Mega Thread The Random Thoughts Thread Part 1

[Vagabond0]

No, it really isn't. Where do you think the money that insulated the economy from the GFC came from? A money tree?

Good question. Given we own our currency and printing press why does the Federal Government need to fund deficit budgets by selling bonds which need to be repaid with interest?

 

[Janus]

Good question. Given we own our currency and printing press why does the Federal Government need to fund deficit budgets by selling bonds which need to be repaid with interest?

Because if you're expecting that money to be worth anything anywhere else it needs to be valued against a strong stable currency like the US dollar - since that's how all international trade is done. So the bonds are sold to foreign institutions who value them according to their worth against the greenback - which is basically determined by how the economy is going.

That's why it's important for Australia to start promoting high tech exports that aren't beholden to the value of the Australian dollar, because if we keep relying on resources we'll get stuck in the same boom bust cycle - the dollar is high, exports dry up, the economy tanks and goes into recession, the dollar drops, exports pick up, the economy gets out of recession but then gets overheated with interest rates and inflation going up, which drives up the dollar.

The only country in the world that could just print interest free money is the US...but the Federal Reserve Act ensures that this will never happen.

 

[Far Kern]

It is a myth that one side of politics is better at managing the economy than the other. The reforms of the Howard - Keating - Costello eras form a single economic rationalist intellectual tradition. I for one an extremely glad that the Labour government pump primed the economy during the GFC, Turnbull would have stripped us bare like just about every other friggen western country. And gleefully dipping into the kitty? Both sides are guilty of that. Gleefully giving a $50 billion dollar tax cut for big business anyone? It is simply asserted not proven in any way that this will lead to jobs or wage growth. A very large percentage of that cut would gleefully go straight to gleefull big investors. Trickle down economics equals the greatest continuous period of growth in wealth disparity in the modern period. Another name for it is greed.

Stable government. Hahahahaha.

 

[Vagabond0]

Because if you're expecting that money to be worth anything anywhere else it needs to be valued against a strong stable currency like the US dollar - since that's how all international trade is done. So the bonds are sold to foreign institutions who value them according to their worth against the greenback - which is basically determined by how the economy is going.

The only country in the world that could just print interest free money is the US...but the Federal Reserve Act ensures that this will never happen.

Sure so we need to trade in $US dollars on international markets for most commodities and we have an exchange rate.

Is your point that if we started printing money (and I'm talking a control quantitative easing not let the press flow free and wheel barrow the cash around) that our exchange rate would drop so low no one will exchange our currency for $US?

If so I don't believe it. We still have a fairly well balanced Government system, fairly competitive economy and plenty to offer on the international market. Personally I believe the market will just correct itself.

Drop in the Aussie dollar will also help plenty of exporting industries.

 

[Vagabond0]

I for one an extremely glad that the Labour government pump primed the economy during the GFC

Agree however could argue that the Labour government went too hard to soon. In hindsight the policy was right but the timing could have been slower to ensure the new public spend didn't dominate the market forcing prices up through excess demand but acted more like a safety net propping up the market as demand fell.

Although I agree there's no better side. Just different approaches which need to be changed from time to time just to keep all sides of the economy within a reasonable distance

 

[Janus]

Sure so we need to trade in $US dollars on international markets for most commodities and we have an exchange rate.

Is your point that if we started printing money (and I'm talking a control quantitative easing not let the press flow free and wheel barrow the cash around) that our exchange rate would drop so low no one will exchange our currency for $US?

If so I don't believe it. We still have a fairly well balanced Government system, fairly competitive economy and plenty to offer on the international market. Personally I believe the market will just correct itself.

Drop in the Aussie dollar will also help plenty of exporting industries.

The Australian Government does control the amount of money we print through the RBA. But interest rates are already low - the dollar is tied to them directly because those who invest in money markets are basically buying shares in certain economies. You print more money, it devalues it in regards to imports, which means that we are paying more for the things we don't produce anymore because every Australian company gets their shit made in China and at best just assembles it here.

Perhaps if we did something radical like, oh I don't know, lowering the company tax rate to make manufacturing a going concern again, then we can buy Australian made goods that are competitive against the imports without having to rely on massive subsidies to single corporations like the car industry. Do that and you can start printing money because the goods and services are being paid for by Australians to Australians, who view a dollar as a dollar.

But as it stands now, if you did it all you would do is send inflation through the roof. Science, biotech, technology - those are the key industries we should focus on. That's what Japan did.

In my view it's time to grow up as an economy and start adding value to our products instead of sending raw materials out and importing products in.

 

[Far Kern]

Agree however could argue that the Labour government went too hard to soon. In hindsight the policy was right but the timing could have been slower to ensure the new public spend didn't dominate the market forcing prices up through excess demand but acted more like a safety net propping up the market as demand fell.

Although I agree there's no better side. Just different approaches which need to be changed from time to time just to keep all sides of the economy within a reasonable distance

And I agree that mistakes were made, but the clear imperative at the time was urgency, nobody knew what was coming next.

Barry Cassidy on ABC has just gone through the most up to date figures and last night's seat count for the coalition was too generous. ABC now has Labour ahead on confirmed seats, and one ahead at the end if they win every seat they currently lead.

The senate will have Hinch, maybe 2 Xenaphon, maybe 2 Lambie, and at least Hanson. Pauline Hanson. Turnbull is an idiot.

 

[Vagabond0]

print more money, it devalues it in regards to import

But as it stands now, if you did it all you would do is send inflation through the roof.

Yes the text books tell you printing money equals inflation.
However today we live in a very low inflation world, the fear is more in regards to deflation.

If the Government decides to run a $1b deficit which is some ridiculous low percentage of the overall economy why shouldn't they just print that $1b interest free rather than ask for international credit?

Likewise if the economy gets hot and inflation becomes an issue which can't be controlled with monetary policy, the Government should equally take money out of the economy.

 

[Janus]

Agree however could argue that the Labour government went too hard to soon. In hindsight the policy was right but the timing could have been slower to ensure the new public spend didn't dominate the market forcing prices up through excess demand but acted more like a safety net propping up the market as demand fell.

Although I agree there's no better side. Just different approaches which need to be changed from time to time just to keep all sides of the economy within a reasonable distance

So pretty much what the Coalition wanted to do. Give about half what Labor did and wait and see if in the next quarter the economy was still tanking. Ergo, what I suggested - **** off the insulation scheme which was really just them buying a reduction in unemployment, invest more in the BER through fast tracking the NBN (if you can install insulation you can wank cables at the very least) and reduce the $800 spend to $400 and see what happens.

It's all in the budget reply to Rudd's GFC budget. Though I doubt that the Libs would have invested in schools though - probably tax cuts for companies.

I wish people would be smart enough to realize that there is good and bad in everything and we just need to put the right people in the right jobs no matter what their ideology and have the decency to actually listen to what they have to say instead of thinking that one person or party has the solution to everything. The Greens want to save the environment? Put Di Natale in as environment minister. Labor has some great ideas about employment, education and infrastructure spending? Put their ministers in those roles in cabinet.

Maybe I'm taking crazy pills, but that's what I'd do. Then it would counter balance all the stupid ideas that each party has.

 

[Contested Marx]

Listen guys, whatever the result, let's just relish the moment while it lasts.

Bolt and Jones are so angry...

 

[Prison bar Pete]

Barry Curtin on ABC

He's into everything nowadays! [Barry Cassidy]

How was that Lord of The Rings parody? Brilliant! The Battle for Middle Ground

 

[Far Kern]

He's into everything nowadays! [Barry Cassidy]

derrr

How was that Lord of The Rings parody? Brilliant! The Battle for Middle Ground

Yes. To start with I was wondering where they were going with that.

 

[Schulzenfest]

The proposed $525 million non-binding opinion poll to determine Australia's opinion on something that we already know Australia's opinion on should be a wonderful move for the economy.

Labor certainly love a good spend, but at least for the most part the stuff they spend money on is actually for the benefit of the Australian public. You don't see them cutting back essential services so that they can put $24 billion into purchasing a few dodgy fighter jets that don't work.

 

[Magpiespower]

Barry Cassidy on ABC has just gone through the most up to date figures and last night's seat count for the coalition was too generous. ABC now has Labour ahead on confirmed seats, and one ahead at the end if they win every seat they currently lead.

They had it about 73-66 when I last checked. Nine were being pretty cautious with their predictions. Seems they were more on the money. Plus they had Laurie's "Crusher." FMD...

 

[Vagabond0]

I wish people would be smart enough to realize that there is good and bad in everything and we just need to put the right people in the right jobs no matter what their ideology and have the decency to actually listen to what they have to say instead of thinking that one person or party has the solution to everything. The Greens want to save the environment? Put Di Natale in as environment minister. Labor has some great ideas about employment, education and infrastructure spending? Put their ministers in those roles in cabinet.

Maybe I'm taking crazy pills, but that's what I'd do. Then it would counter balance all the stupid ideas that each party has.

I think people are smart enough that's why we're getting hung parliaments.

It's now up to the pollies to understand that and execute it rather than holding onto their party (aka politically sponsored) ideals

 

[LukeSA]

Does anyone here have any knowledge of electric hot water systems? It has come to the point where we can either have a shower in the morning or do our dishes in the evening but not enough hot water for both, surely a system should keep water hot all day.

For some reason, there is an import/ export meter in the box outside even though there are no solar panels on the roof, it has a boost button that heats the water up again but atm we would have to use that button every day probably putting another $400 on top of our electricity bill.

 

[Janus]

The proposed $525 million non-binding opinion poll to determine Australia's opinion on something that we already know Australia's opinion on should be a wonderful move for the economy.

Labor certainly love a good spend, but at least for the most part the stuff they spend money on is actually for the benefit of the Australian public. You don't see them cutting back essential services so that they can put $24 billion into purchasing a few dodgy fighter jets that don't work.

You mean the plebiscite? Most Australians don't care. Its one of those "if it happens great, if it doesn't happen, meh" issues that people love to cling to. If you made it non-conpulsory I'd be willing to bet that not even half the population votes.

Putting money into military spending is vitally important in the Asian region. Chinese especially respect those who have the capability of defending themselves...and if we want the US to have our back, we need to come to the party with regular military purchases. It's just the way the world works.

 

[Janus]

Does anyone here have any knowledge of electric hot water systems? It has come to the point where we can either have a shower in the morning or do our dishes in the evening but not enough hot water for both, surely a system should keep water hot all day.

For some reason, there is an import/ export meter in the box outside even though there are no solar panels on the roof, it has a boost button that heats the water up again but atm we would have to use that button every day probably putting another $400 on top of our electricity bill.

Hot water systems work on J tarrif, which the electricity company charges at a cheaper rate because the water is heated up late at night when most people are sleeping.

It sounds to me as though either the tank you have is too small for your hot water consumption, or an element is fried - there are two in most hot water systems. So you're getting only half your water heated up.

 

[1954]

Aussie politics is the lowest it's been for a very long time, with both major parties chock a block full of cretins, and the lesser parties, and independents, ( Xenophon aside ) akin to a rabbit warren, eg Di Natale, and/or semi literate, eg Lambie.

If Turnbull does get the lemonade and sars, it will be just more proof that voters don't take kindly to an elected prime minister being rissoled by his/her own party, and the libs didn't learn from the Rudd/Gillard/Rudd debacle.

 

[Duck Farmer]

As I said - great at running the economy, shit at selling it to voters because that's all they can do.

No one runs the economy.

 

[LukeSA]

Hot water systems work on J tarrif, which the electricity company charges at a cheaper rate because the water is heated up late at night when most people are sleeping.

It sounds to me as though either the tank you have is too small for your hot water consumption, or an element is fried - there are two in most hot water systems. So you're getting only half your water heated up.

The thing is, yesterday, we didn't even use any hot water and when it came to do the dishes there wasn't any hot water and the hot water we do have is absolutely scalding, which can be a sign that the system is faulty.

Surely a 125L system will do three showers and a sink full of dishes.

 

[SteppingTiger]

Hot water systems work on J tarrif, which the electricity company charges at a cheaper rate because the water is heated up late at night when most people are sleeping.

It sounds to me as though either the tank you have is too small for your hot water consumption, or an element is fried - there are two in most hot water systems. So you're getting only half your water heated up.

Our man Janus, gives hope to Port supporters by day with analysis and unbridled positivity, solves national economic and political problems by night and still find time to get on the tools and fix the hot water conundrum.

 

[charcolechaddy]

And I agree that mistakes were made, but the clear imperative at the time was urgency, nobody knew what was coming next.

Barry Cassidy on ABC has just gone through the most up to date figures and last night's seat count for the coalition was too generous. ABC now has Labour ahead on confirmed seats, and one ahead at the end if they win every seat they currently lead.

The senate will have Hinch, maybe 2 Xenaphon, maybe 2 Lambie, and at least Hanson. Pauline Hanson. Turnbull is an idiot.

Watch out rock spider's

 

[Peck]

No, it really isn't. Where do you think the money that insulated the economy from the GFC came from? A money tree? We have gone through something like 22 quarters without a recession thanks to having a surplus.

Howard and Costello set up a future fund so that the public servants in the government would be fully funded with their superannuation and future governments wouldn't have to dip into general revenue to cover the costs, which meant greater spending in other areas down the track. But that doesn't buy votes from the stupids who can only see what is directly affecting them. So Labor gleefully dipped into it while promoting economy killers like the mining tax and carbon tax to appease the Greens.

As I said - great at running the economy, shit at selling it to voters because that's all they can do.

The surplus doesn’t mean anything, like I said.

Banks have plenty of money to lend or give away, and they would all be in massive amounts of debt. Debt is just another form of income if you manage it correctly.

I’m being pretty lazy, but I did at least take the time to find a blog that might help convince you of this.

http://www.economicshelp.org/blog/14011/debt/effects-of-a-budget-surplus/

 

[Duck Farmer]

Our man Janus, gives hope to Port supporters by day with analysis and unbridled positivity, solves national economic and political problems by night and still find time to get on the tools and fix the hot water conundrum.

REH watch out!