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Analysis and Comment (36)

Angela Merkel has thus far closed her eyes to the need for more spending, at her country’s peril. Reuters

Germany may be the biggest loser if it doesn’t start spending

There’s growing pressure on Germany to spend more to support Europe – and for good reason. But it’s proving to be a hard sell to the country’s leaders. Germany’s budget is balanced and the government insists…
Ordinary people stand to lose if Argentina’s economy collapses. EPA/David Fernandez

Why Argentina matters for indebted countries everywhere

Another week, another proposal to deal with Argentina’s debt. The latest one, by the Argentine president, Cristina Fernández de Kirchner, is to launch a voluntary debt swap where investors holding defaulted…
The drive to privatise was popular during the Howard era. Alan Porritt/AAP

Asset recycling scheme looks more like policy recycling

The Abbott government is about to unveil a new A$10 billion infrastructure package in its first budget. Apparently it is to be funded by a “special immediate measure” in the form of a levy imposed on high-income…
Debt; dollar; deficit - the mantra for this year, amid a turbulent political period. AAP

2013, the year that was: Business and Economy

Debt. Dollar. Deficits. Three little words so close to the hearts of our contributors in a year dominated by a critical federal election, a waning mining boom and continuing international turbulence. The…
Will the credit card cover this? ben_osteen

Time to stop inflating the household debt bubble

Household debt in the UK recently hit a record high, surpassing the previous peak reached in September 2008. That was the month when Lehman Brothers collapsed, sparking off the global financial crisis…
How does Australia’s economy stack up when compared globally?

FactCheck: how strong is Australia’s economy?

“We have among the lowest of budget deficits and debt to GDP of any other major economies in the developed world… If it’s so bad, Mr Abbott, why have we been given by the three ratings agencies a AAA credit…
The federal government’s Farm Finance package includes concessional loans to help farmers restructure and improve productivity - but carries the risk of heaping them with more debt.

Farm Finance package is flawed - and there is a better option

The Federal Government’s new Farm Finance assistance package includes concessional loans to help farms restructure debt and invest in productivity. But this is a back-to-the-future response that carries…
While the blame game for the deficit continues, the economy remains vulnerable to future turbulence. AAP/ Alan Porritt

Why deficits leave us ill-prepared for future shocks

Labor has said all options are on the table to address Australia’s structural deficit and falling tax revenues, following disclosure this week of a $12 billion revenue shortfall, just weeks from the federal…
There’s a strong financial case to selling Medibank Private, but politics has made privatisation an unpopular choice. AAP/ Joel Carrett

Privatising Medibank: good business hamstrung by bad politics

At first sight it is surprising that neither the government nor the opposition, both seeking budgetary savings, is proposing to sell Medibank Private. When retiring Medibank Private chairman Paul McClintock…
According to the organisers of Occupy’s Rolling Jubilee, 77.5% of American households are in debt. AAP

The bitter necessity of debt relief

Debt, it seems, is an idea with currency. Cities, states, nations and individuals are indebted, with creditors at the door, demanding repayment. This year, the US Federal Reserve even had David Graeber…
The federal budget often neglects to address the costs of unfunded liabilities. AAP

Explainer: what are unfunded liabilities?

Every Australian is directly or indirectly affected by unfunded liabilities. Yes — even you. State and federal unfunded liabilities now total more than $200 billion and this amount is rising rapidly. Is…
With the rest of the world mired in economic crises, it seems Australia is the place for foreign central banks to park their assets. Krug6

The boom has made the dollar a dazzler, but Australia is hardly a safe haven

Central banks everywhere - from Russia to the Czech Republic - are piling into Australian-dollar-denominated assets. This has limited the fall of the Australian dollar to around 3% from its peak even though…
A clear-headed analysis of the budget must delve beyond the buzzwords and political rhetoric. AAP

Making sense of a bootstrap budget

Each year the budget is like an annual health check on a patient with many complexities. In a black coat, not a white one, the august Treasurer reports the nation’s temperature, provides much-needed tonics…
Size does matter: rather than be concerned about achieving a surplus or a deficit, the government should be focusing on how to manage its debt. AAP

Don’t forget the debt: there’s more to fiscal prudence than a return to surplus

Treasurer Swan’s commitment to bring the government budget into surplus in 2012-13 may be a political imperative, but is not good economics. The focus for prudential fiscal management should instead be…
The European Central Bank’s long-term refinancing operations have reduced acute liquidity problems in the banking sector, but the situation in the Eurozone remains fragile. AAP

The ECB’s long-term refinancing operations: a solution to the debt crisis, or doomed to fail?

In November 2011, the Eurozone crisis reached a climax with interest rates on sovereign debt of Eurozone problem debtors soaring. Fear of sovereign defaults spilled over into the interbank markets as Eurozone…
Neither Anna Bligh nor Campbell Newman seem keen to talk about Queensland’s staggering debt. AAP

Standing in the shadow of debt in the sunshine state

In the run-up to the Queensland state election, politicians are making all sorts of pledges to win over constituents, but few are willing to tackle a potentially paralysing problem: the spectacular growth…
Decoupled: The Reserve Bank of Australia’s decision to hold interest rates has been ignored by the banks. AAP

Rates of wrath: understanding the Big Four’s actions on interest rates

Last week, the Reserve Bank defied market expectations to announce the 4.25% cash rate would remain unchanged. But the surprise decision by Australia’s Big Four banks to act independently of the Reserve…
Bankrupt former billionaire Sean Quinn accepted highly risky loans from Anglo Irish Bank before it collapsed. AAP

Fallen billionaire Sean Quinn embodies Ireland’s boom to bust

The fall of the “Mighty” Sean Quinn from Ireland’s (and Forbes-listed) richest man to one of the world’s most indebted individuals is perhaps the biggest story of Ireland’s boom-to-bust recent economic…
French leftists protest after Standard & Poor’s downgraded the country’s debt on Friday. AAP

After France’s downgrade, Europe’s debt cycle looks hard to break

Standard & Poor’s decision to downgrade the credit ratings of nine Eurozone countries, including Austria, France, Italy, Spain, and Portugal, is another symptom of the contagious and vicious debt cycle…
Personal loans should be used to fund major infrastructure projects, like the National Broadband Network. AAP

Want to end the GFC? Put debt to good use

The Global Financial Crisis should be called the Global Debt Crisis. Too much debt has been created and there is not enough productive capacity to pay the interest on the debt, let alone repay the loans…
Are ordinary homeowners perpetuating Australia’s property bubble? AAP

The property bubble makes us slaves to each other’s debt

While my recent commentary (here and here) demonstrates Australian housing is in a bubble, I have not explained where this situation has come from. Asset markets, in this case, property, are the subject…
Angela Merkel and Nicolas Sarkozy must take drastic steps to maintain the legitimacy of EU institutions. AAP

It’s time for Europe to show some courage

The European Union is in crisis – yet again. If you enter “Europe in crisis” into Google, more than 655 million entries pop up. Europe’s current problems are being described as a Euro crisis – it is a…
The only way out of this crisis is to dishonour some of the debt that is weighing down the global economy. AAP

Ireland, Greece … France? Accepting default is Europe’s only option

The dramatic falls in share prices of Greek debt-laden French banks overnight highlights just how closely tied the current market chaos is to the world’s worsening debt woes. Market crashes like that of…
Has his compromise with Republicans over the debt ceiling ended Obama’s electoral hopes? AAP

Is Obama doomed? The debt crisis and 2012

Despite the apparent disgust of many Americans and the contempt held by many outside observers, US politics is supposed to look this way – at least sometimes. The widely diagnosed dysfunction of the recent…
Many Greeks are ashamed by what has happened to their country. EPA/Orestis Panagiotou

Greece debt crisis threatens democracy

Athens is no longer considered by scholars as the birthplace of democracy but all of a sudden it has become the epicentre of a powerful political earthquake rocking the foundations of every democracy in…

Columnists (1)

Abbott digs himself into deeper Gonski hole

Tony Abbott enters the last parliamentary fortnight highly vulnerable on that familiar issue of “trust” – and it is all his own doing. The Prime Minister today added to the ammunition the opposition has…

Research and News (1)

Research Briefs (1)