1. high exchange rate for decades to come = high interest rates = more govt revenue, so does this mean the $500B deficit we be gone faster than forecasted?
2. Our economy is doing well all thanks to the asians :)
3. Bottomline is, will this affect us at all when we enter the workforce?
1) What is the relationship between commodity prices, the terms of trade and demand for Australian exports?
2)"The more goverments seek to prevent structural change however, the more inflation prone the economy will become, the higher interest rates will need to be and the more recessions we'll have".
WHY IS THIS?
3)Which economies have suffered Dutch Disease in the past and if so why?
If Australia's trade relies heavily on commodities over the next few years, wouldn't this result in large fluctuations in the size of the CAD (since Australia's trade relies on natural resources)?
"Higher interest rates relative to what we're used to" - Home owners won't be very happy... Especially after the banks increasing their rates more than the increase in the OCR.
How come the economy becomes more inflation-prone if the government seeks prevent structural change? Why would the governemnt seek to prevent structural change?
1) structural change is great! 2) I thought structural change meant that an economy could diversify their export base? In this article, it just seems like the mining sector is prospering. Is this safe? 3)"life's likely to be pretty tough for the rest of the tradeables sector"- With this in mind, and with the booming of the mining industry (primarily), will this bring more good than harm?
1. CAD will continue to increase.
ReplyDelete2. Net income deficit --> Structural component of BoP.
3. Australians are still bad savers.
1. What is cognoscenti?
ReplyDelete2. Would we be in the same situation/ pretty bad if it wasn't for China/India?
3. Article state "there isn't a lot governments could do to stop that". What're the remaining governemnt intervention?
1. high exchange rate for decades to come = high interest rates = more govt revenue, so does this mean the $500B deficit we be gone faster than forecasted?
ReplyDelete2. Our economy is doing well all thanks to the asians :)
3. Bottomline is, will this affect us at all when we enter the workforce?
1. The reason for our impressive strength in the dollar is because of the resources boom.
ReplyDelete2. The $A falls and rises with the fluctuations of commodity prices and our terms of trade.
3. The Dutch disease significantly reduces our international competitiveness of other export and import competing industries.
BONUS QUESTION
4. WHY ARE YOU LEAVING SIR?!?!?!?! :(:(:(:(
1. Dutch disease? ahaha
ReplyDelete2. Structural change is a necessity to prevent more economic downturns.
what will australia rely on if resources such as minerals, being one of our biggest exports, are no longer available to sell?
ReplyDeletebuying shares in australia is safe because of our good credit rating
we trade with china because like india it is one of the fastest developing countries in the world.
1) What is the relationship between commodity prices, the terms of trade and demand for Australian exports?
ReplyDelete2)"The more goverments seek to prevent structural change however, the more inflation prone the economy will become, the higher interest rates will need to be and the more recessions we'll have".
WHY IS THIS?
3)Which economies have suffered Dutch Disease in the past and if so why?
If Australia's trade relies heavily on commodities over the next few years, wouldn't this result in large fluctuations in the size of the CAD (since Australia's trade relies on natural resources)?
ReplyDelete"Higher interest rates relative to what we're used to" - Home owners won't be very happy... Especially after the banks increasing their rates more than the increase in the OCR.
How come the economy becomes more inflation-prone if the government seeks prevent structural change? Why would the governemnt seek to prevent structural change?
1) structural change is great!
ReplyDelete2) I thought structural change meant that an economy could diversify their export base? In this article, it just seems like the mining sector is prospering. Is this safe?
3)"life's likely to be pretty tough for the rest of the tradeables sector"- With this in mind, and with the booming of the mining industry (primarily), will this bring more good than harm?