The author is right there will be a second crash but not for reasons
that he believes.
I suggest he stop talking to economists and start talking to energy experts.

We are in for an energy crunch in the next two to five years and
Australia will be competing for supplies with our cheque book in hand.
Business as Usual is over right now.
Most observers only see the subprime loans in the US as the start
button of the current crash.
However that start was signalled by oil price rising unrelentingly
during 2007 and finally reaching US$147 a barrel.
That forced up prices of food and fuel and people ate instead of
paying their mortgage.
As the economy recovers we will run into demand meeting supply
again and we will get another spike in oil prices and your double crash will occur again.

Growth is finished and will be stalled perhaps for ever.

Yes, absolutely. Our economy is controlled by the world economy and if China doesn't buy our coal, there will be an large economic down turn.

These boom bust cycles have been occuring ever since the start of globalization. When a bust occurs, who ever has all the money at that time, goes around and buys everything at bargon basement prices, China has our rare earths now.

Australia should think very carefully about becoming a member of a world society that has this boom bust mentality.

Personally, I believe we should move rapidly towards being a self sustaining country, independent of what happens in the rest of the world. We have enough energy in the form of solar, geothermal, wind and natural gas to be independent of people like OPEC and big multi nationals that sell us oil. A peoples bank run by the federal government would bring the the big four banks back into line. They have been out of control ever since deregulation by Keating.

The people of Australia have to decide whether they want a big flashy economy, with a big rich end of town and a big poor end of town (present setup), or a economy that distributes wealth more evenly for everones benefit. Australia has the energy in the form of natural gas. The federal government could pass this asset along to the people in the form of cheap car fuel and electricity.

Australia and its citizens should come first, then foreign governments and multi nationals.

Conditions now are almost as identical to conditions prior to the economic chrisis.

There is still too much debt, still too many doubtful mortgages in the US, falling US demand for Chinese goods and too much demand for Chinese money. Stock market prices are unrealisticly high and the spin merchants still in control.

What's changed? Not much except underemployment and unemployment are higher and the really clever Governments have borrowed more and spent all their reserves simply to postpone the inevitable.

That's akin to the effects of Roosevelt's answers to manage the great depression. They simply prolongued the last great depression.

Marko
I can hardly dis agree with you given I've preaching essentially the same for some time.

I don't think that the problem is confined to the Rudd government rather the flaw is Political Parties and specifically their reliance on, fear of the Big end of town. Untill their unofficial testes grip on the majors is broken I can't see the systemic bias (excesses) being broken.

Likewise when it all comes down to it how do you convince the extremely greedy to back off a bit.(the CEO) of a US bailed out Financial house who claimed his $64 million salary was due to his 'doing God's work' not largely due to 'survivor syndrome' (Less competition). Given the 1000 upper staff who got up to $1 million bonus one wonders if they learned anything from the crash(2).
What then is in store for the future.

How do you tell the aspirational voter who can't see past the next new car big screen TV etc that these are the reasons we're in this parless situation, sitting in the top story of house of cards afraid to change less it all collapses. They see what the Greedy have and SIMPLY want their cut.
How do you explain to all parties that argument by extremes is counter productive.

I agree we should concentrate on making Australia more self reliant but how in a Global environment? One can't unravel The spider's web (global economy) much less re-weave it.


the other wild cards is the energy crisis which will be exacerbated by AGW

What a shame Rudd opted to carry on inflating the bubble instead of popping it and beginning the recovery.
Back then he could have rightly pointed the finger at the previous administration, divorced himself from Big Finance (the "Big Leaches") and been a world leader at the end of his term.
Instead he is playing "pass the time-bomb".
Peak oil is now recognised as here or just past.
You would reckon governments would have slowed down the banking system and prevented more leaching...but instead they have accelerated the flow of funds to the bankers. This can only mean: 1) The leaches have more power than any responsible people. 2) The next plunge is due sooner rather than later. The cash grab is on!
This religious deference to financial wankery is stunning and a little bit depressing. You cannot spend money you don't have! A bloody 8 year old could tell you that!

'How do you tell the aspirational[sic] voter who can't see past the next new car big screen TV '

That's a myth, and a patronising and judgemental generalisation akin to the labelling of 'McMansions' for those who dare to participate in society.

The gall that some people think they are somehow 'outside' consumer society, or that their purchases and votes are somehow more morally based or intelligently crafted. That they are in the know, and project this naive lemming behaviour onto anyone they see as different or inferior. It's a common indulgence of preaching lefties.