4.20 Australian Budget 2021-22: Do 10 years of deficits matter? | Nucleus Investment Insights

Treasurer Josh Frydenberg handed down his second “pandemic budget” for 2021-2022 amidst a backdrop of continuing uncertainty. Acknowledging that the virus is a continuing threat to lives and livelihoods, this budget is again framed to prioritise jobs and investment.

View presentation slides: https://nucleuswealth.com/wp-content/uploads/2021/05/australianbudget.pdf

As well as stimulus measures, the focus has been on structural reforms across many of the government portfolios. Skills, infrastructure, deregulation, and digital transformation are all featured, together with a continued emphasis on services.

The current and projected hit to immigration, one of Australia’s favourite growth levers, has seen our per capita income look remarkable as the labour market tightens and more jobs are serviced by local unemployment.

If there was one main takeaway, it is that budget deficits are here to stay. As we will cover more in the show, our historical habit of big budget deficits will continue, taking advantage of the extraordinary low interest rate environment we find ourselves in.

But where is the money going to come from? In normal times, central banks want to keep their independence from spendthrift governments, to fortify their inflation-fighting credibility. For now the RBA appears to be in lockstep with Canberra in keeping their foot flat on the expansionary pedal.

We take some time today to assess and summarise our take on the budget, and consider if we stand at a post pandemic turning point, or run the risk of falling back into the poor policies of the past.

In this week's investment podcast, Nucleus Wealth’s Chief Economist Leith van Onselen, Head of Investments Damien Klassen, and Head of Advice Tim Fuller investigate if 10 years of Australian budget defecits actually matter

On the agenda today:

Key budget parameters

Does a decade of budget deficits matter?

Back to a ‘Big Australia’.

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Nucleus Wealth is an Australian Investment and Wealth Manager providing premium wealth services to all Australians. We're here to help you achieve financial peace of mind. To find out more head to https://nucleuswealth.com/?utm_source=youtube&utm_medium=direct&utm_campaign=podcast.

The information on this podcast contains general information and does not take into account your personal objectives, financial situation or needs. Past performance is not an indication of future performance. Damien Klassen and Tim Fuller are an authorised representative of Nucleus Wealth Management. Nucleus Wealth is a business name of Nucleus Wealth Management Pty Ltd (ABN 54 614 386 266 ) and is a Corporate Authorised Representative of Nucleus Advice Pty Ltd - AFSL 515796

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