25th Jan 2012

What is a trillion, and should we spend it?

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Rachel Tyler Jones

I feel I need to start this blog by stating that I am no expert on economics. I probably have a similar level of economics-know-how to you. I read the newspaper, I listen to the radio and I occasionally Google money concepts when I don’t understand what the ubiquitous ‘they’ are talking about.

When I read that the International Monetary Fund needed (is that like I need oxygen, or like I need a 1953 Jag?) $1 trillion to stop the world from imploding the first thing I thought was “I have no idea how much $1 trillion really is”. So, to help you out:

If you were earning (in your very fancy job) $1000 per second, every second of the day, every day of the year, it would still take you more than 31 years to earn $1 trillion.

So $1 trillion is a lot of money. And the IMF wants Australia, along with a few other countries, to give our money to help make up that amount. That seems as though we are being punished for managing our economy well. The money is going to failing European economies, and sure the world economy is important, but what do you think Europe’s reaction would be if the IMF said “Australia have really messed up and you  need to give them money”. How about “Australia? Isn’t that a kind of cheese?”

Yes, our economy is dependant on the rest of the world, particularly Europe. Yes, things will go downhill for us if the European economy falls over. But I still don’t feel comfortable with the idea of just handing over the cash. Perhaps that is because I don’t think Europe would help us out if we were in the same situation. But the world has been going through some fairly major ups and downs (mostly downs) recently and Australia keeps coming out on top in terms of economic stability. So are we really as dependant on the European economy as we think we are, or would we be better off holding on to the donation and investing in, say, our own healthcare system?

Should Australia be giving your hard-earned dollars away to support the European economy?

Yes
No
 


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COMMENTS

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Kaye Fallick
25th Jan 2012
3:16pm
I'm with Rachel on this one. I strongly suspect that very few countries in the Western Hemisphere would care if our economy faltered. And even if they noticed, it is highly unlikely they would bail us out. Think Galipoli. Think the Fall of Singapore. It was every nation for itself. We are force dot be part of the global economy because we and other nations need to trade. But we are not enjoying the protectionist benefits of the European Union so I fail to see why we should support those member states who forgot how to balance their books.
Mike
2nd Feb 2012
2:27pm
Now you got me laughing, AUSTRALIAN EDAM mmmm cheese
Well for one thing
I am a descendant of an Italian immigrant family one of many that came here from Europe and helped make Australia what it is today. In a way I would like to reciprocate and help them, but as I know many Italians in Italy, they never wanted to lose the Lire, that was their economy, it was a good economy, they also feel the same as we do, why help bail out Greece, they got them selves into that mess, when did any of the European countries support Italy saying they should keep their own Lire economy, they are hard workers and produce many fine things, after all Italy was the birth place of western civilization as we know it today. No I don't agree throwing money at the problem will fix it.
They very well know how to balance books, they first have to address the corruption issues. Changing currency to the Euro currency was supposed to make Europe a strong economy, about 5 years ago I predicted the fall of the EURO to my friends, they laughed at me saying your dreaming, that will NEVER happen,it's a strong economy.
I explained the EURO was not a level playing field, how could one monitor a currency that had so many countries dependent on it, and all fraught with corruption, each European country has it's own business to deal with. For example, what if all the southern hemisphere had the ASIA as a currency, it won't work, yes in the beginning we would be a strong economy, what we could do would be mind boggling, but human nature wins out every time, throw greed into the formula and you get a fast growth of corruption and slowly like a cancer it eats away at the system until you have a failure. I think Europe has to return to it's own individual economy and start again, each country receiving help from a supporting country until they get back on their feet, maybe I'm wrong, but this seems to be a good start to the road to recovery.


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