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07/08/24
11:22
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Originally posted by daicosisgod:
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Chalmers is clueless as to how business operates and how decisions are made in the real economy. Fancy believing giving a cost subsidy for electricity, asking nothing in return, is not inflationary. Inflation means more money chasing the same level of goods produced. So when we hand out money(elec subsidy) we have more money chasing then same amout of goods produced = inflationary. The only exception is if all those that receive the subsidy never spend it, perhaps save it or pay down debt. I know for a fact Chalmers is not saying this. Therefore Chalmers is clueless on the basics of economics.
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The RBA's commentary is that it expects the subsidy to lower the CPI in the period to June 2025, before it rises slightly when the subsidy expires. There's an artifice to the way the CPI is lowered, so not sure how they factor that in.