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Interest rates and zee big wanks, sorry, banks.

https://www.google.com/amp/s/amp.news.com.au/finance/economy/interest-rates/westpac-refuses-to-pass-on-cuts-reducing-variable-rate-by-just-015/news-story/d6345f1407a54a1660bd7a3d0e4487c2

What's your take? Where does the reserve bank/ govt go from here to stimulate the economy?

Is the perpetual economic growth model dead?

 

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Replies

  • I’ve been saying it for years, perpetual growth is impossible.

    How can the double digit growth that companies want and demand be possible long term? Without huge population growth this type of economic growth is impossible. I’m a capitalist, centrist, but I do think we need to reconsider or reboot our financial model/system or we may just be in for a major major depression.

    Also I don’t think privatisation of every bloody thing is the answer either. Governments need to control to some degree essential utilities, if not the avg joe blow can’t keep up with the cost of living. All mass privatisation achieves is the pushing up of prices to allow double digit growth for executives and their companies.

    • What he said ^ 

      • Shit  I agree with you both. I'm very concerned.

  • Our economic growth is all about population growth  and massive failures aroung matching infrastructure. Housing prices have gone through the roof because we have not built enough housing .Supply and demand. Houses in the 60s and 70s were comparitivly cheap when population growth was in some sort of balance. We are headed for 40 million by 2050. Not enough graduating from quality TAFE education .Lots of new tradies are poorly qualified accourding to building companies.

  • From here we go to negative interest rates and QE, and then we go to a recession.

    • You may be right Kram. Look what is happening now The Social welfare budget is very high and may go higher with a recession. The Government seems to be trying to look at things to limit spending on Social welfare. We have had the Robot Cop welfare recovery practice in existence for a while. We have discussions about drug and alcohol testing for those on unemployment benefits. We have an enquiry going to look at the interaction with Superannuation, Pensions and considerations of including your home in the pension asset means test. All these things seem to be looking at minimising the Welfare budget. It may suggest that a recession is on its way and the Government is looking to do anything they can to target Social welfare spending.

  • These (experts ) in the reserve bank are leading us down an unowned path tempting young people to borrow at low interest rates than when rates rise leading to unaffordable repayments 

  • Should the govt. still be trying to get us into surplus?

    Can they still brag about being good economic managers?

    Are the big banks just see you in the N.Ts?

    • The govt shouldn't be hell bent on running a surplus - it's practically meaningless. What they need to do is try and find a way to deal with the massive amount of debt in the system. Unfortunately there's not much they can do - it's not like they can drop rates (remember when they dropped rates to "emergency" levels after the GFC - that was something like 4%!!). They're plugging on about the surplus, the unemployment rate (which is bullshit - UNDERemployment is an epidemic) and inflation (why the fuck do we need inflation - wages growth is flatlining)

      They are terrible economic managers. The economy has grown on a construction boom, coupled with a credit frenzy,  that can't (and hasn't) go on forever. We have been in a per capita recession for a few years now. Now they've junked the Aussie dollar which is a terrible outcome for many. Highly leveraged families (and Aussie families are as highly leveraged as anyone on the planet) have a very tough few years ahead.

      The big banks have already started taking profit hits. The bank's share prices, profits and dividends will all head south over the next 12 months.

      It's not a good look.

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