Currently the global financial system is experiencing situations on scale not yet seen all at once.
The fact is that the banks began to "overtrade" trying to grow their sales without due caution for the quality of the sale. Giving out "low" and "no doc" loans just to sell some more money without charging a risk premium to the borrower to compensate for the extra risk involved with the lending arrangement.
There are two main reasons why businesses fail - one is overtrading and the other is undertrading.
The banks have now gone from overtrading to undertrading. Why? Because they no longer trust each other. However, to continue to exist they need to get over these issues and do business - buy and sell money - for a reasonable profit!
Fear is a very powerful mindset that can brutally affect the decisions we are prepared to make. As Roosevelt said though, "the only thing to fear is fear itself".
In Australia the best percentage of us have it very good. For many of us any financial stress has been brought on by our own choices - we can manage our choices.
If you read Saturday morning's Courier Mail one would think that life as we know it was about to end. However, there I was making pancakes, like most Saturday mornings, for my family and watching my 3 beautiful children play and grow. Life goes on, it up to us to make the decisions that propel us forward rather than hold us back.
Get out there and say thanks for the wonderful life we do have. Then look at ways to improve it if you want - don't make the improvements actually cause so much stress that they are negatives and detract from life.
Regards
Damian Ebzery B.Bus M.Bus(Prof Acc) AFPA ASA
