#Glaring ALP policy failure And what have I been saying for months about China? And how stupid no ludicrous the RSPT and later version the MRRT is?
"Mr Argus has done a stress test on the federal budget and says a fall in the terms of trade - the difference between the price we get for our exports and imports - of just 5 per cent more than Treasury has forecast would wipe out this year's forecast surplus of $1.5 billion two times over.
The warnings came as head of the Treasury's macro-economic division David Gruen confirmed that the terms of trade - which had hit record levels because of China's demand for resources - had probably peaked. Dr Gruen said in a speech yesterday that the terms of trade were "likely to work against us in future, rather than for us"
COMMENT
1. Don Argus is ctitical of both sides however the ALP is in power (sort of) at present so this is aimed at them. If this was Abbott in power and the Libs were failing I would be doing the same thing - I vote for Australia not politicians.
2. Finally ............the lagging indicators have caught up with what traders could see for a very long time using leading indicators and CURRENT CONDITIONS which can be extrapolated into the future using knowledge and by joining the dots.
Yeldub claimed the lagging indicators are the only way to go - rubbish. Business has to budget and formulate strategy using the past & present to measure trends, and look at market forces to work out if the trends will continue or reverse.
I am not going to look up the quote he lifted from the RBA because it is not even worth repeating (ditto KPI's). End up in the wrong place if you look forward - words to that effect. What he is doing is living in the past not the present or adjusting for our future - all because of lagging indicators! All because of the lack of ability to join the dots. Laziness to just crunch the numbers - and damn foolish.
It is glaringly stupid IMO to limit discussion and policy to the past. It displays extreme hubris to argue with those who can look forward and ROFL and LOL at them / me when they / I make these correct predictions - e.g. rates.
