Category: Wealth Tips

As a self funded retiree, I’m frustrated with Canberra’s continuous fiddle with Superannuation contributions and rule changes, plus the measure to Rebalance the Pension Assets Test to be implemented on 1 January 2017.
So here’s fair warning to all politicians of any persuasion, this group of aged voters may be about to make the greatest impact on any Federal election in history. Ignoring them may be the start of a changed political environment in this country.
Change the Entitlements
I absolutely agree, if a pension isn’t an entitlement, neither is theirs. They keep telling us that paying us an aged pension isn’t sustainable. Paying politicians all the perks they get is even less sustainable! The politicians themselves, in Canberra, brought it up, that the Age of Entitlements is over:
The author is asking each addressee to forward this email to a minimum of twenty people on their address list; in turn to ask each of those to do likewise. In three days, most people in Australia will have this message. This is one idea that really should be passed around because the rot has to stop somewhere.
Proposals to make politicians shoulder their share of the weight now that the Age of Entitlement is over:
1. Scrap political pensions. Politicians can purchase their own retirement plan, just as most other working Australians are expected to do.
2. Retired politicians (past, present & future) participate in Centrelink. A Politician collects a substantial salary while in office but should receive no salary when they’re out of office. Terminated politicians under 70 can go get a job or apply for Centrelink unemployment benefits like ordinary Australians. Terminated politicians under 70 can negotiate with Centrelink like the rest of the Australian people.
3. Funds already allocated to the Politicians’ retirement fund be returned immediately to Consolidated Revenue. This money is to be used to pay down debt they created which they expect us and our grandchildren to repay for them.
4. Politicians will no longer vote themselves a pay raise. Politicians pay will rise by the lower of, either the CPI or 3%.
5. Politicians lose their privileged health care system and participate in the same health care system as ordinary Australian people. i.e. Politicians either pay for private cover from their own funds or accept ordinary Medicare.
6. Politicians must equally abide by all laws they impose on the Australian people.
7. All contracts with past and present Politicians men/women are void effective 31/12/2015.
The Australian people did not agree to provide perks to Politicians, that burden was thrust upon them.
Politicians devised all these contracts to benefit themselves.
Serving in Parliament is an honour, not a career.
The Founding Fathers envisioned citizen legislators, so our politicians should serve their term(s), then go home and back to work. If each person contacts a minimum of twenty people, then it will only take three or so days for most Australians to receive the message. Don’t you think it’s time?
THIS IS HOW YOU FIX Parliament and help bring fairness back into this country! If you agree with the above, pass it on.
If you wonder why the above individuals are asking for your help look at the figures below.
STATUTORY OFFICES
Date of Effect 1 July 2014
Specified Statutory Office
Base Salary (per annum)
Total Remuneration for office (per annum)
Chief of the Defence Force > $535,100 – $764,420
Commissioner of Taxation > $518,000 – $740,000
Chief Executive Officer, Australian Customs And Border Protection Service > $483,840 – $691,200
Auditor-General for Australia > $469,150 – $670,210
Australian Statistician > $469,150 – $670,210
Salaries of retired Prime Minister and Politicians
Salary as of 1 July
Prime Minister $507,338
Deputy Prime Minister $400,016
Treasurer $365,868
Leader of the Opposition $360,990
House of Reps Speaker $341,477
Leader of the House $341,477
Minister in Cabinet $336,599
Parliamentary secretary $243,912
Other ministers $307,329
Shadow minister $243,912
Source: Remuneration Tribunal.
So if I press all the right buttons, the TOTAL annual wages for the 150 seats in the Parliament are: $17,317,752
The TOTAL ANNUAL SALARIES (for 150 seats) = $41,694,311 – PER YEAR!
And that’s just the Federal Politicians, no one else!
For the ‘lifetime’ payment example (below) I used the scenario that:
1. They are paid ‘lifetime’ salaries the same as their last working year and
2. After retiring, the ’average’ pollie’s life expectancy is an additional 20 years (which is not unreasonable).
It’s worth remembering that this is EXCLUDING all their other perks!
SO, for a 20 years ‘lifetime’ payment (excluding wages paid while a Parliamentarian)
Prime Minister @ $507,338 = A$10,146,760
Deputy Prime Minister @ $400,016 = A$8,000,320
Treasurer @ $365,868 = A$7,317,360
Leader of the Opposition @ $360,990 = A$7,219,800
House of Reps Speaker @ $341,477 = A$6,829,540
Leader of the House @ $341,477 = A$6,829,540
Minister in Cabinet @ $336,599 = A$6,731,980
Parliamentary Secretary @ $243,912 = A$4,782,240
Other ministers** @ $307,329 = A$6,146,580 x 71 = A$436,407,180
Shadow ministers** @ $243,912 = A$4,878,240 x 71 = A$346,355,040
Conclusions:
TOTAL ‘life time’ (20 year) payments, (excluding wages paid while in parliament) = A$833,886,220 – OVER $833 MILLION.
Julia Gillard, Kevin Rudd, John Howard, Paul Keating, Malcolm Fraser, Bob Hawke, et al, add nauseum, are receiving $10 MILLION + EXTRA at taxpayer expense.
Should an elected PM serve 4 years and then decide to retire, each year (of the 4 years) will have cost taxpayers an EXTRA Two and a half million bucks a year! A$2,536,690 to be precise.
A 2 year retirement payment cut-off will SAVE our Oz bottom lineA$792,201,909 *** NEARLY $800 MILLION.
There are 150 seats in House, minus the 8 above = 142 seats, divided equally for example = 71 each for both shadow and elected ministers.
This example excludes all wages paid while a parliamentarian AND all perks on top of that – travel, hotels, secretarial staff, speech writers, restaurants, offices, chauffeured limos, security, etc. etc. 150 seats, 20-year payment of A$833,886,220 less annual salary x 2 years of A$83,388,622. [$41,694,311 x 2]
“Instead of giving a politician the keys to the city, it might be better to change the locks.”
YOU’RE RIGHT, YOU HAVE FOUND WHERE THE CUTS SHOULD BE MADE!
ACTION: Push for a MAX 2 year post retirement payment (give ‘em time to get a real job).
Spread it far and wide folks. People should know.

Seems like banks are still going south…
http://www.zerohedge.com/news/2016-04-12/what-world-going-banks-week-emergency-meetings-banker-summits-crashing-european-bank

When I wrote my first article on the Global Financial Crisis exposing who was behind it and why, I sent it to some friends after which it went ballistically viral.
That article subsequently became the first chapter of my book on the subject.
I have made that article – the first chapter of the book – available for free.
Hope you enjoy!
http://johntrumanwolfe.com/is-the-international-economic-crises-a-carefully-orchestrated-strategy-to-gain-control-of-the-worlds-finances/
Best,
Bruce

I have met the authoir of this book and read some of his work. I have yet to read this one but have no doubts as to the validity of the underlying assupmtions.
http://www.amazon.com/Coming-Financial-Crisis-Wizards-Curtain/dp/0996968644/ref=sr_1_1?ie=UTF8&qid=1452065397&sr=8-1&keywords=john+truman+wolfe

I received this today from my accountant, Tony Cammarata at Prudential Partners. I thought it well worth sharing with you.
There are basically two ways to give someone a gift when you die:
You can give it to them ‘outright’; or
You can give it to them subject to some ‘rules’.
When you give an outright gift to someone under your Will, the beneficiary receives the gift from your executor, with no strings attached. The beneficiary can do what they like with it.
If you impose any rules on the gift, then you have effectively created a ‘testamentary trust’, and things get a little more complicated.
The simplest type of testamentary trust is one that is created when you give a gift to someone subject to them reaching a certain age. Under this scenario, your executors will hold the gift as ‘trustee’ until the beneficiary reaches that age. When the age is reached, the beneficiary will then receive the gift and the trust comes to an end.
But this simple scenario is not what people generally mean when they talk about creating a ‘testamentary trust’ in their Will. The term ‘testamentary trust’ has become associated with a strategy whereby you give ‘control’ (but not ownership) over assets to someone, subject to a set of sophisticated rules. These trusts can last for generations.
We liken a testamentary trust to ‘bubble-wrap’ that surrounds the gift you are giving someone. They can see the gift, they may be able to control what happens to the gift, use the gift, but legally speaking, they do not ‘own’ the gift. The gift comes wrapped in some rules that must be obeyed.
The key elements of a testamentary trust are:
Certain assets are singled out to be held in the trust, called the ‘trust property’;
Someone is given control over the trust property, called the ‘trustee’; and
The trustee must manage the trust property (and its income) for one or more people, called the ‘beneficiaries’. The beneficiaries may include the trustee.
So why would someone complicate the lives of their beneficiaries in this way? Why wouldn’t you just give the gift to your beneficiary outright?
There are a number of reasons for this, but the main ones are to protect the gift from harm, and to potentially access some tax benefits.
Because the gift is surrounded by bubble-wrap, and is not owned by the beneficiary, whatever happens to the beneficiary will not impact the gift. For example, if the beneficiary goes broke, or has a spending habit, the gift remains protected.
The tax benefits are a little more complex to explain. But basically, because the gift is not owned by the beneficiary, any income or taxable gains from the gift do not immediately flow to the beneficiary. Each year the trustee of the gift can decide who is to receive the income and gains, and can thereby manage how much tax is paid by spreading the income and gains around a number of taxpayers.
A popular type of testamentary trust is called a ‘second chance’ trust. Under this strategy a beneficiary receives part of a gift when they reach a certain age (say 25), and then receives the balance of the gift when they are a little older (say 35). If the beneficiary gets into financial trouble between 25 and 35 (say from a failed business or divorce) only the assets they received at 25 are at risk. When they reach 35 they receive the balance of the gift, and have a ‘second chance’ at properly managing this wealth.
As you can imagine, there are as many different types of testamentary trusts as you can conceive of conditions that someone may wish to impose on a gift.

On 1 January depositor “bail-in” came into effect across the European Union. Just in time for a new, rapidly building global financial crisis, the EU’s bail-in regime empowers financial authorities to confiscate money from bonds and deposits in order to save collapsing banks.
Bail-in was one of four “resolution tools” prescribed by Europe’s Bank Recovery and Resolution Directive (BRRD) which came into effect one year earlier, on 1 January 2015, establishing a “single rulebook for the resolution of banks and large investment firms in all EU Member States”. (Individual EU member states had the option to adopt bail-in straight away, but they agreed it would apply to all members as of 1 January 2016.)
Bail-in is designed to prevent too-big-to-fail banks from collapsing and setting off a chain reaction meltdown within the US$2 quadrillion global derivatives bubble. The EU Commission used the so-called haircut of bank depositors in Cyprus in March 2013 as its “template” for the BRRD. As happened then, deposits and investments of ordinary people will be stolen—bailed-in to reduce the liabilities of the bank—in the vain hope of protecting the stability of the global financial system. Use of dedicated resolution funds or limited bail-outs—considered “state aid” by the EU Commission—will now only be considered after a bank has bailed in 8 per cent of the value of its assets, but would not preclude further bailing in of creditors’ funds. “The exact degree of burden-sharing would depend on the bank in question, the amount of losses that would need to be covered, and the wider economic situation.”
A European Parliament press release of 2013 claimed that “shareholders and bond holders [will] take the first big hits” and that “Unsecured depositors (over €100,000) would be affected last…” and assured “Smaller depositors would in any case be explicitly excluded from any bail-in.” However, such assurances are practically worthless, as in each bail-in crisis so far, from the original Cyprus bail-in, to Spain’s Bankia, to Italy and Portugal, various “rules” have been thrown out the window. In Portugal’s Banco Novo case, the Portuguese Central Bank was directed by the European Central Bank to ignore the rule of so-called “equal treatment” for unsecured creditors. Incredibly, the toxic derivatives gambling instruments that melted down the global financial system in 2008 are explicitly excluded from any bail-in action, if they are deemed to be critical for the stability of the financial system.
Banks to die for
The case of the 68 year-old Italian pensioner, Luigino D’Angelo, who committed suicide after losing €110,000 when his bank, Banca Etruria, was bailed in on 28 November 2015, epitomises the deadly threat bail-in presents to the masses of ordinary bank customers. D’Angelo had written a letter before his death, accusing his bank of stealing all his savings, after he was assured the “subordinated bonds” sold to him were safe.
Banca Etruria was one of four Italian banks that collapsed in November 2015, along with Banca Marche, CariFerrari and CariChieti. Over 100,000 shareholders and junior bond holders lost money in the so-called “orderly” resolution. Astoundingly, it actually could have been worse. Italian Prime Minister Matteo Renzi reportedly acted to pre-empt the introduction of the 1 January bail-in laws, because then it would have involved deposits. In a parliamentary hearing on 9 December, head of supervision at the Bank of Italy Carmelo Barbagallo said that a million savers would have been affected under the new regime.
“The bail-in can exacerbate—rather than alleviate—the risks of systemic instability caused by the crisis of individual banks”, Barbagallo maintained.
On 29 December Portugal’s Novo Banco—the already bailed-out “good bank” remains of the Espirito Santo Banking Group—expropriated €12 billion from its senior bondholders to recapitalise itself. Instantly, the remaining bondholders “ran” on the bank; the value of Novo Banco’s bonds fell from 94 cents on the dollar in the morning, to 14 cents in the afternoon.
Fortune magazine, in a 23 December piece titled, “The Many Things That Could Go Badly Wrong for Europe in 2016”, stated that the new EU bail-in model is “meant to weed out the zombie banks from the healthy ones. But clean-ups like this invariably mean brutal transfers of wealth from one class to another, causing the kind of political storm hated by governments”. (Emphasis added.)
Hence the need for governments to resort to increasingly fascist measures of control over their populations. The terrorism scare that is being used to rapidly strip away civil liberties is a pretext: as in Hitler’s Germany in the 1930s, bankers are demanding such measures, to guard their system against the popular uprising that they know policies such as bail-in will trigger. A 28 May 2013 report by JPMorgan Chase entitled “The Euro Area Adjustment: About Halfway There” spelled it out. That report singled out the explicitly anti-fascist provisions in the constitutions of southern periphery countries such as Spain, Portugal, Italy and Greece as the obstacle to “further integration in the [EU] region”. Political systems “established in the aftermath of dictatorship” tend to feature “weak executives; weak central states relative to regions; constitutional protection of labor rights; consensus building systems which foster political clientalism [sic]; and the right to protest if unwelcome changes are made to the political status quo”, Wall Street’s biggest bank complained.
The EU’s bail-in regime has come into effect just in time for the financial crisis that is gathering to explode in 2016. Defaults in the US$5 trillion of debt associated with the oil and gas sector are expected to hit at least 25 per cent—higher than the defaults in the much smaller sub-prime mortgage sector that triggered the global financial meltdown in 2008. The risk of sovereign defaults beginning with Puerto Rico, and the knock-on effect on the global debt bubble of the US interest rate rise, are also potential triggers of an implosion of the US$2 quadrillion global derivatives bubble.
Glass-Steagall
The criminal insanity of bail-in is indisputable when you consider the alternative: a Glass-Steagall separation of commercial banking from the speculation and gambling of investment banking. Instead of allowing banks to gamble, loot and pillage, and then stealing their customers’ savings to prop them up when they go bust, don’t let them gamble in the first place! Under the US Glass-Steagall Act of 1933, which lasted for 66 years until 1999, there were no systemic banking crises in the United States because no bank was too big to fail, no commercial bank that held deposits was allowed to engage in reckless gambling that put those deposits at risk, and the investment banks that did gamble and lost were made to wear their own losses or fail, without any risk to the system.
The CEC in coming days will provide an update on the status of bail-in in Australia. We will continue to lead the fight against this fascist attack on civil rights and human life, and for the Glass-Steagall alternative. This fight has never been more urgent—join us!
http://www.cecaust.com.au/