Well if this is based on fact then I can't see a problem.

It still does not address the fact that some people will save thier money.

Perhaps a card that can only be used for eftpos purchases may be a solution. Make sure it has an expirery date of say 2-6 months.

And of course you can't draw cash from it either.

Bruce- I don't agree with your view that the economy is so dynamic that it needs fine tuning/re-engineering on a moment-by-moment basis. We generally get by with very few adjustments to the settings- fiscal and monetary policy changes are usually done by the month, or even less frequently and budgetary intervention even less frequently. The "dynamism" that you speak of is more like food and drink service on the jet and perhaps problems with toilet queues.

What I am getting at is- how many econometricians modelled, say,the possible consequences to the economy of failure of a number of financial institutions and what might happen if, say, the government nationalised the banks and set its own terms for borrowing?

As far as I can see, economists argue around marginal changes, not large changes. Witness the response to some of the doomsayer economists eg Paul Krugman and Nouriel Roubini. Roubini, for example has been frquently criticised for being non-quantitative in his predictions- but none of his detractors seemed to be able to refute him by saying that they had performed research on potential large variations in those economic parameters and found different outcomes. His predictions have been correct many times, but economists still don't seem to get it.

For a good read about fairweather economist's response to attempts to understand disruptive change, ie Paul Romer's "New Growth Theory", I refer you to David Warsh "Knowledge and the Wealth of Nations" (Norton 2006).

The same argument is now being applied to bushfire management in Vic- ie how do we deal with "100-year events" that have now become five-yearly events?

What is ‘spurious’ about wishing to sustain the domestic economy by stimulating demand and thereby ameliorating the effects of growing unemployment caused by reduced demand from our markets?

Surely financing school upgrades is aimed at achieving short- medium term rather than long term outcomes for which it is criticised.

Providing money to age-pensioners and others might reasonably be expected to result in short term stimulus. While it is true that some of those monies will be saved, some is likely to be expended on items produced in Australia.

Claims by Turnbull that the government stimulus package has been a dismal failure are premature and unfounded. Given that the December stimulus did not result in funds reaching pensioners until 15-19 December, it is nonsense to believe they would or could have any significant effect on the economy in Q2. The effects of this package will not be evident until the end of Q3 and subsequent months.

Financing for smaller infrastructure projects with short lead-times, such a school upgrades and other ‘ready to go’ projects (housing improvements/new dwellings) should be seen as aimed at maintaining employment and demand in the medium term.

Large infrastructure projects often require longer start-up due to the need to complete design, tender documentation, and contact award before expenditure is incurred on employment and establishment. Such projects are expected to increase demand for Australian manufactures and support services in the longer term.

Given these considerations, it seems to me that government packages are aimed at covering a spectrum of expenditure aimed at stimulating and sustaining demand over the short, medium and longer terms, the latter being accompanied by recovery of our export markets, particularly in our region.

It is far too early to evaluate implementation or outcomes, let alone effectiveness of this approach.