From proclamation, to capitulation, and now stimulation. Will it get Team Australia over the line?
"How good is fiscal uncertainty!" is not the cry you'd be hearing from Capital Hill's Oblong Office in Canberra this week.
The Morrison government rode back into power last year on a wave of mutilation* and proclamations that Australia would soon be back in the black. And they very nearly did it; the ScoMo Dance Krew held on as long as they could in the wake of natural disasters and global economic turmoil to that magical, ethereal surplus.
(*that's a Pixies reference, by the way. I had tickets. Fingers crossed they'll be back; fans of peerless 80's alternative rock will be very vexed otherwise.)
We finally get a fit-for-purpose stimulus package last week, and what happens? The bloody goal posts get shifted - in this case, about three suburbs away from where everyone thought the playing pitch was located. That's a tough call when you're still only getting your boots on and have barely warmed up.**
(*...and that's a footy reference. It's pertinent...read on.)
So now, Team Australia (oi! oi! oi!) has become Fortress Australia (oi! get back here!) with enhanced visitor restrictions and resident lockdowns imminent. We're all hoping this helps save lives and slows the spread of COVID-19, to give breathing space to a health system that will struggle to cope in a deluge.
New stimulus measures expected this week
More federal billions are on their way, on top of the Morrison government's $17.6 billion announced last week to save businesses and boost consumption. The States are topping up as well; the Berejiklian government announced $2.3 billion from its own coffers yesterday, largely to bolster NSW's health system resources.
This in a moment in history where reserve banks around the world are dropping rates faster than a pair of pants at a Ford Pills party. Rates in the US are near zero; there's talk the RBA is about to drop another 25 basis points and pull the trigger on quantitative easing measures. For those of us who don't speak economist, that basically means pumping more money into the system.
Articles like this one and this one lay out the case for why COVID-19 is the straw that broke the back of central banks, and has led us to extreme measures like QE to keep our economies afloat.
Hurty Hurty Pain Time (or HHPT, as it's known to members of the medical fraternity)
The banks won't like this. Long story short, QE measures will hit them where it hurts (the profit centre), fresh after they've already been winded by a blow to the loan regions (also connected to the profit centre) bought on by the passing of the last RBA cut in full.
Australia's listed companies are having a tough time of it as well. As Chanticleer pointed out yesterday, profit guidance means nothing in an economic world as uncertain as this. Listed companies in sectors most exposed to the immediate consequences of the Virus That Wuhan Made like tourism - such as airlines, for example - are leading the downward charge. Little wonder the ASX had had its worst day since 1987 by yesterday's close.
Even the footy's hurting! ARL Commission Chairman Peter V'landys (pictured with a less-than-impressed NRL CEO, Todd Greenberg) tried the same trick he pulled (successfully) when heading up the racing industry when Howard was PM, and called for the Morrison government - via the media, no less - to throw the NRL a few hundred million shekels as part of the federal stimulus package. "An Australia without footy isn't Australia" - but then again, nor is an Australia without a functioning economy or, while we're playing with what-ifs, people.
Keep calm and carry on
In light of all this, what now for us working stiffs? Just get on with it and try not to think too hard about it, seems to be the message - and for God's sake, stop reading the Daily Mail. That stuff is pure mind poison.
Australia's 1.2 million public servants are preparing to work from home if and when lockdowns are put in place and travel restricted. The focus for government - and indeed, as many other enterprises as can logically do so - is to keep operating during any restrictions.
Here in NSW, the coppers will have powers to enforce isolation bans - once, of course, we know what said bans are. Debate over whether schools should stay open was still rattling along yesterday - although I'd imagine most students are pretty clear on where they stand on that particular issue. I know my boys are...won't they get a super surprise though, when they realise dad has played that fun, fun game of Let's Hide The Xbox Controllers!
The big mea culpa scheduled for 17 March 2020 is for anyone who poked fun at the toilet paper hoarders. Who knew those crazy muppets weren't so crazy after all? Especially now that I have relatives calling me asking, do you have any spare loo rolls?
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