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Treasury on emissions trading & the Australian economy

The Australian Treasury document Australia’s Low Pollution Future is a major study of the economics of greenhouse gas emission control for Australia.  It deserves a careful reading. In the main it argues that Australia gains some ‘first mover advantages’ from dealing promptly with climate change on the assumption that all countries will eventually control their […]

Bud Petal

This is experimental folk music with some class. Good lyrics, listen! Interesting stuff. I also liked this view of the talking chimp.

Thanks Bernd

Rudd’s politics

PM Rudd loves the dramatic gesture that has symbolic effect – ‘apologising’ to aboriginals for the claimed sins of our ancestors, ratifying the soon to be irrelevant Kyoto and, last weekend, posing for that inspiring snap of himself – shirt sleeves rolled up – ‘getting down to work’ with Ken Henry.  A man of action!

Unfortunately since […]

What’s happening?

Guest post by Professor Rabee Tourky, University of Queensland

These are interesting times for economists. I hardly know a serious economist whose attention in the past weeks has not been fixed on the changes in asset prices.

An emerging narrative is that for some years we have seen a bubble in US house prices, asset […]


An interesting story that I have known about for years – but which has only just resurfaced – oxycodone is replacing heroin as the drug of choice among former heroin users. It has most recently resurfaced at Sydney’s “Safe Injection Room” AKA the Labor Party shrine to Stupid Public Policy. Oxycodone is a opioid pain […]

Western European banks exposed to ’emerging markets’ bubble

Will Europe initiate a new wave of problems from the financial crisis? The focus is on the collapsing bubbles in emerging markets (and here) and their implications for what are mainly European lenders. London stocks crashed 5% again this morning as new dimensions of the current crisis became apparent.

This story, HT to commenter observa, is frightening.

“The financial crisis […]

Billy Connelly on ING?

Misdirected enthusiasm?

Thanks Bernd

Sell your house?

I noticed in today’s press that a large number of fairly expensive houses being put up for auction in my suburb yesterday and that all were passed in.  The story was much the same across Melbourne. A plausible guess is that either those with big mortgages are trying to ‘sell up’ in anticipation of a possible housing price […]

More on the economic crisis

I have been heavily involved in other things and too busy to make a comprehensive update on the crisis. My last long post on it took a lot of time to write – I presented some of the material at a La Trobe University seminar organised by the SRC and the radical group Socialist Alternative.


The end of free market fundamentalism not of the mixed economy

Capitalism these days does not resemble the ‘free markets’ model of it that is often conceptualised by its critics on the left. All economies have substantial public sectors – in Australia, for example, government absorbs about 1/3 of output produced. Therefore it is best to refer to ‘mixed economies’ which have dominant private sectors […]

Financial crisis, Australia & unknown unknowns

One of the refreshing incidental features of the current financial crisis is that many economists are displaying uncharacteristic humility. They don’t know what is happening and they know that they don’t know. Humble pie is also being eaten by supporters of theories that our real savings performance has been boosted by capital gains on the […]

George Soros on free market fundamentalism

This is an amazing interview with Soros.  A fan of markets he nevertheless sees deregulated financial markets as delivering a biased reflection of reality that generates booms, busts and bubbles.  The reason – too much credit, too much leveraging.  Free market fundamentalism is just as misguided an ideology as socialism.

Soros sees the current […]

Thursday bloodbath

I glanced at the All Ordinaries at 10-25 am today and the index had fallen just under 6% in 25 minutes. This is fearful stuff.  Last night the S&P on Wall Street fell 9% the biggest decline since 1987.  Oil prices have hit a low of $75-90.

The fear is that the US […]

Obama supporter by default

I find it hard to support war hero John McCain and his dud Vice Presidential candidate Palin.  But Obama is no shining angel either. 100 prominent US economists get stuck into Obama’s policies on tax and trade (a longer list is here):

‘Barack Obama argues that his proposals to raise tax rates and halt international trade […]


This is stunning, grotesque, entertaining.

Thanks Bernd I think

Rudd’s fiscal stimulus

Kevin Rudd’s $10 billion fiscal expansion package makes some degree of sense as a preemptive way of offsetting the impending effects of a (likely) impending international recession on the Australian economy. This move will complement the recent interest rate cut and the dramatic decline of the Australian dollar as a means of stimulating the economy.

Under […]

Nationalising banks or boosting their liquidity & restoring trust

John Quiggin seems enthusiastic about the prospects for more ‘utopian’ society with government-controlled major banks.  As much as I am deeply concerned with the very recent claims of imminent global financial peril I do not share his enthusiasm for this at all. Governments might well wish shore up the capital base of large banks in Europe or […]

A comment on Aussie equity markets

Equity markets around the world have fallen dramatically over the past week as fear of the next financial disaster or just fear of the pure unknown has taken hold.  I have no idea what will happen or how long the current crisis will prevail – indeed I am unconvinced anyone does – but I have […]

Immigration & Labor

One of the most despicable anti-Australian policies of the Hawke-Keating era was the devotion to bring many unskilled immigrants into Australia under the guise of the ‘Family Migration’ Program to bolster Labor’s standing with the ethnic lobbies.  Whenever the global economy faltered the Labor Party pursued high immigration targets based on the ‘family’ program to bolster its re-election […]

Grim news & a cheer-up

This quote from the Times Online just about says it all:

‘Interest rates across the world were slashed yesterday as central banks took unprecedented emergency action in an effort to contain the worst economic threat since the Great Depression…..

….The extraordinary level of coordination was designed to demonstrate resolve in the face of financial panic but […]