I completely disregard anything the IMF publishes or any argument that uses the IMF as a basis for justification. The IMF are irrelevant to Australia. They don’t dictate policy, nor can they. They have no power to nor the resources required even if they so desired.
I'm not religious person /rather trying to be spiritual/ and I'm not in favour or against any kind of God-Jesus for this matter as well,but to say( the Jesus bit which is bullshit to begin with) proves only once again that the person has no idea what he is talking about in this matter-if it's bullshit for you,that's fine...
LOL, interest rates on bank savings accounts are already practically at zero, it makes absolutely no difference if they technically hit zero. My everyday spending Commonwealth account is zero, and the interest baring saving account associated with that is 0.1%. But I have to leave all my cash in the everyday account for practical reasons, I have zero in the savings account, it's all in metals and other liquid assets instead. And this is why people won't care if interest rates go negative a bit, they have to keep a decent amount of cash in there for everyday transaction and things that are withdrawn automatically. The banks know their is not going to be any mass exodus.
Of course not. There are some pensioners with a few grand in their account that need to be used for everyday living. There is no way they are going to pull that out and then risk being home invaded or robbed by the low life mongrels in our society that wouldn't even blink an eyelid and kill you for it.
But you're willing to give credence to those "legally responsible" by default? You have a way to turn a simple discussion into a debate about who's likeable and trustworthy in your eyes. You're beginning to reveal the true reasons why you believe what you do. This isn't a case of cognitive dissonance, this is just you being bitter. Mate, I sincerely hope you're able to get onto the winning side of these markets and make the fortunes you've been dreaming of. I wish you well, I really do.
I'm not giving the RBA credibility. I'm just acknowledging that they have the legal responsibility and capacity to make decisions and are publicly accountable for their actions (though not personally accountable unfortunately) - whereas the IMF doesn't have the authority to implement policy decisions in Australia. It doesn't mean I think the RBA does a good job, I don't. It's a pretty simple concept. RBA calls the shots, IMF doesn't. I've made no mention of trustworthiness, I've made no mention of likability. If the only conclusion you can draw from this debate is that I'm bitter then the past few posts from both of us has been a complete waste of time.
In my 20s till before I married, I hated figures so much I’ll never be able to survive on less than 3 months wage in cash account. Those days I looked at my bank account only 2-3 times a year. So what I did was to spend as little as possible and left the cash account that earned almost no interest to accumulate without even looking at it. I also hated paying bills so all my regular bills are deducted automatically from my cash account by the bank, utilities, phone bills, insurance, credit card bill (I pay in full every month since the day I had a credit card. I only applied for a credit card because I needed to use it to get a 15% discount off petrol, otherwise I use only cash for everything).
Sure do. Have been putting the pennies away in the hope of starting a new business venture. My current 1.2% interest is making me impatient to get it started though.
The RBA meets shortly and there won't be a change to the cash rate. In a Senate Inquiry last week Lowe reiterated what he has been saying for the past few months, note my emphasis in bold: https://parlinfo.aph.gov.au/parlInfo/download/committees/commsen/a3af0917-dc51-4d01-a86f-69153eb93040/toc_pdf/Senate Select Committee on COVID-19_2020_05_28_7741.pdf;fileType=application/pdf#search="committees/commsen/a3af0917-dc51-4d01-a86f-69153eb93040/0000" My interpretation of that, especially the last bit is that governments have to abandon their old notions around budget surpluses and particularly deficit spending. As as been pointed out before the biggest hurdle to this change in mindset will be the electorate, because self-serving politicians will not be able to unite and work together as they'll be trying to appease the whims of the people or their own beliefs will steer them in the wrong direction. And most of the electorate if they have any interest in the economy have an outdated view of how fiscal policy should be implemented under a system where the government has a monopoly over the issuance of currency.
With government dumping money into the system, the RBA will have no need to do anything from here. So i trust Lowe when he says they will not go negative. RBA will be happy to see this. Just need velocity to pick up, but what will make people confident? The big question is now that government has a taste for unchecked spending, will they be able to stop at some point? Drugs are easy to start but hard to stop.
Is all of that your interpretation of what Lowe said? Or is part of that also your opinion? let’s face it. Interest rate cuts haven’t had any real stimulus in the economy since they got below about 3% IMO.
I think it’s my interpretation but as I share a similar opinion I think I can recognise what he’s saying. I think he’s realising that MMT best explains how the system works. Lowe has repeatedly said over the past 8 months at least that monetary policy cannot solve the crisis we face. Now I think he’s a little reluctant to call out politicians and specifically say he favours tax cuts and infrastructure spending so he makes repeated calls for fiscal policy change, which is the “mindset” to which he refers. This “mindset” is the old “taxes collected pay for services” mentality. Which is not true. Now, he has no control over fiscal policy so he has to continually lecture those that do, this the bluntest message I’ve read from him. He’s walking a tightrope between independence and influence.
He’ll be applying as much pressure to the pollies as possible in the corridors between the tea room and their offices every time he happens to pass by someone of significance. He’ll be lobbying that they don’t do what they’ve always done in the past and cut the funding programs prematurely. Hope he’s got a pallet load of hand sanitiser.
Looking at that chart once that extra money that has come out of thin air is spent in the real economy and trickles down and everyday people start to realize that the same $50 note is buying you less goods, we will have increased inflation. Only question is how much, 2-3 % or more, seem like the can has been kicked down the road again. Its difficult to really feel/notice inflation on a personal level over a shorter period of time. I have noticed, some products go down in price, other up, sometimes you may not purchase a particular product for years then go back to it and fall off your chair with the increased price. But we all notice it over a longer period, many here will remember when 50c would buy you lunch, pie, big m and a bag of lollies. Ditto on a larger scale of house prices, you think your house is worth a million, it is but that million buys you a hell of a lot less today than it did when 30 + years ago. So its a combination of price increases and money devaluation, the issue is the vast majority of people can not/refuse to see it, and even less make any attempt to protect them selves against it and almost nobody does anything about it. We really need to return to a system where government does not rule, but the people do. Timmy
A convert is someone who is brought over from one way of thinking to another. So probably yes. But have I abandoned my old economic theories? No. I'm an Austrian and an an-cap and until someone invents a new theory that better advocates for sound money, the free-market and the abolition of the State I will remain so. But that's not the system we have. And there's a lot of old ideas floating (mainly having their roots in classical economics) that simply don't apply to the modern monetary system we have now, I mentioned one of them above. This is the "mindset" I think which Lowe is referring to. Now, as I want to maximise my opportunity I need to come to grips with how this modern system works, but that doesn't mean I have to like it. MMT works for me because governments have a monopoly on the issuance of currency, they have to spend first in order to create a tax liability and doing so does not create any burden for future generations nor can a sovereign nation default as they have an endless source of money which they can create out of thin air. The only way out of this system is what @Timmy alluded to, a system where people rule not the State. Beyond democracy?
I noticed Sportsbet and BetEasy don’t run a market on interest rates any more. I guess even at $1.01 for “No change” they’d stand to lose a substantial amount of money.