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If individually everybody takes that self centred approach then collectively we are doomed.

Yep - I guarantee it. But even if we're not alive, actually giving 2 ****s about the next generation would be great. We don't see much of it these days - it's all about me, me, me.

We can afford to pay the interest until the interest is equal to our GDP. It would sort of suck though that at that point we would not even have enough money left to eat. I'm sure it won't get that bad - the rest of the world will see through our tricks well before then and stop financing us.

But the government, rba, etc don't actually produce anything. So their tricks will shift wealth around for a while (from the future to the present, from first home buyers to existing home owners, from the rest of the world to Australia) but eventually the game runs out of steam and somebody...

Unfortunately the whole of Australia does replicate the actions of people in this forum! But fair point though. The property market economics section can easily drift into global macro economics which can be a bit over the top.

What does government debt have to do with it? (typo maybe?)

Chris Joye argues our big 4 banks should show a home bias to their activities because they have an implicit government guarantee. I wonder if he would apply that logic to the rest of the world that Australia relies on so heavily? Most of the worlds banks are currently either government...

The assets (house values) supporting the debt is rock solid so we don't need a guarantee. The guarantee makes the assets rock solid. Something circular here ---- hhhhhmmmmmm

Why did we need to do it though? I thought our housing assets were rock solid? Can't international investors see that? Isn't it obvious to them? ;)

Wholesale bank funding guarantee The RBA had an impact in saving the property market (lower rates) but the number 1 influence by far was the wholesale bank funding guarantee. It was not something I expected. The whole property market is absolutely dependent on the flow of credit to keep...

Must save this one.

So the performance depends on the time frame selected. Thanks for pointing that out. How about this, "since early 2008 when many people thought residential property would collapse it hasn't collapsed but remains down slightly in real terms." Is that a fair statement?

From your own link ....

Nope. The fundamentals aren't there. The government can redirect wealth towards the housing market (by robbing me) and keep it alive for a long time but not forever. Eventually the whole country goes down with it. By the way - in real terms (after CPI) house prices have gone nowhere...