The only argument about housing prices seems to be whether they will crash or fall slowly. Paul Keating warns of a possible “Minsky moment” – a sudden and spectacular crash. A paper published by Ben Phillips and Cukkoo Joseph of ANU, going into regional detail, finds that there is already an oversupply in some inner-city regions, but suggests that oversupply in itself is unlikely to reduce prices to any significant extent in the short term. Core Logic reports that auction clearance rates in Sydney and Melbourne have been on a noticeable downward trend over the last twelve months.
Wayne Byrnes, Chairman of The Australian Prudential Regulatory Authority has given a speech warning: “The broader environment of high and rising leverage, encouraged by historically low interest rates, requires ongoing prudence. It is easy to run up debt, but far harder to pay it back down when circumstances change”. Those seeking a summary of Byrnes’ speech will find one by Clancy Yates, writing in the Fairfax Press.
Wage growth, or the lack of it, is in the news. The ABC has three related but separate stories: Carrington Clarke “Cost cutting hurting workers and the economy” summarising a speech by Reserve Bank Governor Philip Lowe; Stephen Letts and Michael Janda “Wage growth mired near record lows”, citing the ABS Wage Price Index; and Michael Janda “Australian workers gift $130b to employers through unpaid overtime”, based on work by Jim Stanford of the Australia Institute’s Centre for Future Work.
Ross Gittins points out that, as a source of economic advice, Treasury’s power has been waning, with more influence coming from the Productivity Commission and the Reserve Bank, institutions more in touch with the real world. Labor, if elected, would boost the influence of the Parliamentary Budget Office.
A Washington Post-Kaiser Family Foundation poll has found that those identifying themselves as “Christians” are far more likely than “non-Christians” to blame poverty on individual failings rather than people’s circumstances: “46 percent of all Christians said that a lack of effort is generally to blame for a person’s poverty, compared with 29 percent of all non-Christians”. Among “white evangelicals” 53 percent blamed the individual.
In defiance of media predictions that Labor would retain the seat of Northcote in a Victorian state by-election, the Greens had a convincing victory. With 45 per cent of the primary vote, against 35 per cent for Labor, they easily cruised through on preferences. The Liberals did not contest the election in a metropolitan seat that Labor has held for aeons, but even though those who were disinclined to Labor or Green had the choice of another 10 candidates, they secured only 20 per cent of the vote between them. (Figures from William Bowe’s Poll Bludger.)
Richard Butler wrote in this blog that nuclear war is becoming ‘thinkable ,again’. This article shows a US Marines F-35 squadron is training to fight through nuclear war against North Korea – Business Insider.
Twelve Australians of the Year write an open letter to the PM on Manus Island.
Infographics in The Conversation show exactly what Adani’s Carmichael mine means for Queensland.
The owner of the Carmichael project can’t walk away from mine without descending further into distress, says an energy expert in The Guardian.
With the mining boom spent, the big infrastructure spend on the gas industry gone, and the east coast housing boom in its final phase, it seems there’s little ammo in the locker left to help fire up a wages lift any time soon – but there’s a silver lining, writes Ian Verrender. Read the full story
Richard Denniss explains that the coalition is unpopular because it has unpopular policies (Canberra Times)
Tim Hollo explains that Australia’s ageing constitution is past its ‘best-by’ date (Canberra Times)