I have this sneaking feeling, with no hard evidence to back me up, that speed skater Steven Bradbury is actually in control of Australia’s finances. Maybe as Wayne Swan’s puppeteer?
Of all our first world competitors, our economy seems the only one that hasn’t fallen over. They’re all in a bit of economic poo, something like quicksand, where the harder you flail, the deeper you stink.
It’s been two decades since our last recession. Our Treasurer got the gold medal as Euromoney’s “world’s greatest treasurer” last year. (But it’s not like they could give it to anyone in Europe with their catastrophic problems, is it?)
Australia’s government has a very low level of debt. But can we make the same claim for us as individuals? Mmmm …
Australians seem financially healthy. We’ve got low rates of unemployment, low loan defaults and more of us have been saving in the last year.
But depending on which statistics you want to believe, Australia’s private sector debt is a concern.
Most private debt is for real estate, both homes and investment properties.
Does that mean we’re set up for a fall? Not necessarily, although some, such as economist Professor Steve Keen, is utterly certain Australian property is due to swan dive into a pool of set concrete.
Unlike the country’s finances, you can do something about your own finances. Have a plan to reduce non-deductible debt to keep your personal balance sheet fighting fit in case others around you start falling over.
Bruce Brammall is the author of Debt Man Walking (www.debtman.com.au) and principal adviser with Castellan Financial Consulting.