Jul 232008

These surely are desperate times. Malcolm Turnbull trying desperately to draw a link between the alcopops tax and a rise in inflation by 0.3% for the quarter ended June 2008. That’s despite the fact that while the alcopops tax may well be regulation based, the legislation hasn’t passed ‘go’ yet. Never the less, it seems scads of binge-drinking teenie-boppers are splurging the money they don’t have on bottles of spirits as opposed to bottles of lollie-water. Malcolm is completely certain of it. Despite not being able to produce any categorical evidence. Yes, a definite flow-on impact which is costing us all dearly!

He goes on to claim …

"How can you be fighting inflation when you’re putting up the price of alcohol, putting up the price of health insurance, putting up the price of motor cars?"

Desperate straits, for sure and certain. Still, I don’t recall the price of alcohol going up across the board, health insurance premiums increasing, or rampant rises in the price of cars? Am I missing something? Is the alcopops tax causing these destructive CPI impacts? Bloody teeny binge drinkers!!!

Meanwhile in other news, no economist interviewed by any player in the mainstream media has expressed any fears of the Reserve Bank taking drastic action – like raising interest rates further. It’s okay people! Nothing to see here. Just a crazy man trying to get some attention. Move along! Move along!

Oh …. before I forget. Word in the marketplace is that the NAB are about to announce a home loan product launch sans early repayment penalties. Very big move for one of the four pillars not known for being a leader. I wonder if there’s any connection between this snippet, last week’s across-the-board rise in rates from the Big Four of between 0.15% and 0.20%, and a fall in the 90 day bank bill swap rate over the past quarter of nine basis points? Oh, and there’s the House Standing Committee inquiry into competition in the banking and non-banking sectors, which closed to submissions 11 July. I reckon I can draw a better parallel between the NAB’s ‘new’ product, last weeks rate rises and the Parliamentary inquiry than Turnbull can to alcopops and inflation.


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