Recently some folks have tried to convince us that housing is now cheap, given valuations are 2002 levels. But that pales next to the following from The Kouk today. Apparently, our economy is the best since 1964!
The current economic data in Australia are about as good as one could expect to see.
Australia has GDP growth of 4.3%, at the same time inflation is running at 1.3%, at the same time the unemployment rate is below 5.5% (5.2% to be precise), at the same time mortgage interest rates are below 7% (6.85% for the standard variable rate).
Delving into the various data bases to try to match up a time when Australia’s GDP growth was 4% or more, inflation was 1.5% or less, the unemployment rate was 5.5% or less and the standard variable mortgage interest rates was 7% or less, and I came up with March quarter 1964.
Peace and good will to all men!
Beyond the hyperbowl, there is a solid point here. So long asset prices are held in check, up or down, an economy driven by the levels of business investment we are seeing and with low inflation, is pretty close to Nirvana. Just not a lot of risk assessment here.
