Sunday Territorian

It’s a pity just how Lowe you will go

- Scott Pape

MY INBOX is still melting from last week’s column on interest rates! It seems that right now everyone wants to stomp on RBA Governor Philip Lowe’s spectacles.

One of my readers was so “alpaca angry” that he’s actually talking to his lawyer about launching a class action against Phil and his funky bunch of bureaucrat­s.

Here’s what he said …


Why is there no class action being taken out against Philip Lowe and the RBA? How can the head of the RBA make unequivoca­l statements (not prediction­s) that interest rates will not rise until 2024 and then wash his hands and take no responsibi­lity for the trauma (financial and mentally) his words have caused? Thousands of people, myself included, proceeded to purchase property based on these statements and are now in serious financial stress. To my mind, Philip Lowe’s statements were grossly negligent and have caused serious financial stress to thousands of hardworkin­g Australian­s.

I have contacted my lawyer to investigat­e what options are available, but I am surprised that I have not heard of any legal action. I will willingly join in any class action that might be looming.

What are your thoughts?


So I have a couple of thoughts. First, Philip Lowe deserves to be benched.

He is, after all, one of our most powerful and highest-paid officials, and he stuffed up right royally.

(And, in doing so, “the Guv” actually proved something I’ve said for years in this column: no one can predict where interest rates are going … even the bloke who sets them!)

Yet what he doesn’t deserve is the ugly media pile-on that’s happening right now. Apparently, there are paparazzi camping out at his home. What juicy pic are they thinking they’ll get? A snap of Old Filthy doing his morning sudoku over a cuppa on his porch?

However, I agree with you: as taxpayers we should hold our highly paid (unelected!) officials accountabl­e.

But while we’re talking about accountabi­lity, Ben … where is yours?

Did you really base a significan­t long-term financial decision on a relatively short-term prediction from the Reserve Bank?

And did you even read the published RBA statements before you went in paws and all?

If you had, you’d have realised there was incredible uncertaint­y around Covid, and that the global economy was in a state of flux (which is why Phil should have known to put his crystal ball away).

Instead, what most people did was listen to the pundits in the media who took Phil’s sound bite and shouted it from the rooftops. The same people who are now calling for his head. It’s not financial advice, it’s financial porn, plain and simple.

Look, no one put a gun to your head and told you to borrow too much money when interest rates were at their lowest levels in recorded history. I’ve written about this every week for the past decade, mate! So sorry, Ben, but I won’t be joining your pity party.

Tread Your Own Path!


If inflation is a society-wide problem, why is our only reaction to take money from a specific group (mortgage-holders) and give it to a specific industry (banking)? I read an ABC article that suggested it would be fairer and more effective to let people stash that money in something like super (which reduces people’s spending) so it still belongs to them and can flow back into the economy through spending once the crisis has passed. What are your thoughts?


Hi Doug,

I think it’s a deliciousl­y simple solution … and it will absolutely not work.

Mainly, and most boringly, because the level of our interest rates – relative to other countries – determines the value of our dollar. If we keep our rates low, our dollar will likely be hit, which will make everything we import more expensive.

My view is that the real problem we’re grappling with is that money should never have been priced at zero. That decision – which was driven by central bankers around the world, not just the RBA – was pure madness. It fuelled a mania in housing and the sharemarke­t (and, in the late stages, even in rubbish like Dogecoin). The net result? The rich got richer, the poor got screwed, and an entire generation has been priced out of the property market.

And now you want low-income earners to bail you out?

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Because that’s effectivel­y what would happen. Those people at the bottom of the income ladder, who are struggling with the cost of soaring grocery prices and rent, would be forced to take home even less in their weekly pay packet (because they would be forced to put more into super), so they can save homeowners’ (and their landlord’s!) backsides.

Good luck with that!



Your answer to last week’s question from the 90-year-old man, wanting to see whether he should implement your financial plan (“Old Dog, New Tricks”) would have to be the most insensitiv­e, egotistica­l slapback I have ever read in your column.

The man is asking a question about finance, not asking for family therapy. He genuinely wants to get a sense of purpose, build his nest egg, and still feel there’s a reason to go on.

Telling him to focus on his family and friends not only doesn’t answer the question … it implies: “What’s the point of looking forward? You’re nearly dead anyway.”


Hi Angie

My answer to the old fella’s question was the most insensitiv­e and egotistica­l thing you’ve read in my column? Hold my beer.

So you think the reason for him to go on is to … make more money?

He already told me he was financiall­y secure. His problem – which he admitted to – is that he’s nearly dead.

That’s life. He’s probably not buying long-dated milk these days!

Yet what you got right is that he wants a sense of purpose. And that’s why my financial advice was – where it is prudent – for him to give away some of the excess money he was planning to leave in his will to his loved ones while he’s still alive. That way he gets to watch the joy and hear about the experience­s his gifts bring.

After all, Angie, we all want a sense of purpose. Some people get it by giving away money to their loved ones in the golden years of their lives. Others get it from writing angry emails to strangers on the internet.


I’m the librarian at Mornington Primary School. A grade 5 student named Liam nominated Barefoot

Kids for our book of the week. His reason was “because this book changed my life and made me want to start a business”. Now I imagine you get lots of mail from our younger generation, but Liam is a very quiet, shy student. I know it’s a big ask, but even a reply from yourself that I could show him would be such a confidence-booster. Anna

Hi Anna,

Thank you for getting in touch. I’ll address this one straight to Liam.

Liam, thank you so much for getting my book into your school!

And because you’ve read the book, you’ll know about the secret I never told anyone before: I’m actually pretty shy myself.

When I was your age and had to talk to anyone, I’d stare nervously down at my feet, my mind would go blank, and my face would turn as red as a beetroot with embarrassm­ent.

And that’s why I came up with a little saying to help me when I got nervous. It’s called S.E.A. (Smile, make Eye contact, and Ask questions like “How’s your day going?”).

It really works!

Even better, the more you practise it, the easier talking to people gets.

Now I don’t know what your Barefoot business is, Liam, but I’m hoping it gives you the chance to spend a lot of time swimming in the S.E.A. Doing that will really change your life!

It seems that right now everyone wants to stomp on RBA Governor Philip Lowe's spectacles.

DISCLAIMER: Informatio­n and opinions provided in this column are general in nature and have been prepared for educationa­l purposes only. Always seek personal financial advice tailored to your specific needs before making financial and investment decisions

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