March 15, 2011 – RESERVE Bank of Australia governor Glenn Stevens said that there is nothing to worry regarding the country’s failing housing market. He further explained that there are other social issues at which he is much worried about as compared to economic issues.
He noted that there is not much difference between the buyers’ incomes and the house prices since the last 10 years. He is a bit confident that the market will still be stable and will still be able to meet the demand of the consumers and buyers will still demand for supply.
According to Mr .Stevens, Asian countries like India and China demanded from Australia for commodities from mining, leaving Australia in a position where it can profit gracefully. But this has been negated by the central bank telling us that this may not last long and that we should not be overly confident about this situation. But it is also explained that perhaps this may stay long as expected especially now that India and China are expanding on their economy.
This scenario should be taken as an opportunity for Australia to gain from this deal since it has been forecasted that the mining industry will have a 4 percent increase in the next three years. But this must be managed properly so as to be able to provide the demand and still survive longer.
Because of this, Australians were able to benefit since taxes were cut and made core inflation above 4 percent.
With this, the government opted to give a tough tax on the mining industry but it was just for a short while and this move resulted to the ouster of Prime Minister Kevin Rudd.
The next Prime Minister, Julia Gillard, offered a lesser tax on the mining sector.
These changes kept our heads up high and that we are confident that the housing sector is not affected for whatever changes there will be in the economy since the government is able to answer the needs of the people for them to be able to save for future housing ventures.
