Can you believe it, the RBA bribing people. I wonder where they got the money for that? :lol: "Please Mr Stevens sir, I want some more. " [youtube]http://www.youtube.com/watch?v=M4CVZnGJIzQ[/youtube]
Latest money supply expansion figures: Over the month of May, M3 rose by 0.9 per cent and broad money increased by 0.9 per cent. Over the year to May, broad money grew by 8.4 percent.
So I have to be earning 8.4% interest on my savings just to keep pace with the growth in the money supply? So if I'm getting 4.9% on my Business Savings Account, does that mean the relative value of the Cash in Bank line in my balance sheet is depreciating at 3.5%? Can I claim this as a tax deduction? :lol:
i think you also need to take into account the increase in GDP.. but dont forget income tax on that 4.9%!
I'm not sure I entirely understand this, but maybe someone can clarify a couple point. I gather the OP of the thread is saying that inflation / money supply is accelerating in $A. So I downloaded the historical data and graphed it expecting to see such trend in the graph. I got this for broad money. and this for m3 So as you can see, both graph are under the long term trend line. So wouldn't this indicate that we are not yet experiencing a acceleration of money supply in Aus?
My point of this thread was to highlight that there are now a lot more Aussie dollars (credit) in the money supply. Average money supply growth is over 8% pa over the past couple of years. But what has the official inflation rate been in Australia? 3% pa? And what about economic growth? 3-4%? So the amount of credit in the system has been growing at over TWICE the rate of economic growth. I believe this is highly inflationary. (And this is apart from the fact that our economic growth is purely down to the mining sector. If there was no mining, i reckon we'd be screwed. How's our secondary and tertiary sectors doing? Manufacturing? Retail? Building?)
I have to agree 100% that without mining sector, Australia would be same boat as many of the other counties that have found themselves in massive debt spiral. Woundn't we expect money supply growth to be sum of inflation 3% and economic growth 3-4%. I'll have to do some more thinking about this. Like I said, I don't really have a good understanding of how this all works.
Inflation is a symptom. A symptom of too many dollars chasing too few goods. http://economics.about.com/od/helpforeconomicsstudents/f/inflation.htm
Shouldnt money grow with population also? I'm not convinced yet that this money growth is a big issue, other than the inflation component of course - I dont think we should have any inflation. Those charts tend to indicate it is growing at a consistent rate
LOL - Would you believe the RBA is only growing the money supply by a consistent amount? Would you believe it? No? Well, would you believe the money supply is growing at a consistent rate? Don't think so, huh? How about a compounding and variable growth rate that reduces the value of the currency to zero over time, stealing the value of your savings by giving it to the people who get to use the newly printed money at full value before the dillution effects are realised? Source: http://dollardaze.org [youtube]http://www.youtube.com/watch?v=F-QA2rkpBSY[/youtube]
Has our productive capacity doubled in the last seven years? Hah our stock market hasn't even doubled in the last seven years.
