The Secret Broker: Hey RBA, that’s not a pub test. THIS is a pub test.
The Secret Broker
The Secret Broker
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After 35 years of stockbroking for some of the biggest houses and investors in Australia and the UK, the Secret Broker is regaling Stockhead readers with his colourful war stories — from the trading floor to the dealer’s desk.
So, after 40 years, the RBA finally gets an overhaul, having become a bit of a political hot potato over the last year.
In fact, hot potatoes have probably become the staple diet of nearly two million Australians as their mortgage repayments have skyrocketed, courtesy of the RBA.
Mind you, I once did some business with an eccentric Indian gentleman, who was vegetarian.
He told me that his family had 208 different recipes on what you can achieve with the humble spud, which was unlike my Irish relatives, who just had one recipe.
“Just peel ‘em and boil ‘em” was their motto.
Even their dog only ate potatoes and guess what he was?
Correct. ‘Paddy’ (of course) was an Irish wolfhound and just like my uncle, he was on a strict Guinness and potato diet.
So, if you are struggling financially, find an Indian neighbour and not an Irish one, so at least you can have over 200 different meals as you wait for the rates to come back down.
Part of the RBA overhaul was to appoint two new directors, though I reckon Barry Humphries (if he was fully fit) could have been appointed and they could have got three directors with personalities for the price of one.
No better way than to cheer up the nation with bad rate-hike news, than if it was delivered by Dame Edna, swinging her gladdi, or Sir Les Patterson, if he no longer sits on the cheese board, with whisky in hand, live on TV.
I can’t imagine how boring their board meetings must be. Though now apparently they are going to have to publish them and then rock up to press meetings and actually be forced to answer questions.
According to our Chancellor, this brings the RBA up to ‘the same standards as other modern countries’ and makes them more accountable.
Also, ‘fewer board meetings’ were highlighted, as 1 of 51 recommendations that came out of the 294-page report, which I must admit, I haven’t read from front to back for some reason – though I did manage to find this absolute gem.
Only in Australia could these following words appear in a formal report on one of its most important institutions. With great pleasure, I quote:
“Current and former Reserve Bank board members themselves described the Reserve Bank board’s role in various ways, ranging from providing real-time feedback on the economy, to an informed second opinion, to a ‘pub test’ of how decisions might be understood by the public,” the review found.
I always like to see what words I can get away with when penning this column, so hats off to those who managed to get the word ‘Pub’ into a formal report on the Reserve Bank of Australia’s performance. I haven’t laughed so much since the Northern Territory came out with their tourism slogan ‘CU in the NT’.
There it is in black and white on page 136, fourth paragraph:
Though I must admit, I have also used this term in a presentation to my bosses in 1988.
It was when inflation was eating away at my pay packet and because of my personal circumstances, my spending power was falling way below my peers.
Basically my favourite lager, Tennents Extra was going up in price at double the price of inflation and when I cornered one of my bosses and told him that my wages were falling behind the rising price of my basic staple dietary needs, he just said ‘put it in writing and I will take it up with head office’.
So I did.
I can’t remember if PowerPoint actually existed at this point, but I did present a comprehensive four-page report (not an RBA 294 page door-stopper), ghost written by our brewing analyst.
It cleverly pointed out the rising cost of hops and yeast and I/we projected how over the next four years they would only increase even more. Thus I/we concluded, these costs will be passed on to the end consumer and we have spent the last six months doing ‘pub test’ research to provide these findings.
‘Inflation 10% and beer prices rising 20% year on year’ was the heading and also basically the conclusion.
After a couple of weeks of our pay rise submission, I got called into a meeting and was handed back my report and told that head office was very impressed with my submission. I was also handed a folded piece of paper.
“Here is your answer,” he said.
I opened the note and all it said was “We suggest that you drink 20% less beer”!
And that was that. Bit like Philip Lowe telling you that maybe you should eat 20% less potatoes if you don’t like his inflation message.
I didn’t really worry too much though, as by now we had negotiated with the local wine bar that if we ordered a minimum of 100 Long Island Iced Teas a week we could get them for £2.50 instead of £4.00 each.
Problem solved! Lager consumption fell as suggested but the alcohol consumption remained the same and at a far less cost to my wallet, though not my liver.
Speaking of liver, I have always suffered from gout or ‘broker’s toe’ as the older ones would say, but for all of you who still suffer out there I have found the holy grail.
No longer on any medication and no more flare-ups.
Two tablespoons of fresh lime juice in a mug of water every morning and night is all it has taken for me to get rid of it.
Now that truly is the best tip you will ever get from a broker!
Feel free to contact him with your best stock tips and ideas.