My money is on the US recession being sharp but short. The win by Barack Obama, predicted by all the polls, would bring to the stage a new president with a message of hope and necessary change.
US monetary policy has been eased and fiscal policy is adding further stimulus. American resilience and entrepreneurial flair will do the rest.
Australian monetary and fiscal policy have already been eased. The easing is pre-emptive, in marked contrast to previous post-war experience.
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In both the recessions of 1981-82 and 1990-91 fiscal policy and monetary policy were eased only when it was blindingly obvious that the economy was in trouble. In the mini-boom of the mid-80s, fiscal and monetary policy were tightened pre-emptively and this prevented - or at least delayed - the usual boom and bust scenario.
Monetary policy has notoriously been moved too little, too late, meaning cash rates have risen too slowly in booms and thus eventually have had to rise more than might have otherwise been necessary.
Cash rates have also been required to remain high for enough time to ensure the "recessions we have had to have" were sufficient to reduce inflation.
In the long China boom, Australian cash rates were again raised too slowly and as a result eventually went higher than they needed to.
But the subsequent easing this time was far more timely and there already has been a 125 basis point cuts from the high point of 7.25 per cent.
Today is that one day in the year when the nation stops for a horse race. In Henry's day that meant the board meeting was suspended and members and advisers adjourned to the dining room where a television set was provided so the race could be followed.
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Nowadays, with an announcement of the board's decision required by 2.30pm, the meeting must of necessity be far brisker, with papers taken as read and only the most telling questions asked and answered.
We have all been given a pretty good idea of the thinking of the management of the Reserve Bank. I refer to the fine recent paper by Deputy-Governor Ric Battellino.
"The daily barrage of gloom and doom" makes it easy to lose perspective, a situation that Battellino sets out to remedy.
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