This comment was made at Macrobusiness (link may be locked – but there is a free trial available)
All that international capital seeking a home and bidding up the dollar is allowing Mr Swan to run up cheap (for now) public debts and the RBA to run a low interest rate strategy. They are hoping the littler battler stays on the tips of his toes. Of course that is pure short term thinking and will do plenty of long term damage to several sectors of the Australian economy.
But as we discovered yesterday any questioning of the low interest rate strategy and using household debt to drive the economy is the province of driveling Utopians, socialists and the naive. Continue reading