Current Articles

Articles concerning current issues in insolvency, the state of the economy or the firm generally.

9-7-08 The Advertiser - Business conditions deteriorate

BUSINESS conditions deteriorated sharply and unexpectedly in June as costs continue to rise and confidence falls, a survey says.

National Australia Bank's monthly business survey found business conditions fell seven index points to zero points in June, 20 points lower than its recent peak in October 2007.

9-7-08 The Age - UK on brink of recession

BRITAIN is in serious danger of heading into recession as the credit crunch tightens its hold, according to a survey of businesses across the country.

9-7-08 The Age - Wall Street fears the worst is yet to come

AS HOUSE prices decline and Washington struggles to end the US economic malaise, Wall Street is starting to send a sobering message — the worst is yet to come.

One of the strongest warning signs came on Monday, when shares in the nation's most important mortgage companies, Fannie Mae and Freddie Mac, plummeted. After falling almost continuously over the past month, in just one day Freddie Mac tumbled another 18%, and Fannie Mae lost 16% amid concerns that the companies would need to raise billions of dollars in fresh capital.

9-7-08 The Age - Australian Business Hits the Skids, report shows

AUSTRALIA'S economy is braking sharply, with business reporting that soaring petrol prices and high interest rates have wiped away all positive momentum from demand.

Bankruptcies have soared to record levels.

8-7-08 Sydney Morning Herald - Business Confidence Slumps

Business confidence slumped in June to the lowest level since the September 11 terror attacks in the US, as rising inflation and a grim outlook for the global economy dash hopes of an upturn in business activity.

1-7-08 The Age - BIS warns the worst is far from over

A YEAR ago, the Bank for International Settlements startled the financial world by warning that we might soon face challenges last seen during the onset of the Great Depression. This has proved frighteningly accurate.

1-7-08 Courier Mail - House lending hits skids

THE brakes have been slammed on the Australian economy with home loan approvals posting their weakest annual growth since the recession of 1991.

1-7-08 Sydney Morning Herald - After the binge, a thumping $400b hangover

BEARING the scars of a tumultuous year for business, the sharemarket recorded its biggest fall in 26 years in 2007-08, wiping close to $400 billion from investors' funds.

The market fell 0.4 per cent yesterday, capping off a financial year in which it shed almost 17 per cent, the worst performance since 1981-82, and the worst decline in the month of June since 1940.

27-6-08 The Age - Insolvencies soar on faulty tactics

POOR strategic management, insufficient cash flow and trading losses are among the most common reasons why companies fail, and in most cases, unsecured creditors receive less than 10¢ in the dollar back, statistics from the corporate regulator indicate.

27-6-08 The Age - Oil passes $140 a barrell

Oil prices have crossed $US140 a barrel for the first time in New York and London amid a declining dollar and after OPEC warned prices could hit $US170 this year.

27-6-08 Sydney Morning Herald - Market plunges as oil surges, outlook darkens

Wall Street stocks have tumbled, sending blue chips to a two-year low, as oil prices leapt to fresh highs and sentiment was hit by a barrage of troubling economic and corporate news.

The blue-chip Dow Jones Industrial Average sank 354.42 points, or 3%, to 11,457.41 at the closing bell.

26-6-08 Sydney Morning Herald - Credit Crisis May Last 2 Years

Commonwealth Bank chief executive Ralph Norris said there had been some improvement to the global economic outlook.

However, Mr Norris said the global credit crunch still had at least 12 months to two years to play out.

25-6-08 The Age - Boom talk followed by gloom

SOUTH-EASTERN Australia is close to recession, with growth in spending likely to slow to about 1% and business investment falling 5% as high interest rates drive down economic activity, Westpac is warning.

25-6-08 Sydney Morning Herald - Financial Firms may cut 175,000 jobs

The world's biggest financial firms may lose as many as 175,000 jobs by this time next year as Citigroup and other banks shed workers amid slowing revenue and billions in writedowns, executive recruiters say.

23-6-08 The Age - Stockmarket to test fresh low

Investors dumping loss-making stocks to offset profit gains are likely to drive the Australian sharemarket to a fresh low in the final week of the current financial year.

The main Australian index, the S&P/ASX200 is trading down 18% since June last year taking the market to its first loss in five years, and the worst performance in 20 years.

23-6-08 The Age - World Credit Crisis puts Heat on Mortgages

THE global credit crisis is shackling Australian banks from cutting home loan interest rates, ANZ chief executive Michael Smith is warning.

Mr Smith says he sees no sign of the industry being able to reduce the additional 40 basis points added to mortgage costs since January. This is because the price of funds in the money markets is higher than the official rate set by central banks.

23-6-08 The Age - Bill Express in Debt Crisis

CREDITORS are lining up at Bill Express, with the national electronic payment company facing debts in excess of $180 million.

20-6-08 Sydney Morning Herald - Double whammy of rates and fuel hurting business

HIGH interest rates and rising fuel costs are hurting businesses, a new survey has shown.

19-6-08 Sydney Morning Herald - Mortgage Arrears Rise to Record highs

Australia's mortgage arrears rate rose to a record in March as borrowers struggled to make repayments because of rising inflation and higher interest rates, according to Standard & Poor's.

18-6-08 The Advertiser - Wage demands to push interest rates higher

AUSTRALIANS could be hit with another interest rate rise if they push wage demands too far and risk an inflation blowout, the Reserve Bank has warned.

18-6-08 The Age - Rising costs spark retail gloom

FEARS of rising interest rates and petrol prices have trumped expectations of next month's tax cuts, driving down consumer sentiment to the lowest in the four-year history of a Sensis confidence gauge.

The findings echoed a survey of small and medium retailers, which found confidence dipping 8% and led the Australian Retailers Association to warn that businesses unable to contain costs would struggle.

18-6-08 Sydney Morning Herald - Profits Slowdown

THERE will be few winners and plenty of losers as higher fuel prices and a rapidly slowing economy drag down most industrial companies, with analysts predicting profits falling across the ASX 200 by up to 10 per cent.

12-6-08 The Age - ATO declares war on cash economy

HUNDREDS of tax investigators will be swooping on people participating in the illegal "cash economy".

Sydney Morning Herald 11-6-08 - Markets expect rates to rise

GLOBALLY, interest rates look set to go higher, but the case is strong in Australia for the Reserve Bank to stay on hold.

The financial markets fully expect the RBA will order a rise by the end of the year to push the official cash rate to 7.5%. The chance of a move in August, after the next consumer price index number, is at 64%.

Sydney Morning Herald 11-6-08 - Battlers bear the brunt

Kevin Rudd's battlers are feeling the pinch.

The sky-high fuel prices and higher interest rates are combining to drive consumer sentiment down.

The feeling of workers towards Australia's economic performance and outlook has plummeted to a level not seen since the economy was climbing out of the 1990s recession.

Sydney Morning Herald 11-6-08 - Consumer sentiment sinks to 15 year low

Consumer sentiment tumbled 5.6% in June to its lowest in more than 15 years, as rising food and petrol prices stretched household budgets.

The Advertiser 10-6-08 - Employment Expectations lowest in 17 years

EMPLOYMENT expectations amongst Australian executives are at their lowest level in 17 years, the Dun & Bradstreet Business Expectations Survey released today shows.

10-6-08 The Age - Australian Business braced for a downturn

"Businesses expect a "steep decline" in sales, profits, employment growth and capital investment in the September quarter................."

6-6-08 Sydney Morning Herald - Construction activity slumps

Australia's construction sector contracted sharply for a third straight month in May, as high interest rates and slumping customer confidence drove activity to its lowest in over two years, a survey showed.

6-6-08 The Age - Property group on verge of collapse

TROUBLED property group Octaviar is on the verge of collapse after Public Trustee of Queensland, an arm of the Queensland Government, applied to wind up the group and some of its satellites over the payment of $351 million.

5-6-08 The Age - Rate Rises back on the agenda

The OECD also warns that Australia faces "a significant negative risk" that the world economy will slow more than it has forecast, driving down the export prices that underpin Australia's growth. It nonetheless endorses the Government's budget tightening as appropriate, saying it "should ease demand pressure to some extent".

Rivkin Article - March 2008

This is an article that has been written by our lawyers about one of our many insolvency cases. This one involves us unravelling the web and following the trail of monies of the late Rene Rivkin - a bankruptcy file.

18-4-08 - You Tube - An absolute inspiration!!

This is a terrific clip about a boy who is bullied but who comes out and sings like and angel. Again, a nice change of pace from the world of bankruptcy and liquidation.

31-5-08 Sydney Morning Herald Backlash to the debt binge

AUSTRALIANS are shying away from debt. But while the rate of new borrowing is plunging, the hangover from the debt binge when interest rates were low looms as a significant threat to the economy.

27-5-08 Sydney Morning Herald - Mortgage arrears at 11-month high

Australia's delinquencies on mortgages to people with good credit histories rose in February to the highest in 11 months, according to Standard & Poor's.

26-5-08 The Daily Telegraph UK - George Soros - We face the most serious recession of our lifetime

'This is a period of wealth destruction. The people who make money will be few and far between. There will be a lot more money lost than made." When George Soros - the phenomenally successful hedge fund manager - says this, you know something is wrong, very wrong. And indeed it is. The 77-year-old billionaire sinks back into the sofa in his Chelsea townhouse and exhales.

21-5-08 The Courier Mail - Economists warn householders to brace for mortage pain

THE threat of another interest rate increase has roared back on to the agenda. Some economists warned yesterday they expected a rate hike this year and renewed their criticism of the Government, saying Labor should have done more to fight inflation in the Budget.

21 May 08 - Sydney Morning Herald - Consumer confidence stays low

Consumer sentiment improved slightly in May thanks to a post-budget bounce, but remains "disturbingly low'' as rising mortgage repayments and higher petrol take their toll.

21-05-08 Sydney Morning Herald - RBA rates strategy could lead to disaster

The Reserve Bank of Australia's strategy of raising interest rates to battle inflation is potentially dangerous, a Nobel Prize-winning US economist has warned.

20-5-08 The Age - Director liability laws in the spotlight

"THE question of company directors' personal liability is back on the agenda because of the Government's drive to harmonise a range of federal and state laws and make national markets more efficient."

16-5-08 Courier Mail - Families struggle as bank fees soar

THE misery of household debt has led to a whopping rise in profits for banks.

The windfall comes from fees and charges including a 170 per cent increase in credit card fee income over the past five years

16-5-08 Sydney Morning Herald - Economy about to slow

Reserve Bank governor Glenn Stevens has warned again the national economy is about to slow and defended the bank's strategy of inflation targeting

16-5-08 Sydney Morning Herald - CommBank: Home loan rates will rise

HOME loan rates will be pushed even higher this year as a result of higher bank funding costs, Commonwealth Bank chief executive, Ralph Norris, warned yesterday.

13-5-08 The Age - Rate rises sap new home lending

TREASURER Wayne Swan will bring down Labor's first budget tonight against the background of the biggest drop in four years in the number of loans for new housing.

Both the value and quantity of loans for housing fell in March as official and bank-led interest rate rises slowed the housing market. The number of housing loans fell 6.1% to 59,371 — a much worse decline than expected — while loans for new dwellings dropped by a massive 11.5%, its biggest fall in four years, the Bureau of Statistics reports

10-5-08 The Advertiser - Shops hit by rate rise as consumer confidence slips

"INTEREST rate rises are starting to hurt, with enthusiasm for spending plunging at a rate similar to that before the last recession

Small retailers are expected to bear the brunt of the drop in consumer confidence, which has plunged to levels not seen in more than 14 years"

10-5-08 Sydney Morning Herald - Are we there yet?

"There is a view slowly emerging that the worst of the global credit crunch and sharemarket ructions has passed. But there are many reasons to believe predictions that the crisis has reached bottom are prematurely optimistic.

Rising interest rates and a credit market that has frozen also have a dramatic effect on companies. Just ask directors at Centro Properties Group, MFS, Allco Finance and ABC Learning Centres..........

More companies will explode. But it is not as if these early starters will be the only candidates for corporate collapse"

More liquidation, voluntary administration, bankruptcy appears to be on the cards for the future.

8-5-08 The Advertiser - Coles shopper dockets a discount fuel con, says ACCC

"SUPERMARKET giant Coles has been accused of overcharging loyal customers who use discount vouchers to buy petrol.

"Consumers shouldn't be fooled that the discount voucher from Coles will not necessarily get them cheaper petrol."

8-5-08 Sydney Morning Herald - Westfield slumps as shoppers stay home

"WESTFIELD, the world's biggest shopping centre owner, has revealed a sharp decline in sales across its United States and New Zealand portfolio as consumers tighten their belts and close their wallets

............consumers are not likely to continue to spend heavily in the face of higher interest rates and an uncertain economic outlook"

In the currernt climate with consumer spending tightening, financial questions will be asked of traders inside of Westfield shopping centres - some may head toward insolvency and liquidation.

7-5-08 The Advertiser - Business confidence takes a hit

"BUSINESS confidence has slumped to a 14-year low due to high wage costs and slow growth, while interest rates remain a top concern, surveys released today show.

The economic slowdown that is occurring is starting to bite business, many saw poor results in the March quarter and are anticipating that the challenges will only increase as we head in to the second half of the year"

The economic slowdown is seeing an increase in insolvency, bankruptcy and liquidation.

7-5-08 The Courier Mail - Interest rates on hold, but risk remains, RBA says

"THE Reserve Bank of Australia has indicated the risk of further rate rises remains, despite a well-anticipated decision to leave rates steady for another month. If demand does not slow and inflation expectations remain high, absolutely there is a risk of further tightening........
A Dun & Bradstreet business expectation survey, also released yesterday, showed that 53 per cent of 400 firms questioned ranked interest rates as the most important issue influencing operations in the quarter ahead."
With tightening credit, insolvency and liquidation will be a concern to many businesses in the immediate future.

7-5-08 The Age - Oil hits new record on supply threat

"Crude oil rose to a record $US122.73 a barrel in New York on threats to supply in Nigeria and Iraq and growing Asian fuel consumption.

Supply shortfalls will probably send oil to between $US150 and $US200 a barrel within two years, Goldman Sachs analysts led by Arjun N. Murti said in a report."

6-5-08 The Advertiser - Banks toughen loan eligibility criteria

"HOMEBUYERS face more knockbacks when applying for a mortgage, as banks and other lenders secretly tighten rules on who qualifies."

6-5-08 Sydney Morning Herald - Business confidence slumps: Survey

"Business confidence has slumped to a 14-year low on the back of the worst conditions in five years, a new survey reveals.................The extent of the wider global slowdown is beginning to be felt domestically, and as a result, business will need to reassess plans and formulate effective strategies to adapt to this new environment,"

The news continues to point to difficult times ahead for business - that now, more than ever, needs to be vigilant in controlling costs and avoiding insolvency and liquidation.

5-5-08 Sydney Morning Herald - Inflation is guage hits a record

"Inflation is growing at its fastest rate on record as petrol prices reach new heights...............Economists say an interest rate cut by Christmas is now looking less likely, as price pressures persist.

''This is a truly shocking result,'' said Mr Williamson, who forecast a rate cut by December in an AAP survey of 19 economists last week.

Inflation increasing has a flow on effect into confidence and the amount of disposable income. This is likely to have a negative affect on many businesses and individuals and may be a cause of insolvency, liquidation and bankruptcy.

1-5-08 The Courier Mail - Food bills up $139 per month

"SOARING food prices have added $139 to the average family's monthly shopping bill in the past year, according to the Australian Bureau of Statistics.

In 12 months the price of a loaf has risen almost 9 per cent to $3.51.

The cost of two litres of milk has rocketed 11 per cent, or 36c, in 12 months and is up from $3.03 three years ago to $3.51.

1-5-08 The Advertiser - Personal borrowing slows as rates rise

"LENDING to the private sector is showing signs of moderating as higher interest rates begin to bite, new figures show.

All told, the March credit data paint a picture of slowing growth in the economy with a particularly pronounced slowdown developing in retail spending."

The issue will be has the interest rate increases been too aggressive and will this result in an increase in voluntary administration, liquidation and insolvency generally.

1-5-08 The Age - Filling a trolley takes bigger bite of budget

"Since March 2005, the price of petrol has risen by more than 40%, while the price of milk has gone up by 18.5% and cheese by 24.4%.

Meat prices have also crept up, with the price of rump steak climbing more than 25% since 2005, while a whole chicken now costs consumers 29% more. Bacon rashers climbed 19.3% and lamb loin chops by 7.2%, while sausages have only risen by 4.4%. Fruit and vegetables have also risen significantly over the past three years, with marked increases in the price of potatoes (43.6%) and carrots (19.4%)."

30-4-08 The Advertiser - Business conditions worsening

'BUSINESS conditions have worsened in the first three months of 2008 as companies battle high interest rates and a high Australian dollar, a survey says......

The combination of much tighter financial conditions, falling global equity markets and the global credit crunch has produced a sharp fall in business confidence,'' NAB group chief economist Alan Oster said."

2008 and 2009 will be a tough year for business and individuals and it is no surprise that personal bankruptcy and corporate insolvency is on the rise.

30-4-08 The Courier Mail - Surging oil fuels inflation worries

"FEARS that crude oil prices will continue to escalate have sparked concern at the effect on the cost of food and other vital commodities.

Market analysts warned yesterday that further rises would impact the wider economy by fuelling inflation."

One can only wonder what impact the price of oil is having on industries such as transport and the flow on effect through the economy. Certainly the rate of insolvency and liquidation appears to be on the increase.

30-4-08 The Age - Budget 'hardest in years'

"TREASURY secretary Ken Henry is buttressing Treasurer Wayne Swan's warnings that high interest rates and slowing global growth are hurting Australia's economy and federal revenue.......

Dr Ron Woods, chief executive of Econoclast.com.au, said the surplus would eventually be lower because slower growth would reduce household tax collections. "It will mean slower employment growth and less disposable income, making it more difficult for households......"

With business confidence declining along with less disposable income and employment concerns coupled with an increase in inflation and interest rates, the future outlook is somewhat bleak and must be of concern to many Australian businesses. Those facing any insolvency issues should always seek appropriate advice as early as possible so that liquidation is not the only option.

29-4-08 The Advertiser - Westpac hikes rates by 0.10pc

"WESTPAC has become the third bank in less than a week to raise its variable mortgage rates by 0.10 per cent to 9.47 per cent due to rising borrowing costs.

We will continue to absorb a significant portion of the additional borrowing costs that we are experiencing on behalf of our customers.''

The bank's comments that it says it will continue to absorb a portion of the borrowing costs on behalf of its customers will be of little comfort to those who have had homes repossessed or had their business placed into liquidation.

29-4-08 The Courier Mail - Homeowners warned about rate rises by big banks

"HOMEOWNERS are being told to brace for tougher times ahead as Australia's biggest banks continue to ramp up home loans independently of the Reserve Bank.

.........home prices had declined 11 per cent over the past year and there were predictions they would fall by 35 per cent in the US before the economic hard times eased.

The implications for Australia are very considerable. There is a lot of pain in Australia that is going to come out of the US."

With rates increasing independent of the Reserve Bank, there are implications for business and the cost of borrowing. Without careful consideration and planning for such issues, a business may find it faces insolvency issues and worse - liquidation.

29-4-08 The Age - Confidence falls to dot-com bust level

"BUSINESS confidence has dived to its lowest level in seven years, putting pressure on the Reserve Bank not to add to the four interest rate rises of the past year when the board meets next week...........

With confidence a leading indicator of economic performance, a dip in sentiment shown in the National Australia Bank business survey was likely to have a flow-on effect on investment decisions and employment levels, said........NAB's head of Australian economics."

For small business owners, a dip in confidence and employment may affect levels of disposable income and lead to tough times and perhaps insolvency and liquidation for some businesses.

28-4-08 Sydney Morning Herald - Business confidence hits seven year low

28-4-08 West Australian - Refinancing warning as big debts start to bite

28-4-08 The Advertiser - NAB follows ANZ with 0.10 per cent rate hike

28-4-08 The Age - Recession warnings grow in US

28-4-08 Sydney Morning herald - Big changes to aid small business

24-4-08 Sydney Morning Herald - Soaring petrol prices: more to come

24-4-08 The Courier Mail - Rate rise tipped: dollar hits 24 year high

24-4-08 The Age - Inflation shock fuels rate fears

24-4-08 Sydney Morning Herald - ANZ sets $2.4b aside for bad loans

23-4-08 The Advertiser - Inflation rising at a faster pace - now at 4.4 per cent

23-4-08 The Courier Mail - Inflation hits 17 year high, chance of rate rise 50-50

23-4-08 The Age - Economists have their say