Second stimulus package discussion

[GumbyLearner]

No claims of being clever

The obvious is that the problems in the US and Europe are getting worse not better no bottom in sight. What the various Governments are doing is stuff that's behind the curve.

What I mean is they are trying to slow it down but the broken bits are simply to big for governments to fix they are reacting to the crisis not acting before.

The other minor detail is what the governments are currently doing is all theory particularly in the US and UK.

The Rudd Government no doubt on advice from treasury, RBA and others are acting in front of the curve, their actions on the banks, trying to put a floor under housing prices, the 1st stimulus package etc. Also they are trying to shore up confidence.

This 2nd round is about still acting in front of the curve but will not stop the coming crunch unfortunately simply put nothing will the numbers overseas are simply to big (remember when a $bil was a lot of money) but hopefully will buy some time and soften the blow.

The real red flag is the speed the RBA are dropping interest rates, never been done before they are very concerned and that's a worry.

Politics aside I though Keating had a reasonable take

http://www.abc.net.au/reslib/200902/r335492_1519593.asx

Keating had a much better business brain than Little Johnny or Mr K Rudd imo!

 

[GumbyLearner]

Re: Water pipeline

Good point... I am very much with you

Also, let us redirect SOME of our super onto our homeloans seeing that these clowns dont know how to handle it properly.

Brad

Great call! But unfortunately no matter what flavour of political party is in government they wont listen to you. Maybe monotone Bernie Fraser has the answers. "We're the super of the future" ROFL..yeah right thanks Bernie!

 

[beerwm]

Perspective: Rudd Government

5% emissions reduction target by 2020

$42,000,000,000 on plasma TVs, and insulation.

I think they have bought enough votes with our money for the next election.

 

[inrodwetrust]

So have I got this right?

I earnt less than $100k in 07-08 & paid tax.....Ka'ching $950

but this year if I'm making a loss ... so I claim unemployment benefits.... ka'ching!

then I do a course ... say how to drive a back-hoe ....ka'ching

I buy a backhoe ... ka'ching!

I buy a computer .... ka'ching! ...what for ? f@#* if I know!

I shack up with the farmer's single mum's daughter next door ... ka'ching... for the schoolkid..ka'ching..(no guarantees on this one!)

become a farmer ... ka'ching!


anything I missed?

 

[BigAl]

Instead of cash, the handouts should be in a voucher/coupon form redeemable at Coles, Woolworths, Harvey Norman etcetera so the money can only go to businesses who will employ more staff.The money could be directly channeled.
This would have a much more positive affect than giving cash to bludgers who spend it on alcohol, drugs and cigarettes.

Sounds great in theory.

In reality it sucks dogs balls, here's why:

I receive a $1,000 Coles Gift Card. As an extra incentive to spend it (quickly) the govt has set the expiry date at 3 months from issue.

I'm intent in battening down the hatches as the mother of all housing crashes is imminent (IMO) and want to put $1,000 onto the home loan.

How do I do it?

Do my regular weekly shopping at Coles and do not spend a Cent extra, over and above what my normal shopping bill would be. Put all these 6 or 7 weeks of grocery shopping onto the Coles voucher. My left-over money from my pay packet now (as I'm not spending on grocerys) is chanelled into the home loan, week by week, until I reach the magical... $1,000.

Stick that up your pipe Krudd.

 

[nunthewiser]

So have I got this right?

I earnt less than $100k in 07-08 & paid tax.....Ka'ching $950

but this year if I'm making a loss ... so I claim unemployment benefits.... ka'ching!

then I do a course ... say how to drive a back-hoe ....ka'ching

I buy a backhoe ... ka'ching!

I buy a computer .... ka'ching! ...what for ? f@#* if I know!

I shack up with the farmer's single mum's daughter next door ... ka'ching... for the schoolkid..ka'ching..(no guarantees on this one!)

become a farmer ... ka'ching!


anything I missed?

LOL might as well get the farmers daughter up the duff with quadruplets and hammer the baby bonus while on the way to buying ya first home to get that other free gift

gawd i luv a sunburnt country

 

[GumbyLearner]

So have I got this right?

I earnt less than $100k in 07-08 & paid tax.....Ka'ching $950

but this year if I'm making a loss ... so I claim unemployment benefits.... ka'ching!

then I do a course ... say how to drive a back-hoe ....ka'ching

I buy a backhoe ... ka'ching!

I buy a computer .... ka'ching! ...what for ? f@#* if I know!

I shack up with the farmer's single mum's daughter next door ... ka'ching... for the schoolkid..ka'ching..(no guarantees on this one!)

become a farmer ... ka'ching!


anything I missed?

Learn to apply yourself like the chameleon
Plenty of businesses will become broke, they need people to sort out the problems!

When one door closes, another opens!

 

[Glen48]

Dr. Steve Keen on SBS 03/02 claims it is all a drop in the bucket and a complete DUD

 

[GumbyLearner]

Dr. Steve Keen on SBS 03/02 claims it is all a drop in the bucket and a complete DUD

Honest reference Glen48. He's probably right!

 

[inrodwetrust]

LOL might as well get the farmers daughter up the duff with quadruplets and hammer the baby bonus while on the way to buying ya first home to get that other free gift

ka'ching!..ka'ching!..ka'ching!..ka'ching! &

ka'ching!..ka'ching!....crickey ....ka'ching! * 10

Dr. Steve Keen on SBS 03/02 claims it is all a drop in the bucket and a complete DUD

Glen, if I heard right, earlier on this evening he said $2trillion of credit has to be wound back to zero, before it's all over... I don't why he thinks it has to wound back that much, or even if it can.

Dud.. may well right though.

 

[Julia]

Glen, if I heard right, earlier on this evening he said $2trillion of credit has to be wound back to zero, before it's all over... I don't why he thinks it has to wound back that much, or even if it can.

Dud.. may well right though.

Presumably he's referring to the trillions tied up in the Credit Default Swaps which are still floating somewhere out there in some financial sub-hemisphere.

 

[Glen48]

Keen on ABC this Morning claims we have 60 YRs of USA debt and 45 yrs of Oz to undo.
Japan is deeper in debt now than 20 yrs ago and still in deep brown stuff.
Keating last night claims we have 6-7 yrs to go.
I would like to past the hat around or run a raffle for Robots.
I guess we just watch USA and see what we have to look forward to their RE is going down faster now than last yr.

 

[Glen48]

Keen on ABC this Morning claims we have 60 YRs of USA debt and 45 yrs of Oz to undo.
Japan is deeper in debt now than 20 yrs ago and still in deep brown stuff.
Keating last night claims we have 6-7 yrs to go.
I would like to past the hat around or run a raffle for Robots.
I guess we just watch USA and see what we have to look forward to their RE is going down faster now than last yr.

 

[Julia]

Why can't the nation build a massive water pipe from up north to down south?

This would make a lot more sense than giving more to people who (in the present climate of fear) will save it or pay off debt rather than spend it as Mr Rudd is anticipating. A FNQ call centre operator yesterday said that at present the equivalent of six times the volume of Sydney Harbour is pouring out into the sea off, I think, Townsville every day. Think what this could do for the water woes of Victoria and SA.

And another question, if this package is designed to stimulate jobs, then why isnt business included in any of the benefits? Giving money to tax payers wont save their jobs, but helping business will.

Now you are just being very ungrateful Prospector. Isn't there some sort of tiny tax break for small business? And can't you go out and buy e.g. a backhoe?
Seriously, I'd have thought that generous assistance to business would have in turn ensured more jobs into the future.

My thoughts are that cash payments to low-income earners it largely ends up paying excessive credit card debt and overdue bills (or the Rudd Thursday on pokies). From anecdotal evidence, that is what most I know in that group said they spent the money on.

Middle earners is an interesting one... Maybe some would just put it on the mortgage. I know with me it's well "now what do I do with that". I've already got my bills well covered and no debt, and have a weekly savings plan, so thinking I would spend it on something consumery. If others were thinking the same, could have a different effect on the economy to lower income earners... maybe

And the more Mr Rudd emphasises the dire outlook, the less likely people are to spend it on other than necessities.

WTF! . WHY is my dollars paying for YOUR handouts ? WHY am i paying for roof insulation ( of all things christ!)

geeeeez seems everyone gunna get there packages stimulated real nicely on MY buck

ps im not gettin nothing hence my dissapointment

Well now, we finally have something in common. I don't get anything either, not because I'm earning a large amount but because the considerable amount of tax I've paid has been via a SMSF which apparently is not eligible for the bonus payment.

Dont worry when the tax increases are announced to pay for it all you'll be first on the list

That is just so true. This will indeed all have to be paid for by the faithful taxpayer eventually.

 

[Boggo]

Instead of cash, the handouts should be in a voucher/coupon form redeemable at Coles, Woolworths, Harvey Norman etcetera so the money can only go to businesses who will employ more staff.The money could be directly channeled.
This would have a much more positive affect than giving cash to bludgers who spend it on alcohol, drugs and cigarettes.

Buy up shares in gambling stocks kiddies, Victoria recorded a 25% increase in gambling revenue after the last payout, at least we know where our tax dollars are going

 

[andrew08]

So my partner and i who don't have any children and earn under $80K should expect to see $950 each from this??

 

[CoffeeKing]

ka'ching!..ka'ching!..ka'ching!..ka'ching! &

ka'ching!..ka'ching!....crickey ....ka'ching! * 10

This sounds familiar all over the country ???

 

[CoffeeKing]

Suppose you could buy one of these and get some Gov't tenders seeing they have pots of money...

Or do this if you want
http://au.youtube.com/watch?v=c9yfaTlRA7w&feature=PlayList&p=1A838BA3D16DE0B4&playnext=1&index=24

 

[prawn_86]

So my partner and i who don't have any children and earn under $80K should expect to see $950 each from this??

Yep thats right.

On another note, can any accountants out there tell me if tax deductions can be carried across years?

EG - I have an ABN for my travel forum, but its not earning anything, so if i bought a new computer with this incentive, could i roll over the tax deductibility?

 

[sinner]

From my (hopefully) Austrian perspective:

Australia and the UK both exited the Great Depression much quicker than the US because they were quicker off the bat to devalue their currency against gold. Or maybe they just didn't have the staying power the US had at the time (either way it was obvious devaluing the currency against gold helped immensely).

It is worth noting the US Fed has begun monetising the debt they began putting out in September/October, with 10bn USD of Treasuries and other securities purchased back so far.

Gold used to be the worlds main reserve currency, now it is USD. We have already devalued greatly against USD with no signs of an opposite movement any time soon due to continued interest rate cuts and lack of strong commodity markets. So what is left?

$950 for everyone is a vastly inflationary tactic, it is literally dropping money from the helicopter as Bernanke espoused. I will give some credit to the Treasury for not just printing the money, and at least backing it by Aus Govt debt which actually has a decent standing right now on the international debt markets.

Just from some napkin calculations, Rudd has spent about $100bn all up since things got rough: on bank liquidity injections, company bailouts, initiatives, etc. Not all of this money is inflationary, but a large portion (those dollars making their way into the hands of the common people) of it is. Especially considering 6 months ago we had a $20bn budget surplus and close to $1bn trade surplus.

So in the long run, while I would have preferred to see fiscal conservatism and tax breaks funded by Government budget cuts, I can see how the Treasury is operating over a longer term scope and maybe they can actually get us out of this? Sooner or later everyone will be devaluing anyway as this is the nature of a fiat currency. We might as well get it over and done with so when the next cycle rolls around (commods are always first out of the barn on a recovery) we are ready for it.

Tighten your belts kiddies. It's been time now for the last few months to significantly cut back your household expenditure and put the savings away. Keep a months worth of living expenses in hard cash somewhere like a safe deposit box or similar just in case. Kill your debts off and refinance anything you can't. Do not rely on the next XAO upswing to return you to safety. Things could continue for some time and deteriorate as they do. Best to concentrate on the simple things like guaranteeing food, shelter and water over the long run, worry about the yield on your investments later.