you need to think outside the box

My perception of the current bear logic on this forum;

Property will crash because..

Rates will rise to combat inflation.


My view...

Rates will not rise because we need to improve other areas of the economy to combat a slow down in the mining boom

Yes, you then have the problem of inflation

But rates are not always used to combat inflation

It is plain to see with the current commentary about Australia's structural tax problems BOTH sides of politics will be raising taxes and / or reducing spending over the next 5 years or more.

This change fiscal policy can effectively offset the detrimental effects of loose monetary policy

What does this mean for property ?

Take a guess: Low rates, high population growth and low employment (if the re-calibration of the economy works) = Up

Or in the very least it means maintaining growth with inflation NOT a crash of epic proportions as Keen & Co would have you believe.

Thats my opinion anyway

Monetary policy i.e. Rates is not the only influencing factor governments have to steer an economy

There is also fiscal policy !