Unlike A41's fund and my primary fund they will all go down like a tumbling tower block the instant intra bank lending tightens on a global scale.
The EU is in effective recession, China is no better and most emerging economies are in crisis. This is the backdrop against which the likes of our big 4 must borrow money, lend it out at a profit and hope for the best with maybe 10% of their residential clients now underwater.
Our funds are all heavily exposed to bank shares. When it comes to innovation they can't see beyond FANG.
We are currently discussing greater Government control of local funds along with the consolidation of those funds because the model the government set in place years ago was the wrong one. Governments can't run funds properly. Over in the EU they are using pension funds to gobble up toxic Italian bank debt on the basis that a lot of the Lehman era instruments eventually retained their capital. Government advisors overlook the a key fact that this is not 2008 and there is insufficient growth to turn non-performing instruments into good ones. As I see it many EU funds will lose everything as a consequence of government prodding and short term expediency.
All Scomo and Shorten seek to do locally is to use private super savings to fund Government budget items so that they can tout tax cuts (Trumpian style). It will end in tears.
