{"id":14546,"date":"2011-05-18T17:19:00","date_gmt":"2011-05-18T07:19:00","guid":{"rendered":"https:\/\/billmitchell.org\/blog\/?p=14546"},"modified":"2011-05-18T17:19:00","modified_gmt":"2011-05-18T07:19:00","slug":"calling-planet-earth-they-will-print-low","status":"publish","type":"post","link":"https:\/\/billmitchell.org\/blog\/?p=14546","title":{"rendered":"Calling Planet Earth – they will print low"},"content":{"rendered":"

\t\t\t\tMore rate rises on the way: economists<\/a> – where various “leading” bank economists were interviewed about the release of the minutes from the last month’s Monetary Policy Meeting of the Reserve Bank Board<\/a> and the pending release of today’s wage cost data from the Australian Bureau of Statistics. I heard that we are facing rising wage pressures which would force the RBA to hike interest rates soon and that increased fiscal rectitude was required to ease inflationary pressures. I checked the station to make sure I wasn’t receiving some short-wave radio station from an unknown planet somewhere. As it turned out I disagreed with everything my bank colleagues said which is no surprise. But I decided then to call today’s blog – “They will print low” – which was part a reflection of the opaque jargon these bank economists use to convince themselves that they have something important to say and partly my forecast for today’s wage data.\n\nHere are a snippet from last night’s ABC PM segment that I linked to in the introduction:\n\n\n

\nJournalist: … David de Garis, senior economist with the National Australia Bank. He says it’s wages that are causing the biggest headache for the bank.\n\nDAVID DE GARIS: We’ve already seen wages growth pick up to just under 4 per cent over the past year or so and signs are there with the unemployment rate pushing down through 4.9, through 5 and to 4.9 per cent that going forward we expect even more pressure on wages.\n\nSo that’s pressuring business costs and we’re likely to see some increase in the inflation rate over the next year to 18 months.\n\nDAVID TAYLOR: It’s such a big concern that some economists are calling for a change to immigration policy.\n\nCommSec economist, Savanth Sebastian.\n\nSAVANTH SEBASTIAN: You need to start … increasing the size of the labour force or the workforce and to do that skilled migration in the short term is the key driver on that front.\n\nSo I think from that perspective you want to see tight fiscal policies so there’s no stimulatory factors to the economy, tight spending from the Government and an improvement in skilled migration. That will help to alleviate some of the pressures on the Reserve Bank.\n\nDAVID TAYLOR: In fact figures out tomorrow morning will give analysts a picture of just how much pressure the labour market is putting on inflation.\n\nDAVID DE GARIS: But yeah it depends on the flow of data. For instance tomorrow we’ve got the wages numbers for the March quarter as well as consumer sentiment and skilled vacancies data. So there is the potential there to add a little bit more to the picture, particularly the wages numbers which we think will probably print on the high side.\n<\/blockquote>\n\n\n\nSo here we have some bank economists – who represent private corporate interests only – presenting themselves as experts on the economy and informing the public (it is a national program) that:\n\n\n