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Business Spectator Column
This week’s Business Spectator column. If you would like to receive an unedited version by email on Fridays, let me know and I will put you on the distribution list. Email info at institutional-economics dot com.
posted on 03 May 2008 by skirchner
in Economics, Financial Markets
(2) Comments | (0) Trackbacks | Permalink | Main
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Comments
Fiscal policy has been and will remain irrelevant to inflation and interest rate outcomes, which are a function of loose monetary policy and developments in global capital markets.
Ok, so lets say Swannie decides to hand back the entire surplus as tax cuts. I struggle understand how injecting $20 odd billion into the economy would not have some inflationary impact.
Posted by on 05/03 at 11:24 AM
Alternatively, if the Govt was really serious about reducing inflation (ie. excess money in the economy) it could take that $31bn and simply destroy it!
Set up a big bonfire in front of Parliament House.
Posted by on 05/06 at 11:52 AM