Last Week I Discussed with Mark Bouris a Little Understood Part of Our Economy – Monetary Policy
By Gerard Rennick
In 1985 Paul Keating removed capital controls and allowed foreign banks to start lending to Australian families via domestic banks.
This policy decoupled the price of a house from earnings and instead linked it to foreign inflows.
This fuelled an explosion in house prices and household debt.
It also meant Australia created a rod for its back.
Instead of ensuring the cost of finance was distributed to other Australians, mainly the older generation to fund their retirement, we were now transferring our hard earned earnings offshore instead of distributing them to our children.
At the same time household earnings for blue collar workers started to decline as tariff protections on manufacturing was removed.
A lot of these productive jobs were replaced by Mickey Mouse jobs in Universities, Bureaucracies and Superannuation that didn’t produce any real goods but transferred wealth to the inner city at the expense of the metropolitan and regional centres.
The mining boom in the early 2000’s has managed to mask a lot of the wealth distribution but our younger generation are now inheriting both household debt and government debt due to the poor economic government decisions of the 1980’s and 1990’s. This includes the reckless privatisation of infrastructure of State governments.
To reverse this trend, Australia needs to start building and retraining our younger generation in how to build. We also need to lower taxes on wages and allow young people to keep their superannuation to reduce their debt burden.
Last week I discussed with Mark Bouris a little understood part of our economy – monetary policy.
The full clip is on comments below.
In 1985 Paul Keating removed capital controls and allowed foreign banks to start lending to Australian families via domestic banks.
This… pic.twitter.com/aSHbQNRVXM
— Gerard Rennick (@RennickGBR) August 1, 2026
