Personally I was a bit stunned that Krudd could be offering inducements to first home buyers by doubling and tripling the first home buyers grants in this market. Can he really be so stupid as to think this is a good idea when the bubble is set to burst...must burst in fact?
Does he really think 100,000 or 200,000 more sub-prime loans is the answer?
The extra money to old age pensioners/carers is good but does he think a one off payment is enough? Are all old age pensioners now expected to fall off their collective perches just as that money runs out?
If he announced a massive increase in infrastructure spending I would have applauded, as long as it was sensible - like more dams/water infrastructure etc, not greeny BS like windfarms. That sort of thing creates jobs and has been sadly lacking in all state and federal govts for a couple of decades.
He has essentially wasted 1/2 the surplus bequeathed him by the previous federal govt...I even saw a piece, allegedly, written by him in the print media yesterday claiming
HIS govt was responsible for the budget surplus ...like we haven't seen previous federal labor govts do that before
THE world is experiencing its worst economic crisis since the Great Depression.
Share markets throughout the world have fallen dramatically and many developed countries are facing the possibility of a recession - this will mean a contraction in economic growth and rising unemployment.
The US, Britain and other nations' governments have been forced to bail out some of their largest banks and have moved to guarantee bank deposits to shore up confidence.
Australia is not immune from this global crisis.
It will affect our financial sector and our economy.
Banks are facing higher borrowing costs as foreign banks become less willing to lend, share prices have fallen significantly and slower world economic growth means less demand for our exports and lower tax revenues.
What has gone wrong? It boils down to a couple of core facts.
Roll the clock back to the US recession of 2001, to what was then described as the "tech-wreck", and to what happened when the US Federal Reserve responded.
Capital became very cheap, money became very cheap and, as a result, risk and the perception of risk was reduced.
You had excessively cheap finance, resulting in excessive risk in US mortgage markets.
At the same time, new financial products came on to the market, financial products that the regulators had not properly thought through.
On the one hand, you had excessive risk in the mortgage market, but on the other hand, underpinning those mortgages was the securitisation of them by financial institutions using financial instruments that neither they, nor the US regulators, properly understood.
The amount of bad mortgages was a problem.
But the much bigger problem was the fact that these sub-prime loans were hidden from the financial regulators.
Knowing how much people owed is one thing.
Not knowing how much US financial institutions were exposed to that, well, that is something else.
And that has created the two core elements of the problem we face.
So much for what went wrong.
What are we doing about it?
I strongly believe in levelling with the Australian people on the gravity of this crisis - it is the economic equivalent of a rolling national security crisis.
But in the gloom we also have a silver lining for Australia - out of all of the developed countries caught up in this crisis, we are probably the best placed of any country to ride it out.
If you've got money in the bank, if you own shares, if you own property, if you've got a job, or if you're looking for one, then Australia is probably the safest place in the developed world you could be.
This is because the Australian economy and our financial system are in very good working order.
Our banks are among the best regulated, safest and strongest in the world.
On Sunday I announced a guarantee on all cash deposits, whether from a business or an individual, along with guarantees on term funding - the loans banks make between themselves.
My Government has also built up a $22 billion surplus as a buffer against tough economic times. (Gee, I remember it slightly differently)
Those times are now here.
We thought ahead of a future when the rainy day would come, and it has arrived, meaning the Budget surplus can now be used responsibly to strengthen the economy.
The recent cuts of 1.25 percentage points in interest rates, along with any further cuts the Reserve Bank might make, mean that families paying off a mortgage have some breathing space after 10 straight rises under the Coalition. (that would be the interest rate rises the economy needed to rein in an economy out of control?)
This takes a bit of pressure off the weekly household budgets, which will also help keep the economy ticking over.
Back at the time of the Budget in May many commentators and critics told us to abandon the tax cuts we promised before the election - we rejected that approach, and those tax cuts are now also helping to strengthen the economy.
And the source of much of Australia's ongoing economic prosperity has been the China-led resources boom. (which will come to a grinding halt when the US stops buying the crap China produces)
The Chinese economy is still expected to grow strongly over the next couple of years. (You hope - but not very likely)
That will help to bolster demand for our exports and underpin ongoing economic growth here in Australia.
We have already acted decisively to protect Australia from the worst of this global crisis but there are many international factors that are out of our control. (Nope, they are all out of your control)
That is simply a cold, hard fact.
Nonetheless, we will continue to focus on the things we can control and use every economic tool at our disposal to protect working families, pensioners, carers, small businesses and everyday Australians from the damage that will be a consequence of this crisis.
Kevin Rudd is Prime Minister of Australia
Thank God it points out this moron is the PM