Advertisement
One of the more magical (not in the sense that it is good) phenomena of zero interest rate policy (ZIRP) and quantitative easing (QE), or in Australia’s case just very low interest rates, is what it does to various asset prices. As I noted in my recent post “Australia turns Japanese“:
Australia’s cost of capital is evaporating before our very eyes as a global capital glut destroys yields from Tokyo to London and New York and back to Berlin. The entire world is turning Japanese.
What does this mean? We need only look at other nations to find out. There are three main impacts.
The full text of this article is available to MacroBusiness subscribers
Cancel at any time through our billing provider, Stripe
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.
Advertisement