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Permalink Reply by Michaelng Clayton on November 21, 2010 at 12:43pm

Hi John

I do not know the real answer to this question, but I suspect it just goes into general revenue and becomes part of the profit of the bank. It seems to me from what I have read that the reserve bank annual figures get manipulated re the surposed loss of the current 2010 reports.

May be someone more into banking could tell us if anyone knows.



John C Fairfax said:

Who gets the money or what share of it when the Reserve Bank increases the interest rate?

It's no pressure on me as I have no money borrowed and refuse to borrow again due to consequences of their up and down 'bear markets' and 'meltdowns'.

However a lot of people sure are hurt for the rest of their lives due to stress from foreclose etc.

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Permalink Reply by Laurel Ender on November 23, 2010 at 12:32am

from a link Colin [osted a while back I also noted a WALMART chappy is on the board..
explains why!!! Walmart will be ruining whats left of Aus shopping sometime soon.

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Permalink Reply by Colin J Ely on November 23, 2010 at 3:49am

Michaelng

The Reserve bank of Australia is a Public Institution. No dividends are payable to private shareholders as their are none. Any profit on its banking activities is payable to Consolidated Revenue.

As a contractor who works at the RBA i feel you should apologise for maligning my character by association and think that this topic should be moved to The Truthers.

It has been many a long year since I worked directly for a bank so you will forgive me if I am a bit hazy on the details. All banks are required to keep a certain proportion of the liquid assets with the RBA, for which they are payed a nominal sum in interest. if they have need to borrow some cash for short term purposes eg at Christmas time they can borrow from the RBA and have to pay interest. So when the RBA increases interest rates the banks have to follow suit or they will lose money. That is not to say that they cant set interest rates at whatever they like although they would be judged by the market. If you had some spare cash to invest and one bank was paying 1% interest and another was paying 10% interest, which one would you invest in?

I would be more worried if a member of the RBA board only expertise was serving on the local kindergarten committee rather than on the board of a major company! ;-)

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Permalink Reply by Janet H. Thompson on November 23, 2010 at 9:07am

I agree with Colin. (Perhaps in another discussion, though,) I would like to flesh out the problem we've got with deposit guarantees and other Goverment involvement in the banking industry.

Col asks: If you had some spare cash to invest and one bank was paying 1% interest and another was paying 10% interest, which one would you invest in?

I think one of the great tragedies post-Great Depression was Government getting more involved in the banking world. With guarantees of deposits, the incentive for people with cash to use their MINDS and JUDGEMENT about who they entrusted their money to was taken away. That is a shame. We should have to think about everything we do.

I would enjoy a real conversation like this without it degenerating into conspiracy theory.

Cheers,
Janet

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Permalink Reply by Michaelng Clayton on November 23, 2010 at 2:35pm

Hi Colin Allan

It appears you are right and I am wrong. Now it appears The Australian Reserve Bank comes under a new regulatory authority.

The Reserve Bank gives banking and registry[disambiguation needed] services to agencies of the Government, to other central banks, and other official institutions. The assets of the Bank include the gold and foreign exchange reserves of Australia, which is estimated to have a net worth of A$101 billion. The Bank is fully owned by the Australian government and the profits that the Bank gains are transferred back to the government.


The Australian Prudential Regulation Authority (APRA) is a statutory authority, and the prudential regulator of the Australian financial services industry.

It was established on 1 July 1998. APRA currently supervises institutions holding approximately $3.6 trillion in assets for 22 million Australian depositors, policyholders and superannuation fund members.

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Permalink Reply by Michaelng Clayton on November 23, 2010 at 5:32pm

Hi All

Please accept my apology for my lack of discipline in posting this thread without properly researching the facts in this post.

Michael Clayton

 

Spiritual Secrets Part 2 - Truth and Illusion

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Permalink Reply by Michaelng Clayton on November 23, 2010 at 5:42pm

Taken from The Reserve Bank’s 50th Anniversary

The Reserve Bank opened for business as Australia’s central bank on 14 January 1960 (with the Reserve BankAct 1959 having separated the central banking and commercial functions of the Commonwealth Bank).
The 50th anniversary of the Reserve Bank provided a special opportunity for greater engagement with the community. The Bank hosted a sequence of international meetings in Sydney to mark the anniversary, including a symposium that addressed central banking lessons learned over the past 50 years and the challenges ahead. The papers and proceedings were published online and a commemorative volume has also been published.

http://www.rba.gov.au/publications/annual-reports/rba/2010/pdf/2010...

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