Asset price BOOM
Sharing a fascinating case study of Japan about why continued intervention by government to prop up a country beset by asset price bubbles does not work. According to Austrian economic theory, it is better to let things get bad, sell off bad debts, and start again. This is the idea that I have often argued for and Australia desperately needs from our leaders. I hold onto hope the size of a mustard seed that this budget might allow us to go into recession and rebuild the country so that hard work and good stewardship is rewarded. That would be a politically courageous and difficult thing for any government to do.
Continuing as we have is sending us into recession the political leaders and mortgage holders do not want. Banks are already there with mortgagee sales popping up faster and quietly if you know where to look. The stuff has not hit the headlines. Better to be honest and act now and let things be bad in the short term for the good of the people in the long term.
We need investment in public service front line jobs, better regulation of bank and non-bank lending, protection of low to mid income young savers in public policy so young people can lose their jobs but not the entirety of their hard earned savings and investment in home ownership programs.