Dose

The Budget

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The libs have received a bounce for apparent largesse. The 100% deduction was always available over the longer time frame. They've simply pulled demand forward as your point 2 asserts. Coincidentally, it ends just after the next scheduled election.

 

It will be rorted as much as is possible. But not as much perhaps as those without a basic grasp of economics suspect. The rorters need to have the cash flow and pay enough tax to benefit. The tax office threats are impotent. They have just sacked a bunch of watchers so their ability to enforce law is reduced.

As much as I'd like to shoot Tony and stab Jockey I think it's an appropriate budget for today. 

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As much as I'd like to shoot Tony and stab Jockey I think it's an appropriate budget for today. 

 

As a Keynesian you'll get no argument from me. The economy seems to be tanking. I'm already hearing why the RBA should further lower rates. And why APRA should and is introducing controls. The difference between the parties is only measurable in microns. It's a liberal wet dream of a labor budget. It's benefit I suspect is coincidental to the libs gaining a second term. Mind you shorten is utterly failing to inspire...

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As much as I'd like to shoot Tony and stab Jockey I think it's an appropriate budget for today. 

 

It isn't. It another attempt to insert cash into the economy but refusing to pass it to the general public by raising the Newstart allowance.

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It isn't. It another attempt to insert cash into the economy but refusing to pass it to the general public by raising the Newstart allowance.

The general public don't receive the dole. However I do think the dole is low and should be increased. What is it? $250pw for a single? In Brisbane you can rent a room for ~120pw, furnished and utilities included. That leaves $130 for everything else. Hardly living like a king. 

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The general public don't receive the dole.

 

It is now a fact that the monetary system is a trickle up system. By increasing the dole you insert the money at the bottom of the pyramid and from there it trickles up through every person within the pyramid. By giving it to small business you insert the money at the half-way point of the pyramid and from there it trickles up through every fifth person within the pyramid.

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It is now a fact that the monetary system is a trickle up system. By increasing the dole you insert the money at the bottom of the pyramid and from there it trickles up through every person within the pyramid. By giving it to small business you insert the money at the half-way point of the pyramid and from there it trickles up through every fifth person within the pyramid.

We're talking about fiscal, not monetary policy. 

 

Increasing the dole (which I've stated I agree with - on equity, not economic grounds) is a permanent and real increase in govt expenditure. Paying unemployed an extra $30 a week for ~600k people will certainly provide some stimulus but it's not going to boost confidence.

 

Accelerated depreciation only costs the govt the time value of money, and is a time limited policy. It applies to double the amount of people on newstart. The govt receives less revenue this year and more in year 4+. It boosts confidence and creates/retains jobs. 

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Capital investment: Economic outlook slips "from bleak to recessionary"

 

 

Two weeks after the budget, Australia's economic outlook is bleak.

 

Mining as well as non-mining firms are planning to slash investment in the year ahead, cutting total investment spending by 21 per cent.

The Bureau of Statistics survey conducted in April and May is at odds with the budget forecast of a lift in non-mining investment.

The survey of chief financial officers shows mining firms expect to cut investment 34 per cent, manufacturing firms 24 per cent, and other firms 6.1 per cent.

"The rotation away from mining investment that seemed to be progressing over the past year is no longer advancing," said JP Morgan economist Stephen Walters. "Firms outside resources actually have downgraded their spending intentions after adjustment for the usual estimation errors. They are in no position to offset the even steeper fall by mining firms."

UBS economist George Tharenou told clients the outlook had switched "from bleak to recessionary".

"The capital expenditure cliff has arrived early," he said. "This data is so bad it would worry the Reserve Bank and raises the risk they will cut rates again ahead."

In Parliament, Treasurer Joe Hockey said the data was "disappointing" but the $20,000 instant asset write-off in the budget would make a difference for small businesses.

 

 

But it's all A-OK as the immediate tax write offs signal a burgeoning of the good old animal spirits... Small business will shoulder the burden.

 

Small business are responsible for 50% of employment but can they drive employment in an economy where the big players are downsizing?

 

 

RBA stats on small business...

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On 14/05/2014 at 9:13 AM, zaph said:

First home saver accounts are being dumped.

And now they're back!

Quote

 

First home buyers will receive preferential tax treatment in the budget to enable them to save for a deposit, but caps will be imposed to limit the pressure on house prices and to avoid costing the government too much revenue.

After days of speculation, sources have confirmed the Coalition will introduce its own version of first home saver accounts which will essentially resemble a superannuation account.

First home buyers will receive concessional tax treatment on contributions by being able to salary sacrifice, and the earnings will also be taxed at a concessional rate.

There will be caps on the amount that can be contributed annually and an overall cap on the size of the fund. There will be no age limit on who can set up such a fund but it can only be used for the purchase of a first home.
Read more: http://www.afr.com/news/budget-tax-breaks-for-first-home-buyers-20170504-gvyy39#ixzz4gXi6YHUv 

 

 

They weren't popular last time. What makes Trumbull think it will be different this time?

Oh that's right, it's all about appearing to something and actually doing very little. 

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6 minutes ago, zaph said:

Oh that's right, it's all about appearing to something and actually doing very little. 

Precisely - all about lip service.

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1 hour ago, cobran20 said:

Precisely - all about lip service.

"Today I announce a raft of policy measures that will half the price of all houses in Australia."

This is what housing affordability is. Lower prices - no one wants to say that. Can't see any politician making that statement. It would be economic and political suicide. Any caring and realistic local member would want zero or little price growth.

If housing is unaffordable then by how much? 30%? - It would take a good decade of no growth for wages to catch up. Maybe some good olde 70's inflation (just not in house prices) might do the trick.

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1 hour ago, zaph said:

"Today I announce a raft of policy measures that will half the price of all houses in Australia."

This is what housing affordability is. Lower prices - no one wants to say that. Can't see any politician making that statement. It would be economic and political suicide. Any caring and realistic local member would want zero or little price growth.

If housing is unaffordable then by how much? 30%? - It would take a good decade of no growth for wages to catch up. Maybe some good olde 70's inflation (just not in house prices) might do the trick.

They'll rather wait for the next recession to do the dirty job for them. Then they can say not our fault, yet their economic policies largely caused the downturn.

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3 hours ago, zaph said:

And now they're back!

They were pretty popular in the clown household. :) Especially after they changed them so that they didn't go into super after expiring.

Quote

They weren't popular last time. What makes Trumbull think it will be different this time?

Oh that's right, it's all about appearing to something and actually doing very little. 

I likely won't be different this time. It requires substantial income to take full advantage of game said accounts. In the absense of _actually_ doing something about CGT discounts and NG they are a consolation prize for the base.

 

Quote

"Today I announce a raft of policy measures that will half the price of all houses in Australia."

This is what housing affordability is. Lower prices - no one wants to say that. Can't see any politician making that statement. It would be economic and political suicide. Any caring and realistic local member would want zero or little price growth.

If housing is unaffordable then by how much? 30%? - It would take a good decade of no growth for wages to catch up. Maybe some good olde 70's inflation (just not in house prices) might do the trick.

You mean like this non-answer. The question was about NG yet the answer mentioned the term zero times.

Q&A

The truth is that 64% of the country have a vested interest in property prices forever rising. The concern is hand wringing.

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1 hour ago, cobran20 said:

They'll rather wait for the next recession to do the dirty job for them. Then they can say not our fault, yet their economic policies largely caused the downturn.

The next recession will be exacerbated by household debt. And you're correct that they will say "No-one could have seen this coming"

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2 hours ago, staringclown said:

You mean like this non-answer. The question was about NG yet the answer mentioned the term zero times.

Q&A

The truth is that 64% of the country have a vested interest in property prices forever rising. The concern is hand wringing.

 

What's happened to Tony Jones? The table seems to have been shrunk from a semi-circle to a quarter circle.

A few years ago I went to a drug company funded faux Q&A event at the National Press Club. Quite a fun way of discussing some serious stuff. 

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Tony asks too many questions. Virginia Trioli or the other morning show clown are much better behaved and will explain the governments point of view far better...

 

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Thank god there are better days ahead

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23 minutes ago, staringclown said:

Thank god there are better days ahead

I'm not sure. I'm about to watch the budget. I have a large bottle of Vodka and razor blade ready. I've managed to get most pollies mobile numbers so they're on speed dial too. Well, they would be if my family tax ABC was increased so I can pay for my iPhone. 

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I hope the FHB grant is valid for overseas properties. Then I may be interested. :)

Even in remote suburbs an average house costs $600-700k which is obscene for what you get. I'd get a luxury flat in the centre of town in Russia for half the price.

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There's going to be a Melbourne to Brisland rail route. 

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There's something about fart-e-suitcal benefits. There's health car. Geducation. Potentia card. There will be reregime for banks. ScoMo made so many errors. It wasn't his speech, he didn't believe it - those sort of errors happen when you either don't know or don't believe the content. It was hard to follow Mo it was like he was calling a horse race. 

60% discount for CGT on affordable housing. I think there was something about reducing depreciation - reducing negative gearing but not by name. 1.5bn tax pa on 5 banks. 

"This govt, as always will live within it's means." WTF they've doubled the debt. 

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Scomo is drowning. I do a reasonable amount of public speaking. The only time I struggle is when someone else writes it or I don't believe it. Scomo is drowning - how long till he get's replaced. 

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Well, the ABC stated the unspoken. The economy can't afford for home prices to fall as jobs & banks are riding on it for its survival.

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IIRC the FIRE sector constitutes 60% of lending. Banks are stuffed when property prices go south.

 

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1 hour ago, zaph said:

Scomo is drowning. I do a reasonable amount of public speaking. The only time I struggle is when someone else writes it or I don't believe it. Scomo is drowning - how long till he get's replaced. 

Scomo has always been ridiculous. When he gets replaced? At the earliest opportunity. Trouble is who would replace him?

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14 hours ago, Mr Medved said:

I hope the FHB grant is valid for overseas properties. Then I may be interested. :)

 

I hope you're not planning on taking the family? Their airfares would soon eat up any tax benefits of this new scheme.

Max contribution of 15k pa with a total max of 30k contribution. That's barely stamp duty in some states. 

So let's say I'm on under 87k income pa. My marginal tax rate is 34.5%, soon to be 35%. I chuck in 15k x 2 years. Taxed at 15%. Total benefit 6k. Peanuts. Oh but wait theres more. The income my 30k earns will only be taxed at 15% instead of my marginal rate of 35%. Lets say it performs well and I get a 10% return that's another massive tax saving of nearly a grand. 

Quote

Even in remote suburbs an average house costs $600-700k which is obscene for what you get. I'd get a luxury flat in the centre of town in Russia for half the price.

 

400k gets you a decent house in the outer burbs of Brisbane. 

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