Aus macro


Finding myself going through the thesis, for the hundredth time again, as we await the RBA today, and writing a fairly similar note to many previous iterations on the matter.

The thought

Listening to the articulate Mirvac CEO, but disagreeing on the general health of Australian households. It comes down to beliefs. Plenty of clever people whom are not concerned about the below (e.g. they say it is debt we owe to ourselves, or, taking another common thought/statement/get-the-point-accounting path, record high net wealth sits on the other side of that debt!)..


We are in the camp that thinks this (referring to collection of graphs above/below) matters. Over-levered…


frothy…(read unsustainable credit demand)


…and vulnerable to higher rates.


The problems to loan servicing (and the economy at large) come from the tail of the distribution, not the average (whom are typically ahead of payments, and travelling well).

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