Loosen up, Australia

Credit miserable

Australia's pulsating immigration program is largely tilted towards younger, working age migrants.

And the Aussie population is presently growing by more than one million persons every 2½ years, as we'll be reminded over the coming weeks when the esteemed population clock whizzes past 25½ million.

For a supposedly burgeoning labour force and dynamic economy, credit growth of just 3 per cent and slowing is woefully inadequate.

Yet that's where we're at, and this will be indirectly reflected in the economy growing by a ghastly 1 per cent over the 2019 financial year, the most benign growth we've seen since the early 1990s recession. 

Ugh!

Personal credit growth was negative 4 per cent over the year to July 2019, the sort of lamentable result more readily associated with the global financial crisis or the previous recession.

Cactus.

Housing credit growth also fell to around 3 per cent - despite the labour force expanding by a pumping 2.6 per cent year-on-year - with zero growth in the reputedly riskier investor cohort, the lowest result on record. 

There's been some shrill reporting about Baby Boomers - the richest generation since forever - taking on a modest amount of mortgage debt in an environment where the cash rate is 1 per cent.

Would that life were so tough for the rest of us!

Now admittedly the environment isn't too awkward for borrowers of high credit quality seeking plain vanilla home loans, but lending generally remains risk averse for anything outside the most basic of parameters. 

When the simplest projects such as splitters or plexes are being scrutinised like they're contaminated with radioactive waste this nanny state mentality must surely be smothering market's ability to supply new housing over the forthcoming cycle.

Cue no astonishment when the national accounts once again reveal negative per capita growth in a few days' time!