Their fault

There's been an interesting theme in The Australian the last couple of days. Bit of background: the government (it's since lost power) changed the tax laws so that there was a window of opportunity where people who were cashed-up could put unusually large amounts of money into superannuation schemes (like a pension, or a 401k). It was a one-time deal, a temporary increase in the amount of money that could be put aside in a tax-efficient way.

Many people did this, and if I had had a decent amount of cash I would have too. Between April and June last year people put $15billion aside like this. Of course, with the benefit of hindsight this probably wasn't a great time to put money into the market. But that's only with the benefit of hindsight - at the time it seemed like a good idea, especially because everyone else was.

So what's happened? Well, the market's gone down. It does that - it goes up sometimes, it goes down sometimes. In today's Australian, on page 2, there's an interview with a bloke who put $900,000 aside in this fashion. He's lost just over a quarter of it, which isn't that unusual.

What I love about this is that he's blaming the government for giving him the tax incentives in the first place. "Mark Amdur.. was among the thousands of Australians who ploughed $15billion into superannuation between April and June last year to reap the Howard government's generous tax concessions" (I query the use of 'reap' here, but that's a separate issue.)

He goes on to say "I took advantage of the tax concession, realising it was a one-off thing, a sop to the electorate before the 2007 election. I've since lost a bit of money but that's the way it goes... the market's down, everyone's down."

No, of course I'm making that up. The interviewer says (and I so wish this was a direct quote) that he said he thought it was what the government wanted him to do. So in other words, he wasn't doing it because he thought he could make money by squirreling away assets in a favorable tax environment, he was doing it because the government wanted him to. And now that it's all gone a bit wrong, it's their fault for leading him on.

So there. I don't want to sound mean, and I have a great deal of sympathy for people like Mr Amdur. I've lost money too, and I don't like it either. But I'm not going to blame it on voices in my head.