With interest rates, mortgage debt, and housing prices rapidly surging, many Australians wonder whether and when the bubble is going to burst…
The question is: how can property remain affordable without causing a price crash, especially when two-thirds of the population are owner occupiers?
Known critic of modern economic theory Steve Keen joins us today to reveal everything mainstream economists get wrong about the property industry. He shares his insights on the possibility of a property crash and how first-home owners might be vulnerable.
We also discuss the rising level of household debt, what it can ultimately result in and how the government can intervene.
If you enjoyed the show, do like, rate, subscribe, and share us on social media and if you have your own questions you need clarity on, email us at questions@theelephantintheroom.com.au!
See you in the episode!
Episode Highlights:
- What Economics professors get wrong [02:36]
- The determinant of change in property prices [06:16]
- On measuring household debt [09:01]
- Why first-home buyers are vulnerable to rising debt [14:09]
- What can trigger a price crash, aside from a debt crisis? [18:50]
- How the government can stimulate property demand [20:27]
- Getting inflation under control [23:56]
- The possibility of a property crash in Australia? [28:45]
- Steve’s Senate election pitch: money creation [32:59]
- The need for a modern debt jubilee [35:37]
- The current state of consumer confidence [38:14]
- The issue with government debt [40:44]
- Sustainable long-term solutions to housing [53:54]
- The economic impact of climate change [57:34]
About our Guest:
Steve Keen is a heterodox economist and an author. His two most famous books, Debunking Economics and The New Economics, are both critiques of modern economic theory that discuss debt deflation and financial instability. Dr. Keen was a professor at the University of Western Sydney and Kingston University in London. Now, he is leading the development of Minsky, a software platform for visually modeling national economies.
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