Given that Australia has one of the highest household debt levels in the world, it could be the “first domino to fall” in the now often rumoured event of a global financial crisis. Our economy is looking “increasingly similar to Ireland's” prior to the 20007 housing collapse.

This warning comes from John Adams, Digital Finance Analytics, who has been predicting an “economic Armageddon” for the country because of overseas financial crisis due to property, household debt and net foreign debt bubbles. But as house prices fall faster, he now predicts that Australia will be the first to fall, for the first time in its history.

Australia is compared with the well known Irish economic plunge of 2007 because at the time, the Irish household debt to GDP was 100%; that of Australia last September was 120.5%. The Reserve Bank now puts “debt to disposable income at 188.6%, slightly below Ireland's 200%, but above the U.S 116.3%. Two thirds of our debt is invested in real estate! 60% of all lending is for housing, prices of which are going south!

Then there's mention of “second order falls” in prices as investors rush to sell. Not to mention flat incomes, large mortgages and rising costs.

We are also warned that the next recession is likely to be “structural, long and deep”.

There is dissenting opinion from an AMP economist but, given the recent findings by a Royal Commission into banks where the AMP showed up in a poor light …...

(Source: News.com)

I'm trying to work out what an ecomic is.

Is it:

A batman/superman/casper the friendly ghost etc comic that is only available online

or

a comedian who only tells jokes on twitter

I doubt that anyone who feels it's alright to make such a stupid, unhelpful comment would be able to "work out" anything.

We may be on a trajectory to recession, but that's something that can probably be reversed by cutting interest rates. And even if that's insufficient, we can ALWAYS get out of a recession very quickly (or avoid it completely) by increasing the government deficit. Australia has unlimited credit in Australian dollars, and no generation will ever be under any obligation to eliminate Australia's debt.

mhaze,
I think you're reading it wrong – 'tis an environmentally friendly microphone!

They'll probably bring in more students- I mean immigrants to temporarily buoy the market. Housing owners appear to be addicted to growth- same as the developers. What a wicked web we weave. ;)