Deficiencies in our education systems

[Jerry_Atrick]

I was in the pub last night enjoying a tapas eveninng, and having a chat to a mate, who is a deputy head of a local school. At the end of the conversation, I was amazed at how little people know about the foundations of probably the two most important things that govern our lives - the law and finance. I am only talking foundations, not the complexities. And when I look back on my and my kids educations, it is profound how missing these things are from early years of learning. 

 

In the discussion, he had fallen on some hardship, which we didn't know about, but it culminated in asking for a one month pause on paying a mortgage which he as held for years with an otherwise unblemished record. This is when you learn retail banks are not your friends. Although I have little more than a basic understand of the practices of retail banks, they are not your friend. But he seemed perplexed when they took a hard line with him. I then explained the basics and how their threats were hollow and designed to get him to cay up come what may, and explained a little of how loans work, and it was clear he had no idea whatsoever. That is because we are conditioned to follow a set pattern of behaviours and if they are not within our sphere of interest, we just follow that conditioning. He was armed with a few basic tools to use when he next wpeaks to the bank and we will see how it goes. 

 

Similarly, most people have no real appreciation about how law works and when they find themselves in a pickle,. have made wildly inaccurate assumptions based on what can only be the mass media and shitty Amercian drama shows. 

 

It is almost criminal that the education system is still largely what it was like when I was a kid. Knowledge is power, and of course, it would disrupt the apple cart if the population had more of the power. 

 

For kids and grand kids, make sure they start the foundtions of financial and legal education earlier rather than later.

 

 

 

[rgmwa]

A lot depends on what kind of education you get and what level you reach. I’m not surprised he didn’t know much. Nor did I when I got my first home loan. I still don’t know that much really and most of what I’ve learned over the years about banks, finance and investments has come through sometimes bitter experience. Fortunately nothing too disastrous. At the other end of the scale, my primary school teacher daughter is concerned that many of her young pupils don’t have the basic fine motor skills needed to hold and write with a pencil but they are fine with an iPad.

[old man emu]

Ts & Cs apply. How many times have you seen that in relation to some product? Just recently I was working through the operating instructions for a TV. I just wanted to find out what the symbols on the controller were. However,  I reckon that half of the pages of the booklet dealt with the terms and conditions of use of the TV. Pages of what was once called "fine print" but now referred to as "small font size". Of course I didn't read them. These Ts & Cs must surely only benefit the manufacturer. 

 

It appalls me when I see a young child in a pram fully engaged with what is showing on the screen of a mobile phone. Of course, giving a babe a mobile phone allows the mother to be fully engaged with hers, ignoring communication with the child.

 

The Victorian Era idea of education for the masses, which had the implied goal if producing factory fodder, is now condemned by educators whose idea of a education system fails to educate in so many areas.

[ClintonB]

I’m always surprised at things we (SWMBO) mention in front of our kids and their partners (27, 25, 23 by 2, 20 and 16 )

and get blank stares in return. We ask “didn’t they teach you that a school”. Answer is usually “no”.

i think I was lucky in the 80’s an early 90’s in my schooling. We learnt a large variety of history, English, art subjects.

my 16 yo daughter could not get her year 12 subjects of choice last week and was put in ancient history. She has had no exposure to anything about this subject. I was interested in this stuff as a kid and still like watching documentaries about it.

If someone ever goes through with buying my workshop that is on the market, I will be completing a booking I made for a Mediterranean cruise of Greece, Italy , France and Spain to see the places I learnt about as a kid. It has to be amazing to stand among structures that are over 2000 years old built by humans that are still standing.

heres to hoping.

[facthunter]

Cathedrals, Too many People, Toll roads, Old Bricks and dog$#it. The best reason to travel is that it makes you appreciate what we have HERE..  We expect Schools to do Everything. We are All a bit soft and too reliant on others and don't want to Pay tax to support those expectations. Whinging is easy. Self reliance and a bit of REAL is needed.

 LAW and Economics. The LAW is an ASS  and is so expensive as  to be beyond the reach of ordinary Mortals and Economics a CON for Robbers  and Grifters.  The stock market is Manipulated and runs on GREED and FEAR. Accountants ruin GOOD companies by cutting cost and research and conditions for Workers. BANKs Predate on their Customers as is frequently exposed. Free Enterprise forms monopolies when it can some equity Companies with more Power than Governments. Anti trust Laws in the USA are only a memory. Crime Pays and it's the white collar crime that flourishes rarely Punished. Recessions and inflation takes Money from poor people For the RICH Tax is Optional. It's ALL stacked unless you are Part of the Corruption. Ethics is a hindrance to the Money Makers/TAKERS. Not a subject Brought up at Board Meetings where the CEO'S salaries are in the tens of Millions or Billions in the case of  people like Bin Salman or Musk and Putin  who does it covertly with bad things happening to his opponents Nev.

Edited Saturday at 02:54 AM by facthunter

[Jerry_Atrick]

2 hours ago, facthunter said:

Cathedrals, Too many People, Toll roads, Old Bricks and dog$#it. The best reason to travel is that it makes you appreciate what we have HERE.. 

You must have taken the el-cheapo holidays or something 😉

 

Yep, at some sites, thee are too many people.. Don't go during the peak holiday season. I was in Frankfurt a couple of weeks ago and inadvertently ended up in a deprived (and depraved) area.. Yep, it wasn't too great, but not much worse than similar areas of Melbourne. I also walked a couple of miles from the centre of the city - sort of going form central melbourne to maybe the beginning of Sydney Road, Brunswick distance. Once outside the CBD area, well curated tree-lined streets, local taverns where locals were enjoying a drink and dinner al fresco - all nice and calm - no nutters driving about in their V8s dropping burnouts, and the like. Everything relaxed, and no dogship, either. Made me question my move back to Australia. Although I am probably not welcome there as I did mention ze war...

 

2 hours ago, facthunter said:

LAW and Economics. The LAW is an ASS  and is so expensive as  to be beyond the reach of ordinary Mortals and Economics a CON for Robbers  and Grifters.  The stock market is Manipulated and runs on GREED and FEAR. Accountants ruin GOOD companies by cutting cost and research and conditions for Workers. BANKs Predate on their Customers as is frequently exposed. Free Enterprise forms monopolies when it can some equity Companies with more Power than Governments. Anti trust Laws in the USA are only a memory. Crime Pays and it's the white collar crime that flourishes rarely Punished. Recessions and inflation takes Money from poor people For the RICH Tax is Optional. It's ALL stacked unless you are Part of the Corruption. Ethics is a hindrance to the Money Makers/TAKERS. Not a subject Brought up at Board Meetings where the CEO'S salaries are in the tens of Millions or Billions in the case of  people like Bin Salman or Musk and Putin  who does it covertly with bad things happening to his opponents Nev.

Edited 2 hours ago by facthunter

Which is exactly why pupils should be universally educated at an early age then. We teach our kids the three Rs at an early age to build the foundations. And these are needed, but because these two subjects govern one's life even before they leave the relatively protected life of school and transition into the big bad world, don't you think we should educate them on how it works so they can navigate the minefields a lot better than they do now? Knowledge is power. As it stands, only those that proactively want to gain the power, whether it be for vested interests or protection of others. The more power everyone has, the less predatory those two elements of society become. 

 

Also, I wasn't talking just economics, but the financial system.

Edited Saturday at 05:31 AM by Jerry_Atrick

[old man emu]

Educating kids about money??????

 

Kids these days have difficulty recognising coinage and notes. It's a plastic world to them.

[spacesailor]

Today's schooling is heaps better than the " demobilised soldiers " who thought they could teach, by the big stick theory. 

spacesailor

[old man emu]

1 hour ago, spacesailor said:

Today's schooling is heaps better than the " demobilised soldiers " who thought they could teach, by the big stick theory. 

spacesailor

Spacey, you are sounding like Grumpy Old Nasho when you talk about being hard done by during your school years. I can believe that some demobilised blokes would be carrying the mental scars of the war years, and that would have influenced theeir behaviour, but I was educated under a very strict disciplinary regime, and I hold no grudges against my teachers.

[rgmwa]

The Catholic nuns were pretty fearsome in primary school. Discipline was maintained with leather straps and the cane end of a feather duster. Some were fairly reasonable but none of them took any nonsense from us kids. Still, we learned a lot. 

[onetrack]

Jerry is spot on with his determination that banks are not your friend. In fact they're the most ruthless and uncaring of any corporate organisation. And if you take them to court, you're up against a coterie who group together like a pack of ruthless commandos, to annihilate you.

 

I've been on the receiving end of banks ruthlessness, and it cost me everything I'd ever accumulated in my 30 years of working life to that point (1995). This bank destroyed our family business, our assets and our family by demanding repayment of ALL outstanding loans and other monies owing - a total of $1M - within 48 hrs. And we had no payment arrears, no major financial problems, and the $1M was fully secured with $1.6M of excellent properties -  a farm, city property and industrial property in Kalgoorlie/Boulder.

 

The reason given for the unprecedented demand? "Some computer-generated future scenarios were carried out, that showed, in perhaps 12 mths time, the bank will be owed money by your family business, that we will be unable to recover. Accordingly, we have lost confidence in you as our customer, and no longer want your business, and you will repay the entire sum owing within 48 hrs".

 

Of course, you say - do what any right-thinking person would do - go to another bank! We did. We went to NINETEEN other banks to get them to take us on as their customer, and EVERY SINGLE ONE OF THEM gave us the same response.

 

"Who are you with now?"

 

"XXX Bank, one of the Big Four".

 

"Oh. If they don't want you as a customer, you must be hiding something from us that means a great hidden risk to us. Thanks, but no thanks."

 

I went to see a lawyer about invoking a lawsuit via the Unconscionable Conduct laws relating to Banks. His answer was succinct. "How many years have you got, and how much money have you got?"

 

He went on - "Because no matter if you have $10M or $20M to spend on financing a lawsuit against this bank, I can tell you this much. They have tens of billions to spend on countering lawsuits, and will continue to run the lawsuit for as long as it takes, with delaying tactics, disputed evidence, and various other legal scheming, that will guarantee YOU will run out of money, and time - long before they do!".

 

He was entirely correct, as the banking lawsuits associated with the 20 Foreign and Australian Banks loans to Bell Group in 1990 proved.

The 20 Banks had lent multiple hundreds of millions to the Bell Group, owned by Alan Bond, when it was in its death throes and essentially insolvent. The W.A. Govt had also lent over $150M from the State Govt Insurance company (SGIO), to the Bell Group, in a number of badly-managed investments.

 

When Bell Group went into liquidation, the 20 banks ensured they received the lions share of any remaining Bell Group assets, and the remaining creditors could go whistle.

 

The W.A. Govt, funding the Bell Group liquidator, took the banks on, to recover their lost monies, claiming the banks exercised their power as secured creditors in unreasonable arrangements that denied funds to other creditors.

It took until 2013 - TWENTY THREE years of bank arguments, delaying tactics, subterfuge, and disputed evidence, to come to a judgement whereby the Banks were instructed to pay out $1.7 BILLION to the creditors denied their rightful monies via devious bank behaviour. 

 

EVEN THEN, the banks refused to pay, declaring they wanted it all reheard again. The W.A. Govt took the unbelievable step of passing the BELL ACT, which was designed to MAKE the Banks pay their judgement monies.

Of course, the banks went to court again, and spent ANOTHER NINE YEARS claiming the BELL ACT was invalid - and it was, according to the learned judges.

 

Eventually, the banks agreed to a mediation whereby they would offer a reduced amount ($1.3B) to settle the Bell Group argument, without DECLARING ANY GUILT for unconscionable behaviour. Therefore, it took THIRTY TWO YEARS to settle the aggrieved creditors claims over the Bell Group losses.

These banking people are the most disgusting people on the face of the Earth, and I trust there's a special seat in Hell for them.

 

In our familys case, we had no option but to sell everything we owned, and worked our guts out for, for over 30 years, at fire sale prices, resulting in the total destruction of our equity, and the total dispersal of all our assets.

I can assure you, I went through a dark place, and spent many years plotting how to kill bank executives by the dozen in a co-ordinated attack - until I finally realised the futility of my thoughts, and the fact that meeting evil with more evil only backfires on you.

 

I'm not alone, I have read multiple stories of business people and farmers who were treated the same as our family, with utter ruthlessness and destructive bank decisions, that sent others into a spiral of depression and revenge.

I read of one bloke who actually planned to fly a bomb laden aircraft into a bank headquarters (this was long before 9-11) - and he said he only gave up on the plan when he realised he could not be sure of killing the exact people he desired revenge on, who had destroyed his lifes work with their intransigent and ruthless behaviour.

 

In many cases, farmers lost their farms simply because of bank revaluations that substantially lowered the value of their farm at that particular point, which meant the farmer was technically bankrupt.

It was egregious behaviour that was completely unwarranted, a short term position, and one that valued the long-standing customer as worthless.

 

But this is the history of banks - and no-one knew that better than King O'Malley, who had seen the ruthlessness and money-grubbing behaviour of banks in America in the 1800's.

 

I definitely did not get enough financial training in my younger years on how to counter banks ruthlessness, but I doubt any extra training I might have received, would have enabled me to deal with bank avariciousness, especially when they hold all the cards.

 

One thing I have learnt, is to NEVER allow any one bank to control all your assets and financing, and never let them take more security than they actually need. It is standard technique of banks to ensure that they grab all your assets for loan security, when you take out a loan with them, whereby they can end up with double or triple the asset value that is required for that particular loan security.

 

Once they have your major assets listed under their control, that then increases their assets base, and allows them to hand out more high-return unsecured loans such as credit cards. So they're effectively lending unsecured money to other people, secured by your assets.

 

And be assured, that ANY Bank, reserves the power to call in ANY loan - including your house loan - within 48 hrs, if they make a decision that you're no longer able to pay off the loan. In fact, it doesn't even need to be a decision based on ability to pay off the loan - it can be a reason as trifling and as irrelevant as undergoing a separation, changing a partnership agreement, or any one of a hundred spurious reasons that enables them to do this, and to claim their loan or loans are at risk of being unrecoverable.

 

One of the documents I received during the foreclosure on our business, was a 48-page document - in fine print - outlining EVERY single reason for a foreclosure. It was breathtaking in its comprehensiveness, and ensured the banks actions were protected and justified, in every single act it carried out. They play for big stakes, and hold all the cards, and you have none - and they play by their rules.

 

 

[Jerry_Atrick]

Jeepers.. that is absolutely shit, isn't it. It sounds like it coincided with when Monte Carlo simulations were introduced into finanacial risk management, although this method is usually used for capital markets (traded products) rather than lending products risk management. I am guessing other statistical methods were also being brought in at the same time.. Beta Logit, Tobit, etc all came in around the same time. My guess is that the banks ran their simulations, checked them, and then started the process. This was under the Basel I accord (Bank of International Settlements in Basel) captial and risk management requirements, of which, to be honest, I have no real idea what was required. They came out in 1988 but would have taken a while to implement. 

 

1 hour ago, onetrack said:

I definitely did not get enough financial training in my younger years on how to counter banks ruthlessness, but I doubt any extra training I might have received, would have enabled me to deal with bank avariciousness, especially when they hold all the cards.

I don't know, because:

1 hour ago, onetrack said:

One thing I have learnt, is to NEVER allow any one bank to control all your assets and financing, and never let them take more security than they actually need. It is standard technique of banks to ensure that they grab all your assets for loan security, when you take out a loan with them, whereby they can end up with double or triple the asset value that is required for that particular loan security.

Isn't that great advice, and if given sufficient education as part of the schooling system, is something you would have known before having to learn the hard way? Yeah - you may have lost the value of your debt, or a bit more as they have to apply a haircut to the collateral, but you would know that and could esnsure they weren't overreaching. 

 

I can't speak for Aussie financial law, but certainly these days, this would be hard in the UK. There was a recovery (or loan workout) unit of then RBS called Global Restructruring Group (GRG), Look it up on Google, but RBS was eventaully compelled after a class action and the press picking it up, to pay compensation to many victims of their conduct and resulted in changes to the law. 

 

I am glad you have come out the other side of it ultimately positively, but your example is why banks need better regulation. Sadly, not much has come out of the Royal Comission...

 

[onetrack]

It's very telling that despite regular and repeated episodes of unconscionable and essentially criminal behaviour by Australian Banks, which behaviour has led to a Royal Commission and multiple number of Banking Enquiries - all of which have determined major wrongdoing by banks in their treatment of loyal customers - not a single Bank executive has ever been charged with criminal behaviour, nor gone to jail, despite their behaviour essentially being White Collar Crime.

 

But the Banks have been obliged, even forced at times, to pay multiple billions of dollars in penalties, as a result of their misbehaviour, disobeyance of banking rules and regulations, mistreatment of customers, and other forms of outright criminality.

They are a protected species, with the Govt and politicians lacking the intestinal fortitude to carry out decisive actions against bank executives who indulge in illegal, ruthless, unconscionable and criminal behaviour.

 

I was told years later, when retelling my bank mistreatment tale to one person, that I'd made the mistake of being too conservative in dealing with my bank. This bloke said, "There's an old saying that holds true. When you owe your bank a million dollars, and its fully secured, you have a problem. When you owe the bank a hundred million dollars, and the security is dodgy, they have a problem. Your mistake was not making them concerned about what a possible upset could cost them".

 

In hindsight (a wonderful thing), we would have been far better off to call in Administrators to the business, which is an excellent method for fending off aggressive and unconscionable conduct by banks. Administration would have enabled us to develop a different approach to protecting our assets, and one that would have meant we could have avoided a totally unnecessary fire sale of business assets.

 

To this day, I still wonder what went on, well above our heads in banking and corporate circles. Our business was the biggest family-owned mining contracting business in Western Australia in 1994, and we regularly competed for mining contract work with the "biggies" - Leightons, Roche Bros, Eltin, Brambles, etc, etc. - and I often muse about whether, above our heads, one of these companies threatened to withdraw their business from this bank, unless they took steps to wipe us out, and thus relieve them of annoying and costly competition.

 

Edited Sunday at 12:51 AM by onetrack

[facthunter]

I've NEVER taken El Cheapo Holidays (or something) in Europe Jerry and the More Preparation and research the better the Experience will be for you. I try to mix with the Locals (and keep away from the tourists Hot spots) and boozy People. I don't expect thick Overcooked steaks either. I sample the Local Fare as it's done "their" way.. Europe is generally NOT CHEAP. Nor should we expect it to be. Letting them know you are not English helps too. An Australian  Accent is very strong. We are pretty LAZY with our pronunciation generally.. Nev

[Jerry_Atrick]

6 hours ago, facthunter said:

I've NEVER taken El Cheapo Holidays (or something) in Europe Jerry

'Twas a tongue in cheek comment (hence the emoji).

 

I have spent a lot of time in Europe on client sites at nuclear facilities, so they tend not to be in the glitzy, glamorous part of town. And like you, especially when working, I mix with the locals. And over both Western and central/Eastern European countries, apart from the old buildings, many of which are designed for their climate pre-heating/airconditioning times, and therefore are more environmentally friendly. I don't recall much more dog poop than in streets of Melbourne. Europe not cheap? Are you having a laugh? Maybe for the Aussue $ it isn't. but Australia is definitely not cheap, either. Last time I was in Aus (2018), I was aghast at the prices.. $4 for a loaf of bread (Tip Top's the one). Warbutons (equivalent main brand) was, at the time, about £1. 500ml soft drink at the servo was about $5, whereas here it was about $1.30 at the time. I am telling my family that they had better get used to less material things and treats on the move to Aus. 

 

And Europe in general is cheaper than the UK.. however, you can't generalise. Nordic countries are a lot more expensive, at least on food and drink. And western European countries are generally more expensive than Eastern European countries within the EU, let alone those outside the EU, with Solvenia being the notable exception. So, it depends on where in Europe you are. As to cleanliness, I find that also depends as well. You would be surprised at how clean some of the Eastern and Central European places are. Our family holidays tend to be in Cyrprus, and yeah, they do have a problem with their rubbish in that it is just piled in these massive wheelie bins and in holiday season at holiday hotspots is often overflowing. 

 

 

[facthunter]

The UK Pound is amazingly High so you get a very god deal at the Moment. Yeah UK was always more expensive than France, especially after your Local  friend negotiated L'Addition down by significant amount. Tolls and Essence was trop Chere.   I don't mind France. Nev

[pmccarthy]

Onetrack I was running a mine contracting business in the late 1980s (JARA mine construction) and we had similar problems. We dropped the contracting and went consulting. Over the next 30 years there were times I tried to borrow from banks but they wanted personal guarantees. Then when our business was booming they tried to lend us money but we didn’t need it.

[Jerry_Atrick]

When I moved from nuclear/energy to banking, I got a contract in wholesale credit risk projects. On my induction, the global head of credit, who had a balance sheet bigger than Australia's GDP, said that they don't want to lend to those who need it and bust a gut to lend to those that don't.  And yes, when they have large exposures to a corporation that turns sour, it is their problem, not the corporations. And their recovery team works hard to see their teetering client can stay afloat well before drawing the curtains on them.