Australian Politics, Mark II

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Sorry that’s not how it works - you continue to conflate private industry borrowing with the way a sovereign currency issuing government ‘borrows’ (i.e. prints money)

The RBA literally presses a button and injects more money into the economy by crediting its bank reserves, as the monopoly issuer of the AUD, it can inject as much money as it likes into the economy (infinite). Taxation is the debit, this allows those bank reserves to be depleted.

Bonds are another way to deplete excess bank reserves and is a tool to control the RBA’s overnight rate targets, otherwise if excess reserve were left in the system that overnight rate would be zero.

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Yep.

I mean, if you can’t trust a woman you met on a quasi escort website, then one has to wonder if there is any trust left in the world.

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Even Bob Hawke didn’t claim hookers as part of his travelling allowance like this dill has.

With the tinkering that you are proposing to reserve requirements, to expand money supply, I just come back to my same concern: I think you risk trashing the AUD.

We don’t manufacture much here, we need the rest of the world to keep valuing our currency, to continue our net purchases as a nation from overseas…

You can’t just keep creating monopoly dollars and then expect the Asian manufacturers to always accept them as payment for our clothes, cars, mobile phones, etc.

Post of the year for mine

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I understand your point and kind of agree. You have to accept that there is a huge element of risk though if you’re in the public domain, married and go to such a place. I dare say that Seeking Arrangement will lose some of their clientele now.

What am I proposing? I was merely explaining how sovereign debt ≠ private debt and the issuer of the currency can always pay.

My understanding is that only the US can get away with printing more money, only because oil is bought in US dollars. Seems anybody who tries to change this ends up in a ditch.

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Reckon you need to check your figures.

In 2017 and 2018 , generally our balance of trade has been in surplus, due mostly to mining and agriculture, but we do also export a growing number of manufactured items. I take most of this credit, as my Company have started exporting in the past two years, and every little bit adds up.

G’day.

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G’day.

You’re on fire this week.

“I know how to ■■■■ my woman.” Classy.

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It’s got nothing to do with the ‘petro-dollar’ started by Nixon in the 70’s.

The question is can the economy absorb the influx in spending? Do we have enough productivity in to make all the stuff that the increased money in the economy will be spend it on?

We must ditch the dictum of “tax and spend” and flip to “spend and tax”. We, like the U.S have an aging population who are going to be exiting the work force which means there’s going to be less people to produce the stuff we need and more people who have exited the work force with less stuff to buy – that is a big potential problem for the economy and is a big reason to invest big in our youth and on our climate.

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Racist much?

Ignoring the issue isn’t solving it, though.
It either fixes itself with a huge crash, or policy/taxation adjusts it down.

I’m not sure rolling back neg gearing would result in tens of thousands of defaults. You’d ramp it in, for a start. Ie all extant negatively geared properties are exempt for, say, 2 years, then the proportion you can claim progressively drops down over year 3 and 4.

Should avoid a huge dump sale.

If people are teetering on the borderline of defaulting, they’re going to be far more vulnerable to rate changes than anything else.

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Makes a fair point about that bastion of journalistic integrity, and deeply researched and in-depth political reportage that is New Idea.
Also, did you see what Kerrie Anne Kennerley was wearing?

You don’t honestly think that’s how the market works right? Wait for a 2-4 year progressive drop to sell down investments? Give me a ■■■■■■■ break.

I think the ALP policy is that all existing neg geared properties can continue to be neg geared. There’s just no new neg gearing arrangements going forward. So the impact of the change is going to be sloooooow.

I’d much prefer a more general neg gearing removal with a phasing in period as you suggest though. There’s some people who’d get burned (in particular the 25yo kids you see getting hyped up in Domain etc who own seven houses after being gifted a half mill starter fund by their parents and then taking advantage of low interest rates and loose lending practises to leverage themselves to hell and back), but frankly the ALP changes will, in the short term, assign a privileged tax status to people who were mostly doing well for themselves already.