While we are happy that banks have been doing such a wonderful yeoman service for the growth of the economy, will we be happy to continue to depend on bank financing as the predominant mode? Are we compelling the banks take too much risk, thereby endangering the depositors’ money? 10.
But working in the other direction are flat real wages at a time when debt levels are high and housing prices are falling in our largest cities. We are continuing to assess the balance of these forces. As we do this, we are watching the housing market closely. There has recently been considerable public attention paid to declining housing prices in Sydney and Melbourne.