Here’s a nice counterpoint to all of the death of the mining boom gloom that’s been spreading this week, from Paul Bloxham.
I have only one question really. The “staged” wind down of the mining boom thesis relies on this rather strange notion that price can be substituted for by volume in an altogether smooth transition. I don’t know about you, but I can’t remember many capitalist booms ending this way. Rather, price booms resulting from inelastic supply usually crash when the delayed supply response hits already waning demand.
It’s a direct analogy with Australian housing, especially in Melbourne. So, its perhaps no surprise that Bloxo sees no likelihood of a major correction there either.
Enjoy!
120727 Downunder Digest – Reports of the Mining Boom’s Death Greatly Exaggerated
