"Would this be the same RBA board that lowered interest rates to generational lows, while the Labor government was pumping billions into the housing market to make it rise 20% during the GFC?"
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I provide two scenarios for you Vertigo.
1. We have a GFC with a very big negative impact on the economy. Do you adopt an expansionary or contractionary fiscal policy? Ans: Text book policy response would be expansionary.
2. When the economy is BOOMing, do you adopt expansionary or contractionary fiscal policy? Ans: John Howard adopted expansionary (tax cuts / baby bonus / FHOG etc) which meant the RBA had to go the other way (ie increase rates). End result was money came in via one hand, then out via the other.
