One of my grand kids is studying economics at the University and, to help him with an essay on current macroeconomic policy in Australia, he asked me three rather pertinent questions..
1. If there is an inflation problem which is overwhelmingly supply-side driven, as we now seem to have in Australia, and if everyone expects a significant slow-down in domestic demand in the year or two ahead, why are the Reserve Bank and the Government responding (or planning to respond) with demand-deflation policies? That is not what my textbooks tell me is the right response.
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