Everyone knows Australia’s foreign debt is getting out of hand. In the March quarter alone, the deficit on the balance of goods and services rose by $994 million dollars, a factor of more than a third (37 per cent) from the previous quarter.
The coming June quarter when published is likely to be even worse.
What people don’t think about is the rest of the equation. As an accountant this worries me – how do we balance our books? Foreign capital inflow is the answer.
Where is all this ‘new’ capital being spent in our economy? It’s going into buying up our housing stocks and agricultural land, hence the big city housing boom in troubled times.
What are our ‘pollies’ (and the Reserve Bank) doing: the same as always, ‘fence sitting’, reducing interest rates and the ‘Aussie’ dollar in the hope of a growth factor to slow our economy’s inevitable decline.
What is really going on? For years we’ve lived on borrowed time by flogged of our minerals and now their prices have been devalued by world competition.
From which (so called boom) we saved very little. So now we’re flogging off our land and the future of Australia’s young, to those who have the money like China etc and don’t blame them for what we ourselves have done.
Perhaps we should be flogging our politicians as we slide into the real era of Paul Keating’s forecasted ‘Banana Republic’ or is that Tony Abbott’s ‘Oz Banana Monarchy’ as Tony with zero opposition crawls towards his ‘must have’ second term?
T. Sharples, Tweed Heads
