Tag Archives: prognostication

Is THIS The “Trend” Growth You Are Banking On, Wayne?

1 Dec

Isn’t it wonderful how inveterate liars and deceivers eventually get caught out?

From the Australian:

The Treasurer today declared the government was banking on growth remaining at trend to deliver its wafer-thin budget surplus in 2012-13, despite the threat posed by worsening economic circumstances in Europe and the United States.

Here is the newly-revised MYEFO budget “forecast” for GDP growth that Wayne is “banking on”:

MYEFO 2011-12, Part 1 Overview | Click to enlarge

Er … 3.25% annual GDP growth?

I have one chart for you Wayne.

From the RBA’s latest chart pack (trend line added):

Click to enlarge

So … Wayne.

“Trend growth” for Australia over at least the past 18 years (since 1993), has been slowly but steadily sinking towards 2%.

And yet, you really expect us to believe that we will witness way above-trend 3.25% growth both this financial year, and next? In spite of all the increasing turmoil and volatility in a debt-saturated world right now?

Mr Swan said revised budget forecasts outlined yesterday were based on the “best judgment” of Treasury.

Having confidence in Treasury’s “best judgment”, is akin to having confidence in the “best judgment” of the band playing “In the Shadows” as the Titanic slowly sank beneath the waves.

Rather like Australia’s GDP “trend growth” slowly but surely sinking beneath the waves of a debt-soaked world economy.

And to think this government is introducing a world’s-highest carbon dioxide derivatives trading scheme scam from July next year.

Based on more modelling tea-leaf reading by the same Treasury “bozos” who originally predicted 4% GDP growth back in May.

The same “bozos” who could not foresee an onrushing GFC that even Blind Freddy could see (“Why Would Any Sane Person Believe Treasury’s Carbon Tax Modelling When Its Budget Forecasting Record Is This Bad?”).

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