Rudd's $42 billion 'nation building' plan (5 Viewers)

[katie tully]

Which FB group, jack daniels simon?

NVM, I'll look at your profile and it'll tell me

 

[Will Shakespear]

lol @ the hsc kids itt who don't understand how ppl can give non-keynsian explanations of economics

 

[Gerald10]

The Austrian explanation fits the facts better than other theories

I mean a system where the government doesn't control so many aspects of the currency. A system where people are free to print and use whatever currency they want, start whatever banks they want - and let the market decide what currency will be used. Here's a link to the free banking wiki

When the government issues the currency and makes people use that specific currency, via stuff like legal tender laws, Australian Bank Notes Tax Act 1910, capital gains tax, land tax - it circumvents the natural free market "check systems" that exist. Because in a free market when a private currency issuer just starts printing money like crazy, people who don't want to have a devalued dollar can simply switch to another currency. With the existence of state legislation and rules, that becomes impossible to do, so the people are forced to live with a currency that loses spending power quickly. Inflation (referring to the expansion in money supply, not CPI), is a hidden tax on savings.

The government meddling with the currency is what caused this "myopia" of the actuaries and banks, by artificially making more money available than what there should have been. In Austrian economics, the determination of interest rates is generally based on how much more you want something now vs how much extra you'd have to be paid in the future to get more than that. eg. "do you prefer $100 now or $108 in a years time?" It's a time preference thing.

When the government "prints money", they are making interest rates lower than what they would otherwise be, which creates malinvestment. Since many calculations regarding investment are required in a society as complex as ours, you can see why such a thing is so crucial to the function of the economy. And since the underlying interest rate was incorrect, the calculations were wrong and resources have not been allocated where they were most needed.

The existence of other regulations contributed to it too:
- Community reinvestment act - made it easier to give unsustainable loans
- freddie and fannie

Contrary to what Rudd says, this crisis is not about greed. This crisis is fundamentally due to the government control over currency.

Two things

1- printing money only results in inflation - more money chasing after the same amount of goods leads to prices generally rising.

2- Why would I or anyone accept money for goods and services if there was a real possibility that noone else would accept that money?

And to an extent it is possible anyway - Theres nothing stopping me paying you in US dollars if we both accept it but because it isn't legal tender you have the right to reject it. In fact in most places you travel throughout the world $US are readily accepted. Removing legal tender would only result in unnecesarry instability throughout the economy - from the grocery store to international trade.

 

[katie tully]

lol @ the people in that FB group

"MALCOLM TURNBULL IS A CUNT COZ HE IS WEALTHY. WE'RE JUST GUNNA IGNORE THE FACT THAT HE IS A SELF MADE MILLIONAIRE!!!!!!!!!!!"

 

[katie tully]

fucking lol even more, the libs only got lucky coz of the mining boom.

I'm pretty sure that before the mining boom even happened, Labor wanted us to invest all our money in the technology boom that America was riding on. When that died in the arse, Australia weathered the storm because we were smart enough to get in on mining before it turned out to be as lucrative as it was.

 

[katie tully]

hey guys, do you think 950 bux will get me a lap dance from Scores?

 

[H@wkeye!]

lol @ the hsc kids itt who don't understand how ppl can give non-keynsian explanations of economics

You calling me a HSC Kid?

Plus, i blame Neo-classical economics for this whole mess

 

[katie tully]

You calling me a HSC Kid?

Plus, i blame Neo-classical economics for this whole mess

Of course you would, it appears after all that you're a career student.

 

[H@wkeye!]

Of course you would, it appears after all that you're a career student.

I was waiting for someone to pull that card.

i consider it, a change in direction rather than career student.

 

[katie tully]

House is still sitting. It's expected to vote on the bills at 5am.

$42 billion of expenditure really demands better scrutiny than this.

I know right.

If they were going to spend 42 billion on an Island to send all of these nutcases to, it wouldn't matter if they passed it in 2 days.

 

[Boxes]

I was waiting for someone to pull that card.

i consider it, a change in direction rather than career student.

seriously though, why the fuck are you still going to uni?


is it really that hard to let go?

 

[katie tully]

seriously though, why the fuck are you still going to uni?


is it really that hard to let go?

He wants to be an Eco Warrior.

 

[incentivation]

And he still can't spell STIMULUS!

Must be quality university education.

 

[Will Shakespear]

I was waiting for someone to pull that card.

i consider it, a change in direction rather than career student.

it's more like spinning around on the spot then isn't it

 

[sdent40]

1- printing money only results in inflation - more money chasing after the same amount of goods leads to prices generally rising.

I'm not sure what your point here is. Yes, I'm arguing that the government prints too much money and circumvents the free market checks that exist. If you're talking about the definition of inflation, that's just because in Austrian economics "inflation" means expansion in the currency. The rise in prices is just a necessary consequence of expanding money supply.

2- Why would I or anyone accept money for goods and services if there was a real possibility that noone else would accept that money?

Which is why people would switch away from that currency if the creator just printed too much. Which goes back to my point about the free market check system of people switching to another currency being stopped by the state.

And to an extent it is possible anyway - Theres nothing stopping me paying you in US dollars if we both accept it but because it isn't legal tender you have the right to reject it. In fact in most places you travel throughout the world $US are readily accepted. Removing legal tender would only result in unnecesarry instability throughout the economy - from the grocery store to international trade.

Problem is, the currencies of the world are all being printed by central banks, it's hard to use sound money. In the USA, private use of sound money has been policed and invaded, eg. Ron Paul dollar.

There wouldn't be instability, the market would find a solution without government meddling in the system. Whether that means the use of physical gold, or private currency notes issued by businesses that have an incentive to not print too much (because otherwise people will switch to another currency).

 

[CIV1501]

haha yeah $950 would get you an amazing night at the strippers

 

[chicky_pie]

"This is what happens when you have Labor governments, they always drive the country into debt, It's only when Liberal governments are elected that we have to clean up the mess." - Liberal George Brandis.

 

[blue_chameleon]

"This is what happens when you have Labor governments, they always drive the country into debt, It's only when Liberal governments are elected that we have to clean up the mess." - Liberal George Brandis.

Just on that;



Opinion: A Debt Burden to Shame Keating (Malcolm Turnbull)

Interesting read.

 

[Rafy]

Why is this page on the centrelink site already?

Why doesn't Rudd just abolish the parliament?

 

[boris]

but that says i cant have any money?