I have been struck since the budget by economists saying really stupid things.
The budget was mildly expansionary. to say it would worsen inflation when the economy is slowing quite markedly was very stupid to say the least. GNE at 1.75% is not going to boost inflation
Refusing to acknowledge inflation is a lagging indicator is the same. If you believe inflation is so entrenched a recession is needed then say so. Angus Taylor is a politician so I expect nonsense from him but if you say the government should get rid of the structural deficit then admit this will oproke a recession.
As it is the budget is perhaps right on the money in helping australia avoiding a recession.
I have said it before it is very hard to to budget repair once the central bank starts raising interest rates, I agree with Ken Henry that the budget should be in surplus when this occurs however the previous coalition government did nothing with regard to budget repair.
The rise in interest rates have done their job and the economy is slowing. Both the government and the RBA have to be very wary now
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