Sunday, December 12, 2010

Treasury warning on home price 'bubble'

Can anyone work out WTF the ALP were thinking making Wayne Swan Treasurer?

"However, it is the considered position of the Treasurer and the Treasury that our housing market reflects the fundamentals of supply and demand and not a bubble - specifically that Australia is simply not building enough new houses."

Wrong on both counts as far as I can see. Assuming for a minute the confected lies were actually true, why then isn't Australia 'building enough houses'? (And where are all the people without houses living?) Surely that would represent some sort of national crisis the govt should be addressing urgently? So why aren't they?

I note Treasury use a report from vested interest Westpac as their bible also – who it appears may be almost on the skids based on their urgent borrowing of US Fed bailout money in a recent revelation.

I think Labor are deliberately keeping their heads in the sand so that if and when housing collapses they can pretend they had no idea. In the meantime, it's just unaffordable. They're forgetting the 'Labor values' of social justice and equality also in all this.

And we're actually paying people high salaries to be in a 'Household Demand Unit' in Treasury that is in equal measure useless and mendacious.

A SENIOR Treasury official has sounded the alarm over Australia's property market.

He has warned that the prospect of a sudden and dramatic drop in prices is "the elephant in the room" and should not be ignored by the federal government.

While the government and Reserve Bank insist Australia does not have a housing bubble - as some economists and the International Monetary Fund suggest - it remains such a worrying concept that Treasury has privately sought reassurance from its analysts that prices are not artificially high and that Australia does not face the kind of house price collapse that has hit Britain and the US.


Steven Shaw said...

I used to think that our public officials were stupid and corrupt but I've come to realise that there are quite a few options:

1. Incompetent. Unknowing. I.e. They don't know the truth and just trundle along doing there best according yo there adopted ideology.

2. Corrupt. Here they could be knowing or unknowing but care not and only seek tom further their own interests.

3. Foolish. Knowing. Here they know the truth and it's worse than even the bears amongst us think. They have rationally decided that the best course of action is to keep the public uninformed and keep kicking that can down the road as far as they can. They see no alternative. Perhaps they hope for some kind of miracle before the can reaches the end of the road.

Sean Reynolds said...

All of the above, Steven.