Thank you for all the great work you are sharing here it is very much appreciated.
We do not think rising rates is a big threat at this stage either. Weak demand for one thing. The slow motion global "Japan" we are seeing will continue for some time.
Pressures on the banks - not sure if I can agree with you on this however, or if that is actually what you mean for that matter. European banks are going home, don't want to or can't participate in syndicated loans or the wholesale funding book leaving a big hole. Selling local assets here too in the process, will shut shop and leave.
Our economy is in a difficult position IMO. The 800lb gorilla in the room is the dead consumer - that is a global problem. The middle class boomed on a debt binge now unwinding slowly. Unemployment rising - I don't believe the official figures as I have looked at how the ABS 'measures' this metric. Ditto GDP have looked and it does not reflect real business growth at all. In Australia more large scale infrastructure (new projects) and government spending - in some cases double counted.
The falling property prices after the 100% loan era and no doc loans etc leaves mortgages underwater. As property valuations shift the banks will need to adjust reserve ratios to suit. The stress is there it is real we have tested and proved the concept already. I also spoke to people direct from offshore banks (not EZ) going home and glad to take a haircut how much do you want to buy?? Some local assets too.
This is highly important for gold investors in Australia as it affects our dollar and therefore the AUD price of gold. Hence my close interest in all of this including how the RBA operates on rates (slowly and after the event).
Don't drink beer (allergic) so wine or scotch for that discussion would be preferred :-) Don't pretend to understand all the jargon so would have to sit and ask questions to clarify.
