AUSTRALIAN PRODUCTIVITY COMMISSION                              AUSTRALIAN CURRENCY TASKFORCE

LB2 COLLINS STREET EAST PO                                                   BOX 242, LA TROBE UNIVERSITY,
MELBOURNE VIC 8003                                                                   BUNDOORA VIC 3083

housing@pc.gov.au                                                                          hardcurrency2k@hotmail.com                                                    

              AN INQUIRY TO EVALUATE THE AFFORDABILITY AND AVAILABILITY OF HOUSING

                                                    FOR FIRST HOME BUYERS

                                          PRODUCTIVITY COMMISSION ACT 1998

                                                    OUTLINE OF SUBMISSIONS

1.	WHY THE PRODUCTIVITY COMMISSION ?

AUSTRALIAN LAW  REQUIRES THAT THE COMMISSION MUST HAVE REGARD TO THE NEED

TO IMPROVE THE OVERALL ECONOMIC PERFORMANCE OF THE  AUSTRALIAN ECONOMY

 IN ORDER TO ACHIEVE HIGHER LIVING STANDARDS FOR ALL MEMBERS OF THE AUSTRALIAN

COMMUNITY, 

AND THAT INCLUDES THE NEED TO IMPROVE BOTH THE OVERALL SYSTEM AND THE RESULTS OF

PREVENTION OF ECONOMIC IMPERILMENT OF AUSTRALIAN CITIZENS,

IN THE NATIONAL INTEREST AND IN THE INTERESTS OF THE NATIONAL (ECONOMIC) SECURITY.

THIS COMMISSION IS, PURPORTEDLY, AN INDEPENDENT AUSTRALIAN GOVERNMENT AGENCY
 
AND IS THE GOVERNMENT’S PRINCIPAL REVIEW AND ADVISORY BODY ON MICROECONOMIC 

POLICY AND REGULATION.

ITS INDEPENDENCE IS (APPARENTLY) UNDERPINNED BY ITS OWN ACT OF PARLIAMENT, 

AND ITS PROCESSES AND OUTPUTS ARE OPEN TO PUBLIC SCRUTINY,

DRIVEN BY CONCERN FOR THE WELLBEING OF THE COMMUNITY AS A WHOLE.

2.	WHY THIS INQUIRY ?

2003 MARKS THE TWENTIETH ANNIVERSARY OF THE BEGINNING OF THE  END OF

THE IMPLEMENTATION OF THE CAMPBELL COMMITTEE OF INQUIRY DISASTROUS 

RECOMMENDATIONS,

AN INQUIRY SET UP BY THE THEN TREASURER,  THE HON. JOHN HOWARD MP,

THE CONVENOR OF THE PRIME MINISTER’S TASKFORCE ON HOME “OWNERSHIP”

AND OF THE WALLIS COMMITTEE OF INQUIRY INTO THE  AUSTRALIAN FINANCIAL SYSTEM,

WHOSE  RECOMMENDATIONS ARE NOW NOTORIOUS, TOO.

1983 WAS THE YEAR WHEN THE CURRENT PRESIDENT OF THE WORLD BANK, 

THE MAYOR OF NEW YORK, THE CHANCELLOR OF BOND UNIVERSITY,

THE RECENT PAST-PRESIDENT OF BANK UNITED, USA      (AND OTHERS)

ALL WORKED AT  THE SAME  WALL STREET INVESTMENT BANK,

WHERE  FIRST HOME “OWNERSHIP “-RELATED “INNOVATIONS” WERE THE WIZARDRY OF THE DAY

SOMETIMES KNOWN AS LIAR’S POKER (“MASTERS OF THE UNIVERSE” WAS JUST A SHOW THEN).

THE BANK, NOW A SUBSIDIARY, CONTINUES TO BE LINKED TO THE BIGGEST FINANCIAL 

SCANDALS (THAT IT ESCAPES BY BUYING ITS WAY OUT OF PROSECUTION) AND WAS CLOSELY 

ASSOCIATED WITH THE LATE FIRM OF ARTHUR ANDERSEN, THE AUDITORS AND ACCOUNTING 

“ADVISERS” TO ENRON AND WORLDCOM,    AND TO MOST AUSTRALIAN STATE AND FEDERAL 

GOVERNMENT DEPARTMENTS,   INCLUDING THE HOUSING AUTHORITIES.

THE DISASTROUS “OWNERSHIP”  SCAMS OF THE EARLY EIGHTIES AND NINETIES

(FACILITATED BY A NUMBER OF AUSTRALIAN LEGAL AND ACCOUNTING FIRMS AND “FINANCED”

BY CERTAIN LOCAL AND FOREIGHN “BONDHOLDERS” WHO INSISTED TO BE, AND WERE,

“IDEMNIFIED” OUT OF STATE AND FEDERAL TREASURY RESERVES) WERE ALL REALLY NOTHING

MORE THAN A DELIBERATE AND AN ELABORATE REAR-GUARD ASSAULT ON THOSE FUNDS.

THEY OFFERED (TEMPORARY) “OWNERSHIP” IN THE HIGHEST INTEREST RATE CLIMATE EVER,

BUT “CALLED” ITS (BALOONED) MONEY BACK ONCE THE INTEREST RATES TURNED, THUS

FINANCIALLY & ECONOMICALLY CRIPPLING SEVERAL  GENERATIONS OF AUSTRALIAN CITIZENS.

LITIGATION ASSOCIATED WITH THIS BACCARAT-STYLED ECONOMIC CRIME IS CONTINUING

(NOW THAT THE CROWN AND DERIVATIVE IMMUNITIES ARE NO LONGER AN ISSUE)

AND ALL AUSTRALIAN LAW ENFORCEMENT AND INTELLIGENCE AGENCIES HAVE THIS TIME BEEN 

PUT ON AN ALERT FOOTING, WELL IN ADVANCE, TO GUARD AGAINST ANY NEW ATTEMPTS TO 

RAM-RAID TAXPAYERS’ FUNDS, NOW THAT THERE ARE AGAIN SUGGESTIONS OF “PRESSURE” 

TO LIFT INTEREST RATES. 

HON. JOHN HATTON MP , THE FORMER CHAIRMAN OF THE NSW PARLIAMENT’S

“SELECT COMMITTEE UPON HOMEFUND AND FANMAC LTD.”, SAID IN HIS FOREWORD TO

THE COMMITTEE’S MAY 1994 REPORT TO THE NSW PARLIAMENT THAT: 

“…WHERE MINISTERS AND EXECUTIVE GOVERNMENT FLOUT ESTABLISHED PRACTICE,

IGNORE THE NEED FOR CHECKS AND BALANCES AND EMBARK ON MAJOR EXPENDITURE

INVOLVING PRIVATE ENTERPRISE  IN AN OFF-BUDGET SCHEME WORTH BILLIONS OF DOLLARS,

THE DANGERS ARE CONSIDERABLE.

WHEN WARNINGS ARE GIVEN BY THOSE CHARGED WITH SERVING THE PUBLIC INTEREST,

IN THIS CASE THE SOLICITOR GENERAL AND TREASURY, AND WHERE THOSE WARNINGS ARE

IGNORED, THEN THE WRATH OF THE PUBLIC MUST EXPECT TO BE FELT BY THOSE ELECTED 

REPRESENTATIVES WHO IGNORE THE ADVICE AND EMBARK ON

PERILOUS FINANCIAL ESCAPADES.

IN THE CASE OF HOMEFUND, THE GOVERNMENT EMBARKED ON A SCHEME WITH FANMAC LTD.

WHICH AVOIDED LOAN COUNCIL GUIDELINES AND FOR WHICH MECHANISMS OF

ACCOUNTABILITY WERE NEVER PUT IN PLACE TO FOLLOW THE PUBLIC DOLLAR LIABILITY.

THIS RESULTED IN PROFITS FOR FANMAC LTD.  BUT CONSIDERABLE FINANCIAL COSTS TO

THE STATE AND MASSIVE PERSONAL AND FINANCIAL COST TO MANY HOMEFUND BORROWERS.”

THE COMMISSION OUGHT NOT IGNORE THE “COINCIDENCE” OF THE RETURN OF THE MUCH-

DEFRAUDED FHO(S) GRANT, RECENT “CALLS” FOR THE ESTABLISHMENT OF THE SECONDARY 

“RESIDENTIAL EQUITY” MARKET (IN ADDITION TO THE SECONDARY MORTGAGE MARKET),

THE RECENT CHANGES AT THE TOP OF ASIC, ASX, ACC AND ACCC, THE ESTABLISHMENT OF 

THIS INQUIRY AND ACADEMIC “SPLIT-OWNERSHIP” TASKFORCE (INSTEAD OF THE AUSTRALIAN

INSTITUTE OF FAMILY STUDIES USED FOR THE SAME PURPOSE LAST TIME AROUND).

3.	TERMS OF REFERENCE

IT IS A MATTER OF GRAVE CONCERN THAT ONCE AGAIN (IN A RISING INTEREST-RATE CLIMATE

AND IN A NON-VIABLE PROPERTY MARKET) IT IS THOUGHT PRUDENT IN SOME QUARTERS

TO “…IDENTIFY AND EXAMINE MECHANISMS AVAILABLE TO IMPROVE THE ABILITY OF

HOUSEHOLDS, PARTICULARLY LOW INCOME HOUSEHOLDS, TO BENEFIT FROM OWNER-

OCCUPIED HOUSING.

THIS WILL INCLUDE AN ASSESSMENT OF RENT AND DIRECT OWNERSHIP SUBSIDIES,

LOAN GUARANTEES AND SHARED EQUITY INITIATIVES…”  !!!

THOSE ASPIRING TO PURCHASE THEIR FIRST HOME ARE AMONGST THE MOST VULNERABLE 

MEMBERS OF OUR SOCIETY, LOW INCOME HOUSEHOLDS PARTICULARLY SO.

ENTICING AND FACILITATING THEIR ENTRANCE INTO A NON-VIABLE FINANCIAL TRANSACTION

(BE IT A FULL OR A PARTIAL ONE), BY WAY OF IMPOSITION ON CONSOLIDATED REVENUE 

(BY WHATEVER NAME) AND OF ESCALATING ONEROUS MORTGAGE OBLIGATIONS, AMOUNTS TO

AT THE VERY LEAST SOLICITING PERSONS TO INVEST FUNDS CONTRARY TO THOSE PERSONS’ 

BEST INTERESTS,   A CRIMINAL OFFENCE IN THE STATE OF VICTORIA BY VIRTUE OF S. 191

OF THE CRIMES ACT 1958.

IT IS SUGGESTED THAT THE  TERMS OF REFERENCE  ARE FATALLY FLAWED IN THAT

THEY ARE “CONTAMINATED” AND ACTUALLY DICTATE TO THE COMMISSION 

A PRE-DETERMINED APPROACH, THRUST, COLOUR, AND FLAVOUR OF THE OUTCOME OF 

THE EVALUATION AND THE RECOMMENDATIONS THE COMMISSION IS YET TO MAKE.

4.  THE COMMISSION’S APPROACH

THE CONTENT AND THE LANGUAGE OF THE COMMISSION’S “ISSUES PAPER” IS THE FIRST 

EXAMPLE OF THE EFFECT OF SUCH CONTAMINATION, AND IT IS PRECISELY FOR THIS REASON 

TOO THAT MOST SUBMISSIONS, PRIMA FACIE, APPEAR TO ADDRESS NEITHER THE TERMS NOR 

THE ISSUES, MAKING THESE SUBMISSIONS EASIER TO DISREGARD.

SOME “ISSUES PAPER” MATERIAL IS FACTUALLY INCORRECT AND IS HISTORICALLY AND/OR

OTHERWISE INACCURATE, NOT TO MENTION THE INTERPRETATION OF SOME ECONOMICS-

RELATED CONCEPTS (AND EVENTS) AND OF THE POLITICAL ASPIRATIONS OF THE GOVERNMENT.
THE REFERENCES RELIED UPON BY THE COMMISSION AND ANNEXED TO ITS “ISSUES PAPER”

ARE MOST REVEALING, AND CONFIRM THE CONCERNS OUTLINED ABOVE.

IT IS IMPORTANT TO NOTE THAT AT THE DATE OF THIS SUBMISSION NONE OF THE PARTICIPANTS

IN THE HOME OWNERSHIP DEBATE (PARTICULARLY THE INDUSTRY, ACADEMIA AND FINANCIERS)

ATTEMPTED TO MAKE THEIR VIEWS KNOWN TO THIS STATUTORY INQUIRY, BY WAY OF 

SUBMISSION, AND IT WOULD BE WRONG FOR THE COMMISSION TO CONSIDER AND/OR RELY ON 

THEIR VIEWS AS IF THEY HAVE MADE A SUBMISSION.

5.	GOVERNMENT “ASSISTANCE” AND THE AVAILABILITY OF “FINANCE”

THE COMMISSION’S STATUTORY OBLIGATION TO “DO GOOD” REQUIRES IT TO TAKE

A POSITION UNAFFECTED BY THE CONCEPTUAL REASONING, TERMINOLOGY AND THE JARGON

OF THOSE SUBJECT TO ITS INQUIRY.

NOT TAKING IT WOULD JEOPARDISE THE INTEGRITY OF ITS FINDINGS AND RECOMMENDATIONS.

IN ORDER TO PREVENT THE LATTER FROM OCCURING THE COMMISSION OUGHT TO BEGIN

ITS TASK BY REMEMBERING THAT DESPITE “COMMON” USE OF SOME WORDS AND CONCEPTS,

CONTRARY OR NOT TO  THEIR “ACTUAL”  MEANING, NOT ALL ARE MUTUALLY INTERCHANGEABLE, 

EXCLUSIVE OR ARE IN THE SAME CONCEPTUAL DIMENSION, AND THAT:

A.  THE AUSTRALIAN CASH CURRENCY’S LOSS OF PURCHASING POWER AT HOME

AND PROLIFERATION OF THE DEBT CURRENCY AND OF THE SPORT OF GREED

ARE THE MORE LIKELY CULPRITS BEHIND THE ESCALATION IN PRICES THAN THE PURPORTED 

“INCREASED WEALTH” OF THE AUSTRALIAN HOUSEHOLDS.

B.  HOUSING PRICE ESCALATION AND PROPERTY SPECULATION ARE THE RESULTS OF

THE CONCERTED (BUYER AND SELLER) SPORTING EFFORTS TO EXTRACT THE MOST FUNDS,

FROM THE WILLING “INSURED” MONEY-LENDER AND OTHERS PREPARED TO “ASSIST”,

IN ORDER TO ENTER OR TO RE-ENTER THE RACE FOR THE PERCEIVED CAPITAL “GAINS”.

C.  THE BUYER’S LENDER, WHO WILL “EARN” MORE ON THE HIGHER NEW BORROWINGS

IS “RELAXED” ABOUT AN EARLY REPAYMENT, AS THE “CASH” CURRENCY HELD BY THE BUYER IS, 

TECHNICALLY, WORTHLESS DUE TO ITS DEBASEMENT AND SUBSTITUTION BY THE CREATION OF 

THE “DEBT” CURRENCY.

WERE IT NOT FOR ITS EXISTENCE, BUYERS’ AND SELLERS’ EXPECTATIONS WOULD NOT HAVE 

BEEN DISTORTED TO SUCH A PROHIBITIVE, AND COMPOUNDED, EXTENT REQUIRING ACTION.
D.	“AFFORDABILITY” IS NOT IMPROVED OR MEASURED BY ACCESS TO SUBSIDIES OR DEBT,

AND/OR BY SHARING EQUITY, BUT BY THE FINE-TUNING OF THE EARNING CAPACITY.

E.	IMPEDIMENT TO AFFORDABILITY IS CURRENCY (AND EARNINGS) RELATED,

THAT IS, HAVING TO RELY ON SOMEONE-ELSES (EXPENSIVE) MONEY.

F.	CREATION OF ARTIFICIAL LIQUIDITY, BY INTRODUCING SUBSIDISED AND OVER-COMMITTED

FIRST-TIMERS, HELPS TO FURTHER FUEL PRICES AND DEFEAT THE PURPOSE OF THE WHOLE

EXERCISE.

G.	AUSTRALIAN HOUSING MARKET REQUIRES A CHANGE OF CULTURE, TIGHTER REGULATORY 

CONTROL AND LAW ENFORCEMENT, TO PREVENT ABUSE, MANIPULATION AND CORRUPTION OF 

THE MARKETPLACE BY A PLETHORA OF WELL-PLACED PROFESSIONAL SHARP OPERATORS. 

H.	PRICES WILL FALL WHEN BARRIERS ARE KNOWN TO BE UP, NOT DOWN.

WITH THE COMPLIMENTS FROM THE AUSTRALIAN CURRENCY TASKFORCE, MELBOURNE

OCTOBER 17, 2003

PETER SHERMAN

REGISTERED AGENT,  AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, MELBOURNE