Yes. I completed my homework. For those people with nothing better to do the question was:
*Are Australian household over indebted? How has is the federal governments fiscal stance related to private sector debt?
Please hand your answer on my desk, no latter than Monday.
CLUE: The answer is Yes - due to asset bubbles in the housing market because of low interest rates due to low and less variable inflation rates and increased competition in the banking sector. Federal Surpluses aggravate this. In order for the economy to continue to grow, if the gov does not spend any money than households must fuel this growth by investing themselves. This will be funded primarily by loans from overseas, which in turn will aggravate our current account further. The government in turn can not raise interest rates in fear of causing massive defaults across the economy.
My American tutor was quite surprised that no one in my class had a credit card. He said uni students were meant to be the ones in society with the greatest chance of earning large amounts of money latter in life, and so should be targeted by credit card companies.
In other homework news I got 100% for my ECON3220 MONEY & FINANCE tutorial. This is despite the fact that my tutor keeps giving me the evil eye. 'Fight the Machine!'
