Carrington Clarke

The way that Michelle Bullock and the previous Governor Philip Lowe talk about inflation is almost biblical, like a great evil.

And it does sap everyone.

It saps the purchasing power of everyone from rich to poor.

So whilst they acknowledge that hiking interest rates has a disproportionate effect on people who are in those middle years,

family formation, housing debt, and it has generally, generally, a beneficial impact on older people who have assets, who have savings, who get more money from those savings when interest rates go up.

They're aware of that, but they also...

Essentially, they never say the words, I don't care.

But what they do say is, this is the lever we've got.

This is the lever we've got, and it's the only one we can pull.

There are lots of things government can do, and government are not that into doing them.

It is in some ways...

that an independent central bank, of which the government has no control over beyond appointing the governor every five or ten years or so, makes the call.

They make the hard call.

They wear it.

But there are other things you can do than just pulling this one lever.

We haven't pulled a lot of government levers.

I can rarely think of a time where there's been a better illustration of the fact that the stock market is an indicator of the economy.

It is not the economy.

Here and in the US, you have stock markets at frothy highs.

You have investors saying, we believe that these companies, that everything is going to roll forward, that things are all going to work.