Glenn Stevens is enacting economic theory that simply doesnt work. He failed to take account of rising asset prices and now after causing the problem in the first place he seeks to crush asset prices.
Raising interest rates never did "fight inflation". It has a three-way impact to INCREASE inflation: it reduces real investment, it increases production costs and it cuts back on supply. Fewer people work for fewer hours producing fewer goods or services at higher cost.
Glenn Stevens and his crew at the RBA constitute a so called independent central bank. Why do we have a democracy at all if we give over total control of monetary policy to a small group of elite and muddle headed economists?
