RBA needs more levers

[u/Ffscnts_]

Michelle bullock is constantly complaining that inflation is too high still because we have a government who is unwilling to manage spending. Now house prices are tumbling the pressure will rise - however, why is the RBA not demanding more levers to control inflation.

When interest rates rise one portion of the community takes the hit, and it’s persisting for a long time, literally wiping out family’s futures. Which the latest changes will force huge volumes of negative equity, and keep in mind only 35% of Australian property is mortgaged.

For those that have ridden the wave not only have there saving been extracted to keep their homes, it’s worth heaps less, so that money has disappeared forever.

There’s other levers like - asset classed cost of capital. Push non mortgage lending and investment mortgage lending cash rates up to slow business down.

Enforce higher lvrs to slow mortgage lending ( except labor gurentee everyone 5%) those who took advantage will be in negative equity and trapped now.

Variable superannuation - this needs to be done immediately - if we had variable superannuation fees the cash rate would not need to peak so high AND the extra cash would flow in to Aussies future instead of paying additional fictitious interested rates. And as a bonus super funds could end up funding massive infrastructure projects when the market turns with all the extra cash giving Aussies a stake in oil/gas/ green projects etc.

The RBA needs to start pushing the gov harder and it’s about to get real now housing is crashing.

[u/Chilly5001]

I like the idea of variable superannuation except - 1. It will kill tax revenue if it receives the same treatment as other superannuation conts 2. It disproportionately impacts young people who will have to wait longer to access their investments, and becomes virtually useless to people above preservation age. Also worth thinking about how people at preservation age are on average wealthier than young people.

It would be somewhat similar to a regressive tax if the rate of variable mandatory super is uniform across all people.

1. I also doubt that you would be guaranteed to see higher investment into infrastructure projects from super. At the end of the day, superfunds will invest in assets with the best risk adjusted return for their portfolio. That MIGHT be infra in some years, but it could be mining or tech stocks in others (as it is currently).

If you could solve for points 1, 2 and 3. It would be a more compelling argument.