Imagine a world where money was destroyed. What would happen? We would barter. I might grow apples and trade them for you building a shed. Easy. This works, but not for long. Eventually, we will come up with a few problems. Maybe you don’t have what I need but you want apples. Maybe I don’t need anything now but my apples will go rotten if I don’t trade them now. Maybe you only...
Liberal Democracy: a democratic system of government in which individual rights and freedoms are officially recognized and protected, and the exercise of political power is limited by the rule of law. Australia is supposed to be a liberal democracy and our state and federal government responses to covid have shown just how far our society has regressed from this. The State of Emergency /...
This is really quite simple. People choose to save instead of consume. And then people use these savings to invest in new production. With more production, there is more to consume. The economy has grown. The market is a process that sees entrepreneurs using these savings to invest in what they believe people want. And as they learn more about what people want (or not want) they either invest...
No doubt you have received investment advice to start saving and investing as soon as you can. The reason for this comes down to a very simply yet powerful mathematical phenomena: compounding. The power of compound interest Imagine a world where the bank pays an interest rate of 10% in your savings account every year. You put $1,000 into the account and a year later there will be $1,100 sitting...
Before discussing economics and the respective policy implications, we need to decide on our objectives. Protect the genuinely needy To me, you are genuinely needy if you, for whatever reason, cannot earn sufficient income or have sufficient wealth to afford basic food, shelter and medical care; AND have no family nor friends willing to help you meet these basic needs. You are responsible for...
There is a chasm between what sounds good and what is good; or what sounds like it will deliver great results and what actually delivers great results. Politicians will try and sell you something that sounds good; and I hope to give you the way of thinking so you can see if it actually does good too. I am what is considered a Classical Liberal as opposed to an Egalitarian; a position I have taken...