On Tue, 1 Sep 2015 14:18:03 Rohan McLeod wrote:
Russell Coker wrote:
Perhaps it could be added that unlike the budget of a person, household or ordinary company, where a deficit is unconditionally undesirable; the budget of a government, particularly a national government, in some ways resembles a bank. Where the business model is not zero deficit; rather the idea is to have maximum 'borrowings' (the depositors funds);
The aim for a business is to borrow as much money as they can invest to make more money while not taking excessive risk. The aim for a household is to borrow money for major investments such as buying a house or car. It's expected that most families will have mortgages at some time. As an aside the interest on a mortgage is lower than on most other loans so using a redraw facility on a mortgage to fund all other purchases is becoming quite common. -- My Main Blog http://etbe.coker.com.au/ My Documents Blog http://doc.coker.com.au/ -- Sent from my Samsung Galaxy Note 3 with K-9 Mail.