@Osi says the RBA doesn't control interest rates, that these are set my international markets or some other agent. What do you think? I said the RBA has complete control but doesn't want to harm special interest groups. Of course if we had higher rates here then there might be an influx of overseas capital looking for returns, but that assumes free markets from the outset. What take would you have on that? The typical story has it that low interest rates caused the housing boom, but I think this may even be denied in MMT. Of course a rise in rates now would cause defaults and deflation in housing, but that is not the same as saying that housing prices are set by interest rates in the first instance.
