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If you look at interest rates from 1990 to now, and average household debt, it's easy to see why the economy has been up up up up. People have been spending way

If you look at interest rates from 1990 to now, and average household debt, it's easy to see why the economy has been up up up up. People have been spending way more money than they make for 30 years in Australia. That will make any economy boom. The difficult thing is... when does it stop? The above could have been said 10 years ago, just replace the 3 with a 2. Should it have stopped then? Now? In 10 more years?

ComputerGuru 5y ago
That type of economy (powered by extreme consumerism beyond the customers’ means) isn’t unique to Australia. It’s only sustainable so long as the target population continues to increase (kind of like social security). The forecasted global population drop that will hit home in the next 15-20 years is going to completely destroy economies propped-up by fake money.
- danielmarkbruce 5y ago
  It's not unique, but in the first world Australia has gone from being ranked one of the lowest in average household debt in 1990 to one of the very highest in 2021. It's not fake money. It's likely not even "beyond means". The debts can likely be paid back. But it seems quite unlikely the level of spending can continue to grow.
  - ComputerGuru 5y ago
    It’s fake money in the sense that, assuming people aren’t in over their heads with loans they shouldn’t have been approved for, everyone is fully leveraged at some multiple of their monthly salary. In that regard, the present is fully leveraged taking a debt that the future will have to pay back, and it can only be pushed out indefinitely so long as the economy continues to grow. That’s regardless of GDP: it can be - and this is what people futilely speculate when it’ll hit - because the economy took a turn south (GDP looking only at the working-aged population drops) or, as mentioned above, even if the economy is doing spectacular on a micro level and GDP (again calculated only against working-age population) is up, but there simply aren’t enough cogs in the machine to keep it spinning at the same rate it was before.
- zizee 5y ago
  I agree that Australia's economy is propped up by continued ion growth, a giant pyramid scheme if you'll excuse the hyperbole. However Australia has such a large amount of land, and such a small population that forecasted worldwide population drop won't affect Australia so much. It's such a desirable place to live that immigration at the current rates will be sustainable regardless of the rest of the world's population growth rate. Whether or not our cities can keep up with the growth and maintain their high levels of livability is another question. I'd also question your statement about population drop on the next 15-20 years. All forecasts I have seen are that the world's population will continue to grow until the end of the century. If the world's population were set to start shrinking in such a short timeframe, I'd think it would be a huge talking point in any discussion about sustainability and global warming.
  - ComputerGuru 5y ago
    15-20 to start feeling it in the most developed nations, end of the century worldwide. Immigration can stall the former but current policies are not promising. Germany will sing songs of praise in Merkel’s name.
    - zizee 5y ago
      Well the sooner countries can start to transition to an economy that is not reliant on perpetual population growth the better. I am always amazed at news reports from Japan about how the sky is falling because their population is shrinking. For some reason no one ever says "on the plus side, Japan is one of the most densely populated places on the planet, a slow decrease in population will help improve quality of life measures and sustainability".
      - fomine3 5y ago
        In other words, aging society is the problem, and shrinking makes the problem much worse. Fixing the problem in ethical way is difficult.

ComputerGuru 5y ago

That type of economy (powered by extreme consumerism beyond the customers’ means) isn’t unique to Australia. It’s only sustainable so long as the target population continues to increase (kind of like social security). The forecasted global population drop that will hit home in the next 15-20 years is going to completely destroy economies propped-up by fake money.

danielmarkbruce 5y ago
It's not unique, but in the first world Australia has gone from being ranked one of the lowest in average household debt in 1990 to one of the very highest in 2021. It's not fake money. It's likely not even "beyond means". The debts can likely be paid back. But it seems quite unlikely the level of spending can continue to grow.
- ComputerGuru 5y ago
  It’s fake money in the sense that, assuming people aren’t in over their heads with loans they shouldn’t have been approved for, everyone is fully leveraged at some multiple of their monthly salary. In that regard, the present is fully leveraged taking a debt that the future will have to pay back, and it can only be pushed out indefinitely so long as the economy continues to grow. That’s regardless of GDP: it can be - and this is what people futilely speculate when it’ll hit - because the economy took a turn south (GDP looking only at the working-aged population drops) or, as mentioned above, even if the economy is doing spectacular on a micro level and GDP (again calculated only against working-age population) is up, but there simply aren’t enough cogs in the machine to keep it spinning at the same rate it was before.
zizee 5y ago
I agree that Australia's economy is propped up by continued ion growth, a giant pyramid scheme if you'll excuse the hyperbole. However Australia has such a large amount of land, and such a small population that forecasted worldwide population drop won't affect Australia so much. It's such a desirable place to live that immigration at the current rates will be sustainable regardless of the rest of the world's population growth rate. Whether or not our cities can keep up with the growth and maintain their high levels of livability is another question. I'd also question your statement about population drop on the next 15-20 years. All forecasts I have seen are that the world's population will continue to grow until the end of the century. If the world's population were set to start shrinking in such a short timeframe, I'd think it would be a huge talking point in any discussion about sustainability and global warming.
- ComputerGuru 5y ago
  15-20 to start feeling it in the most developed nations, end of the century worldwide. Immigration can stall the former but current policies are not promising. Germany will sing songs of praise in Merkel’s name.
  - zizee 5y ago
    Well the sooner countries can start to transition to an economy that is not reliant on perpetual population growth the better. I am always amazed at news reports from Japan about how the sky is falling because their population is shrinking. For some reason no one ever says "on the plus side, Japan is one of the most densely populated places on the planet, a slow decrease in population will help improve quality of life measures and sustainability".
    - fomine3 5y ago
      In other words, aging society is the problem, and shrinking makes the problem much worse. Fixing the problem in ethical way is difficult.