Australia is a tiny country by population, and relatively young. To say we can't have an independent, isolated catastrophe here is naive IMO.
We're in more debt vs our income than any time in our history. Up to 10% of current mortgages are in the danger zone (where the customer is contributing 53% or more of their income to mortgage repayments). These mortgages are worth anywhere between $140 - $170 billion. What's the market cap of CBA again? On top of that 1.15% of total mortgages are already in arrears.
Our employment situation is worsening, and with building approvals falling off a cliff recently we could shed hundreds of thousands of construction jobs in the next couple of years.
To pile on, our banks are borrowing from markets like the US who are experiencing sustained rate increases, which are then naturally passed on to Australian consumers. When I said this 6 months ago this forum destroyed me for saying our banks could raise rates out of cycle. Now I can't find a single major Aussie bank that hasn't raised rates.
