- 6 October 2016
Monetary Policy Decision
Watch my response to the RBA’s Monetary Policy Decision in my latest video
https://www.youtube.com/watch?v=ToStqxPTrv8&rel=0
On hold yet again...
As you know the Reserve Bank of Australia, as we predicted, sat on its hands and took no action to help the economy and jobs at its October meeting. I believe it has breached its charter in doing so. This calls on the RBA to maintain full employment - that's a sad joke! It's also called upon to increase the living standards of Australians - another joke! With constant falling savings, disposable income and wage growth.
What stunned me was the media comment that followed the RBA decision. They all nodded in unison that the RBA was waiting for the inflation figure to be released in October, believing this would have a bearing on their decision in November! This is an indictment on the RBA and their 400 economists and 600 research staff. Others are saying they are waiting on the property growth in Sydney and Melbourne - this means that they can't see this market is built on supply and demand, not on a national interest rate setting.
Nowhere in the policy statement or comments did I see discussion on the two major economic issues of concern.
10% of our people are unemployed or under employed - one in ten! Consumer spending that drives job creation is in sharp decline. In fact if you read the RBA minutes, they are in cloud cuckoo land. They believe that all is well in the job market and in the retail economy.
All this adds up to a sound argument to reverse Howard's decision to give the RBA autonomy. Put it back under the control of our elected representatives. Representatives who can be held accountable at anytime, create movements. Representatives who can talk to the media in clear concise language and set out a fine future path that people can follow. Central banks that have been formed have deserted this logic. They prefer to talk in gobbledygook and give no forward direction. Our redundant bank should be folded back into government. What do you think?
Kevin Young
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