# Rate Rise: NAB Sucks



## juiceman (25 April 2008)

Nab moves it's standard variable rate by 10 basis points, and uses the Anzac Day long weekend as a cover.
What a low act.
While i don't have an account like that with them, if i did i would vote with my feet and short there share's.
Desperate and greedy


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## Aussiejeff (25 April 2008)

juiceman said:


> Nab moves it's standard variable rate by 10 basis points, and uses the Anzac Day long weekend as a cover.
> What a low act.
> While i don't have an account like that with them, if i did i would vote with my feet and short there share's.
> Desperate and greedy




Maybe NAB (like the jolly cobbers they are) thought they would play their own version of "2 up" with their lendees, in the true ANZAC spirit......?

Nah... 



AJ


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## juiceman (26 April 2008)

This bank has no respect for it's existing customers [ raising it's variable rate to 9.46% ]
It's not our fault! it's just the extra cost of money! they say
What utter rubbish
They have just offered NEW customers, as at to-day their New Base Variable rate of 8.75%.
So much for their loyalty program.
Vote with your feet.
ps where did the cheaper money come from all of a sudden?


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## xoa (26 April 2008)

All the banks are raising their rates independently of the Reserve Bank. That's because the official cash rate doesn't reflect the true cost of money. They are raising the interest rate on savings accounts, too. Money doesn't grow on trees any more.


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## juiceman (26 April 2008)

xoa said:


> All the banks are raising their rates independently of the Reserve Bank. That's because the official cash rate doesn't reflect the true cost of money. They are raising the interest rate on savings accounts, too. Money doesn't grow on trees any more.




Yes  but if that is so?  Where did they find the cheap money for New Customers.
So much for St Kevin and Swansky keeping the banks in line, as they promised


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## xoa (26 April 2008)

juiceman said:


> Yes  but if that is so?  Where did they find the cheap money for New Customers.
> So much for St Kevin and Swansky keeping the banks in line, as they promised




It's a teaser rate, and probably associated with higher fees. It attracts people who want a rate honeymoon. Credit card companies do it as well. After a short period, the rate increases dramatically. Nobody is getting something for nothing.


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## juiceman (26 April 2008)

Yes your probably right.
But can't you see the principle of this.
Let's see what, if any press they get on Monday


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## Macquack (26 April 2008)

xoa said:


> All the banks are raising their rates independently of the Reserve Bank. That's because the official cash rate doesn't reflect the true cost of money. They are raising the interest rate on savings accounts, too. Money doesn't grow on trees any more.




I am not going to say the sub-prime debacle has not had an effect on world financial markets. But it is a bloody good excuse for the local big banks to raise lending rates (increase their margins) and cripple the variable rate mortgage borrowers.
No question the sub-prime fallout has hammered the local non-bank lenders (rams home loans, Allco Finance etc). However, the big four Australian banks don’t have to source their funds overseas because they can issue/create (literally print up) their own money here in the lucky country.

There has been a lot of discussion recently about the housing afordability crisis. I have viewed public debate on television with experts from government, housing industry, social workers and even bankers giving their two bobs worth on the cause of the problem and possible rectification.
What amazes me, is nobody ever mentions the amount of money the private banks have been issuing in the form of loans. In my opinion, the massive growth in the money supply is the core problem and has resulted in a real estate bubble and the consequential housing affordability crisis.

I believe the deregulation of the banking sector during the 90s was the start of the rot. Prior to the deregulation, the major banks had specified minimum reserve ratio requirements (eg Statutory Reserve Deposits (SRDs) held with the Reserve Bank). Minimum reserve requirements keep a lid on the banks credit creation ability. The current reserve ratio requirement for SRDs is zero. The Reserve Bank’s new big stick is “capital adequacy” requirements. What the hell does that mean in todays world of highly engineered  (Houdini like) financial practices. Macquarie Bank for one, is very creative in this area. Creating special purpose entities used to hide debt off the balance sheet and away from scrutineering by the Reserve Bank.

Finally, I will leave you with a quote from the great mind and insight of Thomas Jefferson (former US President) – “If the American people ever allow private banks to control the issue of their currency, first by inflation then deflation, the banks and the corporations that will grow up around them, will deprive the people of all property until their children wake up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it belongs.”


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## wayneL (26 April 2008)

Macquack said:


> What amazes me, is nobody ever mentions the amount of money the private banks have been issuing in the form of loans. In my opinion, the massive growth in the money supply is the core problem and has resulted in a real estate bubble and the consequential housing affordability crisis.



'Cause it's old ground here at ASF. Those that realize what you say take it as a given and invest accordingly. Others disregard it and invest accordingly. 

Caveat Emptor


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## numbercruncher (26 April 2008)

Hello,

Very rude doing this on anzac day.

Think the RBA will crack the whip next month too ? I mean they have a obligation to protect your savings from the nasty old Inflation stuff !


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## Julia (26 April 2008)

numbercruncher said:


> Hello,
> 
> Very rude doing this on anzac day.
> 
> Think the RBA will crack the whip next month too ? I mean they have a obligation to protect your savings from the nasty old Inflation stuff !



A spokesperson for NAB this morning said that they have a routine policy of announcing rate changes on Fridays and did not want to vary this.
I really can't see why there's so much fuss about announcing it on Anzac Day.

ANZ has already upped theirs.  The others will surely follow this week.


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## Julia (26 April 2008)

Macquack said:


> No question the sub-prime fallout has hammered the local non-bank lenders (rams home loans, Allco Finance etc). However, the big four Australian banks don’t have to source their funds overseas because they can issue/create (literally print up) their own money here in the lucky country.




Really?   Could you expand on this?  Where and how do they print up their own money here?  How do you know they source no funds from overseas money markets?


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## numbercruncher (26 April 2008)

Julia said:


> A spokesperson for NAB this morning said that they have a routine policy of announcing rate changes on Fridays and did not want to vary this.
> I really can't see why there's so much fuss about announcing it on Anzac Day.
> 
> ANZ has already upped theirs.  The others will surely follow this week.




I just think its disrespectful is all, everyone else had to shut shop to pay respects.

Would they have done it if it was Christmas day or New Years day? Id imagine no ...

Yes I think all the others will follow suit, on a Business day


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## ROE (26 April 2008)

Call me cynical

Everyone ever wonder why banks keep rising rate 
Everyone know the cost of funding is expensive that is the excuse they give

But I cant help but think, they are low on capital and want to keep rise rate to stop people borrowing from them because they dont have the capital and no one is willing to buy mortgage bonds. 

Or they want to pissed off enough people to move elsewhere and return them the capital they need for other things rather than ties up in mortgage where it got no love at a moment. 

So the government is doing their dirty work .... move if you cant get a better deal rhetoric  .. banks must be silently laughing in the background


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## Macquack (26 April 2008)

numbercruncher said:


> Hello,
> 
> Very rude doing this on anzac day.
> 
> Think the RBA will crack the whip next month too ? I mean they have a obligation to protect your savings from the nasty old Inflation stuff !




Here is an over-simplistic view of the Reserve Bank's logic in the current economic conditions.

1. World oil price increase
2. Leads to commodity price increase
3. Leads to CPI increase.
4. Reserve Bank lays blame at end consumer for over-heating the economy!
5. Reserve Bank punishes mortgaged home owners for their excesses?

On second thought, its not over-simplistic.


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## Pronto (26 April 2008)

Perhaps NAB is now the Great Satan. However, the last time that I looked, it was an Australian company worth about $50 billion with many, many thousands of owners owning some 1.5 billion shares in their investment portfolios. 

Perhaps you would like NAB to reduce its profits and operate at a loss. Of course the value of its shares would fall and the many owners would be much poorer and have to work much longer to accumulate their retirement assets... 

Rate rise? Get over it!


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## Macquack (27 April 2008)

Perhaps you would like NAB to reduce its profits and operate at a loss. Of course the value of its shares would fall and the many owners would be much poorer and have to work much longer to accumulate their retirement assets... 

Rate rise? Get over it![/QUOTE]

Sounds like a self interested shareholder here.
The issue here is the question of fair play.
NABs loan book is pretty much a captive market to be screwed if required in the quest for profits.
The call to shop around, if you are not happy with your bank is a bit of nonsense. With the entry and exit costs prohibiting this action, the banks win either way.


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## Macquack (27 April 2008)

Julia said:


> Really?   Could you expand on this?  Where and how do they print up their own money here?  How do you know they source no funds from overseas money markets?




Take some time out and look up “fractional reserve banking”. Wikipedia’s article covers it nicely.
The banks don’t print up money, because they don’t have to.
Consider this, if currency (notes and coins) represents less than 5% of the total money supply, where did the other 95%come from???
Loosely speaking, this says to me the banks as a group run a 5% reserve ratio (cash to deposits). 

So my comments don’t sound like the usual commo rantings, I must add that the credit creation process is not a complete fraud. For every dollar created there is a corresponding dollar created as a deposit for which interest is payable.

What worries me the most about credit creation is that for every dollar created, all existing money is devalued (watered down). That is why I believe the reserve bank should concentrate more on regulating money aggregates rather than playing with the interest rate.


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## metric (27 April 2008)

there is no need to used the big banks anymore. there are many other credit unions, building societies, and banks like bendigo, muslim banks, etc that are much more user friendly. 

australian islamic banks are well worth a look.....you dont need to be muslim, and they are much more sympathetic to people.

some islamic banks dont charge interest (or very little) as muslims dont believe in usury. (charging interest)


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## juiceman (27 April 2008)

Quote:
Originally Posted by xoa  
All the banks are raising their rates independently of the Reserve Bank. That's because the official cash rate doesn't reflect the true cost of money. They are raising the interest rate on savings accounts, too. Money doesn't grow on trees any more.
So if it's that simple, could you please tell me the true cost of money to National Australia Bank


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## numbercruncher (27 April 2008)

I think its cute how the Banks get in with a raise just before the RBA meetings, hoping for a bit of Influence on the decision process perhaps ?


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## juiceman (27 April 2008)

Posted Saturday 26/04/08 10:00pm    
Regular Member

( 27 posts) 

 while I am quite pragmatic regarding how businesses operate, I find it absolutely astonishing that NAB would be so disrespectful as to use ANZAC day as a smokescreen to announce a rise in its interest rates.
I fully understand the effect of the subprime and lending markets at the moment, but what F++kWIT in that company would think it was a good idea to do that?
That they didnt have the balls to announce it on a normal business day like the other banks tells me they are a weak bank, running scared, and not one that I will put my money in.
I am neither a shareholder not a customer, just a patriotic Australian.  


Just could not resist lifting this post from ss


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