Chimbu..Chicken Little
You dont do hysterical...you are giving a good impression of someone who is.
There will be some industries...luxury producing industries...that will suffer as discretionary expenditure is re evalauated.
I have a B.Comm LL.B from UNSW which provides a reasonable understanding of what is going on...I liquidated every stock I had in July last year...not being smug or clever...but it was obvious that things were getting ridiculous.
Things are serious...sure...but there are opportuniites now that havent been avaialble for awhile.
Go down to the local mall..... is it empty?.
Are people living in cardboard boxes outside your house?
The interest rate hikes over the last 5 years made people re evaluate their debt levels...most did.
This puts most people in reasonable shape to ride this situation out.
Your arguments are repetitive and circular.
The Sub prime mortgage situation in the US was bought about by home buyers being sold mortgage products that had nasty kickers.Introductory rates of 3% that balloned to 12 and 13 % after 5 years.Defaults on these mortgages were inevitable.
Hedge funds got in on the cheap money and were paying inflated prices for just about everything.
Fair value was destroyed and the gambling mentality took over.
The good times were never going to end...well they have...for awhile.
The Americans took their eye off their financial instituitons and let them run riot.
Not so in Australia...our exposure to sub prime was/is comparatively small.
None of our banks needs to be bailed out.Liquidity is a little tight.Thats not a bad thing.
The banks are solid...the real estate market is solid.The dole Qs havent lenghtened...nor will they lenghten appreciably over the next 12 months.There will however be a reallocation of labour.
Rudd is doing the right thing.
Spending is what ended the Great depression.
Give people a reason to spend..
Its the oil of economic machinery.
Consumers stop consuming ...game over.
Fair value is about to return to just about everything.
Go out and start bargain hunting.
Dont buy what you want...buy what you NEED.
Stupidity is about to be replaced by common sense.
The people who caused this problem now caused the problem in '87.
In another 20 years time they will cause another problem...if we let them