Wry & Dry #36 FY-24 From the Murray to… “That would be the Euphrates”. Rats.

10 May 2024

Ten stories you may have missed

  1. From the Murray to the Strait; Victoria, we’re broke, mate
  2. “Err, that would be the Euphrates”
  3. When the rats start deserting
  4. Not so much ‘arship
  5. Chips ahoy
  6. Gentlemen’s club now just a club
  7. Where’s Alan
  8. Gender makes no difference
  9. Student debt idiocy
  10. Melbourne again an outlier

1. From the Murray to the Strait, Victoria, we’re broke, mate

In the most flagrant breach of responsible government since that which caused then PM Whitlam to give Federal Treasurer Jim Cairns the DCM1 in 19752, Victorian Premier Allen has not given state Treasurer Tim Pallas the DCM.

And in abject bovine indifference, the financial media chewed the cud spewed out by the government’s PR machine and effectively said “Tut, tut. Must do better.”

Even the state opposition leader (err, bowler’s name?) couldn’t bring himself to ask for the head of Pallas to be impaled on a spike at the city gates.

Pallas allowed himself to be bullied by Dan Andrews and Jacinta Allen in an orgy of irresponsible spending without exploring any means to plug the ever-widening gap between income and expenditure. Or not to spend billions on projects that were cancelled. 

In his early days, Pallas set himself a net state debt to gross state product (the state equivalent to GDP) ceiling of 3%. It soon went to 6%.  And then, in a feat reminiscent of Black Caviar, it effortlessly raced past the Cain-Kirner record of 16%. In 2026, the figure will be 25%.

This is Bradmanesque. A Wayne Gretzky3 outlier. Premier Allen probably decided to keep Pallas in the job until the ruin of Victoria is complete. And bowler-hatted bureaucrats from the IMF arrive in Spring Street. In fact, the first bailout has come, in the form of a $3.2 billion gift from Albo to help rescue the government’s shamefully over-manned, under-costed, shockingly planned so-called North-East road link.

In the meantime, a plethora of election promises that Chairman Dan gave before the last election have been ‘deferred’, until the 12th of never. And that’s a long time.

Victoria already has the worst credit rating of any Australian state. Readers can soon expect a credit rating nearer to Z than to A.

But it’s all okay. The Geelong Football Club will be given $3m for a new scoreboard.4 And Mr. Pallas has his sinecure.

1 DCM: Don’t Come Monday.

2 Cairns was a romantic left-wing politician, who was appointed to clean up the mess left by Frank Crean. He made it worse. The infamous ‘loans affair’ (when a dodgy intermediary tried to arrange a $4 billion loan for the government) was exacerbated when he agreed for the government to pay George Harris (president of the Carlton Football Club) a 2.5% commission to raise funds for the government. But Cairns was better known for his affair with his secretary, Junie Morosi. Whitlam sacked him in May 1975.

3 Ice hockey’s equivalent to Don Bradman.

4 There are four marginal state seats around Geelong. But Wry & Dry cannot see that a scoreboard will make a difference.

2. “Err, that would be the Euphrates”

As the wilful indifference to the shameful surge in anti-Semitism across universities continues, the Wall Street Journal reported of a survey of university students in the US.5

Of the respondents who said they were chanting “From the river to the sea, Palestine shall be free…” only 47% could name either the river (the Jordon) or the sea (Mediterranean). And even less knew both.

Other answers included the Nile, the Euphrates, the Caribbean (!), the Dead Sea (which is a lake) and the Atlantic (now that’s an ambit claim).

But wait! There’s more. Just over 10% thought that Yasser Arafat was the first prime minister of Israel.

Does this suggest that US university students:

  1. Are hopeless at geography;
  2. Are hopeless at history;
  3. Join the demonstrations without really knowing about what they are demonstrating against; or
  4. Forgot their Netflix passwords and had nothing else to do?

Close. But no cigar. The correct answer is all of the above.

And the American template has been mindlessly copied in Australia. Sympathy for Gazans betrayed by Hamas and bearing the pain for it has morphed into radicalised and deepening anti-Semitism.

Of course, there’s no shame in being geographically ignorant, even for a university student. Unless it is a scream for the extermination of millions of Jews.

5 From Which River to Which Sea? – WSJ

 3. When the rats start deserting

The writing has been on the wall since about a nano-second after Borisconi opened the door to 10 Downing Street. The writing said, “The Conservatives are [insert Reader’s part participle pejorative here].”

Borisconi rode into the top gig having succeeded the pasty but well-heeled Theresa May,6 and won the next election with a massive majority, caused not by his own abilities, talents or ideas. But by the monumental idiocy of his opponent, the hapless born-again 1960’s left-wing ideolog: Jezza Corbyn.

A smarter, more sensible, harder working PM could have arrested the steady decline that began with the election of the vacuous David (now Lord) Cameron. But Borisconi was not smart, sensible nor hard working. He gave himself the DCM before his colleagues did.

For reasons which remain lost in the party-based democracy of the Conservative Party, Liz Truss won the popular vote. She famously lasted fewer days than it took for a lettuce to rot. The parliamentary party then chose the smart, sensible and hard-working Rishi Sunak to steer a ship that was well-holed below the waterline. But, by then the polls told the story that everybody sensed: a landslide win to ABC: anyone but Conservatives.

On Wednesday, another sign occurred of the bridge of the ship about to disappear below the turbulent waters of government: a second Conservative MP turned her coat. And joined the Labor Party. Natalie Elphicke didn’t fit the mould of a Quisling, other than coming from the right wing of the Conservatives.

When the rats desert the ship…

6 She wore gorgeous shoes.

4. Perhaps not so much ‘ardship

The Economist published a chart that caught Wry & Dry’s eye. The folk called Generation Z7 often complain about how tough life is. Well maybe it’s not. At least, not in the US.

As the chart shows, after adjusting for price differences over the generations, Gen Z are better off than their immediate forbears. As is each generation.

Gen-Z has more money on which to live than all previous generations, even after allowing for inflation. But that does that not include the cost of housing. Over the long-term (well, for the last 53 years) US home prices have risen in real terms by only 1.87% p.a.8 But for Gen-Z, they are confronted by property prices increasing at 4.7% p.a.

Millennials had the free lunch, buying after the GFC. Gen-Z are not so lucky.

As for Australian Generation Z, comparative data is rare. But the simple fact that the median house price in Australia is now about six times the median household income, but up to nine times in Melbourne and Sydney. The long-term average has been about three times.

Maybe being Gen-Z is tougher than the income data shows. In which case they might consider the advice of demographer Bernard Salt. He said that if young people stopped going to trendy cafes and ordering smashed avocados with crumbed fetta on five grain-toasted bread they would have enough to save for a deposit. Mr. Salt’s comments provoked outrage about how many avocados on toast it would actually take: 32,955.

His point was missed. The young need to give up some pleasures to get into the property market.

7 That is, those born between 1997 and 2012.

8 Source: Federal Reserve Bank of St Louis.

5. Chips ahoy

It must have been a slow news day. The venerable Financial Times took the marketing bait offered by Apple. And gave headline prominence to a new computer chip. Really?

Apparently, Apple makes devices called iPads. The latest update of these has a chip called the M4. The media release from Apple described the chip as “having an outrageously powerful chip for AI”.

The point of all of this is an attempt to rescue Apple’s share price from its lame relative performance over the last 12 months (see the chart).

Wry & Dry cannot help but wonder about the ongoing rush to build a better and more expensive AI mousetrap, will buyers start to think, “is it worth it?” How much speed/ memory or whatever does one really need in a device?

Does one really need a better mousetrap to catch a mouse?

6. Gentleman’s club become just a club

For millennia, some gentlemen, like some ladies, preferred to occasionally congregate in the company of members of the same sex. It was inevitable that sooner or later, the gentlemen would get around to getting themselves organised into clubs, with the delightfully named South River Club9 seeming to be the earliest formed (certainly in 1732 but possibly as early as before 1700) in the USA.

The South River Club is perhaps not a ‘club’ in the common and Anglo understanding of a gentlemen’s club (i.e. providing exclusive and ongoing amenity of discreet accommodation, food and beverage service). In that parlance, White’s is the oldest.

White’s was founded in London in 1693 by an Italian immigrant named Francesco Bianco, as Mrs. White’s Chocolate House.10 It remains one of the most exclusive of London’s clubs. And it excludes women, even as guests.

Wry & Dry draws Readers’ attention to this meandering as another famous London Club, the Garrick Club, spiffingly young at 193 years, on Tuesday voted to admit women as members, with 60% voting in favour. This was light relief for the media in the UK, upstaging the pall of news of Gaza, Ukraine, the government and, doubtless, the English cricket team.

The Garrick is a sort of theatrical club, with members including Stephen Fry.

One member, when asked who the first woman member might be, said he would nominate Stormy Daniels. Ms. Daniels is the former porn star with whom the Trumpster apparently, err, made arrangements, and who is testifying in his trial in New York. But, the member added with a twinkle, “it depends on how her testimony goes.”

But the Club need not have bothered to vote. Lord Pannick KC, one of the UK’s most senior lawyers, pointed out that there was nothing in the club’s existing rules that prevented women from joining.

9 Located just south of Annapolis, Maryland, USA, the members meet four times a year for feasts prepared in a detached kitchen. Women are allowed in the clubhouse only on ‘Pilgrimage Days.”

10  It remains a possibility that many members would not have the wit to draw a straight line between the Club’s name and that of its Italian founder. Especially after lunch.

7. Where’s Alan

The entire planet was not surprised when Qantas admitted that it sold tickets on flights that it never planned to operate during part of 2021.

For its sins, on Monday, the Spirit of Australia coughed up $120m in a negotiated settlement with the ACCC (the competition regulator). A wise decision to settle, in view of Qantas’ risible excuse for the practice. That excuse was that passengers don’t buy an airline ticket, they buy a ‘bundle of rights’ to the possibility of a flight.

And it would have been mercilessly skewered in court.

Of course, the decision to settle was probably driven by an even bigger matter. A settlement meant that former CEO Alan Joyce wouldn’t have to sit in the witness box.

Imagine the media circus if that happened.

It was never going to happen. He re-counting his final year payment of $21.4m.

8. Gender makes no difference

A research study by the Australian National University has caused some discombobulation in some corridors.

The study found that the gender of directors appointed to company boards had zero impact on the financial performance of those companies. And five performance measures were used.

This outcome seemed to surprise only those who thought that the increase in women on boards would have a positive fiscal result.

Wry & Dry sees the results differently. Perhaps the gender of directors made zero difference because boards themselves make zero difference.

9. The idiocy of student debt calculations

Feelings are so important these days. Especially to university students. So it would be a foolish member of parliament to ignore those fiscal feelings. These students are the soft clay on the potter’s wheel into which more seasoned voters are formed.

And so the government had moved warily with the issue of so-called ballooning student debt. Of course, students are not happy that the government pays only about half of their university costs. And rest has to be paid up-front or borrowed from We-The-Taxpayer.

The student loan system has three features that makes it somewhat, well, friendly: zero interest, price controls on university fees and an income-contingent repayment system.

The problem is that debt is increased each year by the CPI. Because of the fuss about last year’s increase of 7.1%, the government has changed the methodology to be the lower of CPI or the Wage Price Index. And backdated it, of course.

This is weird. Well, not that the government caved in. But that it retained the wrong base metric.

A student loan is, well, a loan. Its cost should reflect the funding cost of the lender, with a margin added on for risk.

So why should student loans be indexed to consumer or wage price inflation? Surely the cost should be the same rate as the government borrows money: the government bond rate.

The security for the loan is the mandated repayments system via payroll deductions (on a sliding scale). For the government, for many borrowers this security is better than a mortgage. And easier to administer.


10. Melbourne again an outlier

The below chart speaks for itself.

Okay, maybe it doesn’t.

Canberra’s workforce benefitted from Albo’s decision to introduce five-day-a-week WFH rights for federal public servants, of which there are many. The fact that one of Canberra’s senators is Katy Gallagher, the Minister for the Public Service, is a coincidence.

Melbourne’s CBD workforce reluctance to return to work is a mystery…

Snippets from all over

1. Trumpster would do the same

The porn actress Stormy Daniels acknowledged making money from her story of an alleged affair with Donald Trump, saying it was exactly what the former president would have done in her shoes. (The Times)

Wry & Dry comments: she gave as good as she got, in the witness stand.

2. Real wages in Japan keep going down

Real wages in Japan fell 2.5% year-on-year in March, marking 24 consecutive months of declines for earners due to rising inflation. (Financial Times)

Wry & Dry comments: And the yen is also going down. Or the Australian dollar is going up: In late 2019, one Australian dollar bought 64 yen. Today it buys 102 yen. That’s a 60% increase in the value of the Australian dollar/ decline in the value of the yen.

3. Trumpster’s other trial postponed, indefinitely

The federal judge presiding over the criminal case related to Donald Trump’s handling of classified documents has postponed the Florida trial indefinitely, citing the need for “adequate preparation”. (Wall Street Journal)

Wry & Dry comments: The judge, Aileen Cannon, was appointed by the Trumpster to the federal bench in 2020. Just sayin’.  

4. Germany’s role in Brexit

Germany’s main opposition party leader [Friedrich Merz] has said Berlin and Brussels are partly to blame for Brexit because they were unwilling to offer the UK real concessions before its pivotal EU referendum in 2016. (Financial Times)

Wry & Dry comments: It’s only taken eight years for someone in the EU to state the obvious.

5. Buffett’s cash pile

Berkshire Hathaway’s cash pile swelled to a record $189bn in the first quarter of 2024 as Warren Buffett’s sprawling conglomerate continued to dump stocks, including Apple, one of its largest positions. (Financial Times)

Wry & Dry comments: Nice work if you can get it..


  1. Australia: the RBA left interest rates unchanged. Possibly the wrong decision. 

And, to soothe your troubled mind…

When somebody hurts you, just go after them as viciously and as violently as you can.

The Trumpster, quoted from his book by a prosecution witness in the legal case People of the State of New York against Donald J. Trump.

Such a gentle man.


The comments in Wry & Dry do not necessarily reflect those of First Samuel, its Directors or Associates.


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