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Section: Economics

  • ECONOMICS

    What will rising interest rates mean for wealth inequality?

    • David James
    • 01 March 2022
    3 Comments

    Australia’s Reserve Bank mainly concentrates on keeping inflation within an acceptable range and maintaining a high level of employment. Social equity has never been considered to be part of its mandate. It should be. Interest rates have been the biggest cause of economic and social division in Australia, not just between rich and poor, but also between older and younger generations. 

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  • ECONOMICS

    The rise of the machines

    • David James
    • 31 January 2022
    5 Comments

    There is a great deal of commentary about the growing importance of artificial intelligence, or AI, especially in business circles. To some extent this is a self-fulfilling prophecy — if people think something will have a seminal effect then it probably will. But if the supposed commercial benefits are significant, the dangers are potentially enormous.

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  • ECONOMICS

    Best of 2021: Homelessness is caused not by poverty but by wealth

    • John Falzon
    • 04 January 2022

    When you put rising housing costs alongside stagnating wages, an alarming trend in normalising insecure work, persistent unemployment and underemployment, and statutory incomes that are going backwards in real terms, there’s good reason to be deeply worried about an increase in homelessness.

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  • ECONOMICS

    Best of 2021: Why corporatism, not capitalism, is the root of social harm

    • David James
    • 04 January 2022

    There really is no such thing as ‘capitalism’ — or rather there are so many capitalisms that the word is altogether too imprecise to be useful. A much better term to identify the problems, even evils, of modern developed economies is ‘corporatism’. This can be precisely identified and its transgressions and general harm are getting worse.

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  • ECONOMICS

    Why Australia’s rural sector is ripe for financial reform

    • David James
    • 06 December 2021
    1 Comment

    If Australia does draw back from globalisation — as opposed to trade, which will continue — then there should be more focus on our primary sector and how it could be better financed. Australia’s long history as a primary producer constitutes what economists call a ‘comparative advantage’: an economic area in which a country does best while giving up the least.

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  • ECONOMICS

    Climate change trillions

    • David James
    • 08 November 2021
    1 Comment

    The Glasgow United Nations Climate Change Conference has been advertised as an effort to focus on sustainable environmental solutions. What got much less attention, if any, is that it is probably at least as much about having a sustainable financial system. Many noted that China, did not send its leader: Xi Jinping, president of the world’s greatest CO2 emitter. There was also another significant absence: the financiers who are hoping to profit from the trillions allocated into climate change projects.

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  • ECONOMICS

    A strange financial circus

    • David James
    • 12 October 2021
    3 Comments

    Over the last two years, money printing has created the illusion of strength in savings. But when reality resurfaces, and actual returns are required from actual economic and business activity, the global financial system will come under extreme stress. 

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  • ECONOMICS

    The battle for the future of money

    • David James
    • 07 September 2021
    4 Comments

    There is a three-way battle looming over the future of money and the stakes could scarcely be higher. Conventional money, mainly debt created by banks — the ‘folding stuff’ is only a tiny proportion of the total — is in trouble. Total global debt is now so large relative to the world economy it cannot be serviced, which is why monetary authorities have resorted to dropping interest rates. When they almost hit zero, the next step was quantitative easing (QE): printing money by getting the central bank to buy back government and corporate bonds and putting them on its ‘balance sheet’. 

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  • ECONOMICS

    Labor’s embrace of Liberal tax policies leaves poor worse off

    • Chris Smith
    • 31 August 2021
    11 Comments

    In July, Anthony Albanese announced a significant change of stance on Labor tax policy which was disappointing, if not surprising. An elected Labor government, Albanese promised, would keep the coming high income tax cuts he previously opposed. This decision to not oppose the government proposal to restructure the income tax system through reduced marginal rates is supporting a government policy that will lead to a significant redistribution of wealth towards high income earners.

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  • ECONOMICS

    Why inflation isn't higher

    • David James
    • 12 August 2021
    4 Comments

    The biggest mystery of the financial markets is why, when the monetary authorities have been printing money with their ears pinned back, is inflation for the most part not a problem? What happens with inflation is crucial to the short-term survival of the whole system. Global debt, which is running at well over 300 per cent of global GDP, is only sustainable because interest rates are exceptionally low (the base rate in Australia is only 0.1 per cent). And interest rates are low because inflation is not a problem.

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  • ECONOMICS

    Homelessness is caused not by poverty but by wealth

    • John Falzon
    • 10 August 2021
    13 Comments

    When you put rising housing costs alongside stagnating wages, an alarming trend in normalising insecure work, persistent unemployment and underemployment, and statutory incomes that are going backwards in real terms, there’s good reason to be deeply worried about an increase in homelessness.

    READ MORE
  • ECONOMICS

    Why corporatism, not capitalism, is the root of social harm

    • David James
    • 06 July 2021
    16 Comments

    There really is no such thing as ‘capitalism’ — or rather there are so many capitalisms that the word is altogether too imprecise to be useful. A much better term to identify the problems, even evils, of modern developed economies is ‘corporatism’. This can be precisely identified and its transgressions and general harm are getting worse.

    READ MORE