Identity theft is a growing concern to our financial security. Mailbox theft seems a common way thieves manage to obtain the sort of information that allows them to assume our identity and rack up bills and purchases in our name. Victims often find that their financial standing is permanently discredited if they become a victim.
A long time ago it was suggested that we need what amounted to an internal passport to counter this threat. It was called " the Australia card " and it would have a photograph of the holder to certify identity whenever that was required. The idea was howled down politically as an " invasion of privacy " and was quietly dropped.
Since then the advances of computer technology have made rapid progress. It is now possible to scan a crowd and recognise an individual face amongst the multitude. Every day we are photographed a vast number of times as we pass the array of cctv cameras that screen city streets and transport terminals. Law enforcement will find this a useful tool when looking for a person of interest.
It is suggested that this technology would be very useful if shared between all levels of government, including local government to put a face to a name and end identity theft. Obviously, the collection of individual photographs would be seen by some as an invasion of privacy, but for most of us those photographs are already held in government archives by way of driving licenses and passports. It has become increasingly necessary to surrender our image to obtain many of lifes necessities and that image is already held by a government department.
In the course of each year ever person on several occasions are asked to provide their ID. Perhaps picking up a parcel from the local post office or seeking service from a bank. Without question we pull out our driving license because that is universally accepted because the photograph can be scrutinised and compared with the holder. Is the sharing of that image and information between government and local government departments too radical a change to be rejected on privacy grounds ?
Along with the development of artificial intelligence has come the power of the data collected on each person and the uses to which it can be put. Some theorists claim it is a form of mind control where fake news is inserted into public information arenas such as Facebook to influence voting intentions. In a close vote, this intervention could manage to swing the election outcome.
With our photograph in government hands we open the potential to where computer technology is leading us. There is no reason to think that face recognition can not in the future track each individual to know where they go and what they do. The data that could deliver on their lifestyle, habits and preferences would be commercially very valuable. We are fast reaching the stage when every moment in a public space is under some sort of scrutiny and the marvellous world of advancing technology has the ability to track our journeys.
When this proposal is debated in parliament the privacy issue will probably result in its rejection, but whether we like it or not, it will most likely surreptitiously become reality in the future. The number of photographs already in government hands means that at least a partial interchange of information between government departments is inevitable.
Perhaps privacy is a myth that belongs in a former century !
Saturday, 5 May 2018
Friday, 4 May 2018
Airbag Apathy !
Apparently a lot of Australian car owners are prepared to play a game of " Russian Roulette " indefinitely as they continue to drive cars fitted with potentially deadly Takata airbag systems. This Japanese built safety system was installed in many makes of cars, ranging from the base models to luxury cars at the top of the price range.
It was discovered that a manufacturing fault had the potential to shatter the surrounding fittings when the airbag inflated in an accident, causing shrapnel to fly into the head and neck of the person protected by the airbag. Across the world this fault has caused both a number of deaths and serious injuries. All the cars fitted with this Takata airbag system are subject to a recall to have the air bags replaced under warranty.
This recall has been in place for many months and it is disturbing to learn that many owners are failing to contact the selling agent to have the airbag replacement work done free of charge. It is estimated that thirty thousand cars have so far ignored the recall notice and those driving them face a similar danger to having a shotgun pointed at their head.
What is probably causing this apathy is the knowledge that only a very small percentage of the airbags in use will deliver this danger. The vast number will work perfectly and there is no way of knowing the outcome in a crash and so the odds are heavily in favour of surviving a crash without airbag injuries or death. The reverse also applies. If the airbags operate because of a very low speed tailender, the driver or passenger may be fatally injured if he or she has the misfortune to have an airbag with this fault.
The car industry has gone to great lengths to put recall notices in the hands of owners but many cars may have changed hands or their owners have changed addresses. The Federal Chamber of Automotive Industries ( FCAI ) is looking at what more can be done to ensure that this problem is fully resolved. It seems that the recall will fall far short of all the vehicles affected unless stronger measures are taken.
The logical intervention to scoop up unrepaired cars would be to include that airbag replacement requirement as a specific item to be checked on the annual car registration safety examination by a registered motor mechanic - known as the " pink slip " in most states. Cars would not be cleared for registration renewal unless that recall work had been completed.
That would not be an onerous task for the mechanics undertaking those tests. Car manufacturers keep a tally online of all vehicles affected, together with notification of when this task was completed. A simple call to the local brand agent would instantly divulge this required information. Registration renewal checks are a state responsibility and it would require individual states to ensure this requirement was added to the checklist.
That seems the only certainty that airbag safety will be extended to all the affected vehicles on Australian roads !
It was discovered that a manufacturing fault had the potential to shatter the surrounding fittings when the airbag inflated in an accident, causing shrapnel to fly into the head and neck of the person protected by the airbag. Across the world this fault has caused both a number of deaths and serious injuries. All the cars fitted with this Takata airbag system are subject to a recall to have the air bags replaced under warranty.
This recall has been in place for many months and it is disturbing to learn that many owners are failing to contact the selling agent to have the airbag replacement work done free of charge. It is estimated that thirty thousand cars have so far ignored the recall notice and those driving them face a similar danger to having a shotgun pointed at their head.
What is probably causing this apathy is the knowledge that only a very small percentage of the airbags in use will deliver this danger. The vast number will work perfectly and there is no way of knowing the outcome in a crash and so the odds are heavily in favour of surviving a crash without airbag injuries or death. The reverse also applies. If the airbags operate because of a very low speed tailender, the driver or passenger may be fatally injured if he or she has the misfortune to have an airbag with this fault.
The car industry has gone to great lengths to put recall notices in the hands of owners but many cars may have changed hands or their owners have changed addresses. The Federal Chamber of Automotive Industries ( FCAI ) is looking at what more can be done to ensure that this problem is fully resolved. It seems that the recall will fall far short of all the vehicles affected unless stronger measures are taken.
The logical intervention to scoop up unrepaired cars would be to include that airbag replacement requirement as a specific item to be checked on the annual car registration safety examination by a registered motor mechanic - known as the " pink slip " in most states. Cars would not be cleared for registration renewal unless that recall work had been completed.
That would not be an onerous task for the mechanics undertaking those tests. Car manufacturers keep a tally online of all vehicles affected, together with notification of when this task was completed. A simple call to the local brand agent would instantly divulge this required information. Registration renewal checks are a state responsibility and it would require individual states to ensure this requirement was added to the checklist.
That seems the only certainty that airbag safety will be extended to all the affected vehicles on Australian roads !
Thursday, 3 May 2018
Citizenship Rights !
Every resident who has the right - and the obligation by law - to vote in a Federal, State or council election thought they also had the right to stand to be elected to public office. It was long thought that the only impediment was failure to hold legal citizenship in this country. Newly arrived immigrants could not vote or stand for office until they gained official recognition as a citizen. All those born within Australian borders were automatically granted that status.
To our consternation, we recently found that this is not so when it comes to seats in the Federal parliament, and that is because of section 44 of the Australian Constitution. When the Constitution was drafted 118 years ago it prevented " any person who is a subject or a citizen or entitled to the rights or privileges of a subject or a citizen of another power from running for office. It also bans anyone who has a direct or indirect pecuniary interest with the Commonwealth from standing for office.
Recently eight members of the Federal parliament had their right to sit as elected representatives declared invalid because of section 44 and a further four had their standing questioned. The ruling opened a complex can of worms because in many cases the laws of other countries confer citizenship rights there by way of the tenure their parents - and in some cases grandparents- have passed automatically to their offspring. Many had no idea that those citizenship rights in another country existed.
That interpretation of section 44 cost Australia millions of dollars to hold by-elections. A lot of parliamentarians searched their ancestry and went to the trouble of renouncing any claims to foreign citizenship. Some parliamentary members fell foul of that " pecuniary interest " clause because they leased their parliamentary office from a department in a government owned building.
The government setup an enquiry to examine ways to reform section 44 because clarity is essential. When the Constitution was drafted the concept of dual citizenship was unknown and now it bars such people from parliament. We are a nation of migrants and perhaps the only qualification necessary to legally contest and win a seat in Federal parliament should be the possession of a valid affirmation that such a person holds legal citizenship in Australia, either by birth or through the formal citizenship process.
To achieve that, we need to change the Constitution, and that involves a referendum. That enquiry will soon present its findings and it is most likely that this will be their recommendation. If that referendum intent gets the approval of the various political parties represented in the Federal parliament, there is no reason why it should not be decided in a tandem vote at the next Federal election.
It is important that this question be clarified by Australian law. Some countries do not recognise the validity of citizen rights being renounced when their former citizens gain Australian citizenship and this can throw a legal doubt on parliamentary membership while ever section 44 remains unchanged.
To our consternation, we recently found that this is not so when it comes to seats in the Federal parliament, and that is because of section 44 of the Australian Constitution. When the Constitution was drafted 118 years ago it prevented " any person who is a subject or a citizen or entitled to the rights or privileges of a subject or a citizen of another power from running for office. It also bans anyone who has a direct or indirect pecuniary interest with the Commonwealth from standing for office.
Recently eight members of the Federal parliament had their right to sit as elected representatives declared invalid because of section 44 and a further four had their standing questioned. The ruling opened a complex can of worms because in many cases the laws of other countries confer citizenship rights there by way of the tenure their parents - and in some cases grandparents- have passed automatically to their offspring. Many had no idea that those citizenship rights in another country existed.
That interpretation of section 44 cost Australia millions of dollars to hold by-elections. A lot of parliamentarians searched their ancestry and went to the trouble of renouncing any claims to foreign citizenship. Some parliamentary members fell foul of that " pecuniary interest " clause because they leased their parliamentary office from a department in a government owned building.
The government setup an enquiry to examine ways to reform section 44 because clarity is essential. When the Constitution was drafted the concept of dual citizenship was unknown and now it bars such people from parliament. We are a nation of migrants and perhaps the only qualification necessary to legally contest and win a seat in Federal parliament should be the possession of a valid affirmation that such a person holds legal citizenship in Australia, either by birth or through the formal citizenship process.
To achieve that, we need to change the Constitution, and that involves a referendum. That enquiry will soon present its findings and it is most likely that this will be their recommendation. If that referendum intent gets the approval of the various political parties represented in the Federal parliament, there is no reason why it should not be decided in a tandem vote at the next Federal election.
It is important that this question be clarified by Australian law. Some countries do not recognise the validity of citizen rights being renounced when their former citizens gain Australian citizenship and this can throw a legal doubt on parliamentary membership while ever section 44 remains unchanged.
Wednesday, 2 May 2018
Sacking the " Fat Cats " !
When we mug investors contemplate buying shares in a company we usually take note of past dividends paid as an indication of what are likely in the future. It is usually only the institutional investors who pay much attention to the faces on the board of directors and that seems to be something of a closed shop operation.
When a board seat becomes vacant it seems that the present directors nominate a replacement and that person is usually elected at the next company AGM. In this country, there exists a wide pool of people with business experience deemed suitable for such positions - and the pay they receive is certainly generous. Many divide their time sitting on a number of company boards.
The AMP revelations at this banking Royal Commission have been a disaster for AMP shareholders. The shares have dropped to shed billions of dollars of shareholder value because the company has broken the law in many ways and gouged wealth illegally from its customers. The company chairwoman has fallen on her sword and resigned, and shareholder anger is rising to a crescendo to sack the entire board. Those directors have offered to take a twenty-five percent pay cut, but that is unlikely to satisfy the people who own this oldest of Australia's prestige companies.
A similar situation exists with the big four banks that dominate the Australian money market. This Royal Commission has revealed a consistent charter of illegal operations that can only be described as deliberate theft. Customers were charged for services that were not provided and this happened under the guidance of each banks board of directors. There seems a strange reluctance for the law to move and lay charges against the people who broke the law.
The minions of bank employees who applied this illegality to customer accounts did so under the direction of the banks board. It would be reasonable to expect to see those executives removed from their board rooms in handcuffs and take the " walk of shame " before the media television cameras. This criminality took place under their direction, and along with the chair people, they should have to face a court of law and account for what happened on their watch.
Being elevated to the board of a company is an honour, but it also comes with a responsibility to ensure that company operations meet the expectations of the law. This Royal Commission has uncovered blatant criminality that has enhanced the companies bottom line by billions of dollars. Not only were the customers of these corporations defrauded but now the shareholders are suffering a capital loss because the shares of these companies are in public disfavour.
The forced resignation of CEO's or board members will not suffice. They simply walk out the door with a large superannuation cheque in their pocket and no prison time for the illegalities they have condoned. It is ludicrous that a common criminal who steals someones wallet gets the odium of a court appearance and probably jail time, and the fat cats who preside over the operations of giant corporations walk away unscathed after the theft of millions.
There is the expectation that the culmination of this Royal Commission may see that situation eventuate !
When a board seat becomes vacant it seems that the present directors nominate a replacement and that person is usually elected at the next company AGM. In this country, there exists a wide pool of people with business experience deemed suitable for such positions - and the pay they receive is certainly generous. Many divide their time sitting on a number of company boards.
The AMP revelations at this banking Royal Commission have been a disaster for AMP shareholders. The shares have dropped to shed billions of dollars of shareholder value because the company has broken the law in many ways and gouged wealth illegally from its customers. The company chairwoman has fallen on her sword and resigned, and shareholder anger is rising to a crescendo to sack the entire board. Those directors have offered to take a twenty-five percent pay cut, but that is unlikely to satisfy the people who own this oldest of Australia's prestige companies.
A similar situation exists with the big four banks that dominate the Australian money market. This Royal Commission has revealed a consistent charter of illegal operations that can only be described as deliberate theft. Customers were charged for services that were not provided and this happened under the guidance of each banks board of directors. There seems a strange reluctance for the law to move and lay charges against the people who broke the law.
The minions of bank employees who applied this illegality to customer accounts did so under the direction of the banks board. It would be reasonable to expect to see those executives removed from their board rooms in handcuffs and take the " walk of shame " before the media television cameras. This criminality took place under their direction, and along with the chair people, they should have to face a court of law and account for what happened on their watch.
Being elevated to the board of a company is an honour, but it also comes with a responsibility to ensure that company operations meet the expectations of the law. This Royal Commission has uncovered blatant criminality that has enhanced the companies bottom line by billions of dollars. Not only were the customers of these corporations defrauded but now the shareholders are suffering a capital loss because the shares of these companies are in public disfavour.
The forced resignation of CEO's or board members will not suffice. They simply walk out the door with a large superannuation cheque in their pocket and no prison time for the illegalities they have condoned. It is ludicrous that a common criminal who steals someones wallet gets the odium of a court appearance and probably jail time, and the fat cats who preside over the operations of giant corporations walk away unscathed after the theft of millions.
There is the expectation that the culmination of this Royal Commission may see that situation eventuate !
Tuesday, 1 May 2018
The " Tax Agent " Industry !
Perhaps the Royal Commission uncovering the outright fraud endemic in the banking industry should widen its scope to the people who give financial advice on tax matters to the business community. They are termed " tax agents " and their job is preparing the complicated tax returns of small and medium sized businesses to legally obtain whatever benefits are available to lower the tax bill.
One such agent in Melbourne is accused of stealing $1.3 million from fifteen of his clients and another $2.8 million that is the property of the Australian Tax office. This tale of woe has left many of his clients locked in a bitter legal battle with the ATO.
This 56 year old tax agent constructed what he called " an efficient tax planning arrangement " in which he required an up front payment from his clients to deliver a lower tax bill. He simply pocketed that money and constructed a network of false tax claims to artificially lower his clients tax obligations to the tax office. In due course, this instigated a raid on his home and office by a combination of the ATO and the Federal police. The tax agent has indicated that he will plead guilty to all the charges.
Perhaps those clients should have been warned by their tax agents lifestyle. He drove a Maserati and regularly took expensive overseas holidays, and was well known for his gambling habits, and his forays into the property market were legendary. But then such excesses are often the legitimate rewards of a successful business man. It is those property acquisitions that are now souring relations between those left owing a tax bill and the ATO.
The ATO is aggressively pursuing the tax bills their tax agent left them owing and is applying fines and penalties for late payment. At the same time it is proceeding through the courts to gain access to those properties the agent bought with stolen money and intends to reclaim them to recoup the loss it has suffered at his hand.
The aggrieved clients see it differently. These properties were obtained with money stolen from them and they have the expectation that they should share in funds recovered, but in the pecking order of debt recovery, the ATO takes precedence. At best they are receiving vague promises that the ATO may take a benevolent view on those fines and penalties for late payment.
Many of these clients are small " Mum and Pop " suburban businesses which now face ruin. They can not afford to get into a legal duel with the tax office because that would be a very unequal contest. The ATO is backed by unlimited public money and in comparison they are paupers - and all the legal powers are in the hands of the ATO.
Perhaps now would be a good time to force tax agents to contribute to a fidelity fund such as applies to the legal profession. Should a barrister or a solicitor commit a crime that involves a clients funds those losses are reimbursed. Membership of the fund is conditional on gaining accreditation to practice law. It seems long overdue to extend such an arrangement to the professions that offer services in the tax industry.
One such agent in Melbourne is accused of stealing $1.3 million from fifteen of his clients and another $2.8 million that is the property of the Australian Tax office. This tale of woe has left many of his clients locked in a bitter legal battle with the ATO.
This 56 year old tax agent constructed what he called " an efficient tax planning arrangement " in which he required an up front payment from his clients to deliver a lower tax bill. He simply pocketed that money and constructed a network of false tax claims to artificially lower his clients tax obligations to the tax office. In due course, this instigated a raid on his home and office by a combination of the ATO and the Federal police. The tax agent has indicated that he will plead guilty to all the charges.
Perhaps those clients should have been warned by their tax agents lifestyle. He drove a Maserati and regularly took expensive overseas holidays, and was well known for his gambling habits, and his forays into the property market were legendary. But then such excesses are often the legitimate rewards of a successful business man. It is those property acquisitions that are now souring relations between those left owing a tax bill and the ATO.
The ATO is aggressively pursuing the tax bills their tax agent left them owing and is applying fines and penalties for late payment. At the same time it is proceeding through the courts to gain access to those properties the agent bought with stolen money and intends to reclaim them to recoup the loss it has suffered at his hand.
The aggrieved clients see it differently. These properties were obtained with money stolen from them and they have the expectation that they should share in funds recovered, but in the pecking order of debt recovery, the ATO takes precedence. At best they are receiving vague promises that the ATO may take a benevolent view on those fines and penalties for late payment.
Many of these clients are small " Mum and Pop " suburban businesses which now face ruin. They can not afford to get into a legal duel with the tax office because that would be a very unequal contest. The ATO is backed by unlimited public money and in comparison they are paupers - and all the legal powers are in the hands of the ATO.
Perhaps now would be a good time to force tax agents to contribute to a fidelity fund such as applies to the legal profession. Should a barrister or a solicitor commit a crime that involves a clients funds those losses are reimbursed. Membership of the fund is conditional on gaining accreditation to practice law. It seems long overdue to extend such an arrangement to the professions that offer services in the tax industry.
Monday, 30 April 2018
Bridging the Divide !
We are about to spend fifty million dollars to create a memorial to the day that Captain James Cook first stepped ashore at Kurnell on April 29, 1770. To the ancestors of the first settlers that commemorates the birth of what has evolved as the Australian nation but to the Indigenous people who were already living here it represents the arrival of invaders who imposed laws and a foreign culture on their people.
Exactly what is planned has yet to be formalised but it is hoped that it is something that is acceptable to both cultures to commemorate the two hundred and fiftieth anniversary of that historic moment in 2020. At present, the landing place is marked by a simple plaque attached to a very ordinary stone monument.
In recent times, other monuments to Cook and the British establishment of a penal colony in Australia have been vandalized with slogans such as " change the date " and " No pride in genocide " painted on the visual surfaces. There is a hard core of Indigenous people who refuse to recognise that Australia is now the property of the twenty-four million people who have Australian citizenship. They promote the catch cry " Aboriginal land. Always was. Always will be " !
From a practical point of view, that is tilting at windmills. There is no doubt that the British arrived here uninvited, but it is also a fact that they established their colony by force of arms. They were cruel and inhuman to the prisoners that they came to guard and there is no doubt that genocide was inflicted on some Indigenous people. Those events are consigned to history and both the victims and the perpetrators have been dead for scores of years.
The Aboriginal people of Australia are very much a part of that twenty-four million that call this country home and they are entitled to the rewards that its success delivers. That does not mean that they must abandon their culture or their aboriginality. The country can not go back to the way of life they lived in 1770 because the world is now different to that period. The only way forward is a form of integration, and with good will on both sides that is possible.
That historic day in 1770 saw the old and the new Australia come face to face. We still have a way to go before all our Indigenous people have the lifestyle this nation offers but that is progressing and it will be achieved. Indigenous people are represented in all walks of life and what is now important is the improvement to health culture and the extension of educational opportunities to widely dispersed Aboriginal young people.
It is hoped that the plan to create this commemoration of Cook's landing will be a joint venture between both cultures. This is now a shared land and it is important that it be a prosperous country in a troubled world, and that will only happen if we settle our differences and accept that we are a united people.
What happened in the past is a matter for the history books, but Cook was part of that culture and his arrival can not be ignored. This commemoration of a historical fact needs to be accepted as the creation of a new Australian nation that equally encompasses those that lived before Cook with those that came after. Perhaps this is the bridging point that we need to bring together both sides in reconsolidation.
Exactly what is planned has yet to be formalised but it is hoped that it is something that is acceptable to both cultures to commemorate the two hundred and fiftieth anniversary of that historic moment in 2020. At present, the landing place is marked by a simple plaque attached to a very ordinary stone monument.
In recent times, other monuments to Cook and the British establishment of a penal colony in Australia have been vandalized with slogans such as " change the date " and " No pride in genocide " painted on the visual surfaces. There is a hard core of Indigenous people who refuse to recognise that Australia is now the property of the twenty-four million people who have Australian citizenship. They promote the catch cry " Aboriginal land. Always was. Always will be " !
From a practical point of view, that is tilting at windmills. There is no doubt that the British arrived here uninvited, but it is also a fact that they established their colony by force of arms. They were cruel and inhuman to the prisoners that they came to guard and there is no doubt that genocide was inflicted on some Indigenous people. Those events are consigned to history and both the victims and the perpetrators have been dead for scores of years.
The Aboriginal people of Australia are very much a part of that twenty-four million that call this country home and they are entitled to the rewards that its success delivers. That does not mean that they must abandon their culture or their aboriginality. The country can not go back to the way of life they lived in 1770 because the world is now different to that period. The only way forward is a form of integration, and with good will on both sides that is possible.
That historic day in 1770 saw the old and the new Australia come face to face. We still have a way to go before all our Indigenous people have the lifestyle this nation offers but that is progressing and it will be achieved. Indigenous people are represented in all walks of life and what is now important is the improvement to health culture and the extension of educational opportunities to widely dispersed Aboriginal young people.
It is hoped that the plan to create this commemoration of Cook's landing will be a joint venture between both cultures. This is now a shared land and it is important that it be a prosperous country in a troubled world, and that will only happen if we settle our differences and accept that we are a united people.
What happened in the past is a matter for the history books, but Cook was part of that culture and his arrival can not be ignored. This commemoration of a historical fact needs to be accepted as the creation of a new Australian nation that equally encompasses those that lived before Cook with those that came after. Perhaps this is the bridging point that we need to bring together both sides in reconsolidation.
Sunday, 29 April 2018
Loan Sharks !
Lending money has always been a risky business and the higher the risk the more the rate of interest will rise. At the moment, the world money market is offering an exceptionally low return for savings deposited at the banks and consequently house mortgages are at the low end of the usual debt cycle. Borrowers are warned that a return to normal levels can occur with little notice.
This is probably a very good time for major corporations to seek a loan to expand their business. Unfortunately, demand for loans is fairly stagnant because a mood of caution prevails in business circles. Many are waiting to see how self driving cars and the development of artificial intelligence will change the market place and impact pay levels.
What never changes is the needs of societies lower strata to borrow money to eke out daily living expenses. A century ago that was served by pawnbrokers shops. The borrower presented something of value and the pawnbroker advanced a loan representing a small portion of that value for a nominated period of time and at an agreed interest rate. If the customer repaid the loan on time they reclaimed that item, and if they didn't the pawnbroker was free to offer it for public sale for near its true value.
The pawnbroker trade fell out of favour and was replaced by small lending agencies offering personal loans. Desperate people were forced to borrow at usurious interest rates and the trade was closely connected with underworld enforcers, who often used violence to collect payment arrears. Often the same borrowers kept adding to their debt until it reached unmanageable proportions.
Credit entered a new age when the Australian banks entered the Bankcard era. New credit cards were showered on the population, which quickly divided into those who could manage debt and those who could not. This new debt vehicle quickly replaced the " Hire-Purchase " system, colloquially termed the " never-never " !
In recent times the fast loan business has emerged with the new titles of " Pay day loans " and " Money recyclers ". These are shop front businesses which either dispense cash on credit or offer to buy goods at a fraction of their price in similar manner to the old pawnbroker trade. They are subjected to government interest rate legislation.
Now we are facing a new enticement. Machines - similar in appearance to the banks ATM's - are appearing in retail premises which offer on the spot loans. The borrower needs to enter identification and if accepted the machine dispenses a credit card with the agreed loan value embedded in its operational chip. The offer runs to loans of a thousand dollars.
There is a danger that the ease with which money can be obtained will see debt roar out of hand and ensnare the population percentage who are susceptible to turning to money lenders to finance their weekly shortfalls. The credit rates charged are always onerous and debts can quickly become unpayable. This form of credit has moved beyond providing financial assistance. It is fast emerging as a money trap from which the unsuspecting can not hope to escape. Banning these machines is simply saving vulnerable people from their own poor judgement.
This is probably a very good time for major corporations to seek a loan to expand their business. Unfortunately, demand for loans is fairly stagnant because a mood of caution prevails in business circles. Many are waiting to see how self driving cars and the development of artificial intelligence will change the market place and impact pay levels.
What never changes is the needs of societies lower strata to borrow money to eke out daily living expenses. A century ago that was served by pawnbrokers shops. The borrower presented something of value and the pawnbroker advanced a loan representing a small portion of that value for a nominated period of time and at an agreed interest rate. If the customer repaid the loan on time they reclaimed that item, and if they didn't the pawnbroker was free to offer it for public sale for near its true value.
The pawnbroker trade fell out of favour and was replaced by small lending agencies offering personal loans. Desperate people were forced to borrow at usurious interest rates and the trade was closely connected with underworld enforcers, who often used violence to collect payment arrears. Often the same borrowers kept adding to their debt until it reached unmanageable proportions.
Credit entered a new age when the Australian banks entered the Bankcard era. New credit cards were showered on the population, which quickly divided into those who could manage debt and those who could not. This new debt vehicle quickly replaced the " Hire-Purchase " system, colloquially termed the " never-never " !
In recent times the fast loan business has emerged with the new titles of " Pay day loans " and " Money recyclers ". These are shop front businesses which either dispense cash on credit or offer to buy goods at a fraction of their price in similar manner to the old pawnbroker trade. They are subjected to government interest rate legislation.
Now we are facing a new enticement. Machines - similar in appearance to the banks ATM's - are appearing in retail premises which offer on the spot loans. The borrower needs to enter identification and if accepted the machine dispenses a credit card with the agreed loan value embedded in its operational chip. The offer runs to loans of a thousand dollars.
There is a danger that the ease with which money can be obtained will see debt roar out of hand and ensnare the population percentage who are susceptible to turning to money lenders to finance their weekly shortfalls. The credit rates charged are always onerous and debts can quickly become unpayable. This form of credit has moved beyond providing financial assistance. It is fast emerging as a money trap from which the unsuspecting can not hope to escape. Banning these machines is simply saving vulnerable people from their own poor judgement.
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