aust ecomomy in freefall, page-46

There is a timely reminder of commodity market dynamics from the troubles of KZL. OK they weren't in the right commodity, but Zinc demand from China has grown as much as for any other, its just that in this instance the supply side has kept up.

Australia's economy is highly leveraged to the delicate balance between supply and demand for coal and iron ore. If the balance tips, then we could be in big trouble. It doesn't need a collapse in the Chinese economy or other black swan event to cause this, just supply growing steadily faster than demand.

Government and RBA ought to recognize this and make sure we aren't entirely reliant on abnormal high income from mining. Unfortunately there seems to be an assumption it will go on forever.