You know a famous investor by the name of Warren Buffet was once quoted as saying, “For every bubble there is a pin waiting to prick it”. The resources boom is no different to any other bubble in history, it will burst. If the world economy goes into decline with rising interest rates globally, it will burst before you know it.
There is actually concern amongst some senior economists that central banks that target inflation rather than growth could be leading their economies to disaster, especially when the inflation is imported like it is in Australia and Europe. While the central banks are fighting inflation that they really have no control over, their economies fall into a deep recession. It has only been in the last 30 years that some central banks around the world have been tasked with targeting inflation within a certain band. It is only a matter of time before it will be proven to be the failing fad it has become.