Turnbull certainly gets around. He's the opposition's telecommunications spokesman. But he also turned the wick down on the ASX and Singapore Exchange's chances of getting in bed together halfway through last month when he said the deal was hard to love.
The opposition was flying under the radar on the issue when Turnbull said the deal would be easier to embrace if it were structured more as ''an equal partnership''.
That comment underlined that even if the deal wasn't blocked by the Foreign Investment Review Board or Treasurer Wayne Swan, it would struggle to secure enabling legislation. ASX and SGX put new submissions into FIRB yesterday following Swan's confirmation on Wednesday that the deal would be blocked unless it was changed in Australia's favour, and did so knowing the original deal was a political orphan.
And yesterday, Turnbull did it again. He took time off from attacking the national broadband network to become the first senior politician on either side of the fence to openly declare that Australia needed a sovereign wealth fund.
Reserve Bank governor Glenn Stevens has said it's an idea worth considering, as has the Organisation for Economic Co-operation and Development; and a growing number of private-sector economists and business people including Amcor boss Ken MacKenzie and Fairfax chairman (and RBA board member) Roger Corbett support it as a way to save some of the cash the commodities boom is generating, reduce the political temptation to spend it all, and take some heat out of the Australian dollar, which has risen from around US98¢ to almost $US1.05 in the past three weeks.
But quarantining money that would normally be available for spending had proved to be a curiously unattractive concept for politicians until yesterday. When Stevens floated the idea of a sovereign fund late last year, Prime Minister Julia Gillard and Swan both used the ''we'll get back to you'' line.
The government couldn't act without threatening its plans to return the budget to surplus by 2012-13, the PM said. Swan said he welcomed debate but said paying down the debt and boosting superannuation contributions were the top priorities. Higher super was also a form of saving, he said, and how best to expand savings in the long term was ''an entirely open question''.
Shadow treasurer Joe Hockey agreed - on the urgent need for debt reduction, at least. A sovereign fund was the ''Maserati of public policy'', he said - desirable, but unaffordable. ''I look forward to it in my 10th year as treasurer,'' he said.
Enter communications spokesman Malcolm Turnbull, stage left. The time had come for Australia to create a new sovereign wealth fund, he told an International Chief Executives Forum in Melbourne yesterday.
Turnbull sort of agreed with Gillard, Swan and Hockey (who was given a heads-up that the speech was coming), saying a new fund should only become operational after the budget was back in surplus, and the government's debt repaid. That puts it several years away. The government aims for a surplus in 2012-13 but it will be a few more years before the global crisis debt is repaid.
But Treasury is already banking on the commodity boom pushing an extra $30 billion into the government's pocket in 2011-12; it added $65 billion in Labor's first term. Turnbull says the boom is partly cyclical but also structural, tied to Asia's industrialisation. The cash will probably continue to pour in, he says, and rather than waiting until Australia is debt free to make up our minds we should decide now that it is the right thing to do and spend the intervening years getting the fund's design right.
That will involve choosing between the different models available. Some funds, like Norway's, capture resource revenue and save it for future generations. Others, like Chile's, save and release funds on a shorter time frame to smooth the economic cycle.
It will also involve designing the fund's investment mandate. It should buy overseas assets because if the money remains denominated in Australian dollars it will continue to push up on the value of the currency.
And, finally, Turnbull says, we need to get a handle on just how much cash we will have to invest. Treasury's had a stab at it but he says much more detailed work is needed. It's an off-topic contribution from the Coalition's telco spokesman; you would almost think he was hankering after broader responsibilities.
But it is also a good one. Turnbull is right. We can reach a decision to create a fund quickly and get to work designing it well before the deficit is paid down and cash starts pouring in. Gillard, Swan, Hockey and Tony Abbott probably should have said it first.
Former Goldman Sachs managing director Malcolm Turnbull no doubt noted that Goldman finally moved to buy the outstanding 55 per cent of its Australian investment banking operation yesterday.
The deal is structured as 80 per cent cash and 20 per cent Goldman shares, and values the former JBWere operation at $1.2 billion after retention bonuses are taken into account. With Goldman finally in charge, there will information technology upgrades (the equity desk is still using Were IT under the terms of the 2003 partial takeover) and expanded $A trading. Goldman had the lock on that under the old alliance.
Goldman will be a more formidable competitor here now - and you won't be seeing Wayne Swan blocking the deal. The takeover of ASX is a special case; there is no general foreign investment crackdown.
Source: http://www.smh.com.au
The opposition was flying under the radar on the issue when Turnbull said the deal would be easier to embrace if it were structured more as ''an equal partnership''.
That comment underlined that even if the deal wasn't blocked by the Foreign Investment Review Board or Treasurer Wayne Swan, it would struggle to secure enabling legislation. ASX and SGX put new submissions into FIRB yesterday following Swan's confirmation on Wednesday that the deal would be blocked unless it was changed in Australia's favour, and did so knowing the original deal was a political orphan.
And yesterday, Turnbull did it again. He took time off from attacking the national broadband network to become the first senior politician on either side of the fence to openly declare that Australia needed a sovereign wealth fund.
Reserve Bank governor Glenn Stevens has said it's an idea worth considering, as has the Organisation for Economic Co-operation and Development; and a growing number of private-sector economists and business people including Amcor boss Ken MacKenzie and Fairfax chairman (and RBA board member) Roger Corbett support it as a way to save some of the cash the commodities boom is generating, reduce the political temptation to spend it all, and take some heat out of the Australian dollar, which has risen from around US98¢ to almost $US1.05 in the past three weeks.
But quarantining money that would normally be available for spending had proved to be a curiously unattractive concept for politicians until yesterday. When Stevens floated the idea of a sovereign fund late last year, Prime Minister Julia Gillard and Swan both used the ''we'll get back to you'' line.
The government couldn't act without threatening its plans to return the budget to surplus by 2012-13, the PM said. Swan said he welcomed debate but said paying down the debt and boosting superannuation contributions were the top priorities. Higher super was also a form of saving, he said, and how best to expand savings in the long term was ''an entirely open question''.
Shadow treasurer Joe Hockey agreed - on the urgent need for debt reduction, at least. A sovereign fund was the ''Maserati of public policy'', he said - desirable, but unaffordable. ''I look forward to it in my 10th year as treasurer,'' he said.
Enter communications spokesman Malcolm Turnbull, stage left. The time had come for Australia to create a new sovereign wealth fund, he told an International Chief Executives Forum in Melbourne yesterday.
Turnbull sort of agreed with Gillard, Swan and Hockey (who was given a heads-up that the speech was coming), saying a new fund should only become operational after the budget was back in surplus, and the government's debt repaid. That puts it several years away. The government aims for a surplus in 2012-13 but it will be a few more years before the global crisis debt is repaid.
But Treasury is already banking on the commodity boom pushing an extra $30 billion into the government's pocket in 2011-12; it added $65 billion in Labor's first term. Turnbull says the boom is partly cyclical but also structural, tied to Asia's industrialisation. The cash will probably continue to pour in, he says, and rather than waiting until Australia is debt free to make up our minds we should decide now that it is the right thing to do and spend the intervening years getting the fund's design right.
That will involve choosing between the different models available. Some funds, like Norway's, capture resource revenue and save it for future generations. Others, like Chile's, save and release funds on a shorter time frame to smooth the economic cycle.
It will also involve designing the fund's investment mandate. It should buy overseas assets because if the money remains denominated in Australian dollars it will continue to push up on the value of the currency.
And, finally, Turnbull says, we need to get a handle on just how much cash we will have to invest. Treasury's had a stab at it but he says much more detailed work is needed. It's an off-topic contribution from the Coalition's telco spokesman; you would almost think he was hankering after broader responsibilities.
But it is also a good one. Turnbull is right. We can reach a decision to create a fund quickly and get to work designing it well before the deficit is paid down and cash starts pouring in. Gillard, Swan, Hockey and Tony Abbott probably should have said it first.
Former Goldman Sachs managing director Malcolm Turnbull no doubt noted that Goldman finally moved to buy the outstanding 55 per cent of its Australian investment banking operation yesterday.
The deal is structured as 80 per cent cash and 20 per cent Goldman shares, and values the former JBWere operation at $1.2 billion after retention bonuses are taken into account. With Goldman finally in charge, there will information technology upgrades (the equity desk is still using Were IT under the terms of the 2003 partial takeover) and expanded $A trading. Goldman had the lock on that under the old alliance.
Goldman will be a more formidable competitor here now - and you won't be seeing Wayne Swan blocking the deal. The takeover of ASX is a special case; there is no general foreign investment crackdown.
Source: http://www.smh.com.au
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