Despite all the reassurances that the economy is in recovery, and, bond markets — the financial markets that really matter — simply don't believe it.
If things really get desperate, with say a banking crisis, and the RBA cuts to 0.25 per cent, it seems likely the RBA's first step will be to inject money directly into the economy through what's known as Open Market Operations.It did this during the financial crisis in 2008 but interest rates were much higher back then. This time around, mortgage repayments could drop to around 1 per cent or even lower.
First it was Latitude Finance, the former GE Money that enlisted the services of Ahmed Fahour in a bid to convince investors to tip in their hard-earned. Then came Retail Zoo, the owner of Boost Juice. And last Thursday, Singapore based Property Guru pulled its $362 million float. founder Adam Neumann sacked and its high-profile Japanese backer SoftBank desperately attempting to keep it afloat.
With the cash rate down to a fresh low of 1 per cent, Australia has entered what's been dubbed the"era of irrationality, impotence and inequality".
Same media owners uniting them in doom and gloom? 😏