But some slowing was always going to occur from such levels, and in the context of widespread recession around the world, Australia's performance is good, and much better than would have been anticipated had our performance in previous global downturns been extrapolated. To what do we attribute this favourable outcome?
When the Fed engages in targeted credit programs that seek to change the allocation of credit across markets, I believe it is engaging in fiscal policy. Instead of the central bank engaging in this credit policy, the federal government could carry out these transactions by issuing Treasury debt to support lending to the targeted markets or firms.