Sunday, June 21, 2009

Hopium and Changeeba

by Smitty (h/t Lucianne)

The Herald Sun heralds much sunniness:
Investors in Australia and across the globe will scour the Fed's official statement following the policy meeting in Washington, to be released Thursday morning local time, for further evidence the worst of the crisis has passed.
The market is desperately trying to gauge whether the global economy will stage the much-hoped-for V-shaped recovery or a more protracted W-shaped one.
Although most economists expect Fed chairman Ben Bernanke to keep interest rates on hold, they are also tipping that the central bank will pull back on some of its stimulus measures in a sign that the US recession is finally ending.

I'm no economist, stuck as I am with a simplistic gazinta==gazoutta analysis of these matters. It strikes me that if the fundamentals of debt and deficit spending remain essentially unaddressed, then these Aussies are simply firing for effect.


  1. Australia hasn't fared to badly during the global economic crisis, mainly thanks to China moving to increase the amount of domestic consumption of its own goods, which has kept demand for Australian resources relatively high. This means that cashed up Aussie investors could be positioning themselves to snap up some bargains in the US markets but only if it looks like the US markets are beginning a long term recovery.

  2. gazinta?

    You may be disinclarifying your memeograph by injecting such sniglets. But that's just my personal mindthoughts.