I’ll try not to get on my soapbox too much with this… honest.

Do I think another interest rate cut will make any difference, no not really. Let me try to explain.

With the rate home bills such as gas, water, electricity and council rates costs are spiralling upwards, we’d need several interest rate reductions to even make the slightest positive impact.

What data the Reserve Bank uses to make these decisions to me is questionable.

My concern is, I honestly doubt what the Rba says really means much anyway. I would bet that most of the money loaned in Australia is sourced from overseas at far lower interest rates. The vast profits the major banks keep announcing, seems to prove this, to me anyway.

If the banks aren’t sourcing their funds from Australia, then what impact can the Reserve Bank interest rate announcements really have??

I may be completely wrong, but this is me voicing my opinions and my thoughts.

The interest rate cuts need to reflect the spiralling costs of these rising utility costs, but they aren’t…  At the moment they aren’t even close to offsetting these rising costs. In reality the banks don’t even have to pass on the interest rate cuts the Reserve Bank announces, it’s more of a PR exercise it seems.

What real competition is there in the banking/finance market place? Westpac owns Rams, St George Bank and Bank of Melbourne; Commonwealth Bank owns BankWest; Adelaide Bank and Bendigo Bank have a relationship. This doesn’t leave a lot of marketplace for real competition. The Building Societies and Credit Unions I believe are too small to have any real buying power, so consequently the big 4 banks can really charge whatever they like and still have a vast stranglehold of the marketplace.

I don’t have all of answers unfortunately, I wish I did. There needs to be more transparency and competition in the Banking/Lending market but until that happens, I honestly don’t think we’ll get real interest rates reflecting the real needs of the market. In my opinion, the Government and Reserve Bank need to take control because self regulation clearly isn’t working.

Just my humble opinion.