Second Stimulus Plan + Cash rate cut = Saving the economy?

Australian Federal government executed their second stimulus package, so all working Australian earning below $AUD 80,000 per annum will receive a payment of $AUD 900 as part of the stimulus plan to reimburse tax payers as the Australian economy is riding through a recession period. The base for such a generous act is to put back the economy back to it's place by freeing cash for consumers to spent. As usual Federal Opposition leader, Malcom Turnbull hits back at the Rudd government for using the same method which doesn't spur any growth similar to the previous stimulus package. Mr. Turnbull stated 85% of the population whom had received the previous reimbursement from the first stimulus plan did not spent but rather save their money in the bank to earn interest. Conservatism and low confidence with the market performance, everyone is taking a defensive stand. "Cash is king" era, that's what it's called and it HAS to be spent and monitored under a very tight regime. Splurging unwisely comes with serious consequences which might force an individual running towards bankruptcy and a nation, fattening up their deficit.

7th April 2009

Reserve Bank of Australia (RBA) announce a 25 basis point cut from the benchmark cash rate, bringing it to 3% for loans. The four major banks, namely The Commonwealth Bank, ANZ Bank, Westpac Bank and The National Australian Bank (NAB) is thinking what are the further impacts to their lending rate, "Is it too low?". Retailers welcome the Federal government's move.

The announcement of rate cut was to reinforce the effect of the first stimulus package. Hopefully consumer confidence would rebuilt back.

7th April 2009, 5.15pm Australian time
NAB refuse to follow suit the 0.25% cut on the cash rate. So now what happens? Die or adapt?





Out from all the hypes of activity in the trading house, my very own floor has a very happy floor mate, named Romain Tanti. Reason for his joy is because his girlfriend is coming to visit him and she's arriving tonight, direct flight from France I think. So he's out at the airport waiting for her tonight. Haha happy dude. Cheers my friend and have a good time!

I bet he's going to drink like hell tonight, haha. French-ies past time, sipping wine, or beer. Whichever they can find first. ahah