It's Wednesday and today I consider the current yen situation which is causing some hysteria…
Letter from The Cape Podcast – Episode 9
Episode 9 for my – Podcast – Letter from The Cape – is now available.
Qu’ils mangent de la brioche – Let them Eat Cake. The rally cry of the elites when confronted with the reality that the peasants in France did not have any bread to eat. In this episode we examine modern variants of that disdain that the elites have for the workers, the poor, and for those who struggle to make ends meet. We consider how the unelected and largely unaccountable RBA Board is deliberately attempting to push up unemployment in their misguided policy attack on inflation. All manner of excuses are being given to justify this attack on the living standards of the disadvantaged while nothing is being done to modify the outrageous salary increases of the bosses that have been recently publicised in the media. It is Australia’s, let them eat cake moment.
Duration: 8:14
“All of which is unnecessary given that inflation is falling anyway because the factors driving it, which are not sensitive to RBA interest rate hikes, are abating.”
This pushes me towards the belief that the Federal government and the RBA should do nothing in the current situation because inflation is abating.
What I understand of MMT is that it preferences fiscal policy over monetray policy. But fiscal tools (taxes, government spending) have longer lag times than monetary tools (like interest rates).
What are the fast acting policy tools of MMT when crisis situations arise?
To avoid crisis situations, do we give the Federal Government permanent price and wages control powers i.e. like those proposed by the Whitlam government in the failed 1973 referendum, and a return to centralised wage fixation?
Having survived the inflation/unemployment periods of the 70s, 80s and 90s, I fear a return of those times. I think unemployment is a social evil. My interest in looking at alternative economic theories is to avoid unemployment.
@Sergio
I’m not sure how long you have been reading Bill’s blog, but he does have a pretty well-worked out theory relating to avoiding unemployment. Just type “job guarantee” in the search box at the top of the page.