the mainstream media might have had a point about the children being more mature than the adults.

Childishness seems to be a recurring theme at the COP24 summit. Whether it is the chanting and laughter brigades deployed to disrupt forums on coal or the “Fossil of the Day Awards” where the host brazenly shames representatives who don’t conform to the realpolitik of the climate alarmists, it is juvenile. There are even fossil fuel derived signs and a T-Rex suited sidekick to add to the childish antics of slagging off the Polish hosts for promoting clean coal.

There was touch of irony when the masked compere in a skeleton tuxedo lambasted Australia for having the hide to use its $100s of millions of carbon credits it earned from the Kyoto Protocol. So flimsy is the framework behind these self-coined “historic” agreements, that countries can get a bashing for adhering to the clauses agreed by the same body hosting the summit. Take that!

When will these stooges work out that shaming those that hold alternative views won’t win over the hearts and minds of those they haven’t convinced?  Why can’t they debate with reasoned arguments, facts and courteous common sense rather than tease those that disagree with them in the sandpit? Surely if the supposedly flaky arguments presented by skeptics are allowed to be heard without interruption, they’ll dig their own grave when asked to back up their own untruths? It is that simple. Ahh but to the cultural Marxists, there are no voices to be heard other than their own. A bit like the marching Maoist Chinese girls in The Last Emperor.

Let us be frank. The UN could not give two hoots for this girl other than what she can do to resurrect the fortunes of a conference that is dying in relevance. Think about it. In Copenhagen, 40,000 climate pilgrims showed up to COP-21. This was the summit where Al Gore mysteriously disappeared when it was shown his hockey stick prophecies were utter tripe. Katowice COP24 has managed 22,000 delegates and 7,331 observers. At least we can say there are far fewer hypocrites at this function shooting to maintain frequent flyer status.

COP summits are little more than a cash grab which is pretty obvious when looking at the delegates present. 42% of those at COP24 are from Africa lining up to receive millions in funding from guilt ridden Western nations. There is a reason why Guinea sent 409 delegates and Australia 30, even though the latter has twice the population of the former.

Although is there another reason why the political class is not listening to the kids? Thunberg is probably unaware many leaders of European nations have no progeny.

France’s Emmanuel Macron – no kids.
Germany’s Angela Merkel – no kids
UK PM Theresa May – no kids.
The Netherlands PM Mark Rutte – no kids.
Former Italian PM Paolo Gentiloni – no kids.
Swedish PM Kjell Stefan Löfven- no biological kids.
Luxembourg PM Xavier Bettel – no kids.
Austrian Chancellor Sebastian Kurz – no kids (although he’s only 32)
Scotland’s Nicola Sturgeon – no kids.
EC President Jean-Claude Juncker – no kids.
Incidentally Japan’s PM Abe also has no children.

CM is a fervent supporter of children learning and becoming passionate about certain topics, on the proviso that teaching faculties are prepared to debate both sides of the story in earnest and allow critical evaluation. As evidenced by the 15,000 strong school student led climate strikes across Australia, the Department of Education & Training should be fast tracking spirit levels to schools around the country to ensure there is balance in the classroom.

Sir David’s 22,000 disciples won’t be able to sustain frequent flyer mile status

Yes Sir David Attenborough, we’re doomed if we look at history of the very people in place to save us. Not withstanding the 22,000 climate change disciples who have flown to Katowice, Poland to pay homage at the altar of the UNIPCC to cling on to each other hearing about their inevitable extinction. What a shame that instead of embracing technology and live-streaming COP24 to help us mitigate impending disaster, government funded frequent flyer mile status of climate apparatchiks takes precedence to saving us from all of these dangerous CO2 emissions.

Apart from the 100% certainty of me being screened for explosives at Sydney Airport (yet again today), the other is that the growth in air travel suggests that more and more people are happy to save the planet, provided that someone else offsets on their behalf. CM has long argued this position. Our consumption patterns dictate the “true” state of care of the environment. It hasn’t stopped SUV sales dead in their tracks and last year the IATA forecast that the number of airline passengers is set to DOUBLE by 2030.  Hardly the actions of those frightened by climate change.

Oh but you can offset your carbon footprint! In its 2017 Annual Report, Qantas boasts,

We have the world’s largest airline offset program and have now been carbon offsetting for over 10 years. In 2016/17, we reached three million tonnes offset.”

Carbon calculators tend to work on the assumption of 0.158kg CO2/passenger kilometre.

In the last 10 years Qantas has flown around 1 trillion revenue passenger kilometres. While the literature in the annual report denotes one passenger offsets every 53 seconds, the mathematical reality is simple – 2% of miles are carbon offset. So that means that 98% of people couldn’t care less. Would dispensing with frequent flyer programs cut emissions? These loyalty programs by their very nature encourage more travel. The more you fly the more you can fly for free!  Surely the IPCC should scream for a ban here. Dispense with first, business and premium economy to maximise passenger loads each flight. Apologies for the preamble.

While the US is not a signatory to Paris, 19 of the G20 are. The irony is that the non-signatory nation has seen its total emissions fall while many of the others have not. What value the ink on a pledge? No sooner had President Macron thrown stones at America, that he’s backed down and postponed a fuel tax hike for 6 months to save his city from burning down. There it is in a nutshell. We’re told if we don’t act now we’re doomed. So 6 months is a long time in “immediate” speak. What we do know this is classic smoke and mirrors by Macron. In 6 months the fuel tax will be all but forgotten. Virtue signaling Exhibit A scrapped. Why doesn’t anyone in the media pick on China? It has promised to increase emissions out to 2030 and is a signatory.

Sir David should get cold chills lifting a rock on the recent saga surrounding the NATO signatories where we can learn how worthless pen strokes can be. In 2006, NATO Defence Ministers agreed to commit a minimum of 2% of their Gross Domestic Product (GDP) to defence spending. This guideline, according to NATO,  “principally serves as an indicator of a country’s political will to contribute to the Alliance’s common defence efforts.” In 2017, only 5 of the 28 members outside the US have met the 2% threshold – Greece, Estonia, UK, Romania & Poland in that order. Despite Greece’s economic problems elsewhere, it manages to honour the deal. NATO Secretary General Jens Stoltenberg said “the majority [not all] of allies now have plans to do so by 2024.” 3 more are expected to hit the target in 2018. So for all the good will in the world, is POTUS wrong to call the other 19 members slackers that ride off the US taxpayer when so many of them are only likely to hit the target 18 years after ‘committing’ to it?

Alas, who doesn’t want to breathe clean air? The question is once all of the hysteria of 100m sea rises, forest fires (sharply down from 70 years ago & 90% caused by arson or accidents), hurricanes (nothing extraordinary in the data to show increases in ferocity) or sinking islands (sorry 80% of Pacific atolls/islands are stable or rising) are properly analysed what is the most efficient way to get there? Even Turkey wants to be downgraded to a developing nation in order to benefit from wealth redistribution on climate.

What a masterstroke if signatories to Paris are prepared to take on America’s share of saving the planet. American taxpayers can feel happy in the knowledge that other nations are paying for their NATO commitments by rebating them with tax credits on climate, all the while ruining their domestic competitiveness along the way.  Why does Trump need to Make America Great Again, when the majority of nations are prepared to do it for him? Economist Paul Krugman shouldn’t be calling climate skeptics “sinners” but “saints”

Maybe the teachers need to sit outside the headmaster’s office

If kids want to strike and learn to protest, shouldn’t we the public be able to see whether the children are being constructively taught both sides of the argument in class before they paint placards? CM has a strong feeling that only “one” side of the climate story is being pushed – the alarmist one. Skeptical kids should live in fear of detention.

Perhaps that should be the litmus test – if teachers are proud of getting kids to form such demonstrations, they should not be afraid to allow open access to what they’re teaching. Something tells me they wouldn’t dare because it would prove their own bias beyond doubt.

Here are three things CM would do:

Make the kids debate both sides of the argument in detail. Make them think. Research. Investigate.

Conduct an ethics class to show the countless lies, scandals and whistleblowers outing even government agencies on fabricating data. Kids know what happens when they lie. Perhaps they would grow up to be questioning about what bias they’re fed.

Do an economic feasibility study on renewables vs fossil fuels. Let students decide on whether investing their futures in renewables for zero outcome by 2100 makes sense. Teach them that renewables aren’t cheaper than fossil fuels for two reasons – first, fossil fuel prices are plummeting and second renewable calculations are based on 100% operating capacity which is unrealistic in the extreme. Put them at 20% and renewables are 5x more expensive relatively speaking.

If after thorough and rigorous debate the kids still believed they’re doomed then they can protest their little hearts out.

What it proves is that school faculties are pushing political agendas rather than education. We teach kids that lying is bad and there are consequences for doing so. Shouldn’t teachers be put on the naughty step for doing the same?

CM worries about their future indeed. Oh and it won’t be global warming that kills them. Their dreams have a far higher risk of being killed off through the activism peddled by their teachers. Say, have the teachers told the kids about those alarmists warning childbirth as a cause for future warming?

Karl Marx would be proud.

Unconditional Surrender

There is absolutely no way on earth that the 17mn who voted ‘Leave’ envisaged a Brexit plan that gave away money, took away voting rights, kept the country tied up in all current and future EU red tape, open borders and laws they’ll have no say over. On every level it’s a lose-lose. May’s plan virtually guarantees Britain will be worse off. No deal would make way more sense.

The UK is the 5th largest economy in the world. It should have been enough reason to negotiate FTA’s with anyone. Obama might have threatened that Brits would go to the back of the line, but who was he fooling? 17mn Brits thought otherwise. The people spoke.

Of course the Remainers will crow about their foresighted wisdom. Leavers will wonder why the Tory party room are prepared to back a deal that just looks so ridiculous. It doesn’t look like a negotiation took place. Unconditional surrenders have come with more  favourable T’s & C’s. If May is such good mates with Trump, why didn’t she take a leaf out of his negotiation tactics with the EU? EC President  Jean-Claude Juncker stumbled on the White House lawn after agreeing to sign an FTA with America in one day. Of course the Europhiles will argue the fine print will overwhelmingly protect EU rights, but the point is May never went into bat for her constituents. She sold her countrymen and women down the Thames.

Boris Johnson correctly summed up,

I really can’t believe it but this Government seems to be on the verge of total surrender. With every day that passes we seem to be getting more craven. We have already agreed to hand over £40bn for nothing – and certainly not a trade deal – in return.

We have agreed to become the punk of Brussels, signing up not just to their existing rulebook but to huge chunks of future regulation – even though we will have no say in drafting that legislation. We have agreed against all promises that the European Court of Justice will have a say in the enforcement of that regulation in the UK.

We have been so feeble in our preparations to leave the EU on WTO terms, and so unnaturally terrified of the consequences (greatly exaggerated by the scaremongers) that we have now said we will remain in the so-called customs union.

Which means that our trade policy will be run by Brussels at least until 2022, and – at this rate – long beyond that date. We will not be able to do free trade deals of any great value. We will not be able to take back control of our tariffs, our borders, our money, our laws. It is not even clear whether we will be able to set our own VAT rates – and yet we will have no one round the table to argue the UK case…”

With any luck, the bill will be blocked by Parliament. Leave Rebel MPs should vote against this travesty and look to file a no confidence motion to boot May. This is not what the people voted for. Regardless of whether people may or may not have changed their minds, everyone knew what was on the table and what the expected  outcomes. The ticket stated clearly in black and white,

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So May’s plan technically keeps the UK in the EU without being a member.  No doubt she has been promised a fat cat advisory role in Brussels when she is turfed, which she surely deserves to be.

We should not overlook the behaviour or Brussels with unruly members in the past. Austria, Poland, Hungary, Greece, Ireland etc. You can take it to the bank that the EU will go out of its way to punish the Brits. Easier to bully the UK which may yet sign  away their own rights as if they were the vanquished army in war.  This isn’t a negotiation but a total capitulation.

So much for protecting democracy and respecting the results of a referendum. Why bother holding it in the first place?