Tag: Interest rates

Taking An Interest In Recessionary Economics

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The end of financial year meeting of the Basil and Sybil Cheeseparer Superannuation Fund was going well until the Trustees (a) found that their investment strategy was out of sync with reality and (b) failed to find a fixed interest investment that would return more than 2.50% over five years. “We should stick it under the mattress,” said Sybil. “Your side or mine?” quipped Basil. As you should know, even if economics is not your…

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No interest at all

Though the headline might put you off, we must ask: why are interest rates dropping, who does it affect and where will it all end? Few people would be unaware that the Reserve Bank of Australia (RBA) dropped the official cash rate to 1.50% on August 2, the lowest rate since records have been kept. The supposed reason is to stimulate the economy (that is, to encourage spending and borrowing). It is theoretically OK to…

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