The venerable Glenn Stevens has announced to our 'surprise' that Australia has a housing bubble... the only problem is, he's only 10 years too late.  So what happened in the United States will inevitably happen here, house prices will crash and many Australians are going to be servicing mortgages that are worth more than their houses.

Will the Howard or Rudd governments admit that they were central in inflating this bubble with the first home owner's grant... no.  Will the central bank admit that they shoulder most of the blame for this bubble through artificially lowering the interest rates for the past 10-15 years... of course not.  The funny thing is that right the national argument is whether the government should take over healthcare from the State governments.  So this tragedy will probably see both the central bank and the federal government gaining more power when the real economic crises begins here at home.

The original article can be found at:  http://www.news.com.au/business/story/0,27753,25847312-462,00.html

Evidence of the housing bubble: http://www.debtdeflation.com/blogs/2009/03/22/fhb-boost-is-australias-sub-prime-lite/

God bless,

Dr Washo