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Edition 215

  • 18 August 2017

When I started working in CBA Treasury in 1979, it was like a startup. Personal computers and trading screens were new technologies, access to foreign bond markets was opening and financial markets were deregulating. Balance sheet management techniques were in their infancy, there were no capital adequacy rules and product pricing was naive. Everything was possible.

Heigh-ho heigh-ho, are family trusts the way to go?

The intricacies of family trusts can be confusing, but examining the potential through the eyes of Snow White and the Seven Dwarfs shows whether a trust is a dopey or happy move.

8 ways long-term investing is rewarded

It's intuitively appealing that long-term investing by active managers should be rewarded, but a new report quantifies many ways a patient investor can extract extra returns.

Do your homework on 'granny flats'

Centrelink’s ‘granny flat’ exceptions are designed to encourage people to stay out of supported care, but it's important for welfare recipients to make the correct arrangements.

Oil price projections are no longer gushing

Long-term oil price projections and currency appreciation make the current valuations of many Australian companies look overly optimistic. Extra supply can be turned on quickly when prices start to rise.

The investment bias against small companies

The share prices of smaller companies are traditionally more volatile than large, but the market is changing and the roles seem to be reversing. Is it possible to change our bias against small caps?

What happened in the last Korean War?

A war between the United States and North Korea is unlikely, but with Donald Trump and Kim Jong-Un turning up the rhetoric and mad fingers on the red buttons, anything is possible. What happened last time?

The amazing AUSTRAC versus CBA turmoil

Readers made many insightful comments about trust in financial institutions last week, and we welcome further constructive feedback about the unbelievable cash laundering through CBA ATMs.

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Raising the GST to 15%

Treasurer Jim Chalmers aims to tackle tax reform but faces challenges. Previous reviews struggled due to political sensitivities, highlighting the need for comprehensive and politically feasible change.

7 examples of how the new super tax will be calculated

You've no doubt heard about Division 296. These case studies show what people at various levels above the $3 million threshold might need to pay the ATO, with examples ranging from under $500 to more than $35,000.

The revolt against Baby Boomer wealth

The $3m super tax could be put down to the Government needing money and the wealthy being easy targets. It’s deeper than that though and this looks at the factors behind the policy and why more taxes on the wealthy are coming.

Are franking credits hurting Australia’s economy?

Business investment and per capita GDP have languished over the past decade and the Labor Government is conducting inquiries to find out why. Franking credits should be part of the debate about our stalling economy.

Here's what should replace the $3 million super tax

With Div. 296 looming, is there a smarter way to tax superannuation? This proposes a fairer, income-linked alternative that respects compounding, ensures predictability, and avoids taxing unrealised capital gains. 

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In selling the super tax, Labor has repeated Treasury claims of there being $50 billion in super tax concessions annually, mostly flowing to high-income earners. This figure is vastly overstated.

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