Sure. You can go on and on about a housing crash because the RBA...

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bruceleroy

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30/10/21

10:29

Post #: 57200033
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Originally posted by dirkjeremy: ↑

Good points. However you haven't grasped the full economic impact of 200MTA of excess supply.

That 200MTA that China wouldn't need to import would come out entirely from the Pilbara where Brazilian exports wouldn't be affected and in fact may even be increased.

If we talk about $50 IO price (for argument sakes) which is barely profitable for even tier 1 low cost producers (tax revenue would plunge to zilch) and then 200MT worth of royalty receipts gone for WA.

I don't think the war hawks threatening Tomahawk nuclear strikes from AUKUS killer subs on Chinese cities have thought this through. Because there won't be enough money for Centerlink and NDIS when IO price is at $50. The AUD will also crash and cost of offshore borrowings (key source of funding for our banks lending into the housing bubble) will skyrocket. Then goes the AAA rating.

The thought of all this makes me sick.

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Sure. You can go on and on about a housing crash because the RBA will have no choice but to hike like silly as imported inflation already worsening will blow out under an ever weaker AUD. And the states will start a GST rebellion also given 1/3 of McGowan's royalty goes up in smoke. A IO price crash will have a feedback loop affecting the entire economy for sure.

Reading Abbott's crazy shit just now, I fear the worst. In Tunisian saying, there are some who don't shed tears until they see a casket. By then, it's too late.

FMG Price at posting: $13.93 Sentiment: None Disclosure: Not Held
3 Upvote

0 Great analysis

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