Of course, the more enduring solution to the two issues I have talked about – the transition in the Australian economy and low returns to savers – is an improvement in the underlying investment environment. This is a challenge not just in Australia, but in almost all advanced economies.
I was recently discussing with my staff the implementation of Basel III in the EU. At some point, the discussion turned to the less than optimal experiences with the previous Basel standards. Some pointed out that the US did not implement the Basel II standard in full, despite having pushed for it in the first place.