THE DISTILLERY: Masters of time

There is nothing wrong with being six weeks behind the news. In that time you can get a lot of thinking done. Beef up your research. Refine your ideas. Even think of some new ones.

There is something wrong with being six weeks behind when you pretend time hasn't passed at all – as if, through some fluke in the fabric of existence, October 27 actually is September 11.

That is the wormhole through which Malcolm Maiden of The Age passes today in his comment on the APRA bank liquidity discussion paper. The paper was released...six weeks ago, and Maiden adds...nothing new. For those of us who were present on the first iteration of September 11 this year, we already know that APRA is going to increase liquidity requirements. From his multi-dimensional vantage point, Maiden concludes this "is a very big change”.

Nor has time travel clarified Maiden's thinking. Maiden claims that authorities "have decided the banks should insure themselves against the next” crisis. Yet this statement badly needs qualification. Would one month of extra liquidity provision have prevented the need for a government guarantee this time? Are the liquidity provisions sufficient to make the offshore borrowing too expensive and therefore prevent it? If so, will banks make a bee-line for securitisation? Six weeks is more than enough time to find some answers.

In another wrinkle within space-time, Ian Verrender of The Sydney Morning Herald pleasantly surprises this column with an insightful and entertaining piece on the plight of Qantas. The piece has some good data on collapsing-profitability for key routes, owing to rising competition. Verrender's conclusions, that Alan Joyce will have to cut costs and that Jetstar is set to gobble up the parent, look solid.

Time is also a theme for Michael Stutchbury at The Australian today. Stutchbury is concerned that, "Australia's infrastructure bottlenecks already are destabilising the national economy through rising house prices” and that cities will struggle to cope with the "60 per cent increase in the national population” in the future. Whilst this is a fair point, especially in NSW, this column is left wondering how such examples as failed electricity privatisation are driving up house prices. Stutchbury is on stronger ground when he discusses governments limiting land supply and "shady” deals with developers.

There is no obvious front-runner for your time among the several minds today occupied by CSR.  Matthew Stevens of The Australian does a good job of shattering the Viridian glass business, Stephen Bartholomeusz of Business Spectator, and The Australian Financial Review's Chanticleer agree on the sweetness of the sugar business. Persisting with his time-wasting vignette style, John Durie also covers CSR without distinction, as well as Myer and more on the two-strikes club. One small highlight was Stephen Bartholomeusz's second offering for the day on CSR, which highlighted the possible benefits to retail shareholders flowing from the CSR offer structure being used by UBS.

Several other comments today are worthy of your time. First is an op-ed by John Langdale from the Centre of Policing Intelligence and Counter-Terrorism, Macquarie University, in the AFR. Langdale reminds us that Australia's LNG reserves are "relatively small”, especially when compared to those of Qatar. But he goes on to point out that security concerns around the Strait of Hormuz will mean Asian nations will seek geographic diversity in LNG supply and Australia "will occupy a significant role as a supplier", even if we do not "emerge as an LNG superpower”.

Another good op-ed is provided by occasional commentator, Tony Harris, who describes the emerging battle-lines over reform for financial planning payments. According to Harris, the Financial Planning Association, Financial Services Institute of Australasia and ASIC are in favour of client payments over industry commissions, but many industry players are lining up against the idea. Harris cites a CBA argument that a ban on commissions "would only encourage...subsidies to emerge in another form” and defines the CBA lobby for self-regulation as "touching”. This column can think of other terms that might be applied. Harris also condemns Treasury's position as "plainly deficient” in supporting "cross-subsidisation” and declares "it is time commissions are seen for what they are”. Hear, hear.

Lastly, Alan Kohler has written a rousing piece against the national complacency regarding our rising dollar, an issue that has bothered this column for some months. If the dollar is going to remain "stronger for longer” then we do indeed need to face up to the threat that poses. It's all an issue of time.