Comments on: Rate Cut of 100 Basis Points Couldn’t Cheer Up the All Ords http://www.dailyreckoning.com.au/rate-cut-of-100-basis-points/2008/12/03/ An independent perspective on the Australian and global investment markets Sat, 21 Nov 2009 17:27:32 -0600 http://wordpress.org/?v=2.8 hourly 1 By: charles http://www.dailyreckoning.com.au/rate-cut-of-100-basis-points/2008/12/03/comment-page-1/#comment-55768 charles Fri, 05 Dec 2008 20:56:43 +0000 http://www.dailyreckoning.com.au/?p=4539#comment-55768 If interest rates are less than inflation ( this might happen, but deflation is a real possibility) one would be mad not to borrow and place the money into assets. While the value of gold is measured in dollars and cents, gold has no value as money. When you start telling me I can buy a new car with 20ozs of gold, then gold has value as a unit of measure and perhaps as a storage of wealth, but by then the economic system will be in such a mess that cars won't be available. I suppose a big gold hoarder could put the farm serf to work building a stone castle. If interest rates are less than inflation ( this might happen, but deflation is a real possibility) one would be mad not to borrow and place the money into assets.

While the value of gold is measured in dollars and cents, gold has no value as money. When you start telling me I can buy a new car with 20ozs of gold, then gold has value as a unit of measure and perhaps as a storage of wealth, but by then the economic system will be in such a mess that cars won't be available. I suppose a big gold hoarder could put the farm serf to work building a stone castle.

]]> By: Karl http://www.dailyreckoning.com.au/rate-cut-of-100-basis-points/2008/12/03/comment-page-1/#comment-55432 Karl Wed, 03 Dec 2008 21:40:41 +0000 http://www.dailyreckoning.com.au/?p=4539#comment-55432 Well said Dan. The problem is because money was given away to anyone who asked for it for the past 10 years, everyone's lost the idea that money is meant to be a scarce resource and is meant to be earnt through blood, sweat and tears over a lifetime, not hundreds of thousands of dollars created by the flick of a pen on a handy application form given to a bank. The population needs to be reminded that money deserves respect and bad financial decisions result in lifelong ruin - certainly not government handouts. Make examples of the individuals and institutions who made bad decisions by letting them go broke. The system will not fail because they get sold off in pieces to those who were not so careless, allowing the prudent to become stronger. A kind of financial natural selection. Well said Dan.

The problem is because money was given away to anyone who asked for it for the past 10 years, everyone's lost the idea that money is meant to be a scarce resource and is meant to be earnt through blood, sweat and tears over a lifetime, not hundreds of thousands of dollars created by the flick of a pen on a handy application form given to a bank.

The population needs to be reminded that money deserves respect and bad financial decisions result in lifelong ruin - certainly not government handouts.

Make examples of the individuals and institutions who made bad decisions by letting them go broke. The system will not fail because they get sold off in pieces to those who were not so careless, allowing the prudent to become stronger.

A kind of financial natural selection.

]]> By: Coffee Addict http://www.dailyreckoning.com.au/rate-cut-of-100-basis-points/2008/12/03/comment-page-1/#comment-55276 Coffee Addict Wed, 03 Dec 2008 00:39:03 +0000 http://www.dailyreckoning.com.au/?p=4539#comment-55276 First Home Buyer scheme participants should read the last paragraph of Dan's post and THINK before they jump. First Home Buyer scheme participants should read the last paragraph of Dan's post and THINK before they jump.

]]>