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woof woof Gold Member Offline Australian Politics Posts: 1518 Gender:	What is GDP Apr 4^th, 2013 at 5:35pm What actually is Gross Domestic Product
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MOTR Gold Member Offline Australian Politics Posts: 6646	Re: What is GDP Reply #1 - Apr 4^th, 2013 at 5:56pm woof woof wrote on Apr 4^th, 2013 at 5:35pm: What actually is Gross Domestic Product Total value of all goods and services produced in country. About 1.4 Trillion (1,400 Billion) at the moment.
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adelcrow Gold Member Offline Australian Politics Posts: 20133 everywhere Gender:	Re: What is GDP Reply #2 - Apr 4^th, 2013 at 5:59pm Its the thing we pretend doesn't exist if we're Libbos and in Opposition
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Mnemonic

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Re: What is GDP
Reply #3 - Apr 4^th, 2013 at 6:21pm

MOTR wrote on Apr 4^th, 2013 at 5:56pm:

woof woof wrote on Apr 4^th, 2013 at 5:35pm:

What actually is Gross Domestic Product

Total value of all goods and services produced in country. About 1.4 Trillion (1,400 Billion) at the moment.

................. and it's the monetary value, measured in dollars or whatever currency the country has. It's not a scientific and objective measurement of the value of goods produced. Oh wouldn't it be great if there was such a thing.

To compare GDPs of different countries you convert it into a common currency, say U.S. dollars. They are also two ways of calculating GDP: current-currency exchange rate and purchasing power parity. The latter takes into account the average person's ability to purchase the same good or service in that country.

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freediver

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Re: What is GDP
Reply #4 - Apr 4^th, 2013 at 6:34pm

If you add up everyone's salary, it should give you the same answer as if you add up the value of everything that is sold (retail or export), as well as everything we buy, give or take some changes to savings. It is a measure of the 'official' economy. It excludes a lot of things, such as the value of volunteer work, unpaid work (babysitting) and marijuana sales.

A favourite way to compare GDP without the vagaries of exchange rates is to convert it to something else that is universal - how many big macs you can buy.

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People who can't distinguish between etymology and entomology bug me in ways I cannot put into words.

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woof woof Gold Member Offline Australian Politics Posts: 1518 Gender:	Re: What is GDP Reply #5 - Apr 4^th, 2013 at 8:31pm OK so our debt to GDP is 10% yeah?? Gov says our debt is equiv to someone on 100K having a 10K mortgage yeah?? OK, So GDP is not government income?? whats our debt to government income ratio?? Sure as hell a lot higher than a 100K wage earner having a 10K mortgage. More like a $500 a year wage earner with a 10K mortgage.
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freediver Gold Member Offline www.ozpolitic.com Posts: 49400 At my desk.	Re: What is GDP Reply #6 - Apr 4^th, 2013 at 9:00pm I think the government takes about 40% of GDP. Google tax freedom day for a nice simple measure of this. If you want to compare government income, make sure you compare it against government debt, and over the same tiers of government.
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MOTR Gold Member Offline Australian Politics Posts: 6646	Re: What is GDP Reply #7 - Apr 10^th, 2013 at 10:53pm freediver wrote on Apr 4^th, 2013 at 9:00pm: I think the government takes about 40% of GDP. Google tax freedom day for a nice simple measure of this. If you want to compare government income, make sure you compare it against government debt, and over the same tiers of government. Isn't it closer to 20%
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freediver Gold Member Offline www.ozpolitic.com Posts: 49400 At my desk.	Re: What is GDP Reply #8 - Apr 11^th, 2013 at 5:05pm Quote: Isn't it closer to 20% We might have to put this down to one of those eternal mysteries that will never be solved.
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Dnarever

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Re: What is GDP
Reply #9 - Apr 11^th, 2013 at 10:38pm

woof woof wrote on Apr 4^th, 2013 at 8:31pm:

OK so our debt to GDP is 10% yeah??

Gov says our debt is equiv to someone on 100K having a 10K mortgage yeah??

OK,

So GDP is not government income??

whats our debt to government income ratio??

Sure as hell a lot higher than a 100K wage earner having a 10K mortgage.

More like a $500 a year wage earner with a 10K mortgage.

The ratio is actually about 7% Australian Government net debt. that is 100K wage with a 7K loan.

http://2.bp.blogspot.com/-jZ9YgQio4C0/TaT9dLtz_LI/AAAAAAAAA54/KnpQGaFu2kw/s1600/...

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« Last Edit: Apr 11^th, 2013 at 10:50pm by Dnarever »

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perceptions_now

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Re: What is GDP
Reply #10 - Apr 11^th, 2013 at 11:06pm

woof woof wrote on Apr 4^th, 2013 at 8:31pm:

so our debt to GDP is 10% yeah??

That depends on whether you are looking at the net or gross Debt to GDP?

Gov says our debt is equiv to someone on 100K having a 10K mortgage yeah??
I've heard that said here before, but non one has provided a link to the government statement.
That said, the comparison would not be correct!

OK,

So GDP is not government income??
No, GDP is not equivalent to government income!

whats our debt to government income ratio??
The net figure includes government assets & is about 10%, whereas the gross figure doesn't include government assets & is about 23%.

Sure as hell a lot higher than a 100K wage earner having a 10K mortgage.
More like a $500 a year wage earner with a 10K mortgage.
Whilst the accepted method of comparison is Debt to GDP, I would suggest that is inappropriate and the more correct method should be gross government Debt to Total government Revenue.
On that basis, in comparison to a more standard mortgage Debt to income ratio of say around 4/1, a similar government gross Debt to income arrangement, with government Revenue at around $370 Billion, would see government Debt at around $1.5 Trillion?
Obviously, with gross government Debt running at around $270 Billion gross & Revenue running around $370 Billion, that would equate to a Debt to income ratio of only 70% or so, which is quite a bit under the standard mortgage equivalent, but it is also quite a bit higher than the 100K wage earner having a 10K mortgage.

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perceptions_now

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Re: What is GDP
Reply #11 - Apr 11^th, 2013 at 11:22pm

MOTR wrote on Apr 4^th, 2013 at 5:56pm:

woof woof wrote on Apr 4^th, 2013 at 5:35pm:

What actually is Gross Domestic Product

Total value of all goods and services produced in country. About 1.4 Trillion (1,400 Billion) at the moment.

That's close enough, supposedly!

But, the standard method doesn't take into consideration, the over shoot applications, where governments &/or CB's push large amounts of "stimulus &/or excess monetary actions, such as quantitative easing" into an Economy, which may "artificially" increase GDP, but only on a temporary basis.

In the cases of Japan & the USA, they have both pushed massive amounts into both Q/E & stimulus programs and that has "artificially" increased their GDP's.

BUT, in doing so, they have also massively increased their Debt to GDP ratio's and their current & future costs.

What I'm saying here, is that the effect/s of any "stimulus & Q/E programs" should be calculated & that figure should then applied to reduce the GDP figure back to a more correct net GDP figure!

If this were applied to Japan & the US, then their artificially inflated GDP figures, which may otherwise appear half reasonable, would suddenly come crashing back down!

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Mnemonic Gold Member Offline Australian Politics Posts: 1530 Melbourne Gender:	Re: What is GDP Reply #12 - Apr 12^th, 2013 at 1:13am There's a good chance the U.S. is going to end up like Japan.
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MOTR Gold Member Offline Australian Politics Posts: 6646	Re: What is GDP Reply #13 - Apr 13^th, 2013 at 5:06am freediver wrote on Apr 11^th, 2013 at 5:05pm: Quote: Isn't it closer to 20% We might have to put this down to one of those eternal mysteries that will never be solved. Might have something to do with whether you include the tax receipts from state governments. http://www.budget.gov.au/2012-13/content/bp1/html/bp1_bst10-04.htm
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Dnarever

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Re: What is GDP
Reply #14 - Apr 13^th, 2013 at 6:18am

Dnarever wrote on Apr 11^th, 2013 at 10:38pm:

woof woof wrote on Apr 4^th, 2013 at 8:31pm:

OK so our debt to GDP is 10% yeah??

Gov says our debt is equiv to someone on 100K having a 10K mortgage yeah??

OK,

So GDP is not government income??

whats our debt to government income ratio??

Sure as hell a lot higher than a 100K wage earner having a 10K mortgage.

More like a $500 a year wage earner with a 10K mortgage.

The ratio is actually about 7% Australian Government net debt. that is 100K wage with a 7K loan.

http://2.bp.blogspot.com/-jZ9YgQio4C0/TaT9dLtz_LI/AAAAAAAAA54/KnpQGaFu2kw/s1600/...

Interesting that this is about the same level of debt that the Fraser Government left with Howard as treasurer and no GFC to cause it.

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