These two headlines pretty much summarise the story of the Australian housing bubble:
Value of nation’s homes equivalent to four times the economy
Risk that ‘a minor shock could become far more significant’
But, the full story is well worth a read. The charts are great (ht: Rohit Rajendran). Do not miss noticing how big the housing bubble in New Zealand too is.
The Australian Government announced a Royal Commission to inquire into the conduct of its banks. The Bloomberg story on it lists the following ‘triggers’ for it:
The main opposition Labor party has for months been demanding a royal commission into the finance industry, amid a string of scandals ranging from misleading financial advice, attempted rate-rigging and alleged breaches of anti-money laundering laws. Pressure was growing on Turnbull to hold an inquiry, with some lawmakers in his Liberal-National coalition threatening to force a vote in parliament next week. [Link]
The Opposition leader well captures the ‘capture’ here:
Opposition Leader Bill Shorten said Mr Turnbull had spent 601 days fighting Labor’s call for a royal commission into the banking and financial sector.
“It says everything about Turnbull’s values and priorities that he only agreed to Labor’s royal commission when the banks told him he had to,” he said in a statement.
“He ignored the pleas of families and small businesses, he rejected the words of whistle-blowers. But when the big banks wrote him a letter, he folded the same day.” [Link]
The goose is beginning to get cooked well ‘Down Under’, regardless of the convincing win for Australia in the first Ashes Test at Brisbane.