Interest rates a kept low to encourage Chinese money laundering through real estate thus:
Interest rates remain low, property market overheats, giving greater opportunity to launder vast sums through overpriced real estate.

Warmair, put ten economists in the same room and you can guarantee they'll come up with thirty different opinions!?
Cheers, Rhrosty.

Aiden, my theory has always been that big business is what drives our nation, as it's big business that tenders for and bank rolls most major projects this then involves large business who take on the roll of project managers and small business contracts to do the work.

While interest rates may be low, there are two major problems, one being our very anti competitive IR laws and regulations, the other being the lack of confidence big business has in our governments, recent examples being the threat of the super tax on miners, as well as the threat of a tax crack down on big businesses who profit share off shore.

While the average punter looks at rates and says, yes, that 2% decrease eases my burden by few grand a year, big business has to commit tens if not hundreds of billions to fund major projects and so long as the uncertainty remains in governments or even the threat of changes such as what will happen should labor get back in, big business will remain cautious and interest rates won't really matter.

Big business chooses to be here, it doesn't have to be and that's our main problem.

There are literally thousands of out of work miners wondering why their two on two off $130 K a year jobs have dried up and it's simply because they were blind to the fact that unions secured these unsustainable working conditions through their manipulation of the situation when we had far more jobs than workers.

Unions refuse to accept that what goes up, must also be allowed to come back down and their one eyed approach to job security is just driving our big businesses elsewhere. But, as usual, they are blind.

World debt is 3 times the GDP of the planet. World gambling. derivative market is 21 times the GDP of the planet. Derivatives under the rules must be honoured first,then come share holders and last depositors.

If they raise interest rates the whole system collapses.The central bankers will just print our currencies into oblivion.

Rehctub: It's well established fact that Governments can borrow for around half what private commercial interests pay!?

Nor are they burdened with a tax bills or hanger on dividend expectant shareholders/totally unproductive drones.

Even so, they endlessly claim they do it better?

And probably true if you add in things like gold plated delivery systems, Brownouts and perishable goods destroying blackouts!?

Or captive markets treated no better than herds sent to the abattoirs to be stripped of all their salable components; as they are price-gouged a far as human tolerance or the actual reality of alternative options will allow!?

While there might be the occasional exception that proves the rule?

Nowhere can I find a single example of where privatisation has resulted in cheaper commodities/goods/services?

But plenty or where exploitative capitalists have driven down real wages to where they pay more to keep kept slaves as the principal labor force?

What would Americans pay for food on the supermarket shelves if not for mexican migrant workers and the slave wages they earn?

And just don't start me on child labor or the work related practises in some foreign plantations/factories, hardly better or more humane than the workhouses in famine ravaged Ireland!

Is that what you mean by better?

Or should that just read cheaper?
Rhrosty.

Rhrosty, we live in a country whereby you can have anything you want, provided you are prepared to pay for it, and that included high wages and unsustainable working conditions, and we are about to see just how much we will pay for that when our car manufacturers pack up and leave.

Now you can keep the high wages and unsustainable working conditions, you just have to give something up in return, and in this case it's jobs and job security because we simply can't have both.

There is a classic example now where workers have been sacked, only to have the fair work commission order they be reinstated and paid. This will do unsustainable long term damage as big businesses see this and take it into account when forward planning. Chances are, this type of big brother intervention may just sway them away from Oz in future years but only time will tell.