Interest rate cuts, more money for us! (2 Viewers)

[Wheelbarrows]

Your options:

(1) Pay some maladjusted hack from bos to feed you halfbaked misunderstandings.

(2) Avail yourself of the mass of free information available on the internet.

DUDE! she's hot!

 

[housah0lic]

What specifically do you want to know about, anyway?

i'm just lonely and want some company




..


actually that's a good question
i don't even fucking know
like i do want to know what state we're in and why
i know what recession is and all that basic shit.. but i'm curious as to why this and why that is you know what i mean?
and i like to gather peoples opinions and shit and i understand more when i talk about something rather than doing research on my own.

 

[Wheelbarrows]

i'm just lonely and want some company




..


actually that's a good question
i don't even fucking know
like i do want to know what state we're in and why
i know what recession is and all that basic shit.. but i'm curious as to why this and why that is you know what i mean?
and i like to gather peoples opinions and shit and i understand more when i talk about something rather than doing research on my own.

the reason the reserve bank cuts interest rates is to give ppl more money. when ppl have more money, they spend more. that increates aggregate demand. and BANG! economic activity rises and everything becomes better.

am i right trefoil?

 

[sthcross.dude]

the reason the reserve bank cuts interest rates is to give ppl more money. when ppl have more money, they spend more. that increates aggregate demand. and BANG! economic activity rises and everything becomes better.

am i right trefoil?

You are not right.

Think about it, where does the reserve bank's money that it "gives to people" come from? You can't get something for nothing.

and fyi she is somewhat above average but nothing amazing.

 

[Wheelbarrows]

You are not right.

and fyi she is somewhat above average but nothing amazing.

that's all that 2 years of hsc economics has taught me. correct me?

 

[Trefoil]

the reason the reserve bank cuts interest rates is to give ppl more money. when ppl have more money, they spend more. that increates aggregate demand. and BANG! economic activity rises and everything becomes better.

am i right trefoil?

Pretty much.

But the reserve bank doesn't do it any old time. During an economic boom, they want people to have less money so they spend less, otherwise inflation gets out of control and the economy crashes.

 

[Wheelbarrows]

Pretty much.

But the reserve bank doesn't do it any old time. During an economic boom, they want people to have less money so they spend less, otherwise inflation gets out of control and the economy crashes.

yeah, i know that. business cycle ftw.

 

[Trefoil]

You are not right.

Think about it, where does the reserve bank's money that it "gives to people" come from? You can't get something for nothing.

and fyi she is somewhat above average but nothing amazing.

Um. The reserve bank isn't giving people money. It's making them pay less interest per month on mortgages.

 

[housah0lic]

i just saved 15 bux.


what's your name sthcrossdude?

 

[jb_nc]

Im actually zimmerman8k. Iron banned me for advocating CP.

What's wrong with computer pictures?

 

[withoutaface]

We need a recession and higher interest rates to restore us to an economy based on savings and capital investment rather than unsustainable consumption of foreign goods.

Tsup Paul Keating

 

[sthcross.dude]

Tsup Paul Keating

moar like ron paul yo.

you know im right.

 

[housah0lic]

offer's back on the table.

 

[withoutaface]

Um. The reserve bank isn't giving people money. It's making them pay less interest per month on mortgages.

It's lending them money. Same as giving in this instance.

 

[Trefoil]

I was expressing it in his faulty terms. But how does the RBA make them pay less. By magic?

No. It increases the supply of money. So the wealth of everyone who holds money is diminished.

Oh? I thought rate cuts were a formula thing - disparate from increasing cash supply (which is done in a different situation - to prop up currency)?

That is: rate cuts are not retroactive or anything. Increasing supply of money is.

I agree with your fundamental assertion that we need to seriously consider where the economy is heading, though, and plan it more careful than "let it grow and grow and consume and consume till it pops".

 

[Trefoil]

It's lending them money. Same as giving in this instance.

Really? Because I thought it was increasing liquidity, in the sense that it makes borrowing easier.

 

[sthcross.dude]

offer's back on the table.

better offer plz.

 

[housah0lic]

dude i offered you coffee, money and time.

what more could you want.

 

[Trefoil]

dude i offered you coffee, money and time.

what more could you want.

Random trivia: the reason Australia probably won't go into recession dispite the fact that the rest of the Western world is, is because we're a commodity economy.

That is, we're one of the few developed countries which still has significant natural resource and agriculture capabilities. The other one is Canada. Norway would count except it's all oil - no diversification, and a far more volatile commodity than minerals.

Because of this, we rely significantly on countries with little financial industry infrastructure (developing countries), and thus less to be damaged by America's crash (basically: they're too shit for this crisis to hurt them). Countries which will continue to grow fairly strongly despite a recession in the developed world will thus continue to want our food and metals at a fairly similar rate as before.

Yeah.

 

[sthcross.dude]

dude i offered you coffee, money and time.

what more could you want.

I want the abuse to stop.