Reference :- In this post we discuss the Vancouver real estate crisis . There is much to be learned from it .

Reference :-   Renowned economist ,  Professor Michael Hudson , recently gave a lecture in which he discussed the real estate crisis in Vancouver.   During this lecture he briefly used Australia to illustrate how overpriced real estate damages a country's economy .  I have reproduced the relevant part of his lecture below .   The spoken word often doesn't convert to the written seamlessly , which you will notice .  But the quote is pretty much verbatim .

 " Real estate booms are a kind of curse . In Australia the price of having a house has gone up so high that Australia is unable to be a manufacturing centre.  It is unable to produce goods and services because if you can afford to pay for a home to live in Australia , you have to earn such a high income that your employer cannot compete with exporters in other countries.    I discussed this in Canberra with the head of the central bank  (  The RBA )   and he said  ( paraphrasing )   ' Well we really don't need industry.  We actually don't need 90% of our population because we are very fortunate. We live in a nice neighborhood , the neighborhood of China , and they are buying our iron ore and our other mining stuff and we can balance our payments, and pay the banks, really without industry at all. '
And I said  ' Well what's going to happen to the Australians ? '
And he said  '  I guess you can say that's not in the equation .' "
(At this point the Vancouver audience laughs  . )
Professor Hudson then goes on to say  " And I guess it's not in the equations of economists here in Vancouver when they say Vancouver must be getting rich because of the rising house prices .  They don't see that rising house prices are making the economy poor. " 
  I wonder if we are in Mr Morrison's equations ?     My son , Ken junior , didn't want a thing to do with this post .   He is cheesed  off because he thinks he will never be able to afford a house .  And also cheesed off that he can't get a job , what with the state of the economy and all.   I cheered him up by reminding him he is at least making a few quid selling his herb cookies.  Then we ate a couple and had a good old giggle about it all .   I quite like the lad sometimes .    

Your comrade,  Ken