Warren Hogan who I remember from the financial markets but has now followed his illustrious father into academia has kindly written an article along these lines.
Obviously the largest threat that can be viewed is a US/Sino trade war. Here we simply do not know the reaction of Donald Trump/, In some ways he reminds me of Mussolini. He is a shallow 'strong man'. He thinks you can win trade wars and tarries are paid for by the importing country.man.
On the first John Quiggin shows the way. On the second Trump obviously has no idea.
Whilst Menzie Chinn examines who might win in terms of pay-off matrices It is very hard for either side to 'appear weak in this dispute. We must not discount given Trump simply does not understand the costs of a trade war he could easily over-rule his negotiators because he appears to have given too much away. We should be scared. Very scared. Very late Tyler Cowen on who-loses-most-from-the-u-s-china-trade-war
In case the worse happens we have how-design-to-a-stimulus-package
Whoopsy. I should have mentioned Morrison's tax cuts way into the future. The Grattan Institute have examined these cuts and found very stringent spending cuts are needed for the budget figures to be even feasible. No government has ever been able to cut spending consistently by this much.
Why was this done by the Government? Because they put all the figures into the never never where Treasury simply makes projections. My thinking is if they win the election then they will worry about this problem. Perhaps let tax rise as a % of GDP??
Double Whoopsy
Read this from my old mate Ricardian Ambivalence on financial-stability-and-mortgage-dynamics abd you get grey hair!
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