How the Sydney bubble will pop

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From The Pascometer today, which has truly malfunctioned now:

The 2015 Sydney housing boom has achieved the dubious distinction of bubble status, replete with rampant FOMO (fear of missing out) and key parts of the market departing from gravity as values rise by hundreds of thousands of dollars in a few weeks.

Gravity’s power to reassert itself and history say the bubble will pop or, at the very least, deflate. The problem now though is working out where the bubble-bursting pin will come from when the Reserve Bank and federal government are depending on some of Sydney’s housing fire spreading around the nation.

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About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.