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Weekend reflections

May 20th, 2005

This regular feature is back again. The idea is that, over the weekend, you should post your thoughts in a more leisurely fashion than in ordinary comments or the Monday Message Board.

Please post your thoughts on any topic, at whatever length seems appropriate to you. Civilised discussion and no coarse language, please.

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  1. May 20th, 2005 at 21:37 | #1

    Mark Bahnisch raises an interesting question:

    moral absolute (which is correct – that’s what law tends to do).

    Are laws moral absolutes?

  2. May 20th, 2005 at 22:08 | #2

    Only perfect laws in a perfect world could be moral absolutes.

  3. Econowit
    May 20th, 2005 at 22:10 | #3

    Is protectionism the solution for the U.S. trade deficit? Warren Buffett a good manager of capital has some interesting thoughts on the matter.

    http://www.berkshirehathaway.com/letters/growing.pdf

  4. production line 12
    May 21st, 2005 at 08:01 | #4

    Mate.

    ‘No coarse language’.

    What’s the go? At least give us a list of ‘coarse’ terms which CAN be used. Allow me to provide a provisional list:

    ‘Drat’;
    ‘Curses’;
    ‘Blast’;
    ‘Begorrah’.

    And so, with JQ’s blessing…
    Drat, curses, blast, and begorrah to those foolish enough to think that refusing to use ‘coarse language’ will admit them into the exalted ranks of the middle class.

  5. May 21st, 2005 at 10:24 | #5

    Well, of course, it is clear that “Quiggin” is itself a euphemism. Anyone can see what “to quigg” really means.

  6. Econwit
    May 21st, 2005 at 11:05 | #6

    Shouldn’t it be a four letter word quig.

    I will adjust my pseudonym to econwit, giving clarity to its true meaning.

  7. Guardian of the Faith
    May 21st, 2005 at 11:58 | #7

    Buffett’s plan is an interesting one, but I’ll hazard an alternative. The problem is exessive spending on imports coupled with low rates of saving and investment. My master plan…. Create a fund and force citizens to pay savings into it (thereby decreasing their available income to spend on imports), then let the fund invest…..

    Hang on. Perhaps that would be a non-tariff barrier? Call in the WTO!

  8. Bill O’Slatter
    May 21st, 2005 at 12:12 | #8

    Now the dirty little secret is out about how much money banks make from credit cards we can use this as a measure of political corruption. Both Hawke and Keating were beneficiaries of bank largesse and it would be interesting to see what they have in store for members of the Howard government .

  9. Ian Gould
    May 21st, 2005 at 21:34 | #9

    While Buffett has an extraordinary track-record as an investor I doubt this proposal would work.

    The US currently has a trade deficit of around US$50-60 billion per month. Its exports coem to around US$80 billion, its imports come to around US $120-130 billion

    Import licensing – which is what he’s effectively requiring – would entail a reduction in imports of around $50-60 billion per month.

    That’d probably be enough to cause a severe fall in consumption in the US the probable consequences of which would include a recession and a signficant rise in unemployment.

    I can’t see either side of US politics accepting that.

    The only option I see for reducing the US deficit (and this would take several years to work) is to significantly reduce the US budget defict through spending cuts, tax rises or a combination of the two.

    This would lower interest rates and therefore the debt servicing cost. It would also effectively displace private cosnumption with public savings, increasing the overall savings rate.

    THe other, and I fear more likely long-term solution is to increase money supply dramatically, raise the inflation level and thereby erode the capital value of dollar-denominated foreign assets.

  10. May 22nd, 2005 at 00:19 | #10

    Al Jazeera has started an interesting idea, which might be applied by those with access to the necessary technical facility, allowing readers to rate comments.

    To see what I mean check out the idea in practice here.

    As with any suggestion there are pro and cons.

  11. davidm
    May 22nd, 2005 at 18:17 | #11

    If the Australian dollar is strong because of record prices for our mineral exports, can someone explain to me why the New Zealand dollar is even stronger? Do the Kiwis have vast mineral wealth they are exporting to China?

    Two year chart of NZD vs AUD:
    http://finance.yahoo.com/q/bc?s=NZDAUD=X&t=2y&l=on&z=m&q=l&c=

  12. James Farrell
    May 22nd, 2005 at 21:06 | #12

    They don’t need to export vast amounts since they are a small country. They do export aluminium and timber. And, as it happens, world prices for their better known exports, meat and dairy products, are high as well.

  13. May 22nd, 2005 at 23:15 | #13

    I’ve got lots of questions but I will stick with the most important one to me at the moment. What is the chance of interest rates going up in the next 3,6, 12 months? particularly interested in the 3 and 6.

  14. sh
    May 23rd, 2005 at 13:28 | #14

    Vee, interest rates will rise dramatically in the next six months to a record 29%. You should therefore avoid buying a home or sell the one that you have a mortgage over. I hope my opinion helps. If not, then go see a mortgage broker.

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