Does anyone care whats written on zero hedge?
I find The Onion a more reputable source of information than zero hedge.
I find The Onion a more reputable source of information than zero hedge.
The Fed raises USD rates
- Thread starter Roswell Crash Survivor
- Start date
ParanoidAndroid
Well-Known Member
Yep. And our banks will soon follow suit as the RBA slides further into irrelevance.
Not a chance.
why do you say that?
If our banks borrow long term debt from overseas and then those interest rates rise, then they will be forced to pass on the rate rises to the customer.
Care to elaborate on your chain of thought? My understanding is most Australian borrowing is financed from overseas (primarily denominated in U.S Dollars), so a rise in USD Cash Rate is going to raise the Cost of Credit for domestic borrowers.
The RBA is acutely aware of the negative impact on the wealth of mortgage holders with a rise in official interest rates, it will do everything in its power- in line with its mandated inflationary target to keep rates on hold.
That may still leave the door open for banks to pass on any increase in costs to consumers.
That may still leave the door open for banks to pass on any increase in costs to consumers.
The RBA is acutely aware of the negative impact on the wealth of mortgage holders with a rise in official interest rates, it will do everything in its power- in line with its mandated inflationary target to keep rates on hold.
That may still leave the door open for banks to pass on any increase in costs to consumers.
How can they force the banks to not pass on increases if their overseas rates increase?
Do you think the RBA will do what Japan did and guaranty a low interest rate (1%) for 30 years? Though if they did do that our dollar will tank, but i guess that's something the RBA would be happy about.
As you know there is a disconnect between official rates and those set by banks, it’s not the role of the RBA to set mortgage rates. The banks may well be able to absorb any costs of borrowing internationally, or pass on these rises in other ways. Who knows, I’m not really familiar with how they finance their loan packages.
Can’t see that happening, the RBA tries to keep its credibility intact.
Their mandate to keep inflation at 2% will be upmost in their mind.
Edit to add: House has more idea, the Board ask him before doing anything.
Edit to add: House has more idea, the Board ask him before doing anything.
haha well let's see if he can join in and tell us how the RBA will move (or what he will tell the RBA to do).
Silverthorn
Well-Known Member
I started looking for work again a couple of months ago and it was much, much easier than last time a few years ago. Look for inflationary pressures to start building again.
Depending on how things go I will be looking to add to my shares this time around.
Depending on how things go I will be looking to add to my shares this time around.
Congratulations. Good Luck with your new employment.
Thanks!
Finally my anxiety and lower back problems have settled down with new meds and i got a job as a feild service forklift mechanic.
Company van, fuel card and mobile phone and full 38 hour week plus some overtime on big days when required.
Very happy to be fully employed again and the work is actually quite easy for me.
ParanoidAndroid
Well-Known Member
Well done mate.
harry_mr
Active Member
Former Treasury Secretary Lew Says Tax Cuts Will Leave the U.S. Broke
Former U.S. Treasury SecretaryJacob J. Lew said the Trump administration’s decision to add a significant amount of debt through last year’s tax legislation is leaving the country broke.
“It’s a ticking time bomb in terms of the debt,” Lew said in a Bloomberg Radio interview with Tom Keene and Jonathan Ferro. “You cannot run a fiscal policy by spending trillions of dollars you don’t have at a time that the economy is doing well.”
Having chosen to make tax policy without including Democrats in any of the conversation, now the administration probably can’t rally Republicans in Congress to do the basic business of government, such as making sure the country doesn’t default on debt and children don’t get thrown off health insurance, he said.
“The next shoe to drop is going to be an attack on the most vulnerable in our society,” Lew said. “How are we going to pay for the deficit caused by the tax cut? We are going to see proposals to cut health insurance for poor people, to take basic food support away from poor people, to attack Medicare and Social Security. One could not have made up a more cynical strategy.”
“What we’ve seen is a tax cut that spends money we don’t have to have very concentrated benefits for global corporations and the top 1 percent, and it’s leaving us broke,” according to Lew
https://finance.yahoo.com/news/former-treasury-secretary-lew-says-125300506.html
It really catches my eye with articles from past insiders who have been in these roles send out warnings like this. These tax cuts are a make or break for the US economy if spending doesn't increase as trump expects then this will be like hitting the brick wall with your foot flat out on the accelerator. Good luck to the USD.
Former U.S. Treasury SecretaryJacob J. Lew said the Trump administration’s decision to add a significant amount of debt through last year’s tax legislation is leaving the country broke.
“It’s a ticking time bomb in terms of the debt,” Lew said in a Bloomberg Radio interview with Tom Keene and Jonathan Ferro. “You cannot run a fiscal policy by spending trillions of dollars you don’t have at a time that the economy is doing well.”
Having chosen to make tax policy without including Democrats in any of the conversation, now the administration probably can’t rally Republicans in Congress to do the basic business of government, such as making sure the country doesn’t default on debt and children don’t get thrown off health insurance, he said.
“The next shoe to drop is going to be an attack on the most vulnerable in our society,” Lew said. “How are we going to pay for the deficit caused by the tax cut? We are going to see proposals to cut health insurance for poor people, to take basic food support away from poor people, to attack Medicare and Social Security. One could not have made up a more cynical strategy.”
“What we’ve seen is a tax cut that spends money we don’t have to have very concentrated benefits for global corporations and the top 1 percent, and it’s leaving us broke,” according to Lew
https://finance.yahoo.com/news/former-treasury-secretary-lew-says-125300506.html
It really catches my eye with articles from past insiders who have been in these roles send out warnings like this. These tax cuts are a make or break for the US economy if spending doesn't increase as trump expects then this will be like hitting the brick wall with your foot flat out on the accelerator. Good luck to the USD.
Some good strategies there to reduce the burden of government spending. Maybe if they cut food stamps they’d have a healthier population and a more efficient and cost-effective agricultural industry.
harry_mr
Active Member
Well government spending could remain high if Trump can get the velocity of money up, the plan to juice up consumption by cutting tax's is just another trick to keep kicking the can a bit further. The USD is finished but it has no other sizable competition with 80 years head start on the others. Game of chicken going on right now.