I'm sorry but this economic essay if that is what it is, gets a big F for fail. It's so easy to blame the banks for the state of our economy when so much of what's wrong has its cause in greed is good individualism and the exploitation of others!

Take energy a just one example providing you understand that every western-style economy rests solely on just two pillars, energy and capital!

Energy has been allowed to become way too expensive and acts as a huge tax increase in the economy. Never ever assisted by mindless privatisation to suit an idiotic ideological imperative.

And we have tried to offset this problem with manipulation of capital. Interest rate reductions quantitative easing and the creation from thin air if derivatives, short selling, cryptocurrency, Insuring your insurance policy again and again and onselling the inherently worthless paper alongside other similar Ponsi schemes!

One cannot grow the economy with unrepayable debt. If you and I just borrowed ten times or more than the total capital value of your assets, your parents and against the kid's education trust account etc-etc. We'd be pronounced bankrupt six times over!

As a formula for running any economy, rather reminiscent of what one would expect if the inmates were running the asylum. In fact, some would argue, they'd do a better job?

Conversely, this is what I would do if given my druthers. TBC
Alan B.

"Group think is the embodiment of insanity."

Sure is; and it's rife in Australia.

If we were honest and genuinely wanted to stimulate a tanking debt ravaged economy?

We'd start with the simplicity of attacking and removing poverty in all its forms and guises, as a war on unmeet need and want.

And not with charity or handouts but with extremely inviting work/investment/partnership, opportunities created as government-funded and facilitated, co-ops/cooperative enterprise.

Not all Government debt is bad debt! Just that created to fund recurrent expenditure! And like pouring money down a great big black hole!

Co-ops were the only private enterprise, free-market business model that mostly survived the Great Depression, largely intact! And because they have no peer when it comes to efficiency and productivity! And because every employee is also a shareholder, who wants the enterprise to succeed.

They have no history of growing too big to fail or internal undetected profit harming corruption etc-etc. I mean there are a thousand eyes literally. And as they say, a thousand eyes cannot help but see and via blatant self-interest, expose any and all corrupt practice and eliminate bottlenecks and the drones.

Also maximise wages and conditions without any union involvement, given the employees are also their own, self-interest, union! Key to this is affordable, reliable, dispatchable energy. Most of which could be owned and operated by several dozen, competing for your dollar, co-ops. And as small modular, mass-produced MSR thorium, power generators. An absolute essential is affordable reliable cost-effective, on-demand, potable water! And available forever, as deionisation dialysis desalination!

The rest is as limitless as our best ideas, born in our better people, which currently, is arguably our two most successful exports, save the returns that they could earn for us, are exported with them along with the economic advantages that could've been ours!

We have a unique opportunity here to quite massively boost our economy and our self-sufficient independence. As opposed to just handing over our heritage to triaxia!
Alan B.

Vern has correctly identified that there is a groupthink problem, but has got its implications completely the wrong way round. Lowering interest rates ,when the economy is weak, indeed shouldn't be a difficult decision, but it would be a difficult decision for someone like Vern who advocates the opposite. Their groupthink has the central bankers sharing his unnecessarily hawkish bias, but unlike him they have a duty to try to keep the economy growing. Therefore they make the difficult decision that would be an easy decision for someone less biased.

If he were a little more conducive to logical thought, he might instead understand that productivity is worthwhile whether or not it's the result of capital deepening. And that using recessions to clear out the dead wood is overkill, needlessly damaging healthy trees.

"Something along the lines of doing the same thing over and over again and expecting a different outcome."
Actually in economics it is the case of "Same problems, different solution".

Unfortunately in the case of the Australian dairy industry most of the dairy coops have failed, mainly because they engaged in a race to the bottom with other coops, aided by the supermarkets. They ignored the adage "United we stand, divided we fall".

We can't keep kicking the endless growth can down the road forever.
https://psmag.com/magazine/fallacy-of-endless-growth

Read it and weep.

David

The central tenet of capitalism is healthy competition. Allowed well-managed co-ops to survive two world wars and a depression.

Destroyed by introduced and enforced, dog eat dog competition (greed is good individualism) where the biggest hungriest gradually took over from the rest, some of who were dumb enough to sell their interest to foreign market competition, then cried a river when that plan went pear-shaped!

Co-ops only prospered when they completely embraced cooperative capitalism/mutual benefit outcomes. Co-ops almost alone all but compel the usual economic flow on factors to flow on inside the local community, the state and the nation making every one dollar do the economic work of seven!

Our economy does it in reverse/shares most of the economic flow-on factors with foreigners and our foreign competition.

If we wanted to build a robust manufacturing-based economy that could lock horns with economic giants like China, then we have no other choice than embrace cooperative capitalism, automation and direct, sell from factory to consumer, assisted by the world's cheapest energy and endless reliable water.

Few if any manufactured products do not have a water component. Finally, there is the cost of transport which must be made to rely almost exclusively on electrified rapid rail and fast turnaround, roll on roll off, submersible ferries.

The world's largest subs are around the size of WW11 aircraft carriers and the latest nuclear-powered version can I'm informed do better than fifty knots. Moreover would be less vulnerable to terrorists in small boats I also see a place for electric planes on short-haul ocean crossings.

And as such put them out of the reach of lightly armed terrorists in cars, trucks and small boats.

The best ones will come with two or more counter revolving props And recharge to 80% within an hour.

As other writers have indicated, doing what you've always done while expecting different outcomes is by definition, madness writ large!

And we just go on and on trotting out the same self-harming "solutions" almost daily, in business, as usual, protect your conies and personal benefactor, madness!
Alan B.

It's so easy to blame the banks for the state of our economy
Alan B,
Agree but, their involvement played a major role nevertheless ! They're far from innocent !
They went along with all the blown out of proportion prices & simply lent the money !
They're guilty of complicity.

Alan,

unfortunately for mankind, we cannot/must not dismiss the banks so quickly, nor let them off so lightly.
Even though they are the root cause of our problems, they are not the only one in the mix.
Your co-op idea sounds great, but for some glaring negatives.
You see, the reason they won't work today, is because we have become lazy and entitled.
In the good ole days we used to have to work just to survive.
In those same good ole days the unions kept pushing wages up, unconscionably so, to the point it made our goods and services to expensive to export.
Now you and I are allies in that you believe in your thorium based power generating which would bring the price of energy down to an acceptable level.
My pet worry is the banks, or more the Elite Jews who own or run (apparently) 97% of the banks in the world, and control governments and major political decisions.
Start and finance wars, and the list goes on.
As drastic as it sounds, kill these elite nut jobs with visions of grandeur, like the "one world order" or "one world government", you get the picture.
These are not the ramblings of an old mentally impaired fool, they are the conveying of facts gleaned over time, and I have still some of the examples from which I refer.
Alan, internal bickering aside, we are being manipulated and driven to a point where we will be dependent on a select few who have connived and contrived to ascert themselves as the overlords, and all to our detriment.
Back to co-ops for a second.
Alan, co-ops don't work in an affluent society, because no-one has needs or demands or responsibility any more.
There are very few things we agree on today, and they are mostly self serving, with little or no community benefit in them.

Seeing that implicating the Banks isn't enough to stir interest, let's put the focus on investors & the Commercial Welfare outfits. Speculators are probably worse than banks !

Well ?