I was listening to someone a good deal smarter than me. He said that the flight of capital out of China would increase and although Aussie property is admittedly overvalued he expected the Chinese capital to continue to enter the property market over here. Although I don't agree with him as I think Aussie property has to fall far further, however this would likely keep the bubble from popping suddenly, it was interesting his view.
I think a lot of people are underestimating the advantages to Australia of the cheap dollar, and no doubt it's why the RBA have been pushing the dollar down, or trying to, for a few years now. I was thinking about this today in a restaurant filled with 20 and 30 somethings all spending and earning with gusto. The talk was all of travel and new cars etc, just the thought of mentality that Yellen would love to see. The "richest country in the world" with an exchange rate that gives you access to cheap houses will no doubt be popular. Do you want residency with that?
I see that large and powerful interests like the Aussie property prices supported. Governments depend on property taxes (property price dependent) and bank share prices depend on mortgage values (property price dependent). History appears to show the Reserve Bank taking notice of these kinds of pressures - so I expect a bias to weakening the Aussie dollar to maintain the overseas appeal of Aussie property. However, in other ways, Joe average suffers from weak currency - notably due to rising prices of imports.
Yeah, the underlying theme is "population growth" and it's from overseas. As you know if they invest enough, they get free residency. Most are not really migrants anyway, I think normal "migration" changed a long time ago and the diaspora are far more mobile. Integration is a thing of the past as there no longer is a majority of any ethnicity. Everything is being managed really, there are multiple agendas running simultaneously, ingenious really.
Even if the yuan drops by 15% against the USD, it has still outperform most of other currencies over the last couple of years such as our own