Yellow-Bellied Fiscal and Monetary Policy

Christopher Joye

Coolabah Capital

In The AFR I assess the budget: "Since we fell into the red in 2009, the shortfall between what the government earns and spends has risen to an amazing 21.5 per cent of gross domestic product. Assuming there is zero economic adversity between now and 2020, Treasury projects the cumulative losses will expand to 24 per cent of GDP. The deficits incurred during the horrific 1991 recession - when the jobless rate hit 11 per cent - were 28 per cent less as a share of GDP. If you thought an unprecedented post-war streak of 11 years of consecutive deficits would stiffen politicians' resolve to reform, you'd be mistaken: the budget's underlying cash balance has actually deteriorated from -1.2 per cent of GDP in 2013 to -2.4 per cent in 2016. The Turnbull government boasts of "improving the bottom line by $1.7 billion over the four years to 2020". We're facing a fiscal crisis and they've trimmed $86.3 billion in losses by merely 2 per cent? These blokes would not get jobs as accountants for Alan Bond." Free (VIEW LINK)


Christopher Joye
Portfolio Manager & Chief Investment Officer
Coolabah Capital

Chris co-founded Coolabah in 2011, which today runs $7 billion with a team of 33 executives focussed on generating credit alpha from mispricings across fixed-income markets. In 2019, Chris was selected as one of FE fundinfo’s Top 10 “Alpha...

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