A Big Australia and the problem of #FakeInvestment: A note for Dr Andrew Leigh

Macrobusiness reported the latest ABS release on demographics.

“…….The ABS released its Australian demographic statistics for the March quarter of 2017, which revealed that Australia’s overall population growth rate has accelerated led by unprecedented growth in Victoria, which has once again obliterated records.

According to the ABS, Australia’s population rose by 1.61% in the year to March 2017 to be way above the 30-year average:…..”

389,100 new people last year.

If nearly 400,000 sounds like a lot that is because it is.

To give that figure some context check out the demographics for the USA between 1790 and 1890.

The population grew from about 3 million to 62 million. Continue reading

The end of Oz car manufacturing – “Mission Accomplished” by the LNP, RBA and APRA

So the end of Australian car manufacturing has arrived with closures of both the Toyota and Holden plants to take place by the end of October.

Next year Australians will buy close to 1,200,000 vehicles at a cost of approx $40B (assuming each car costs approx $30,000) and they will all be imported from our trade rivals like France, Germany, England, USA, Italy, Sweden, Japan, Thailand, Korea, China, Russia, Austria and all those other countries that reckon maintaining heavy industry and manufacturing skills is a very good idea.

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Build to Let: The latest non-solution to a problem that should not exist.

The Australian Financial Review has been providing a lot of ‘supportive’ coverage for the promoters of the new  “Build to Let” housing model.

Now that it appears that Mr Scott Morrison is not keen on the ideal of handing out tax breaks to make “Build to Let” viable there have been howls of outrage from the hopeful rent seekers as their dreams turn to ashes.

To some extent the howls are understandable as Mr Morrison is usually very keen to promote asset price speculation with tax incentives like capital gains tax discounts for those mythical average “mum and dads” just trying to “get ahead”. Continue reading

Is Australia becoming a colony again? And who is the coloniser?

Colonialism is often in the news and as a ‘former’ colony Australians might have some sympathy for the Indian perspective presented by Shashi Tharoor for the affirmative side of this debate “Does Britain owe reparations”.

Or do we feel that although Australia was a colony of Britain for over one hundred years between 1788 and 1900 it was not like the other British colonies. Continue reading

APRA and credit creation regulation: Economic secret business

It is that day of the month when the RBA board meets to pluck some wings off bats, boil them with eyes of newt and distil the resulting mixture down to an interest rate decision.

Across the nation thousands pay close attention to every aspect of the

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deliberations and complete secrecy is maintained to ensure that everyone gets the news at exactly the same time.

But what about APRA and its regulation of credit creation by the Australian Banking sector?

Good question because while the RBA has a spotlight on every action it takes, APRA engages in regulation of economic activity, that has equally important effects on the Australian economy, in almost complete darkness.

Continue reading