RBA needs -1% cash rate or $200bn QE to meet econ targets

Discussion in 'Property Market Economics' started by Waterboy, 2nd Oct, 2019.

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  1. Waterboy

    Waterboy Well-Known Member

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    According to our friends at Goldman Sachs, the Reserve Bank's internal economic model suggests they will need a cash rate of -1% per cent would unleash a $200 billion bond-buying stimulus to achieve its unemployment (4.5%) and inflation (2-3%) targets.

    But because the RBA would hesitate to go negative on the rates, they will probably unleash QE instead.

    Read More: Goldman pegs potential RBA bond buying at $200b
     
    Waterboy, 2nd Oct, 2019
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  2. Archaon

    Archaon Well-Known Member

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    Subscriber wall.
     
    Archaon, 2nd Oct, 2019
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  3. rksing

    rksing Well-Known Member

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    Refresh the AFR page, but press stop before the Java script has time to load.
     
    rksing, 3rd Oct, 2019
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  4. ollidrac nosaj

    ollidrac nosaj Well-Known Member

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    If the gov keeps up it's agenda of wage depression and voodoo economics, QE and zero rates are a certainty.
     
    ollidrac nosaj, 3rd Oct, 2019
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  5. croseks

    croseks Well-Known Member

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    You are the real MVP.
     
    croseks, 3rd Oct, 2019
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  6. dragon

    dragon Well-Known Member

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    So Aus will not have recession this time. Is that correct?
     
    dragon, 3rd Oct, 2019
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  7. Waterboy

    Waterboy Well-Known Member

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    let me get my crystal ball...
     
    Last edited: 3rd Oct, 2019
    Waterboy, 3rd Oct, 2019
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  8. hash_investor

    hash_investor Well-Known Member

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    Balls of crystal...
     
    hash_investor, 3rd Oct, 2019
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  9. Waterboy

    Waterboy Well-Known Member

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    Danke schön!
     
    Waterboy, 3rd Oct, 2019
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  10. ollidrac nosaj

    ollidrac nosaj Well-Known Member

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    Maybe,. the government has well and truly lost control of the economy and QE is a last resort "Hail Mary".If implemented will come with a host of negative side effects and new economic risks:

    The Consequences of Quantitative Easing
     
    ollidrac nosaj, 4th Oct, 2019
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  11. Codie

    Codie Well-Known Member

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    All I read out of that is don't save. Buy property.
     
    Codie, 4th Oct, 2019
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  12. ollidrac nosaj

    ollidrac nosaj Well-Known Member

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    Sure:D, as long as you still have a job to pay for it and your wage after inflation still covers the costs.
     
    ollidrac nosaj, 4th Oct, 2019
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  13. C-mac

    C-mac Well-Known Member

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    It's funny, even if mass-QE results in cheaper/negative interest rates; the money an investor saves in the interest repayment portion of holding an investment property, would probably be offset by a ramp-up in costs of all the other holding costs (council water strata maintenance etc.) that was a direct result of QE causing massive inflation in these items!
     
    C-mac, 7th Oct, 2019
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  14. Perthguy

    Perthguy Well-Known Member

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    We have had 'emergency' interest rates for 10+? years. Did this government ever have the economy under control?
     
    Perthguy, 16th Mar, 2020
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