Jen’s Note Special Edition
Without question we are facing very difficult times as the credit crisis in the USA infects the rest of the world. All investors have lost money and may be feeling that the whole situation is most unfair because for the most part Australians do run good businesses and try to be responsible in their spending even though there has been a trend to using probably more consumer credit than is perhaps prudent.
The USA Government has stepped in to try to take control of the market by underwriting the sub prime mortgage debt as well as several large financial institutions. What the long term outcome of this is really anybody’s guess, but it does demonstrate that the more complex and tricky the type of investment is the more chance that it will fail in a poor market. Much of what has happened is because the people who issued the mortgages then sold them on to merchant banks that parcelled them up into “managed funds” holding all sorts of other investments as well.
The reality is this we do not know what further problems the USA has but in Australia things are not going to be as bad as the difficulties many Americans will face.
Our climate is not so extreme so there is little chance that you will freeze to death without heating. As the USA and Europe move into winter the citizens of those countries are going to face great difficulties just surviving if they have no jobs and cannot afford to pay for warmth and good food.
We will have job losses here but we are moving into summer and so will be safer as far as our actual living conditions are concerned. We have a quality welfare program in Australia even though it needs to be more generous than it is at present. We do have access to medical services if we cannot pay and for the most part most suburbs have support systems for those in trouble.
Is this going to be a great Christmas for a big spend up? Not if you are sensible and realise that a big hug and kiss will be just as welcome and you know that it will fit and you will not have to dust it. Looking at ways to reuse and recycle goods rather than buy new unless absolutely necessary will ease the cost of living. If you can postpone some spending or for go it altogether then that will be to your benefit.
Many people are growing vegetables in their backyards, perhaps talking to your neighbours and sharing veggies will be a way to build a new level of neighbourhood support and at the same time be more mindful of others. Please keep an eye on your elderly neighbours, they might not be the liveliest people to know but they may well be suffering financial difficulties and a friendly hand can go a great way towards living in a better and more secure neighbourhood.
Equally they just might have some very good budgeting ideas.
Do not give up on spending time with friends, just invite them round for a coffee or meet them in the park to walk and talk and maybe have a family picnic with each family bringing some food to add to the common table.
We know this all sounds a bit mother hen and not a very sophisticated answer to the economic woes of the world. But no one anywhere can tell you when this will be over, or how much worse it will get or if we have reached the bottom now. They simply cannot and it would be foolish to pretend otherwise.
What we can do is understand that we are all in this time together and that some are going to be better off than others. We should be thankful for what we have and appreciate what real wealth is. Having good friends and a loving family are riches that many do not have.
The government cannot fix this, nor is blaming the USA President or the poor regulative stucture going to help. We must simply live through this time with as much dignity and thought for others as possible.
One benefit that will remain from this period of hard times is this, having learnt the lessons of thrift they are never forgotten by the generation that experiences difficult times. One learns to value the things that are intangible and well as the tangible.
Australians are a very resilient people and will devise ways to improve life when there is less to work with. Out of these times will come great innovation and creativity possibly creating whole new industries and business opportunities. So the clouds will have a silver lining even if it is hard to see that just at present.
If you know people who have lost employment try to help them regain a job by thinking of all the contacts you might have who can assist. Try to keep to a budget to make sure that you have a back up for an emergency. A positive attitude is a great help when things seem to be against you, and remember that tough times never last and that better times return and we can spend this time planning how to take better advantage of them when they arrive.
A word of caution, in times like this the number of scams and generally deceptive offerings increase greatly. It could be someone offering to buy your shares off the market or an email that offers a scheme to reward you with work to be done at home or some other criminal activity. Please warn your friends and family if it sounds too good or easy to make a profit it is almost for sure a scam. You should check the ASIC website for the current scams on www.fido.gov.au.
As you know we lost our lovely canine receptionist Tamba. Well the good news is that we offered the position to Lina, Tamba’s niece and she has accepted the job. Her bio is that she loves retrieving balls, is a black haired girl of 4 years who has just retired as a breeding girl. She likes chicken mince better than fresh beef mince. Her favourite game is doing belly wackers into her paddle pool when Bill throws her ball and she gets a bit hot. She just loves ear tickles and although a little shy still is settling into her new career very well and looks forward to meeting you all soon.
Looking forward to better days.
Jen, Rose and Lina the canine receptionist.