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Featured Articles: GEMS of the Week
Category: Austrailia
The news items published under this category are as follows.
Thursday, August 21, 2008
Will the Federal Reserve Bank Sink the Australian Economy? / Interest-Rates / Austrailia
By: Gerard_Jackson
Dr Stephen Kirchner figures that the Reserve should have acted sooner with respect to inflation. (Centre for Independent Studies Reserve Did Not Go Far or Fast Enough ). Unfortunately Dr Kirchner's article did nothing to illuminate the present inflationary situation and the role of interest rates. In fact, I got the distinct impression that he believes that monetary expansion[1 does not matter. This view was reinforced by his opinion that:
If the RBA's forecasts are right, then the Australian economy will need to slow dramatically by the end of this year, just to bring inflation back to the top of the target range by the end of 2010.
Read full article... Read full article...
Monday, May 26, 2008
Inflation accelerates while the Reserve plays guessing games / Economics / Austrailia
By: Gerard_Jackson
The CPI now stands at an annual rate of 4.3 per cent (1.3 per cent over the Reserve's maximum target rate). And what does Governor Glenn Stevens do? He blames the commodity boom and 'excessive' wage rates, warning that they might force him to lift bank rates.Read full article... Read full article...
Monday, May 19, 2008
Is the Australian Economy Heading for Recession? / Economics / Austrailia
By: Gerard_Jackson
The situation could become very nasty for the Australian economy. For years I have been warning that the Reserve Bank's reckless monetary policy would eventually end in tears. Since March 1996 bank deposits have risen by more that 224 per cent and M1 by 200 per cent. Regardless of views to the contrary, Australia cannot continue to escape the consequences of the Reserve's delinquency. Glenn Stevens " the Reserve's governor " recently made it clear that he wants to slow aggregate demand, reducing it to a rate that is "significantly slower than it was in 2007".Read full article... Read full article...
Monday, April 21, 2008
Is China Driving the Australian Economy Out of Business? / Economics / Austrailia
By: Gerard_Jackson
I have written several articles drawing attention to the possibility that monetary policy may have reduced the ratio of manufacturing to GDP, only to have my concerns dismissed by the likes of Des Moore, a former Treasury official, as not being part of "the traditional explanation". But I was not saying anything new or radical. The possibility of an overvalued currency reducing the size of a country's manufacturing base is sometimes called the "Dutch disease" or the "dual economy".Read full article... Read full article...
Tuesday, March 11, 2008
Bad Economics Caused Our Economies Current Account Problems / Economics / Austrailia
By: Gerard_Jackson
The current account deficit, rising prices and our deteriorating foreign debt situation has caused the Reserve Bank of Australia to raise the cash rate from 7 per cent to 7.25 per cent. Bank assets are a useful guide to monetary policy. These fell by 36.25 per cent from May 2007 to January 2008. These figures suggest that the RBA means business and will continue to raise rates until it brings spending under 'control'. Unfortunately this cannot be done without bringing the economy to a grinding halt. So how did we arrive to this situation?Read full article... Read full article...
Monday, February 11, 2008
Are Interest Rates Driving the Economy into Recession? / Economics / Austrailia
By: Gerard_Jackson
Interest rates are rising and it looks as if the Rudd Government is beginning to panic, a sign of which was Treasurer Wayne Swan's silly threat to banks not to be greedy by raising interest rates. This would be funny if it were not so serious. It is abundantly clear that our Treasurer is at a complete loss to understand what is really happening with interest rates. Unfortunately for Australia the same can be said about our economic pundits.Read full article... Read full article...
Wednesday, January 30, 2008
2008 Crunch Time for the Australian Economy? / Economics / Austrailia
By: Gerard_Jackson
The economy is beginning to look more and more like the proverbial "poisoned chalice". The Treasure, Wayne Swan, is complaining about interest rates putting "financial pressures on families". This bloke is every bit as bad as Costello. If he really wants to know what is happening he should visit the Reserve Bank, there he will find that the bank's balance sheet is collapsing, not that he would know how to interpret the figures.Read full article... Read full article...
Monday, January 21, 2008
Will a Plunging Stock Market Send the Economy Into Recession? / Economics / Austrailia
By: Gerard_Jackson
So far this month the Australian share market has dropped by 10 per cent, sending some people into a panic and raising the spectre of recession. Let us begin by putting this in historical perspective. In October 1987 the Australian share market plunged by 50 per cent. This drove the economic commentariat to wail that the economy was heading into a deep recession.Read full article... Read full article...
Monday, January 14, 2008
Australian Stocks Attempted to Break Losing Streak / Stock-Markets / Austrailia
By: Geoffrey_Transom
We mused on Friday if perhaps the Australian market might be able to break its losing spell this week - and it did its damnedest to do just that today, albeit after a very poor opening.Read full article... Read full article...
Sunday, January 13, 2008
Australian Stocks Continue Week Long Losing Streak / Stock-Markets / Austrailia
By: Geoffrey_Transom
Crikey... seems like the Strayan market just can't get it's act together. Today marked the fifth successive session of decline for every All Ords market-cap sub-index except the ASX20 (which managed a gain yesterday), with average declines in the market-cap based subindices of 5% for the week.Read full article... Read full article...
Friday, January 11, 2008
Australian Prime Minister Should Ignore Demands for Price Controls / Economics / Austrailia
By: Gerard_Jackson
Now that we have wall-to-wall Labor Governments the question of price controls has once again been raised, particularly with respect to petrol. Although I do not believe for a moment that Prime Minister Rudd intends to imposed price controls I still think it is prudent to remind people that those who cry out for price controls either believe that the laws of supply and demand do not exist or that they are determined by institutional factors, meaning that they vary according to time and place. From this they conclude that prices can be fixed without any harm to the economy so long as account is take of the costs of production.Read full article... Read full article...
Tuesday, January 01, 2008
Taxes, Money and Surpluses: Fact and Fiction / Economics / Austrailia
By: Gerard_Jackson
John Stone's somewhat harsh criticism of the Howard government's fiscal policy was fully justified. ( Mr Costello's repeated budget failure , National Observer No. 73 - Winter 2007). However, Stone's comments on government revenues and budget surpluses missed a very important question: what generated such huge government revenues and massive surpluses? There was a time when the answer would have been self-evident to any economist worth his salt.Read full article... Read full article...
Thursday, December 20, 2007
Australian Economy Heading Into Stormy Seas / Economics / Austrailia
By: Gerard_Jackson
The problem with Terry McCrann's economic opinions is not that they are terrible but that they are largely shared by the rest of our economic commentariat. For instance, McCrann cheerfully reports that over the year to October credit for business rapidly expanded. Now he did temper his enthusiasm with the observation that the trade deficit jumped from $1 billion in July to $1.8 billion in August before jumping to $3 billion in October. As he put it: "Import volumes are soaring, thanks to the high Aussie dollar."Read full article... Read full article...
Tuesday, December 11, 2007
Why Austrailia's Trade Unions Sponsored Work Study is Worthless / Politics / Austrailia
By: Gerard_Jackson
The aim of Buchanan and Woonay's Australia at Work study is to persuade people that free labour markets drive down real wage rates because labour lacks the power to defend itself against capitalists. Yet every single critic of this so-called study missed this vital point. What we got were conservative economic illiterates like Janet Albrechtsen, Andrew Bolt and Imre Saluszinsky (all of whom are from the Murdoch stable) engaging in ad hominem attacks instead of dealing with Buchanan and Woonroy's underlying assumption that free labour markets are exploitive.Read full article... Read full article...
Tuesday, December 04, 2007
Unbroken , Australia''s Voters “Fix” Her Anyway By Electing Kevin Rudd / Economics / Austrailia
By: Chip_Hanlon
Political challengers, you just saw a great example of how to run against an incumbent when things in your country are perfect, a seemingly impossible task: convince voters there is essentially no difference between your ideas and those of the incumbent. This strategy was just worked to perfection in Australia , where a week ago the liberal Labour Party's Kevin Rudd was elected as the country's new prime minister, unseating the long-ruling conservative, John Howard.Read full article... Read full article...
