The state of the economy at the street level

[sptrawler]

You said it yourself, the economy is failing.

Keeping doing what you are doing and expecting things to change is a sign of lunacy.

With interest rates so low there would be no better time to borrow money and invest it in something productive.

The best thing they could do imo is invest in energy infrastructure (not just electricity, but oil , gas and liquid fuels like ethanol) and get power prices down. High power prices are killing consumers and businesses and are making us one of the most un-competitive nations on earth.

But no, they would rather sit on a pile of money counting it each day like Scrooge.

Unbelievable.

At this point in time, I would guess there isn't much the Federal Government has that they can throw money at, other than Snowy 2.0.
The Federal Government has said, they will give billions of dollars to Victoria, to build a tunnel to the airport and to build the East/West link.
The Federal Government has said, they will give billions of dollars to W.A, to continue the Roe Highway extension to Fremantle Harbour.
At the end of the day, it is up to the State Governments to build a lot of this infrastructure to relieve bottlenecks and improve productivity, to lay it at the Federal Governments feet seems a bit opportunistic.

 

[Humid]

Only when you live in a Labor state
Maybe West Aussies are grown up enough to choose what to spend our money on

 

[SirRumpole]

At this point in time, I would guess there isn't much the Federal Government has that they can throw money at, other than Snowy 2.0.
The Federal Government has said, they will give billions of dollars to Victoria, to build a tunnel to the airport and to build the East/West link.
The Federal Government has said, they will give billions of dollars to W.A, to continue the Roe Highway extension to Fremantle Harbour.
At the end of the day, it is up to the State Governments to build a lot of this infrastructure to relieve bottlenecks and improve productivity, to lay it at the Federal Governments feet seems a bit opportunistic.

It's a matter of priorities isn't it ?

No money for combined cycle gas generators but a lot of money for highways.

???

 

[sptrawler]

It's a matter of priorities isn't it ?

No money for combined cycle gas generators but a lot of money for highways.

???

I agree the electricity shouldn't have been privatised, but now it is, it would be crazy for the Federal Government to get into direct competition with producers existing plant, the problems with dispatch would be enormous. Also already where it isn't completely privatised, the State Governments are involved, so to add the Federal Government into the mix would be diabolical, even if it was only in a funding capacity the private operators would scream blue murder about an unfair playing field.
The difference with Snowy 2 is that it is a new area of generation/pumped storage, so it actually isn't a new entrant in the market as such, it will be buying power to fill the storage and getting paid to discharge the storage.
So it isn't in direct competition, it is there more as a stabilising medium, when the renewables are over generating Snowy will buy and use their power and when renewables are under generating Snowy will then sell back into the grid.

 

[sptrawler]

Only when you live in a Labor state
Maybe West Aussies are grown up enough to choose what to spend our money on

Hi Humid, I'm pretty sure all the States have Federal co funding for infrastructure projects, I would guess a lot of the money for Syney's second airport, would be Federally funded.
I don't think it is a Labor/ Liberal thing, a lot of these projects take a huge amount of planning, designing, pre ordering plant and equipment.
Just throwing money at a half arsed plan, is asking for trouble, as has happened in the past.
Just my opinion.

 

[Humid]

Hi Humid, I'm pretty sure all the States have Federal co funding for infrastructure projects, I would guess a lot of the money for Syney's second airport, would be Federally funded.
I don't think it is a Labor/ Liberal thing, a lot of these projects take a huge amount of planning, designing, pre ordering plant and equipment.
Just throwing money at a half arsed plan, is asking for trouble, as has happened in the past.
Just my opinion.

I’m pretty sure the Roe extension to Freo was stopped by local Labor in the way of an election so the feds giving money to a project voted down by the people is very much a Lib Labor thing
Btw I’m all for the extension....south of the river road network is 3rd world I don’t know how you live there it’s chaos

 

[Toyota Lexcen]

Why not do an 8hr day? Then a "brother" can get a job. More union fees.

Not good taking all the hours, Labor??

 

[sptrawler]

I’m pretty sure the Roe extension to Freo was stopped by local Labor in the way of an election so the feds giving money to a project voted down by the people is very much a Lib Labor thing
Btw I’m all for the extension....south of the river road network is 3rd world I don’t know how you live there it’s chaos

I agree, even if they go with the Kwinana outer harbour plan, the Roe extension makes sense. I can' understand why they just don't build a bridge/raised highway over the space between North and Bibra lake, then cover it, or even do a tunnel under it, it isn't rocket science. It just seems that politicians can't think outside the box.
There is a big push starting at the moment, to introduce a congestion tax in major Australian cities, Perth will be a nightmare without a ring road, which the Roe extension is a part of.
I think McGowan has been really good, but I can't understand his stand on the Roe extension, just make it a way that doesn't impact the ground.

 

[Humid]

Why not do an 8hr day? Then a "brother" can get a job. More union fees.

Not good taking all the hours, Labor??

Since Little Johnny Howard’s reign you don’t have much say in working hours but of course if you had a job you would know that you bum

 

[moXJO]

Compare it with sitting in traffic daily for hours and to work in Perth I would have to do 5x10 hour days and half day Saturday which leaves you with travel about 1 day off a week.
I’m casual atm doing about 10-12 days on followed by 7 off.

I see it the other way....I don’t know how you do it,meals cooked and your room cleaned
I give up the long stints after Wheatstone it fried me

I was a bit spoilt in the end. Could work when I wanted and make $2k a day if the work was there. It literally ruined me for a normal job though. I was lucky enough to be one of the only guys being able to fix things no one else could though.

But deadset ruined me for even looking at hourly rates.

 

[Toyota Lexcen]

Worse than the buses of workers that come into bust union picket lines.

The 36hr week good for people.

Seen lots of riggers and crane drivers loose their families chasing the $$$. Never home, causing accidents on sites.

Not very caring.

 

[Humid]

36 hours a week should just keep you out of poverty and apparently we’re already overpaid
If you don’t like 12 hour days
Don’t go mining

 

[qldfrog]

You said it yourself, the economy is failing.

Keeping doing what you are doing and expecting things to change is a sign of lunacy.

With interest rates so low there would be no better time to borrow money and invest it in something productive.

The best thing they could do imo is invest in energy infrastructure (not just electricity, but oil , gas and liquid fuels like ethanol) and get power prices down. High power prices are killing consumers and businesses and are making us one of the most un-competitive nations on earth.

But no, they would rather sit on a pile of money counting it each day like Scrooge.

Unbelievable.

Economy can not always grow, you need a purge from time to time
And better a small recession than an Apocalypse

 

[Toyota Lexcen]

How 12hr days, day after day passes a risk assessment is beyond me.

Maybe Health & Safety officer signing it off.

 

[satanoperca]

You said it yourself, the economy is failing.

Keeping doing what you are doing and expecting things to change is a sign of lunacy.

Agreed, so stop lowering the IR's first thing, the lower the go, the less people spend.
RBA - hello from Pluto but having an inflation target of %2-3 is just lunacy in a deflationary cycle.
Govnuts - if you wanted wages to grow and unemployment to decrease STOP importing so many people as they will get old to and they also need infrastructure.
Govnuts - stop the politics and start governing, people have had enough of your b----lshit and wasting of money.
People of Australia - get yourself better educated about what is happening in the world, understand economics and trade more so you don't complain when things get tough.
The World - don't be frighten of recessions, they are a natural cycle
Govnuts and Australian's - high property prices does not my our society and communities rich

 

[SirRumpole]

Agreed, so stop lowering the IR's first thing, the lower the go, the less people spend.
RBA - hello from Pluto but having an inflation target of %2-3 is just lunacy in a deflationary cycle.
Govnuts - if you wanted wages to grow and unemployment to decrease STOP importing so many people as they will get old to and they also need infrastructure.
Govnuts - stop the politics and start governing, people have had enough of your b----lshit and wasting of money.
People of Australia - get yourself better educated about what is happening in the world, understand economics and trade more so you don't complain when things get tough.
The World - don't be frighten of recessions, they are a natural cycle
Govnuts and Australian's - high property prices does not my our society and communities rich

I heard today that constant lowering of interest rates is actually spooking people into spending less, ie they think that the economy must be bad to keep cutting rates, so if it's that bad I might lose my job and I'll save all the money I can in case that happens.

The cat is chasing it's tail and it's getting pretty tired. Consumer confidence is what is needed and there isn't much of that about.

Completely agree on importation of people, we don't need more downward pressure on wages.

 

[satanoperca]

With interest rates so low there would be no better time to borrow money and invest it in something productive.
But no, they would rather sit on a pile of money counting it each day like Scrooge.

Unbelievable.

Like to discuss this idea and please correct if I am incorrect, trying to understand.

The govnuts want a surplus - proves they are good economic managers.
So what is a surplus :
Govnuts revenues - forecast expenditure for the next financial year = + value, surplus we have

So lets play our your idea and this is obviously an extreme example :

1. Current GDP is $1300B
2. Govnuts Revenue approx $500B
3. Lets say we borrow $1000B for infrastructure spend at 2% Interest on I/O, so $20B in interest goes into the next budget
4. Govnuts have $499B in expenditure but still want a surplus, they just cut funding to schools, pensioners and education by $20B AND
5. as magic happens SURPLUS - people of Australia think they have the best economic managers of a country in the world, Liberal down the champs.

Reality we are now in $1300B of debt as a nation, so my childs childs children will still be paying of this debt.

So govnuts spending is an idea to stimulate the economy, but with interest rates low, the money people save or earn will just go into increasing asset prices like property.

They will not risk their money on innovation and startups or the like.

 

[SirRumpole]

So govnuts spending is an idea to stimulate the economy, but with interest rates low, the money people save or earn will just go into increasing asset prices like property.

People will reduce their debt rather than spend so the benefits of low interest rates are debatable.

 

[macca]

Couple of thoughts on this, the first one is that we should have allowed a mild recession to happen when the GFC hit.

Borrowing money to give away is just silly and shows just how foolish that Govt was. By all means, use the surplus money that was available after the election but to borrow money to have a party is unforgivable.

By having a mild recession when they could blame it on the GFC was quite acceptable politically, Rudd was supposed to be Howard lite and got elected on that policy so when he went feral the polls shot him down.

By not allowing a downturn the next gens were denied the educational experience of doing it tough for a year or so. Consequently many of them are completely unaware of the fact that this is as good as it gets and have no concept of delayed gratification or saving for a rainy day.

Their CCs are maxed permanently so there is no way to increase their spend.

On the other hand, mortgage holders are in two camps, some are meeting their payments, others are behind. I have read that most keep paying the same amount when interest rates fall, some use it as a way of catching up and the others use it to get ahead.

No increase in spending there either.

Something that has changed in the past 20 years is that BBs have had the opportunity to build assets, no wars, no big recessions in Oz, getting old, lets save for our old age.

Unfortunately, the RBA has not worked out that times have changed, for the past 100 years the world has been in debt with real money (gold standard) and people really were struggling.
Not today's "struggling" I mean really struggling, like whole families living in tents, camping in bush, sleeping in garages etc

Now there are just as any people using interest to fund their lifestyle as people in debt, we know that people in debt keep their payments the same (if possible) but the people who are retired adjust their spending to their income.

Every time interest rates go down the economy slows, has been doing it for the past few years, will keep on doing it until the RBA adjusts its thinking to the new world.

0% interest rates quite simply did not work anywhere in the world, Japan has been doing it for years, made no difference. What needs to happen is they need to work with Govt to create new rules and situations that encourage employment.

There should be savings accounts that offer the same rates as inflation, then people will start to spend again.

Of course, the best spenders are those on benefits, give them an extra $5 a week and you can bet it will flow instantly

 

[SirRumpole]

What's the current credit card rate, still 18% ? I don't have one so I don't know.

Maybe the banks should return some of that to their depositors.