The doomsayers on here are copping a spanking...

[Tambaran]

Stutchbury today:

Instead, the economy grew 1 per cent in 2008-09, rather than zero as forecast in the budget, and is likely to expand faster again in 2009-10 rather than contract 0.5 per cent.



With job ads now rising for the first time since the crisis hit a year ago, unemployment may peak at 6-point-something rather than the 8.5 per cent budget forecast. The budget deficit will be considerably smaller than the $57.6billion forecast in May. Gross public debt will peak below the $300bn-plus that Malcolm Turnbull has made so much of.

When will our doomsayers on here admit their predictions were so terribly wrong?


"Oh, but..."

He even goes on:

This world-beating performance has been driven by three main factors. First, Australia does not rely heavily on manufacturing, which globally collapsed in the wake of the financial crisis. Second, Australia’s pre-crisis resources boom retained substantial momentum, which has been quickly rekindled by China’s recovery.

And, third, the front-loaded fiscal and monetary stimulus delivered by the government and the Reserve Bank has gained more “traction” than in most other economies.

Wow...Stutchbury giving the stimulus considered credit!

The doomsayers must be gurgling in their seats!

Wait for the toys to be thrown out of the pram in a giant tantrum of ad hominem attacks...

 

[Financialpanther]

That's nice

 

[Lach72]

http://brookesnews.com/090709growthmoneysupply.html

Interesting article which pretty much encapsulates doomsayers perspective in an American context.

 

[Lach72]

http://brookesnews.com/090709stonerecession.html

And something similar on the Australian side of things.

 

[Chief]

Only having some minor uni economics under my belt, I still say that there is something badly amiss in the economy. The numbers just don't add up. House prices are still unsustainable without big injections of money from outside the economy. And we don't make much worth selling.

I've cut spending and put more into shares (up around 60% since I got back in a few months ago) and into my home loan. I just do not see a property market awash with bargains, which means I'm staying out.

 

[evo]

I just do not see a property market awash with bargains, which means I'm staying out.

An auction in my street last weekend exceeded even the bubble-like local prices of 18 months ago.

It is like there wasn't even a financial shock.


residential property yields still seem to be historically low.In the order of 3%

I remain skeptical that it is all over. None of the excesses have been washed away and people haven't learnt from their mistakes which is what normally happens in a recession.

 

[Financialpanther]

Only having some minor uni economics under my belt, I still say that there is something badly amiss in the economy. The numbers just don't add up. House prices are still unsustainable without big injections of money from outside the economy. And we don't make much worth selling.

I've cut spending and put more into shares (up around 60% since I got back in a few months ago) and into my home loan. I just do not see a property market awash with bargains, which means I'm staying out.

Shhhhh doomsayer - you are supposed to say that you are wrong.

But seriously, I am with you Chief - conceptually the notion of not taking the appropriate hit and using credit to stave that off can't be healthy. Sure we are technically not in recession and are possibly in a recovery cycle, but it would be interesting to note the amount of first home loans written over the last 6 months before the rates suddenly head north (don't get me wrong - they aren't going to hit 10% but the OCR being at 3% is an emergency rate which is not sustainable). Can the First Home Buyers handle the hit even though they keep their job.

 

[tandino]

An auction in my street last weekend exceeded even the bubble-like local prices of 18 months ago.

It is like there wasn't even a financial shock.

Well, the first home owners grant starts to end at the end of this month. So as it turns out, it seems that the home owners grant was never really about home affordability, just about (unsustainable) growth.

 

[medusala]

I think you need to send an email to the key culprit

khenry@treasury.gov.au

 

[TheBloods]

It's not clear what the purpose of all these trolling threads are, except trolling which is pretty obvious by the OP.

If it's to point out that Australia hasn't crapped out like everyone expected. Yes, well that's true, but that would mean that everyone's wrong. So what. The recovery is also not finished yet, as some have noted.

If it's to point out that the cash handout component of the stimulus package was an amazing success, well that has not been demonstrated either way. Countries all around the world did variations of stimulus packages, yet Australia is the only one so far to be showing signs of positive growth. That seems more likely to reflect natural resources exports to China and the rest of Asia and the sound state of the financial system.

 

[medusala]

If it's to point out that the cash handout component of the stimulus package was an amazing success, well that has not been demonstrated either way. Countries all around the world did variations of stimulus packages, yet Australia is the only one so far to be showing signs of positive growth. That seems more likely to reflect natural resources exports to China and the rest of Asia and the sound state of the financial system.

FRANKFURT (Dow Jones)--Germany's economy returned to growth in spring, final estimates of gross domestic product for the second quarter confirmed Tuesday.

GDP rose 0.3% on the quarter in April-June, after a drop of 3.5% in the previous three months, data from the Federal Statistics Office, Destatis, showed. The figures were unrevised from the first estimate of GDP for the second quarter.

 

[TheBloods]

Another strong export country.

 

[medusala]

Another strong export country.

Not so big on throwing the cash around though.

http://www.telegraph.co.uk/news/ukn...wns-UK-economic-plan-ineffective-Profile.html

And if German finance minister Mr Steinbruck is serious about one day replacing Chancellor Angela Merkel, his amazing attack on UK economic policy will have done him no harm.

..

Now his reputation as a speak-your-mind member of the Merkel cabinet has received a boost with his audacious assault in print on what he called the "crass Keynesianism" of Mr Brown's "breathtaking" tax and spend counter-recession plans.

 

[Schism]

Germany...Australia...Germany...A u s t r a l i a...yep i see how you could get them mixed up

 

[Schism]

http://news.bbc.co.uk/2/hi/business/7902223.stm

Germany has approved a 50bn euro ($63bn, £44bn) stimulus plan aimed at boosting Europe's largest economy.

http://www.spiegel.de/international/business/0,1518,607520,00.html

The largest stimulus package in postwar German history -- and the second such package since the start of the current financial crisis -- was passed on Friday by the German parliament's lower house, the Bundestag. The bill calls for €50 billion in public investments, tax breaks and even cash handouts to junk old cars. It now heads for a vote by the upper house of parliament in a week. As a result of the package, Germany will have to take a record of €36.8 billion in new loans for 2009

Article wars!

 

[Schism]

Not so big on throwing the cash around though.

http://www.telegraph.co.uk/news/ukn...wns-UK-economic-plan-ineffective-Profile.html

And if German finance minister Mr Steinbruck is serious about one day replacing Chancellor Angela Merkel, his amazing attack on UK economic policy will have done him no harm.

..

Now his reputation as a speak-your-mind member of the Merkel cabinet has received a boost with his audacious assault in print on what he called the "crass Keynesianism" of Mr Brown's "breathtaking" tax and spend counter-recession plans.

Nice article meds.I'm sure you agree with this part:

He used his party's powerful position to argue that the policy - Agenda 2010 - should be cranked up to include higher social benefits and a minimum wage for postal workers, among other things.

 

[medusala]

Nice article meds.I'm sure you agree with this part:

He is not a conservative even though he is in government.

His current job alongside the Chancellor is a product of Germany's current Christian-Democrat led coalition, with Mr Steinbruck, from the Social Democrat Party

BTW imagine that German workers without a minimum wage.

What chance do you think of someone calling for that in Australia and being called an extremist?

 

[Schism]

He is not a conservative even though he is in government.



BTW imagine that German workers without a minimum wage.

What chance do you think of someone calling for that in Australia and being called an extremist?

And yet this powerful minister who you like to quote wants a minimum wage brought in.

What about the 60 billion dollar stimulus i linked to.Where are all these posters gone?It's like i threw a cup full of anthrax into the building and everyone dispersed.

 

[medusala]

And yet this powerful minister who you like to quote wants a minimum wage brought in.

You are confusing me with a pom pom waver

What about the 60 billion dollar stimulus i linked to.

a) % of gdp

b) The 17th German federal election is scheduled for 27 September 2009 and will be held to elect the members of the Bundestag, the federal parliament of Germany.[1]

 

[Schism]

You are confusing me with a pom pom waver



a) % of gdp

b) The 17th German federal election is scheduled for 27 September 2009 and will be held to elect the members of the Bundestag, the federal parliament of Germany.[1]

You are a pom pom waver.You attack the Rudd govt. handling of the GFC every opportunity you can by pasting links to articles.

You guys brought Germany into it.I simply pointed out they threw cash at the problem as well.

 

[medusala]

You are a pom pom waver.You attack the Rudd govt. handling of the GFC every opportunity you can by pasting links to articles.

I wave pom poms for neo liberalism not a party. I have plenty of issues with Turnbull (see GW muppetry for starters, then rolling over on IR).

Quite a bit of difference.

You guys brought Germany into it.I simply pointed out they threw cash at the problem as well.

Sure but a) they made it clear they werent about to go on a Rudd like spree and b) they have quite a few more people than Australia and c) there is an election on which makes life difficult (similar happened in Canada)

..


http://www.telegraph.co.uk/finance/...ma-accused-of-making-Depression-mistakes.html

Barack Obama is committing the same mistakes made by policymakers during the Great Depression, according to a new study endorsed by Nobel laureate James Buchanan.

..

In particular, the authors, economists Charles Rowley of George Mason University and Nathanael Smith of the Locke Institute, claim that the White House's plans to pour hundreds of billions of dollars of cash into the economy will undermine it in the long run. They say that by employing deficit spending and increased state intervention President Obama will ultimately hamper the long-term growth potential of the US economy and may risk delaying full economic recovery by several years.

 

[Schism]

I wave pom poms for neo liberalism not a party. I have plenty of issues with Turnbull (see GW muppetry for starters, then rolling over on IR).

Quite a bit of difference.



Sure but a) they made it clear they werent about to go on a Rudd like spree and b) they have quite a few more people than Australia and c) there is an election on which makes life difficult (similar happened in Canada)

..


http://www.telegraph.co.uk/finance/...ma-accused-of-making-Depression-mistakes.html

Barack Obama is committing the same mistakes made by policymakers during the Great Depression, according to a new study endorsed by Nobel laureate James Buchanan.

..

In particular, the authors, economists Charles Rowley of George Mason University and Nathanael Smith of the Locke Institute, claim that the White House's plans to pour hundreds of billions of dollars of cash into the economy will undermine it in the long run. They say that by employing deficit spending and increased state intervention President Obama will ultimately hamper the long-term growth potential of the US economy and may risk delaying full economic recovery by several years.

So being a nobel laureate impresses you then does it?Enough to point it out?Al Gore says hi!

 

[medusala]

So being a nobel laureate impresses you then does it?Enough to point it out?Al Gore says hi!

Did Al Gore get a Nobel for work on macroeconomics?

Should we ask J.M. Coetzee what his views on the GFC are?

 

[Wonaeamirri33]

You are a pom pom waver. You attack the Rudd govt. handling of the GFC every opportunity you can by pasting links to articles.

I think it's safe to say that's fairly correct as well, given that the 'doomsayers' simply ignore Howard's role in running down the surplus through his election bribery, horrendous ideas like the $5 billion/year private health insurance subsidy and the "Pacific Solution" amongst other things, and the public money he spent on blatant party-political advertising.

Without this GLORIOUSLY wasteful spending by Howard during his time in government, the deficits needed to shore up the economy and advance our infrastructure would be far lower.

Meanwhile, Rudd's stimulus strategy has been APPLAUDED by the IMF and the other international financial institutions, and Australia in fact has the lowest levels of debt of any nation in the OECD!

But again, they choose to ignore these things in their postings...

 

[medusala]

But again, they choose to ignore these things in their postings...

Igorance eh? How many examples of failed Keynesian efforts do you need?

Ditto cuts in spending and accelerating economic growth?

http://business.timesonline.co.uk/tol/business/economics/article6832372.ece


This raises a general point. Can public spending be tightly restrained without seriously undermining recovery? Has not Britain become so dependent on the government that once the taps are turned off the economy will be becalmed? The answer is no and, indeed, periods when public spending has been held down have tended to be times of good economic growth.

Looking back on the recent past, the arithmetic tells us that even when public spending is rising strongly, it makes a modest contribution to growth. 2000 to 2008 was Gordon Brown’s “splurge” period, when public spending grew roughly 4% annually in real terms, well above the economy’s overall rate of about 2.5%.

Over that period, GDP rose £224 billion, just over 20%, in real terms. Government spending rose by just over £50 billion. It contributed only just over a fifth of growth even when ministers were spending fit to bust. This kind of static comparison, more-over, probably overstates the public contribution. Had spending not risen, and the taxes needed to pay for it, private-sector growth could have been stronger.

This is the way to look at it for the future. A paper by Goldman Sachs, called Fiscal Consolidation and the Exchange Rate, argues that in an open economy like Britain’s, public-spending cuts affect the composition of economic growth but not its pace. This is because sterling is a safety valve.

A tightening of fiscal policy, accompanied by a weak currency, means that what you lose in government spending, you gain in exports. Sterling is well below fair value against the euro, so this effect is ready to roll as the global economy picks up.

Nor is this just theory. “It is worth looking at what happened to the economy the last time the UK tightened fiscal policy aggressively, during the mid-1990s,” write Ben Broadbent and Adrian Paul of Goldman Sachs. “It performed well. Coming out of deep recession, and aided by a small acceleration in eurozone activity and a big decline in the currency, investment and exports bounced strongly. Aggregate demand grew by 3.5% a year.”