There’s no stopping the RBA’s Mr Rainbow, John Edwards:
THE rapid rise in Australian house prices isn’t problematic and won’t continue indefinitely, a central bank board member has said, before sounding a note of caution about the country’s latest employment data.
“It is not anything approaching a crisis…It is not obvious how far this can run,”.
The original interview was at the WSJ so no doubt Mr Rainbow was attempting to talk down the dollar for global markets but he’s also talking up prices at home.
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It will be a crisis in short order if:
- house prices stop growing and consumers bunker just as we plunge off the mining capex and terms of trade cliffs, or
- house prices keep growing as we plunge off the mining capex and terms of trade cliffs, turning it into a fully fledged bubble with no underpinnings.
But that’s probably just the black armband talking!
