Tom Scollon
Tom Scollon
Chief Editor

The G20 meeting in Washington last weekend left much to be desired. I saw snippets of the fanfare and parading and smooching on TV. And as I watched I contemplated what really came out of all of this other than these world leaders feeling very important.

I searched for outcomes but could find little.

In my view the inability to halt or even slow current market malaise has been largely due to government’s capacity to convince us that they are in control. I include all key global governments and their representatives - in the form of Reserve Bank Governors, Treasuries, Department of Finances and whatever financial entourage that follow like lemmings. I have not heard one smart idea. Governments all over the world mirror image each other at the moment with little evidence of lateral thought.

There was much grandstanding by the G20 about exercising greater control over financial institutions, trading shorting etc., I will repeat my view ‘the horse had bolted’ and to use another metaphor governments ‘are barking up the wrong tree.’ These are the obvious ‘whipping boys’.

Much was deferred by G20 till March. Great, that will just defer the stopping of the slide.

Markets are in a serious slide and I hesitate to contemplate the rort we will see between now and then. Is this what governments are waiting for?

And yet our own Reserve Bank Governor all but admonished us – yes, you and me for talking Australia into a recession! Yeah just like we want one. It is his job and not his talk to ensure Australia does not go into recession. Your fear and chats at work, over the dinner table, at the pub (maybe we could have an economy recovery by producing billions of video cameras cleverly planted that will track our negative talk) will not be the root cause of a recession if we go there. But don’t wait for the alarm bells to ring and tell us we are in recession! Don’t wait for the Reserve Bank to tell us – some months after the event. As we will be somewhere on the way to the next economic boom.

Stay ahead of the curve - and ahead of our highly paid financial and economic experts. Be ready to take advantage of this massive share market low that is ahead of us and see it as a unique opportunity to buy in. Whilst governments are still wondering what day it is!

Enjoy the ride

Tom Scollon
Chief Analyst