Via the silly old fart today who reproduces Highrise Harry unedited:
“APRA and ASIC say there is a bubble. I say there is no bubble.
“But APRA and ASIC direct the banks, so if they want a bubble, then there will be a bubble because banks will lend less and less at the directions of APRA and ASIC. Eventually there will be a bubble.
“If banks were allowed to lend as much as they think is prudent then there will be no bubble.” The bank must decide whether the client is able to repay or not.
“Prices rose in Sydney not because the banks were reckless — it was supply and demand. “Sydney is today probably the most desirable place on earth, that is why people were prepared to pay more. Sydney belongs to the world, not only to Sydneysiders.
“Now let’s assume that there is a bubble. It will be catastrophic. Not only will the banks be running to the commonwealth government for help, but also most people in Sydney (and Melbourne) will become poorer because their properties will drop.
“Already the building industry is contracting. If APRA and ASIC force a bubble to burst there will be a rise of unemployment. Today many businesses are vibrant only for one reason—higher property prices.
Good luck making sense of that spittle-spraying panic. Honestly, what did these greedy old men think was going to happen? That they could just import Chinese, raise household debt and price-out Australian youth forever?
Time for them take some pain so we can restore the economy outside of dog box apartments.
