gold, page-26937

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Because the housing boom has once again been a defining topic this week, here are a few choice quotes by ex-CBA chief executive David Murray we thought are quite fitting.
The chairman of the government's Financial System Inquiry - and former Future Fund chairman - earlier this week warned a crisis on the scale of the 1890s great property collapse could not be ruled out.
"What people should do is look at the 1890s, which was caused by a housing land boom," he told The Australian. "To say it won't happen and simply ignore it is wrong."
Half of the nation's banks closed their doors following the 1890s crash."
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What is your opinion of this article by ex-CBA boss? I have been thinking lately on Oz private sector debt which is very high as @marri did mentioned. I see signs the authorities especially APRA increasingly taking out the sledge hammer to reign in the banking exposure to the interest only loans which are accused of inflating the property prices.

Recent policy by APRA to make the big 4 increase their tier 1 capital ratio was the initial control of the issuing of loans. As a result the banks have without Govt complain been raising their mortgage rates independent of the RBA and only last week raised them again. Against such a 'clipping of the growth wings' don't you think the banks are looking a little over stretched in their valuation or the list of risk mitigation measures are appropriate to buffer the big 4 from any impending burst of the 'property bubble'. I am not a doom or gloom conspiracist but this property appreciation in Syd/Mel cannot just keep rising qtr after qtr. The mechanics of a healthy trend requires to have the froth removes every so often so that it can keep rising. Even with the SP500 valuation we had batches of aggressive valuation destruction before the value hunters stepped in each time.

I want to get your perspective in this sector. Thanks.