So the government does a $150 billion bond sale (borrowing)RBA...

  1. 6,836 Posts.
    lightbulb Created with Sketch. 354
    So the government does a $150 billion bond sale (borrowing)
    RBA buys $150 billion, (QE printing)

    Now, the RBA could one day sell those bonds but highly unlikely

    The government receives $150 billion from the bond sale knowing it doesn't have to pay it back

    Australia is a strong currency, so their won't be any inflation spikes

    The government won't have to increase taxes but will have to increase pay to public servants

    The government spends $150 billion into the economy, keeping the economy going and unemployment stable

    The RBA owns $150 AUS bonds, forcing interest rates to fall

    If I was the RBA, they could afford to spend another trillion dollars subsiding the federal budgets over the next 10 years !

    QE is also very good for the sharemarkets !

 
arrow-down-2 Created with Sketch. arrow-down-2 Created with Sketch.