Hi K8, interest rates can't be cut because of inflation.
If America suddenly recovers strongly, we are in even more serious trouble. Sounds odd, but it's true. Commodities prices will goes through the roof: steel, aluminum, oil, building materials.....
If we cut rates, the AUD will crash, pushing inflation up even more with import prices rising.
America can cut rates to zero because they are suffering from deflation. In fact the fact is printing money furiously trying to get some inflation going.
We are caught between a rock and VERY HARD PLACE. Sorry.
