Sunday Sanity Break 14 August 2016
Crocodile tears are being shed for Australia's too buoyant exchange rate, which keeps trying to creep upwards despite interest rates being cut to levels that threaten economic stability.
Henry regrets that the RBA did not take seriously his early 2013 call for a tax on capital inflow, available here.
Such a tax would have meant that a lower exchange rate could have been achieved without cutting interest rates by a level that threatens to keep asset inflation bubbling and which leaves little room for rate cuts if and when this is needed.
Of course, this is precisely the global position, and in that sense Australian monetary policy is merely repeating the mistakes of the USA, Japan, the Eurozone and the United Kingdom.
So Australia shall be in good company but we could have been in better, or even best company.
(Like the water carriers of old, our motto is, or should be:
Good, better best, We shall never rest, until our good is better, And our better best.
(*Thanks to RA (Bob) Johnston for reminding Henry of this motto many years ago.)
This problem aside, Glenn Stevens has had an exemplary time as governor of the RBA. We wish him a long and happy retirement.
Henry is facing a challenge to switch HenryThornton.com to another server.
As Henry has no idea how to do this, it may take some time and that may mean the screen goes black for a while.
Please excuse this temporary disappearence and take an occasional check to see if the old boy has reemerged. We hope this will be with a smarter appearence and with a small burden of past material.
The historical material is available at Australia's National Library, where this august institution has been downloading the HT site for more than a decade.
Fiona Prior visits World Press Photos 16. These images will haunt you. More here.
Image of the Week
image: Warren Richardson, Hope for a new Life, 28 August, Serbia/Hungary border from the exhibition World Press Photos 16 reviewed by Fiona Prior