Australian (ASX) Stock Market Forum

RBA cash rate

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its the first time I have heard that government aligned jobs have a built in protection that stopped them from generating inflation.
I'd have thought the opposite since CPI is routinely used as a benchmark for pay negotiations.

Way it works is employees a paid a level, they're not paid a specific salary but simply a level which is basically a code number. As an employee any negotiation will be about which level you're paid at, it won't be discussing actual $ amounts.

Reason being the levels all have set $ amounts, precise down to the cent, attached to them and that's where periodic negotiation takes place between government and unions. Those negotiations commonly use CPI as a reference point, meaning there's a positive feedback loop that higher CPI = higher salaries for public servants not immediately but whenever the next pay negotiation occurs (which can't be avoided since the agreements have a specific end date, and the next one is normally backdated). :2twocents
 
if the measure of her sophistication as a lobbyist and representative of a sector of society is to stand in front of a building and shout slogans, then that crowd have lost, already.

The socialists and communists from the Labor Party, Greens, Teals and big Unions thought that they could create wealth for the country by pumping the economy with increased public servants and cash for NDIS, childcare, and infrastructure builds, etc.

They all fell into the trap that most of their ilk fall into. It is the private sector that creates wealth and prosperity, government are meant to look after the running of the country, help the disadvantaged and poor, and assist business with lean taxes, minimal red tape so that the money that governments spend is available.

Bob Hawke and Paul Keating got it.

Albanese, Wong and Marles, actually the whole front bench except for Farrell don't get it.

Though I think Marles has woken up to the fact and is now calling for business to invest to increase productivity, but he still doesn't understand that business need incentive. Why should a business invest to increase productivity and profits if they're going to create higher tax complexity and cost which eat into the profits. It becomes self-defeating.
 
Overnight the AUD got crunched.
Rates did not change, but perceptions of future downward rates increased.
The irrationality of markets is on display.
US rates have had one reduction, Oz remains the same, but our currency gets crunched.
Mick
 
Overnight the AUD got crunched.
Rates did not change, but perceptions of future downward rates increased.
The irrationality of markets is on display.
US rates have had one reduction, Oz remains the same, but our currency gets crunched.
Mick
We get crushed because our economy is stuffed on fundamentals, and the only way mining and agro can save our bacon..till the next election is via a low and lower aud
 
Didn’t other reserve banks around the world basically do the same? Why is it specifically the RBA’s fault?

The RBA didn't go early enough, nor did it go hard enough IMO, whereas other central banks eg. US, NZ did. It's too sensitive about causing political s#!tstorms and consequently its softly softly approach is costing us now with a protracted per capita recession. Would've been better to go early, go hard, induce a sharp but short lived recession, then start the recovery earlier I reckon. Though who knows whether that would've turned out better or worse, after all real life isn't like a video game where you can just reload an earlier save and try different moves to see how they turn out.
 
Overnight the AUD got crunched.
Rates did not change, but perceptions of future downward rates increased.
The irrationality of markets is on display.
US rates have had one reduction, Oz remains the same, but our currency gets crunched.
Mick

I'd guess that was more to do with a shift in sentiment towards risk-off than anything to do with AU rates in particular. Other commodity based / risk-on currencies like CAD, NZD got hammered as well over the same timeframe.
 
The RBA didn't go early enough, nor did it go hard enough IMO, whereas other central banks eg. US, NZ did. It's too sensitive about causing political s#!tstorms and consequently its softly softly approach is costing us now with a protracted per capita recession. Would've been better to go early, go hard, induce a sharp but short lived recession, then start the recovery earlier I reckon. Though who knows whether that would've turned out better or worse, after all real life isn't like a video game where you can just reload an earlier save and try different moves to see how they turn out.
the RBA is usually late ( or too late )

and if i were running the RBA i would have got the rates up to 5% to create 'wiggle-room' for whenever the next major global downturn happens

but the RBA typical of their ilk has resorted the 'jaw-boning ' and fuzzying the raw data
 
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