Dr Sam Wylie

So consumer products, goods and services, plus investment in new productive capacity, plus exports.

or actually net exports, exports minus imports.

Those three things together make up the output of the economy.

And ordinarily, that grows at 2% to 3% per year above inflation.

So if inflation's at, say, 2.5%, and we have on top of that real growth, meaning above inflation of 3%, then the economy is growing at 5.5%.

3% real, and when you add in the effect of inflation,

which is just prices going up, it's not anything real, then 5.5% growth.

That'd be normal and healthy.

And that's great because it means that our wages are going up faster than inflation.

It means that there's plenty of jobs.

It means that the high immigration into Australia, there's plenty of jobs for people who are coming along and for the population growth.

And it's a very healthy, natural state of affairs.

When the economy slows down and goes negative, that's very unhelpful.

Unemployment goes way up.

You know, the pie that is divided in society between all of us, the output that's divided between all of us is getting smaller.

It's very unhelpful.

And that's the circumstances in which the government's going to start to spend more money to stimulate the economy and the Reserve Bank is going to cut interest rates.

And there is a concern that we're heading into, that we will be heading into a recession sometime soon.

Yeah, well, the bad thing will be the effect on the labour market.

So, which is very tight at the moment.