Nothing makes a bank economist and FIRE sector spruiker happier than the ongoing deflationary pressures generated by a mountain of debt around the globe and the masses of mal-investment driven by the recent history of Central Bank “bait rates”.

Deflationary pressures mean they can shout from the roof tops that the RBA no longer has any excuse for not threading a larger and fatter “low interest rate” worm on the debt peddler “hook”.

“Come on Governor Glenn give us a boost – clearance rates have plummeted below 80%”

“We need some stimulation and we need it now”

“Demand for our loans is starting to wilt – cut rates to put some lead in our pencils”

It is the same old cynical story – demand more of the infection that produces the infirmity.

In response to an article on Macrobusiness a Glass Pyramid operative vented a few drops of precious spleen this morning. Continue reading →

This morning the Sydney Morning Herald published an article by Peter Martin discussing the responsibility of the Howard government for the current absurd state of affairs with regard to the price of land/housing in most parts of Australia but particularly in the capital cities.

How did we manage to turn what should be a national competitive advantage – oodles of low cost land into a massive millstone around our neck with only a trickle of ‘wealth effects’ to keep the economy ticking over?

The comment below was made at Macrobusiness