At the moment, reserve banks around the world are all allowing massive money supply increases by keeping interest rates low. Australia' money supply is expanding by 14% per year while economic growth is around 4%. That is 10% worth of pure inflation per annum. "Luckily" this seems to be going into asset prices but we are also seeing food and energy prices rise (helped along by a rising oil price). No reserve bank dares to act alone since, if it raised its interest rates, then its currency would appreciate against the others and disadvantage its imports. It is naive to expect a coordinated world response on this issue since the US is expected soon to lower its interest rates in an attempt to stop the stockmarket from diving there due to the developing housing loans crisis (that still has a long way to unwind). So the situation will get worse. In fact, if you go to Shadow Stats:

http://www.shadowstats.com/cgi-bin/sgs/data

you can see how the US economy is currently contracting by 2% per year and the only thing that allows Wall Street to keep posting new highs is massive inflation!

Adopt your crash positions now! (Put your head between your legs and kiss your paper assets goodbye!)

No mention of the Yen carry trade in this article - the biggest source of the cheap cash.

It really is not very brave for the author to predict a bust. Economist never predicted this boom and really don't know when its going to come to an end. How do you get such a well paying job when really there is no accountability as far as their predictions are concerned? It was only about six or seven years ago that many economist were saying that gold is finished and that we had far to much nickel being produced. They have as much an idea about what is going to happen as the GW (sorry climate change) gurus pretend to have!

Whether we like it or not the bust is going to happen.China cannot continue to grow at 11% pa.There are the looming restraints of climate change,and political/structural changes within China that will bring the world back to reality.The problem with all speculation is that it feeds off it's own success,thus inflating the true value of assets in terms of actual productivity.

Our balance of trade deficit is now over $600 billion or 60% of our GDP.We are in a worse situation than the US.We all have to pay the credit card off one day or go into liquidation.

China has industry and it's own domestic market to fall back on,what do we in the land of OZ have left when no one wants to buy our resources/energy?

Can any one truly think the bust is not coming?
It is it will hit us hard and change our country and the world.

Good one Henry,

But can you please add top executive remunerations to that graph.