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Recovery calls for bold moves : Comments
By Nicholas Gruen, published 24/10/2008It's good policy to fight recession first and worry about the cost later.
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Posted by Arjay, Monday, 27 October 2008 6:49:26 PM
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Arjay, any Govt can print money. Result is that money then loses
its value through inflation. Look what happened in Zimbabwe, when it was taken to the extreme. We could simply print more dollars, net result being our Dollar would lose value much faster, inflation would increase, interest rates would go through the roof. Its not a solution to anything. Yes our current account is bad, our trade deficit is actually not so bad. Current account includes all interest payments, insurance payments, dividends paid from Australian companies to overseas investors etc. Now what would happen if Australians saved more and spent less? Our current account would improve dramatically, less need to borrow from overseas. More dividends would be paid here, rather then sent overseas. Etc. Take a look at countries with a healthy current account. Their interest rates are far lower then ours, as they are not dependant on overseas investors for their money. Yes, the US may try to print its way out of its problems. The results will show up in the value of their $ and in inflation. At the moment the US largely depends on the good graces of the Chinese, Japanese and Middle East. Wall St used to be the central point of exchange for these loans, many made to Australia as well. Now that it has lost all credibility, I'd say that other financial centres in Asia etc, will take over that role. Posted by Yabby, Monday, 27 October 2008 7:32:51 PM
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Yabby ,we in Aust own our Reserve Bank ,while the US Federal Reserve is privately owned.They ,the Federal Reserve dictate the terms to the US Govt,since it is they,who supply sustainance.
This cartell of international banks are borderless and have no alliegence to any particular country.They play one country/philosophy against another.Their ultimate objective is power at all costs.The individual,morality,values,family etc means nothing to them. Google Stephen Lendman,"Dark Secrets of the Temple."It will give you an insight ito the history of the US Federal Reserve and the financial debacle we now have to endure. Posted by Arjay, Monday, 27 October 2008 7:55:12 PM
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Arjay, some snips from Wickipedia:
The Federal Reserve System is an independent government institution that has private aspects. The System is not a private organization and does not operate for the purpose of making a profit. The stocks of the regional federal reserve banks are owned by the banks operating within that region and which are part of the system.[26] The System derives its authority and public purpose from the Federal Reserve Act passed by Congress in 1913. snip. It also generates revenue independently without need for Congressional funding. Congressional oversight and statutes, which can alter the Fed's responsibilities and control, allow the government to keep the Federal Reserve System in check. Since the System was designed to be independent whilst also remaining within the government of the United States, it is often said to be "independent within the government."[27] The 12 Federal Reserve banks provide the financial means to operate the Federal Reserve. Each reserve bank is organized much like a private corporation so that it can provide the necessary revenue to cover operational expenses and implement the demands of the board. Member banks are privately owned banks that must buy a certain amount of stock in the Reserve Bank within its region to be a member of the Federal Reserve System. This stock "may not be sold, traded, or pledged as security for a loan" and all member banks receive a 6% annual dividend.[27] These member banks must maintain fractional reserves either as vault cash or on account at its Reserve Bank; member banks earn no interest on either of these. The dividends paid by the Federal Reserve Banks to member banks are considered partial compensation for the lack of interest paid on the required reserves. All profit after expenses is returned to the U.S. Treasury or contributed to the surplus capital of the Federal Reserve Banks (and since shares in ownership of the Federal Reserve Banks are redeemable only at par, the nominal "owners" do not benefit from this surplus capital); the Federal Reserve system contributed over $29 billion to the Treasury in 2006.[29] http://en.wikipedia.org/wiki/Federal_Reserve_System Posted by Yabby, Monday, 27 October 2008 8:36:18 PM
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Nicholas; You dreaming of the past points up the whole problem.
It is summed up with this now well known saying in some circles; If someone thinks that they can have infinite growth in a finite world they are either a madman or an economist. Nothing happens without energy. Energy production is flat therefore growth will be flat. The economic model has to changed from one of growth to a sustainable economy that is regulated by the amount of energy available. Money is the slave of energy. For too long economists have been telling us the opposite. Wake up ! Posted by Bazz, Wednesday, 29 October 2008 9:57:40 AM
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Our Banks borrow from this international cartell which in turn puts us in more debt.Each working Aussie has a foreign debt of over $60,000.00.The ordinary people in US are in a similar dilemma.Our debt has almost doubled with the devaluation of our dollar to 55c US.
Are you beginning to understand?We are slaves to this international Banking Cartell which includes,J P Morgan,Rothschild,Bank of England Bank of Japan etc. They are at the apex of this debt pyramid scam.