one chart to rule them all, page-4

Thanks for posting those, very very interesting.

It goes to a simple theory of mine - when people have to pour ever increasing amounts of their money into servicing a house loan, it sucks the life out of the broader economy.

Everyone "tightens their belts" which is great to balance their own budget but takes big bucks out of the economy.

Spending goes down, profits follow then lay-offs start happening.

People lose jobs, spend less, more lay-offs , the cycle continues until things get really bad, then the cycle starts all over again.

We've managed to avoid the boom bust cycle in Australia due to a combination of 2 mining booms, government borrowing billions and the rise of China, but it only put of the inevitable, it didn't go away.

In fact, like most things in life, the longer you delay sorting out a problem the worse it turns out to be.