Do not despair chairman Dan.
When you’re unceremoniously turfed out of office in November 2022, you’ll only have to cool your bureaucratic heels for less than year.
The RBA governor’s term comes up for renewal in September 2023. I think you should throw your hat in the ring. The way you’ve handled the COVID-19 problems in your state makes you an outstanding candidate.
It’s blatantly obvious — even to a blind man galloping by on a horse — that you have very limited economic nous.
Why else would you be grinding the tax-paying private sector to dust while rewarding the tax-taking public sector?
But that ‘suck the lifeblood from the host’ thinking sits well in central banking land.
In this free guide, discover how a currency crisis could drain the supply of circulating cash…and how you can keep your standard of living when going through it. Download the free guide now.
As reported in the Australian Financial Review on 9 August 2019:
‘Reserve Bank Governor Philip Lowe has warned that public sector pay caps are entrenching low wage growth and wants them lifted to at least 3 per cent.
‘Dr Lowe told a parliamentary economics committee on Friday that federal and state government wage caps of 2 to 2.5 per cent across the country were helping to depress wages by setting the standard in the private sector.’
Economics be damned. It’s your ideologies that will carry the day.
Appointing someone who doesn’t have a doctorate in MIT economic hocus-pocus is not without precedent.
As reported by Quartz on 3 November 2017:
‘Jerome Powell is Donald Trump’s pick to be the next Federal Reserve chair. If confirmed by the Senate, he will be the first non-economist to hold the job for nearly 40 years.’
And in Quartz on 4 July 2019 (emphasis added):
‘Christine Lagarde has been nominated to replace Mario Draghi as president of the European Central Bank (ECB). A French politician, Lagarde, 63, has run the International Monetary Fund since 2011.
‘If she’s confirmed, both the ECB and the US Federal Reserve—the world’s two most influential central banks—will be headed by lawyers, not economists.’
Dan, the only real value in an economic degree will be to hide any cracks in your wood-panelled office. So don’t sweat it mate.
When the rubber hits the road Dan, all you need to know is how to say with a solemn face (and let’s face it you’ve got that nailed) why interest rates need to go lower and lower and lower.
Deliver it with a slightly saddened expression. Pretend to feel the pain of savers. Just like you’ve done with COVID…‘we don’t want to waste the sacrifices we’ve made’. Dan, mate, we you know you haven’t sacrificed a thing. Yet, you deliver that line with such conviction.
Your theatrics are tailor-made for a highly paid central banker. They feel none of the hurt from their decisions to screw savers to the wall. But when fronting the media, they summon up their inner Robert De Niro and fake genuine concern.
The way you’ve flicked the lockdown on, then off, then on again and then kept it on for a little while longer, makes you the ideal candidate to take charge of the money printing machine…with one exception. You don’t even have to know where the off button is.
How good is that?
And, if you’re questioned about the lunacy of this decision (and let’s face it, you’re well versed in handling that question…think, Belt and Road, COVID, Red shirts…anyway you get the drift) all you have to utter in a solemn tone, are these words…unconventional policy.
From time to time you’ll be called on to do the odd bit of PR work for bank lending.
The Australian Financial Review on 27 June 2020 (emphasis added):
‘Reserve Bank governor Philip Lowe has urged bank bosses to keep lending, as he expresses fears of a second spike in unemployment when government assistance winds down after September 30 and companies restructure their operations.’
This has to be done irrespective of whether households can afford it or not. Somehow you must persuade them it’s in their best interest to take on more senseless and unnecessary pain…not unlike the COVID lockdowns.
The latest Mortgage Stress data from Digital Finance Analytics shows that the RBA — to date — has done a brilliant job in creating financial hardship for Australian households.
Source: Digital Finance Analytics
Dan’s future as a potential central banker looks very bright
Dan, look at these figures as a glass half full.
There’s still 26.6% of ‘Young Growing Families’ who can take on MORE debt.
Clearly not all in the ‘Disadvantaged Fringe’ are disadvantaged. There’s more lending growth in this area too.
Look at the upside in the ‘Wealthy Seniors’…huge growth potential here for our elderly to be loaded up with debt.
It’s not official, but I have it on good authority that the central bank KPI for mortgage stress is 100%. Why else would they take rates so low and actively encourage banks to lend more?
So there’s still plenty of upside in this area Dan.
What about political incompetence, negligence or ineptness?
Mate, no worries. Again, look at the precedent.
The Independent UK, 19 December 2016:
‘French judges found Ms [Christine] Lagarde guilty of negligence for failing to challenge the state arbitration payout to the friend of former French President Nicolas Sarkozy.
‘The 60-year-old, following a week-long trial in Paris, was not given any sentence and will not be punished.
‘Ms Lagarde, who was French finance minister at the time of the payment in 2008, has denied the negligence charges.’
Being found guilty of negligence by a court of law is only a career killer in the real world.
Reuters, 18 October 2019:
‘European Union leaders confirmed on Friday the appointment of Christine Lagarde as the new chief of the European Central Bank, replacing Mario Draghi from November 1.
‘Lagarde’s confirmation for a non-renewable term of eight years comes after EU leaders nominated her for the position on July 2 .’
Don’t worry about your monumental stuff ups Dan. They’re career makers not breakers.
Another attribute that makes you eminently qualified to be a central banker is this…there’s no problem of your own making that you cannot make worse by a solution of your own making.
And, when your solution creates an even bigger problem, you absolutely DO NOT change the solution…you pig-headedly apply an even greater amount of the failed solution.
Proving that you NEVER, EVER, EVER learn from your mistakes is probably the greatest quality you can have to be a central banker.
Oh, just when I thought I couldn’t plead your case any better, I remembered one other ‘strength’ that you have in common with central bankers…an ardent belief in climate change.
So Dan, while those not on the Victorian Government’s payroll wonder if they’ll have a job to go back to or nervously await a call from the bank, your future as a potential central banker looks very bright indeed.
Editor, The Rum Rebellion