/biz/ - Business & Finance

>>15835842
probably because the knew liberals are a bunch retard

>>15835842
>What the hell can people do?
Nothing

ACCC are toothless, and the country is run by boomers who want them sweet dividends

Is there rule in Australia that when banks lower the interest rate for lending money to each other they're supposed to toss money out the window into the street?

big banks make money by taking the money you've got in your accounts, and lending it back out to people with mortages and stuff at a higher rate. So if you get 1.5% interest on any money in your account, the banks take that money and lend it back out to others at about 3% and make the other 1.5% themselves. If the interest rates go too low then people don't want to leave their money in the bank, they try to find other ways of making money that offers more than 1.5%, and the banks have no money to lend, or are forced to make the spread between the interest rates smaller, which is hard because they have high of costs of operating and have to take the risk if the lendee fails to pay them back.

>>15835912
this is why the banks didn't pass on the full rate cut, because then they would have to lower the rates they pay by the full rate as well, which is going to make other people look for a better deal elsewhere.

>>15835842
How fucking low do you want it? The cas rate is the lowest Ive seen it in 40 years.

>>15835937
>
How come it isn't tied to the RBA rate?

If RBA is 0.75%, so should the banks right?

>>15835912
false.

Most banks just take the deposits and buy treasury bonds with them pocketing the difference.

When the bank makes a loan, they create a debt security and buy it from you for the principle amount of the loan which must be paid back with interest.

The central banks interest rates are for funds the bank holds at the central bank.

By lowering interest rates it encourages the banks to lend out more money instead of hold it at the central bank, this means more competition to make the loans, so the banks lower rates to entice more borrowers

>>15835842
Fuck me you guys are all brainlets.
Thinks retail Bank will give him target rate set by Reserve bank .kek
The banks in competition with each other. That’s what sets the deposit and lending rates.
Also morons it’s called fractional banking the deposits the Banks get are to meet the required reserve ratios they use to so they can create the loans out of thin air at ratios around $20 to $1 dollar of actual reserve (deposits)
Yes it’s the greatest fucking scam ponzi in history and the whole western wold in a gigantic debt fuelled bubble that’s going to implode badly.
Buy PMs

>>15835964
>Fuck me you guys are all brainlets.
Says he who still thinks reserves are a constraining factor on the amount banks can lend out!

>>15835858

>>15835842
>jews being jews

i mean what did you expect. hopefully this pisses off the liberal party so much that we dont get a half assed royal commission this time

>>15836666
FUCKING WITNESS

>>15835842
the biggest issue with this is there are literal retards who dont understand how variable rates are where sure interest is good now, but when they get revalued they will be fucked

>>15835842

Hey mate why dont you take our treasurers advice

Get a better bank deal or go: Frydenberg
>https://thewest.com.au/politics/get-a-better-bank-deal-or-go-frydenberg-ng-s-1972051

Frydenberg knows best! After all, what could go wrong with putting a jew in charge of Australia's money policies.

Unrelated

Josh Frydenberg calls for better education on Holocaust
>https://www.theaustralian.com.au/nation/politics/josh-frydenberg-calls-for-better-education-on-holocaust/news-story/6f8f595f00d57dd518cbac6a586749b4