It is very exciting watching the RBA explore the outer limits of monetary policy but it is a policy of desperation and last resort.
With Mr Hockey determined to apply a blow torch to demand by starting his austerity program at the bottom of the economic pyramid, driving the wealth effect with the debt machine is the only alternative.
Using foreign buyers and the risk slurping investor crowd to prop up inflated asset prices is bottom of the barrel stuff.
The only thing preventing a meltdown is the all in gouging by state, local and federal governments on new land releases. Their unbridled greed and drip fed methodology is keeping the price of new land solid as a rock.
When rising unemployment kills off the high population ponzi intake the fun will really begin
Jolly celestial tidings to you as well,
I am out of service area at the moment with the Dire Wolf but I wrapped a flock of cockatoos in alfoil and every now and again they swoop into alignment and deflect a few particles of the internet superhighway towards the bent coathanger that is sellotaped to the back of my idevice.
Yep – even a govt as dim as this one knows that an open gate policy with rising unemployment is a recipe for electoral oblivion.
The problem they have is that too many wallets are already full of dust and moths due to massive household debt sea anchors.
So when the ponzi related demand mojo fades it will combine with debt burden / deleveraging to really kill off domestic demand.
And the government has no idea it is even happening and just keeps on pushing the RBA to keep the monetary policy / debt machine show on the road.