It’s as well that Prime Minister, Kevin Rudd, has guaranteed all monies in Australian Bank deposit accounts, not just to ease concerns of average Australians, but to allay any fears of foreign investors dealing with Australian domestic banks.
The over-whelming impression I’ve gathered from media sources reporting on the current so-called global financial crisis, is that the world is coming to an end. Let’s be just a little realistic about the whole show, and admit that 1987’s stock market crash was a whole level of despair worse and the world clearly continued on because here we are today wailing, moaning and gnashing our collective teeth all over again.
I was particularly dismayed at the media’s play on events, especially Network Seven, in playing up the dramas in financial markets around the globe as having some form of immediate impact on Mr & Mrs Fred Average here in Oz. All day yesterday during the Channel Seven Bathurst telecast, we were confronted with David Koch promoting a segment following the six o’clock news in which he would inform viewers how to minimise the damage they were certainly going to incur, from something they know nothing about. Frankly, I found the whole thing offensive, poorly presented and completely uninformative of the real issues involved. Not only is the media in general, and some – like Channel Seven – being particularly sensationalist about this whole business, some – like Channel Seven – are treating the average Aussie as a know-nothing ignoramus who needs to be severely frightened into acknowledging the end is nigh. The end isn’t nigh and it isn’t even close. There’s no need to panic over perceived losses in superannuation, or bank accounts and investments. In reality, there’s no need to panic at all. In the words of Franklin Roosevelt, “We have nothing to fear, except fear itself”.
As another wise man counselled me through my formative years, “knowledge is no burden to carry”. My advice to those who catch the fear-mongering intent of the media and suddenly take it to heart, is to dispense with what’s being offered in the mainstream sources and make some effort to discover just what the pundits are on about, sans hyperbole. Do your own research, and you’ll find what I’ve found. Bad news and sensationalism sells. Good news rarely does, and besides, it’s as boring as bat-shit.
Clearly, the global financial marketplace is in a state of flux, with a great deal of uncertainty for investors and borrowers. Governments around the world are putting into place – albeit slowly – structures designed to provide protection of assets and fluidity of cashflows. Like the shampoo ad says, it won’t happen overnight, and in the interim, some losses will occur. Losses in values of assets, like houses and superannuation, but those are long term investments. They will recover. Post October 1987, the market rebounded 20% within 12 months. Players in short-term investment holdings backed by debt are going to be stung, but that’s the risk they knew, or ought to have known, existed from the outset. There’s no such animal as the ‘quick buck’, despite claims to the contrary.
So, my advice…..ignore the doom-sayers and carry on your lives in a calm, frugal and responsible manner. Minimise risk at all levels and employ commonsense in business dealings. The ride may not be without bumps, but you’re unlikely to fall off the wagon enroute.