Access economics says recession is over

Jubial Priest · Post by **Jubial Priest** » Wed Sep 09, 2009 9:55 am

Leftofcentresalterego wrote:Still no answers for anything JM or I have asked you?

You right JM, it is a waste of time trying to have a sensible discussion with someone whose chosen occupation is "unemployed beastiality and kiddie-fiddler porn site surfer".

Stimulate my penis and Australia will become a world power
Any takers on the call to stimulate Frogens penis?

I think I'll give that one a miss Froges - IQ might be interested though

You never answered the question about whether you think that govt spending has absolutely no effect whatsoever on interest rates.

Jovial Monk · Post by **Jovial Monk** » Wed Sep 09, 2009 10:41 am

Govt spending has an effect on inflation and so interest rates if the economy is healthy and govt spending competes for resources (credit, employees, services etc) with the private sector.

Right now with the private sector quiet and resources underutilised govt spending can prop up employment and activity without causing interest rates to go up one iota.

Leftofcentresalterego · Post by **Leftofcentresalterego** » Wed Sep 09, 2009 8:41 pm

Once again priest continues to dodge the questions by saying that I did not answer a question.

It's clear that he does not know anything about anything.

I agree with JM that it's possible for the government to compete with the private sector for real resources. But I don't think that this necessarily drives up interest rates. I don't think that it is possible in our modern system for government to compete with the private sector for financial assets. My understanding is that banks expand their balance sheets by lending. They lend first and then worry about their reserve position later. Loans create deposits, not the other way around.

So priest, have you visited the RBA's site or any other site that records the fact that interest rates and government debt levels move in opposite directions far more often than they move together? No? Didn't think so.

You can pretend if you like that interest rates didn't rise each year from the very early 21'st century while government debt fell each year, even to the point where government had no net debt but rates continued to push up. You can pretend that rates did not fall while government debt rose in the 90's. Denial will work well for you. People who are more intelligent than you - that would be almost everybody - will conclude that the documented facts tell us that there is no sensible relationship between government debt and interst rate movements.

Jubial Priest · Post by **Jubial Priest** » Wed Sep 09, 2009 9:12 pm

Keep playing dot to dot dipshit and denying economic theory just because you don't see a correlation on your two tier simplistic theory.

You are dumber than your commie fuckwit old man

Jovial Monk · Post by **Jovial Monk** » Wed Sep 09, 2009 9:17 pm

Very very deep economics in low_moron's post there.

Jubial Priest · Post by **Jubial Priest** » Wed Sep 09, 2009 9:18 pm

I can't hear you with Leftys nuts in your mouth Monk

Jovial Monk · Post by **Jovial Monk** » Wed Sep 09, 2009 9:30 pm

So you have absolutely no idea about economics.

Leftofcentresalterego · Post by **Leftofcentresalterego** » Wed Sep 09, 2009 9:36 pm

No he doesn't know a thing about economics JM - but he is an expert in beastiality and child molester porn. Probably wrote the book on it.

I used think that no one in society was utterly worthless - but then I struck him.

Leftofcentresalterego · Post by **Leftofcentresalterego** » Wed Sep 09, 2009 10:34 pm

On a different tack - can a strong recovery be sustained by itself?

Was gunna do a spiel on the US - will get around to it. It is closely related to the following.

Economic growth for almost 2 decades has been quite strongly underpinned by ever increasing private sector debt. As a proportion of GDP, the private sector in Australia has become more heavily indebted than any other time since the founding fathers declared us a nation and then knocked off and went to the pub. 165% of GDP is rather a lot of debt for the private sector to carry - in fact, it is unprecedented I believe.

It is higher than the highest ever government debt.

As over extended as this is, consider the situation in the US - private sector debt has reached an incredible 300% of GDP. As far as I am aware, there is NO precedent in the past couple of hundred years at least for such a level of private debt. They closest they came was 246% of GDP, just before the great depression. With the US consumer debt saturated, can they continue to keep growing by the same path that got them where they are now? Can they get straight back to their feet, whip the plastic back out and proceed to push private debt to 350%? 400%? 500%?

Will growth now muddle along, anaemic and unable to rise above the level needed to prevent unemployment from creeping up? Will governments need to re-embrace the Keynsian approach that if the private sector cannot/will not spend enough, government must step up there, more or less permanently?

Interesting times.

Jovial Monk · Post by **Jovial Monk** » Thu Sep 10, 2009 10:36 am

Poor LOW_IQ. Of course he couldn't accept my orthodox economics argument re private spending--he would have had to acknowledge Tip's unsustainable tax cuts were inflationary.

How the community can deleverage I dunno. More savings is the obvious answer broadly speaking. Keatings compulsory super stood us in good stead. Bigger problem is: how can companies deleverage while investing in plant, stock, skilled staff etc.

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