Only the best, unless I'm wrong, says Ross Garnaut

Professor Garnaut, who compiled his original Climate Change Review in 2008 and an updated version last November, said much of the media and public discussion on climate change was crude and distorted.

He described reaction to some of his conclusions as "somewhat rabid" and chided the media for misrepresenting US climate change policy.

Prof Garnaut also warned of the worst result of a rejection of carbon pricing would send Australia into a political retreat.

"If carbon pricing were defeated this time around it would open the way to myriad regulatory interventions," Prof Garnaut told a Melbourne conference.

"These would raise costs directly, there would be no opportunity to introduce productivity-raising tax cuts as a form of compensation to low and middle income earners.

The effects of climate change will be one of the reasons to expect higher food prices and higher agricultural prices in the 21st century . . . The question will be what parts of the world will retain a capacity to make use of those better markets," Professor Garnaut said.

He said farmers would also benefit if carbon pricing saw a slowing of growth in the coal and mining sector. "If the huge growth of coal and gas is a bit slower, if the mining industry is right, that will lead to a lower real exchange rate and a huge benefit to the rural sector."

Professor Garnaut conceded he was interested in seeing the final package to come out of the climate pricing negotiations. But he was cautious about passing judgment on the likely overcompensation of low-income earners through a 20 per cent "battler's buffer".

"We don't want the scheme to make lower- or middle-income Australians poorer, but I thought the job was done by just making sure we didn't make them poorer," he told The Australian.

Professor Garnaut said it was optimal for Australia to have a fixed price for three years to allow a comfortable transition to an emissions trading scheme and avoid extreme fluctuations "while the politics settles down".

But he acknowledged a cost of such an approach was that fluctuations in international prices, such as the EU emissions trading scheme, could "get out of step" with the Australian price.

"I recommended three years because it was the best. I only recommend the best for Australia," he said with a smile. "Unless I make a mistake, in which case I am very honest about correcting it.

US Federal Reserve must tighten policy, says RBA board member

Mr McKibbin described debt-laden Greece as merely "the first carriage to break".

Speaking at the same conference in Melbourne, however, Treasurer Wayne Swan offered a different perspective.

"Some have a dire view of what's happening in Europe," he said. "I don't share those views."

The comments came shortly after Greece staged a last-minute escape from bankruptcy, passing a range of austerity measures designed to keep bail-out funds flowing from the European Union and the International Monetary Fund.

That news buoyed markets with the ASX 200 climbing 1.7 per cent to 4608 points, while the dollar soared against the US and hit a 26-year high against the British pound of 66.76 pence.

Since Monday morning the dollar has gained more than US3c against the greenback to trade last night at $US107.37.

The Greek parliament was to stage the second part of the vote last night.

Prof McKibbin - who stressed his views were his own and not those of the RBA - said Greece was just one of several nations that needed to rein in spending and increase taxes.

The US Federal Reserve has to tighten policy. You cannot give away money and have a vibrant economy. There has to be in Europe a tightening of monetary policy and there has to be some adjustment in Asia," he said.

In recent years, he has been a vocal advocate of tighter policy settings, pointing to rapid growth in commodity prices, fuelled by the emergence of China and India, as a risk to the global economy.

He also renewed his call for Australia to embrace a sovereign wealth fund, in part to help the Australian economy deal with a mining boom, which is fanning an enormous wave of investment with the economy.

Australian Foreign investment essential: Ferguson

Professor McKibbin issued the warning yesterday as the Greens released their own research into foreign ownership of Australia's mining industry to prosecute their case for higher taxes on the sector, triggering an angry backlash from miners.

While the Greens latched on to claims that $50 billion worth of mining company dividends would flow overseas in the next five years, the party's own figures also revealed that for every $1 sent offshore more than $4 was invested back in the Australian mining industry.

The $50bn figure for mining dividends sent offshore has also come under scrutiny for apparently being based on the assumption that the sector has the same average dividend payout ratio as all foreign equity profits.

That average ratio of 19 per cent could be inflated because listed miners traditionally reinvest their cash in expansions and pay very low dividends to their shareholders, who rely on growth in share prices for their returns.

Minerals Council of Australia figures for the 10 years to 2008-09 show miners generated cashflow of $210bn, of which $80bn was paid in tax and revenues and $125bn was re-invested.

This would leave just $5bn over a decade (or a 4 per cent ratio) that could be paid back in dividends to all mining investors, compared with the $10bn the Greens claim would be returned to foreign investors as dividends annually, on average, for the next five years.

The dispute over the research flared as the Greens and miners traded insults over the party's use of a nationally televised address to accuse the industry of lining pockets of foreign millionaires. Greens leader Bob Brown told the National Press Club the party would continue to press Julia Gillard to lift the rate of her planned mineral resources rent tax, warning last year's compromise deal with miners over the tax would cost Australian taxpayers $100 billion over the next decade. "While Australia gets jobs, export income, royalties and company tax from our minerals, the (mining companies') foreign owners get profits, dividends, capital appreciation and influence.

While Australia's superannuation system assists in providing the capital needed, if Australia is to fully capitalise on the growth in global energy demand the required investments are so great that overseas investment will be essential."

Mr Ferguson said when it came to energy supplies an open and transparent foreign investment framework was crucial.

The resources minister said not only was Australia dependent on foreign investment but it also relied on overseas workers.

"At the same time as Australia is competing internationally for capital, we also need to ensure we have sufficient skilled labour and this includes skilled migration."

Senator Brown on Wednesday released a report suggesting 83 per cent of the mining industry is foreign owned.

Over the next five years corporate giants will earn about $265 billion from Australian resources with $50 billion in dividends sent offshore, the report states.

Mr Ferguson on Wednesday played down that claim by saying "foreign investment (generally) is welcome in Australia.

Australian House price slide eclipses GFC drop

Top end of town remains troublesome, with property prices in blue-chip suburbs down 5.3 per cent in the past year.

The data shows affordable suburbs are still weathering the storm, down just 0.8 per cent in 12 months.

Melbourne's property market is in a slump, with buyers keeping their hands in their pockets at auctions across the city.

RP Data research director Tim Lawless said January was a bad month for property prices, and while other cities were clawing their way back, Melbourne was still struggling.

"A few alarm bells have gone off for Melbourne because it has been such a good performer," he said.

Mr Lawless said people seemed more interested in paying off their mortgages than spending up big on a new house.

For May alone, national city home values fell 0.3 per cent, seasonally adjusted. That brought the slide so far in 2011 to 2.7 per cent, compared with 2.4 per cent for the five months to July 2008, during the peak of the GFC, RP Data researcher Tim Lawless said.

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House prices are on the slide nationwide, although Sydney is bucking the trend. Photo: Glen Hunt GTH

‘‘That year-to-date figure is mostly attributable to the January figure. Values were down 1.2 per cent in that month alone. The market’s actually continuing to fall in value but certainly not at as dramatic a rate as that,’’ Mr Lawless said.

Sydney dwelling values also went against the downward trend, rising by 0.3 per cent over the month. Brisbane, Adelaide and Canberra were also up marginally, but in Melbourne the brakes were on, with both values and transaction volumes dropping, the figures show.

The outlook for house prices has drawn mixed reviews, with research firm BIS Shrapnel earlier this week predicting solid gains over the coming three years for most cities. Others, though, have pointed to the prospect of another rise in official interest rates, slowing inbound migration and a soft economy outside the mining sector as reasons for house prices to remain steady or fall.

Qantas to minimise strike effects with larger

QANTAS will fly bigger aircraft in and out of Brisbane next Wednesday to try to counter disruptive strike action by engineers.

About 40 members of the Australian Licensed Aircraft Engineers Association will stop work for the first two hours of their shift on the day of the State of Origin decider in their ongoing dispute with the airline over their pay and conditions.

ALAEA federal secretary Steve Purvinas said to minimise disruption, they had offered the airline the option of "using people who were not rostered on to come in and work overtime".

"It's pretty peak time (that we're striking) between 5am and 9am but it shouldn't matter if the company accepts our offer of strike breakers," Mr Purvinas said.

"I wasn't even conscious your little State of Origin was on."

Luke Enright from Qantas said the airline would not be paying staff "four times their normal pay" to go on strike.

"Targeting the State of Origin is a new low for the engineers' union and we will do everything we can to get people to Brisbane for the game," Mr Enright said.

"We have put bigger aircraft on routes in and out of Melbourne on Monday to deal with the strikes and will look to do something similar for Brisbane on Wednesday.

Qantas announced last night it would use larger Boeing 767 aircraft for services in and out of Melbourne, ensuring the majority of passengers can travel as planned.

The Australian Licenced Aircraft Engineers Association will take strike action following this week's breakdown in negotiations.

Qantas group executive operations Lyell Strambi said the airline would inform affected passengers over the weekend.

"We apologise to families and other customers who may be impacted by the union action. We are doing everything we can to get families to their destinations as quickly as possible," Mr Strambi said.

"Most people are surprised that the union is going on strike over the school holidays and while services are still being impacted by the volcanic ash cloud.

"If the union is serious about not disrupting the travel plans of Australians then they should call off the strikes immediately.

Australia Shares End Up 1.7%; Strongest Rise

SYDNEY --The Australian share market rose the most in seven months on Thursday as financial-year-end buying exaggerated a positive reaction to offshore gains following a Greek parliamentary vote in favor of austerity measures needed to avoid a debt default by Greece.

The benchmark S&P/ASX 200 closed up 78.5 points, or 1.7%, at 4608.0 after hitting a four-week high of 4609.2. Industrials, resources, healthcare, utilities and banks led broad-based gains, although trading volumes were no stronger than average.

On Wednesday night AEST, the package was approved in the first stage of a two-part vote by the Greek Parliament to unlock emergency finance from the European Union and International Monetary Fund.

The stage-two vote is scheduled overnight on Thursday.

Mr Johnson said the Australian bond market rallied on Thursday morning after the release of weak house price data and official job vacancy numbers.

However, the already high level of bond prices, and in turn low yields, capped the rally.

Mr Johnson said the rally stopped when three-year bond futures yields got too far below 4.75 per cent - the level of the Reserve Bank of Australia's (RBA) cash rate.

"The bad news is in the price," Mr Johnson said about bond traders' perceptions.

"Unless you really believe the RBA is going to cut rates, then the bad news is in the price," Mr Johnson said

He said after the second Greek vote was approved on Thursday, all eyes would turn to US June manufacturing data due on Friday night AEST.

Banks to cut costs to maintain profits

AUSTRALIAN credit growth remained sluggish in May as house prices continued to slide, reducing the pressure for higher interest rates that has been building up in recent months.

Total credit to the private sector rose a seasonally adjusted 0.3 per cent in May from April, and rose 3.1 per cent from a year earlier, the Reserve Bank of Australia said today. Credit growth was flat on-month in April.

At the same time, housing sector credit rose 0.5 per cent on-month in May and business credit rose 0.1 per cent, having fallen 0.5 per cent in April, the central bank added.

The data may encourage economists to push back their forecasts of when the central bank will next hike interest rates to the fourth quarter.

The central bank has held its cash rate target at 4.75 per cent since November 2010 as an uncertain global environment and weakness in Australian housing and consumer sentiment kept it from lifting rates.

Banks still borrow enough from overseas to make it a worry, with ratings agency Standard & Poor's viewing their reliance on those markets as a "soft spot" that needs close monitoring.

That was unlikely to cause S&P to cut the big four banks' double-A credit rating, a measure investors use to judge the safety of a borrower.

The Reserve Bank of Australia also has confidence in the local banks, with assistant governor Guy Debelle saying that they are less vulnerable to global financial shocks than during the 2008 credit crisis.

He added that the Reserve Bank could bail them out more easily than its overseas counterparts if another crisis struck, because most Australian bank borrowing was in Australian dollars.

Additionally, interest rates in overseas markets are now less likely to suddenly rise after Greece's parliament approved budget cost cutting measures in exchange for a 28.4 billion euros ($A38.93 billion) payment from the European Union and International Monetary Fund.

So far, Europe's debt crisis has not caused interest rates to rise substantially for NAB, chief executive Cameron Clyne told a business lunch on Tuesday.

Local banks had very little to no direct dealings in Greece, but a default by Greece or another European country could cause interest rates to rise across the board as lenders worried that they're money was at risk of not being repaid.

Mr. Popper's Penguins

Mr. Popper's Penguins is a live-action family comedy film distributed by 20th Century Fox starring Jim Carrey, based on the children's book of the same name. The film was originally slated for a release on August 12, 2011, but was moved up to June 17, 2011.

Plot

Mr. Tom Popper (Jim Carrey) is a divorced realtor whose father traveled to many far places around the world during his childhood. When his father dies, a crate containing a penguin shows up at his doorstep. Eventually, due to a miscommunication, more penguins arrive, bringing the total to six. Originally intending to donate the penguins to the local zoo, Popper's children fall in love with them so he decides to keep them. At the same time, Popper is given the task of buying Tavern on the Green, an old restaurant that he used to eat at with his father as a child, with the intent of tearing it down and building a new development in its place. However, its elderly owner (Angela Lansbury) will only sell it to someone who she deems a person of true value.

Having the penguins around helps Popper to become closer to his children, and he begins dating their mother again. The penguins eventually lay three eggs. Two of the eggs hatch, and one does not. Popper becomes obsessed with saving the last egg, losing his job in the process. Upon realizing that the egg cannot be saved, Popper feels he is not capable of raising the penguins and donates them to the zoo. He then refocuses his attention on purchasing the Tavern on the Green. His children and ex-wife, however, are disappointed in his decision, seeing it as wrong.

Popper then finds a lost letter from his father which had been delivered with the first penguin. In it, his father tells him to hold his children close and love them, just as this penguin would love him. He becomes guilt-ridden over his decision to give away the penguins and determines to go to the zoo to take them back. Along with his ex-wife and children, Popper rescues the penguins, who were going to be separated and traded to other zoos. Upon seeing how Popper has reunited his family and rescued the penguins, the owner of Tavern on the Green agrees to sell him the restaurant. Rather than tear it down as originally planned, Popper renovates the restaurant and reopens it.

At the end of the film, Popper and his family go to Antarctica with the penguins, allowing them to live with their own kind. Popper's first penguin, Captain, is revealed to have laid another egg. Popper tells his children that they'll have to come back and visit when the baby is born.

Production

Originally Ben Stiller was going to play Mr. Popper, and Noah Baumbach was originally going to direct; however, they both dropped out. Owen Wilson, Jack Black and Jim Carrey were all considered to replace Stiller, with the role eventually going to Carrey. Mark Waters was chosen to direct. Filming began in October 2010 and finished in January 2011.

On September 21, 2010, it was confirmed that Carla Gugino had joined the cast.

Rhythm and Hues Studios did the penguin animations for certain shots.

Cast

Jim Carrey as Tom Popper

Ophelia Lovibond as Pippi

Carla Gugino as Amanda Popper

Madeline Carroll as Janie Popper

Maxwell Perry Cotton as Billy Popper

Angela Lansbury as Mrs. Van Gundy

Philip Baker Hall as Mr. Franklin

Dominic Chianese as Mr. Reader

Clark Gregg as Nat Jones

Henry Kelemen as Young Tom Popper #1

Dylan Clark Marshall as Young Tom Popper #2

Frank Welker as the voice of Captain, Nimrod, Stinky, Lovey, Loudy and Bitey

Dee Bradley Baker as the voice of Baby penguins

Reception

The film has received mixed reviews from critics, with a Rotten Tomatoes rating of 43% and a consensus reading "blandly inoffensive and thoroughly predictable.

It was also featured on the South Park episode, You're Getting Old in which Stan sees Jim Carrey playing with "shit".