All around the world failed banks have been bailed out by taxpayers to the tune of billions and billions (and billions)of dollars.
In New Zealand and Australia, mercifully so far in this ongoing crisis, this hasn’t happened. (Not yet, but don’t bet against it.) Instead, Australasia’s trading banks are showing healthy profits—profits in line with the return on capital enjoyed by other Australasian businesses—profits earned on lending that has paid off, rather than failed. Profits that have made savers and the banks’ shareholders richer.
Only to the likes of the Greens’s Russel Norman is this a problem, the Ginger Whinger sniffing at this small mercy: telling State Radio this morning that even in this time of global economic uncertainty banks should make neither big profits nor small profits, but profits that are only “average.”
This is the same man who recently declared he wanted to print enough money to make bankers richer and wage-earners poorer.
Here’s Tim Minchin.
UPDATE: Russel Norman says Australian banks excessive profits are “strip mining” New Zealand. David Tripe (who heads Massey University's Centre for Banking Studies) says New Zealand banks make a PRE-tax return on total assets of just over 1%, and a post-tax return of 0.6% - which he describes as "certainly not outrageously high either historically or internationally.”
Not exactly “strip mining,” is it Russel.