|IndyWatch Australian Economic News Feed Archiver|
IndyWatch Australian Economic News Feed was generated at Australian News IndyWatch.
It is Wednesday and so just some snippets. I have written about
the behavioural impacts that studying mainstream economics,
particularly the microeconomics component can have on students as
they progress through their studies. I have observed sort of nice
young people entering first-year and by later years, become
arrogant, self-opinionated and delusional jerks. This phenomenon is
particularly prominent if they go onto to do postgraduate level
studies. It is well documented. The way mainstream economics is
taught builds on anti-social attitudes that might already be
present in students who choose to undertake this sort of training.
The curriculum matters a lot. In that context, our next
macroeconomics textbook (see below) will, in my view, actively work
against any predisposition towards selfishness and against
altruism, while still providing students with a first-class,
technical education in how the monetary system operates.
There was an interesting 2005 study published in the academic journal Human Relations Personal value priorities of economists by a group of researchers mainly from Israeli-based universities.
The authors (Neil Gandal, Sonia Roccas, Lilach Sagiv and Amy Wrzesniewski) noted that:
Policy decisions in the public and private sectors are guided by complex specialized knowledge, often not easily understood by the public. Hence they depend to a large degree on the professionalism of decision-makers. Professionals decisions, however, are affected not only by the knowledge they hold: they also reflect their underlying beliefs, assumptions and goals. In other words, they reflect personal values.
When I was beginning my economic studies it was rammed down our throats that mainstream economics was value-free. One of the main textbooks at the time (Lipsey) was entitled Positive Economics, which was claimed to be objective, and, there was a distinction made between that and so-called normative economics, which apparently was where values were to be found.
It was obvious nonsense but consistent with the mainstream desire to masquerade as an ideologically free space.
Why would want to do that? Answer: because the values that were embedded in mainstream economic theory were pro-capital and anti-government.
The Israeli study notes that:
economists play a central role in forming and implementing policy, both in the public and private sectors. They hold key positions in governmental and other public institutions where they advise policy-makers in diverse areas such as international trade policy, fiscal policy, and regulatory policy it is...
Grandshores Technology Group, a Hong Kong-based public blockchain investment company, is planning to raise $12.7 million through a digital token fund in an effort to finance a yen-backed cryptocurrency project.
Grandshores Technology was initially a contracting company that pivoted to the blockchain industry after being acquired by SHIS, a corporation owned by Singapore-based investor, Yongjie Yao, who is also in charge of the Xiongan Global Blockchain Innovation Fund.
Yao made his name in the technology industry through being a founding partner of the 10 billion-yuan Hangzhou Grandshores Fund, backed by both the Hangzhou government and famed Bitcoin investor, Li Xiaolai.
In order to gain funding, the company will be tapping qualified investors located outside of China to raise funds denominated in Tether, which is backed by USD. The funds will be used to help launch a Japanese yen-backed stable coin, which will operate similarly to Tether.
While speaking about Grandshores new investment, Yao explained that the blockchain industry is on track to disrupt the current financial system, and that there is a significant amount of potential for many small and undervalued projects.
Yao said that:
Blockchain will become the mainstream technology in the next three to five years. We are entering the next stage of blockchain evolution, a stage which is akin to when computer operating system was transiting from MS-DOS [disk operating system] to MS-Windows.
Yao also said that the fund is currently working with a mid-tier Japanese bank in order to provide the means for a yen-backed stable coin. He also expressed immense confidence in the demand for a yen-backed stable coin, mentioning that the fund wants to also launch stable coins denominated in the Hong Kong dollar and the Australian dollar.
Stable coins have been......
What a way to start the week.
Monday morning, all we could talk about was the doomsday 40% house price crash.
Cue panicked homeowners around the country.
Is this the property crash weve been talking about for a decade? Has our lending binge day of reckoning finally come?
Not today, at least.
However, Australia may be forced to face the repercussions of buying a house at any cost.
I guess it depends on whether youre the have or the have not.
If youre like me, and on the hunt for some bricks to call your own, a 40% price crash does sound exciting. Just think of all the properties that would suddenly fall into your price bracket!
The flip side to this is if youre one of the 69% of Aussies that do own a home mortgaged or not you dont want prices to drop.
No one wants to the see the value of their biggest asset lose almost half its worth.
However, Im here to pour some cold water on the idea of a 40% house price crash in this decade at least.
The house price value wipe-out as discussed by 60 Minutes on Sunday night selectively takes information produced by Data Analytics.
Since the segment aired on Sunday night, Data Analytics founder Martin North has come out and said that 60 Minutes cherry picked the information to suit the story.
North said that a 40% house price fall was a doomsday scenario. And furthermore, he put the probability of this happening down to 20%.
But at the same time, North painted a bleak economic picture of if the doomsday scenario played out.
If Aussie house prices dropped to almost half of todays value, North reckons wed also be looking at unemployment rates of 8.5-9% AND a cash rate from the Reserve Bank of Australia dropped to 0-0.50%.
Again, lets just point out that this is highly unlikely.
What 60 Minutes left out, North says, is that he shares the consensus view of house prices declining 10-15% Australia-wide over the next two to three years.
Nothing in the kitty
Rather than a house price collapse into 2020, the more moderate 10-15% house fall prediction can still cause massive problems for the Aussies and our economic growth.
For now, the economy is growing.
The most recent gross domestic product said our economy has an annual growth rate of 3.4%. Making the Aussie economy seem in rude good health.
The problem is, the people within the economy arent so flush.
Media Release - September 18, 2018
We are deeply disappointed that the Labor majority report of the Senate Standing Committee on the TPP-11 has strongly criticized many aspects of the deal and recommended changes by a future government, but has nevertheless endorsed its implementation, AFTINET Convener Dr Patricia Ranald said today.
This was not unexpected, given the decision of the ALP caucus majority last week to support the TPP-11, despite its inconsistency with ALP policy. In practice it would be difficult for a future Labor government, having endorsed the implementation of the deal in opposition, to negotiate such changes with the other 10 governments in the TPP-11 after implementation.
We welcome Centre Alliance committee member Senator Rex Patricks more consistent recommendation that, given its flaws, the TPP-11 should not be implemented until after such changes are negotiated, and note that the Greens and other crossbenchers also oppose its implementation.
Dr Ranald noted that the report identifies the following serious flaws in the TPP-11:
She added that the report also recommends a series of reforms advocated by AFTINET to the trade agreement process including release of draft negotiating texts, release of the full text...
Grandshores Technology Group, a Hong Konglisted investment
holding company, is seeking to raise around $12.7 million through a
digital token fund, according to
reports from the South China Morning Post (SCMP).
Grandshores Technology plans to use the funding to launch a
Chinese investor Yongjie Yao, who currently chairs Grandshores Technology, is also a founding partner at Hangzhou Grandshores Fund, which is backed by the local government of the city of Hangzhou and Chinese crypto billionaire Xiaolai Li.
Yao stated that the company plans to attract investment from qualified investors from outside China to raise funds via Tether, according to the SCMP report. The company will also invest in disruptive startups and other cryptocurrency projects across the globe that are challenging the status quo.
We are entering the next stage of blockchain evolution, a stage which is akin to when computer operating systems were transiting from MS-DOS [disk operating system] to MS-Windows.
The founding partners of Hangzhou Grandshores Fund are currently working with an unnamed, mid-tier Japanese bank to develop the yen-based stablecoin. Grandshores has plans to launch stablecoins pegged to the Hong Kong dollar and the Australian dollar in the future.
Yao remains confident regarding the demand for the coin when it launches. He believes the token could be ready by the end of 2018 or the first quarter of 2019.
We believe cryptocurrency traders and exchanges will be potential takers of this stablecoin, he added.
Stablecoins help tackle one of cryptos chief dilemmas volatility without compromising its core values. On a smaller scale, they also help investors trade seamlessly while transferring money between crypto exchanges.
Earlier this year, Binance Labs, OKEx and other notable investors funded a stablecoin project out of South Korea called Terra. Liechtensteins Union Bank AG also...
Canberra tightens again
Robert will be interviewing me later this week, as an installment of Conversations with Tyler, just as Patrick Collison once interviewed me a while back. At least part of the interview will focus on my forthcoming book Stubborn Attachments: A Vision of a Society of Free, Prosperous, and Responsible Individuals. (And we will do 2.5 hours, a Robert specialty!) Here is part of Roberts bio:
I studied both genetics and economics at the Australian National University (ANU), graduated top of my class and was named Young Alumnus of the Year in 2015.
I worked as a research economist in various Australian Government agencies including the Treasury and Productivity Commission.
I then moved to Oxford in the UK to work at the Centre for Effective Altruism, first as Research Director and then Executive Director.
I then became Research Director for 80,000 Hours. In 2015 the project went through Y Combinator, and in 2016 we moved from Oxford to Berkeley, California in order to grow more quickly.
He is renowned for his thorough preparation and he runs a very good podcast of his own. So what should he ask me?
The Australian Council of Social Service (ACOSS), which
represents income support recipients, in conjunction with Jobs
Australia (a peak body for the not-for-profit job services
providers) released a report last week (September 14, 2018)
Faces of Unemployment which was a welcome return to a focus on
joblessness and the need to provide more jobs, rather than the lame
faux-progressive retreat to UBI advocacy that has dominated the
policy debate for the last few years. However, once you start
reading the analysis you realise that these supposedly progressive
organisations offer the same old neoliberal remedies to solving
poverty and unemployment. They want: Compulsory, assisted job
search, which is just coercion of jobless workers by Australias
privatised job services industry that has an appalling record; 2.
Wage subsidies in the private sector and Public sector wage
subsidies which never produce effective sustainable outcomes of
sufficient magnitude to be called a solution; and vocational
training, which is the same old put workers on the training
treadmill and shuffle the jobless queue. This reinforces the theme
I focus on a lot that the progressive elements in our society have
become captured by the neoliberal mainstream and cannot think
outside that frame. There is actually no mention or analysis of
public sector job creation programs in the entire ACOSS/JA Report.
Sadly, groups like ACOSS have a major public voice and the Federal
government sees their advocacy as non-threatening because the type
of policies they advocate are mainstream neoliberal and just more
of what the Government, itself, thinks are viable. The irony (or
disgrace) is that if these policies were effective then the
ACOSS/JA Report would not have had to be written. Just imagine what
they could have written about the Faces of Unemployment if a Job
Guarantee program effectively wiped unemployment out. It would
become a very short story of workers moving between jobs.
I have commented several times on the parlous income support schemes in Australia that have rendered recipients in an increasing state of poverty as a deliberate ploy by government to create a desperate underclass.
We should also never forget that the unemployed (apart from those moving between jobs) are without jobs because the government has chosen not to use its fiscal capacity to cover the spending gap left my non-government spending decisions.
Mass unemployment is always a policy choice by governemnt. It can always ensure there is full employment by offering an unconditional job opportunity to anyone who desires to work but is currently unable to find a job elsewere.
I have previously considered the state of poverty among...
If youve ever lived through a life-threatening emergency whether a car crash, train wreck or a steep fall (hopefully not) you have noticed that time seems to slow down.
You witness your personal jeopardy in slow motion. A memorable example of this is the film The Matrix, in which the hero, Neo, could dodge bullets since time moved in slow motion for him.
According to the best science, time does not actually slow down for those in jeopardy, nor do their perceptions slow down. What happens is that the stress and novelty of the experience causes the brain to create extra layers of memory, a saturation effect, compared with everyday experiences.
According to researcher David Eagleman, The more memory you have of an event, the longer you believe it took. So yes, time does seem to slow down in a crisis, but its a cognitive illusion.
That slowing down effect is important to bear in mind as we encounter the 20th anniversary of the Russia-LTCM financial crisis of September 1998 (28 September 1998) and the 10th anniversary of the Lehman-AIG financial crisis of September 2008 (15 September 2008).
For investors, those events were the financial equivalent of falling off a tall building or being strapped in during a plane crash. If you lived through them, youll recall some hours that seemed like days and days that seemed like weeks.
Of course, investors recall where they were and what they did during the absolute height of the panics.
Most investors may not be aware that these peak panic moments had actually been playing out for over 15 months in both cases. Investors who closely observed the early signs of trouble had ample time to get out of the way of the panic itself.
A financial crisis doesnt happen overnight
In fact, most investors were oblivious to the early warnings. That 15-month build-up was a real slow-motion event, not an illusion.
The September 1998 Russia-LTCM crisis began in June 1997, 15 months earlier, when Thailand devalued its currency and closed its capital account.
For several years, Thailand had maintained a fixed exchange rate to the US dollar.
Money poured into Thai real estate and resorts to earn high yields with an exchange rate guarantee. When some investors started to pull their money out, a run on the bank emerged.
Thailand could not make good on its US dollar guarantee and devalued, causing massive losses for US investors.
From there, the panic spread to Indonesia, Malaysia, South Korea and other nations. There was literally blood in the streets as some were killed in money riots.
Markets calmed down that winte...
The northern part of the Australian state, Queensland, is bustling with cryptocurrency energy. The region is extremely passionate towards one specific decentralized peer-to-peer electronic currency bitcoin cash (BCH).
Over the last few months, a few bitcoin cash proponents have been spreading a lot of BCH adoption in the North Queensland region in Australia. North Queensland is a very large area with its own distinctive regional character within the massive state of Queensland. Anyone who frequents the Reddit forum r/btc, have probably noticed many posts showing BCH adoption taking place in the region.
North Queensland has its own Bitcoin Cash meetup, its home to the countrys first BCH-only automated teller machine, and right now the area has a lot of BCH accepting merchants. This week, using the mobile application...
|IndyWatch Australian Economic News Feed Archiver|
IndyWatch Australian Economic News Feed was generated at Australian News IndyWatch.
Resource generated at IndyWatch using aliasfeed and rawdog