Joye: Morrison has saved the AAA (NOT)

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From CJ today:

In unusually frank remarks, Morrison argued that world-beating capital buffers were “especially important” because “our banks source a considerable share of their funding offshore, reflecting Australia’s position as a net importer of capital, and [because] our banks provide the bulk of the domestic credit that local firms and households receive”.

Morrison will likely deliver a healthy budget in May with an earlier-than-expected return to surplus, additional housing reforms and an improved structural deficit driven by prudent savings and superior revenues, which should save the AAA rating and ameliorate threats to the banks.

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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.