The Forum > General Discussion > Miners and big money spin
Miners and big money spin
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LOL Thinker 2, Australia owes a nett 1 trillion $! Not the Govt,
for Costello made sure that Govt debt was paid off. But the nation
as a whole, as our current account deficit runs around 5-6% most
of the time.
What that means is that we as a nation, need to pay our debts to
other nations, on a regular basis. We can't use seashells, so we
need hard currency, usually US $. Either we borrow them, or
we earn them, to pay up when international accounts are settled.
At present, our 4 main banks are carrying the load, as they go
cap in hand to international lenders, to borrow all that foreign
currency. If they did not do so, our Reserve Bank would have to
do it, for pay we must.
The moment that international lenders become nervous about our
level of debt, they'll shoot up interest rates, to cover the
higher risk that we pose. There won't be a thing that Govt can do
about it.
At the moment, international lenders look at our mining industry
and feel that we can eventually dig our way out and pay in the
longer term.
But our present smartarse mob of politicians are threatening
that, so we'll see how it all lands up.
Wealth is created by our export industries, Thinker 2. In Australia
that is farming and mining, basically.
The rest of you just shuffle it all around.