7. Jul, 2017

Economic collapse is it imminent?

I have spent the 2 months  since the budget looking at this and studying worldwide effects and problems …One word Yes … how bad will it be … not catastrophic, but here is a quick summary:

Up to 20% of new home buyers will be in trouble and could probably default on their mortgages.

Business will be at its lowest confidence in 3 decades. Wages and employment growth will not meet targets.  Don’t expect renewables to save us we have already missed that boat. But the fact is that renewables could never save us anyway.

We are already in Austerity measures with the poorest and most disadvantaged paying dearly.

Technology advances are out stripping jobs development training and employment. We are already at a technology lag and falling further behind having spent much on outdated and non-productive infrastructure.

Our economy can only shrink based on 2 factors, jobs growth and credit ratings.

Why could this happen? … another quick summary:

Too many Government change overs and a lack of policy direction…this can be blamed squarely on 2 party politics and both the ALP and LNP are to blame.

The mechanism for raising capital is constantly low… ie: bonds are being issued now at a take up rate that is not being met.

Worldwide credit rating are taking a battering and we are not exempt… it is possible we could climb to $1T in debt ceiling within 3-4 years.

An on flow effect is using short term monetary policy to fix what may be unfixable with monetary strategy.

Another on flow effect is that corporate debt is becoming unobtainable and expensive… a double whammy!

Real cash and assets are now being valued less that paper and e currency. You could call this a false economy!

Policy, especially Fiscal policy could be flawed by using estimates that may not be achievable… note: estimates have an up and down value, however if those values are exceeded especially downward the exponential long term damage is very large indeed.

China, the unknown skeleton in the closet!

I am more than happy to talk about it with anyone who wants to have a sensible conversation.