Rising interest rates and unemployment won't be far from the minds of those who lived through Australia's last major recession in the 1990s. But in 2023, with a debt-laden nation paying off homes many bought at record high prices, rising rates mean a new type of misery. Australia's housing market has completely changed the nature of our economy. And as Alan Kohler reports, many of the old economic rules may no longer apply. Subscribe: ABC News In-depth takes you deeper on the big stories, with long-form journalism from Four Corners, Foreign Correspondent, Australian Story, Planet America and more, and explainers from ABC News Video Lab. Watch more ABC News content ad-free on ABC iview: For more from ABC News, click here: Get breaking news and livestreams from our ABC News channel: Like ABC News on Facebook: Follow ABC News on Instagram: Follow ABC News on Twitter: Note: In most cases, our captions are auto-generated. #ABCNewsIndepth #ABCNewsAustralia...(read more)
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Australia's three-decade-long streak without a full-blown recession might be coming to an end. With the devastating impact of the COVID-19 pandemic, experts are raising concerns about the Australian economy's ability to withstand such a challenge. The once resilient nation is facing several headwinds that pose a significant threat to its growth and potentially mark the end of its impressive run. For those unaware, Australia's economy has been the envy of many developed nations since its last recession in 1991. This unprecedented period of growth, commonly referred to as the "Lucky Country" narrative, has showcased Australia's ability to weather global economic downturns and emerge relatively unscathed. However, as the world grapples with the coronavirus crisis, it seems Australia may not be able to continue riding this wave of prosperity. One of the main factors jeopardizing Australia's economic performance is its heavy reliance on China. The Asian economic giant is Australia's largest trading partner, particularly in sectors such as resources and education. As tensions between the two nations escalate due to political conflicts and trade disputes, the Australian economy is vulnerable to disruptions in these critical sectors. Any significant reduction in Chinese demand for Australian goods or services could have a severe impact on the Australian economy. Another challenge facing Australia is its domestic housing market. Housing prices have soared in recent years, making homeownership increasingly unaffordable for many Australians. With the economy now experiencing a downturn, people are losing their jobs and struggling to repay their mortgages. This combination of reduced buyer demand and potential housing price drops poses a significant risk to the stability of Australia's financial system. A crashing housing market could send shockwaves throughout the economy, leading to a recession. Additionally, Australia's tourism and hospitality industries have been hit hard by the pandemic. International travel restrictions have severely limited the influx of tourists, resulting in significant revenue losses for these sectors. While domestic tourism could provide some relief, it is not enough to make up for the absence of international visitors. The continued closure of international borders and the uncertainty surrounding when they will reopen further complicates the recovery efforts for these sectors. Some argue that the Australian government's response to the crisis has been commendable and could potentially prevent a recession. The implementation of stimulus packages, such as JobKeeper and JobSeeker, has provided much-needed support to businesses and individuals affected by the economic downturn. The Reserve Bank of Australia has also taken significant measures, including cutting interest rates to historic lows, to stimulate spending and investment. These interventions may help soften the blow and set the stage for a recovery. However, despite these efforts, there are numerous challenges ahead that could tip Australia into a recession. The road to recovery will be long and uncertain, and the country must adapt to a post-pandemic world with new economic structures that are less reliant on sectors threatened by global events. In conclusion, Australia's impressive 30-year run without a full-blown recession is under threat. The combination of China's economic tensions, a vulnerable housing market, and the decimated tourism industry due to the pandemic are all substantial challenges that the country must overcome. While the government's response to the crisis has been robust, Australia's economy will likely experience a significant slowdown in the near future. The nation must prepare for the possibility of a recession and seek new avenues for sustainable economic growth. https://inflationprotection.org/could-australias-30-year-streak-without-a-severe-recession-be-coming-to-an-end-7-30/?feed_id=119869&_unique_id=64bbd57a9935d #Inflation #Retirement #GoldIRA #Wealth #Investing #abcnews #abcnewsindepth #alankohler #AustralianNews #bank #costofliving #crisis #debt #documentaries #economy #foodbank #house #housing #interestrates #longformjournalism #mortgage #pressure #recession #ReserveBank #RecessionNews #abcnews #abcnewsindepth #alankohler #AustralianNews #bank #costofliving #crisis #debt #documentaries #economy #foodbank #house #housing #interestrates #longformjournalism #mortgage #pressure #recession #ReserveBank
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