Finances
May 31st 2010 03:58
Finances
I wonder about our Reserve bank and its policy of raising interest rates to control spending and thereby reduce the inflation rate in the country. I am sure there must be some other way of sharing the burden around ALL the community. The present policy does nothing but increase the cost of living for the ordinary people. The wealthy, the banks, big business are relatively unaffected, they simply pass on the extra coats to the consumer who is, strangely enough, the only one who can’t pass on the added costs.
The Banks and financial institutions simply raise their interest charges to cover whatever the Reserve Bank adds to the cash rate. Businesses raise their retail prices, Shires raise their Rate charges and the Govt collects tax on it all. The consumer is expected to bear the raise in costs by more prudent spending. It just doesn’t work, you gentlemen of the Reserve bank. The inflation rate is actually pushed up each time there is an interest rate rise, Additional Govt taxes push up the inflation rate, All increases in rates and taxes push up the inflation rate.
Perhaps I am just dumb, but isn’t it time someone in our elected Govt gave a thought to the consumer, the bread and butter people who make up the majority of our population. After all we are supposed to be a democratic country, you know; ’Govt of the people, by the people for the people.
After all is said and done businesses, banks, and Govts, all rely on the ‘people’ to make the necessary money they need to operate at all.
I wonder about our Reserve bank and its policy of raising interest rates to control spending and thereby reduce the inflation rate in the country. I am sure there must be some other way of sharing the burden around ALL the community. The present policy does nothing but increase the cost of living for the ordinary people. The wealthy, the banks, big business are relatively unaffected, they simply pass on the extra coats to the consumer who is, strangely enough, the only one who can’t pass on the added costs.
The Banks and financial institutions simply raise their interest charges to cover whatever the Reserve Bank adds to the cash rate. Businesses raise their retail prices, Shires raise their Rate charges and the Govt collects tax on it all. The consumer is expected to bear the raise in costs by more prudent spending. It just doesn’t work, you gentlemen of the Reserve bank. The inflation rate is actually pushed up each time there is an interest rate rise, Additional Govt taxes push up the inflation rate, All increases in rates and taxes push up the inflation rate.
After all is said and done businesses, banks, and Govts, all rely on the ‘people’ to make the necessary money they need to operate at all.
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