Monday, October 13, 2008

Rudd Takes A Bet Worth Hundreds Of Billions Of Dollars

The odds are good that PM Rudd's monumental bet, in stumping up future taxpayer revenue to guarantee bank and credit union deposits for all Australians, for at least three years, will pay off. Some predict profits. But it's still an extraordinary gamble, a stake in the hundreds of billions of dollars. The biggest bet ever laid in the history of Australia.

Though none of the major banks appear to be shot full of holes from the shrapnel of America's extended 'Economic 9/11', unless they're hiding something monumental (fatal derivatives exposure, perhaps?), its still a remarkable event in the history of the country. Perhaps it would have more resonance if there were visuals to go with it other than numbers on boards, and a fantasmagoria of graphs. It's been porn for actuaries.

The October 12 emergency meeting also showed that behind the theatre and media-filling antics of our politicians, they usually all fall into line when they sense a true and total threat to the nation, and their own futures.

And so for today, a new week for millions of Australians obsessively checking stock market figures begins. There will be misery, hope, ruin, horror, terror, joy, despair, probably all within the first twenty minutes of trading.

It seems very likely that if markets in Australia, the US, Britain and Europe drop more than 20% further by Tuesday, we will follow the example of Russia and Indonesia, amongst the many, and suspend all trading. Shut down the markets for a week or two, sort out the mess. Perhaps such a closure would be a good thing, for reasons other than financial.

Being able to have constant market updates coming through your phone, your TV, your radio, every news site you visit, is one step away from having a permanent ticker flowing through your mind's eye.

People are going to need a solid time out from this full-core media flow soon. It can't be good for the mind, or the soul. We already know its not good for the nerves.