Out for Blood

It is funny (not ha ha) that in Australia people are calling for the resignation of the Reserve Bank of Australia head, after he supposedly said;

“I’m sorry that people listened to what we said and then acted on that and now find themselves in a position they don’t want to be in,” he said.

"Listening" to the reserve bank meant that people were supposedly making decisions that they would not raise interest rates until 2024, so they bought their heavily inflated homes. However, while I don't think that I will go as far as defend the RBA,

Wasn't it fucking obvious they would have to?

When inflation is running rampant, the only mechanism the RBA has is to increase interest rates, and when the value of houses in Australia have increased in price by upward of 40 percent in the last two and half years on the back of the lowest interest rates ever seen, people should know that they can only go one way.

And sure, the argument can be made that "they promised" not to raise them until 2024, but I would like to know how this is significantly different in the affects it has on what most people have, a twenty five to thirty year loan. The only difference prolonging the interest rate hike would make is, it would kick the can a little down the road, but in the meantime, inflation would get worse anyway. So, rather than paying more for home loans, the very same people would be paying more for everything else instead.

The level of irresponsibility on the part of average people is incredibly high these days, where there is a constant blame on every poor outcome they get, based on their own decisions. I would suggest that no one made the decision to buy a house on a few words from the RBA, but rather, they made the decision to buy based on their FOMO in the market, deciding to buy a house in a heavily inflated market because they couldn't control themselves and they wanted "their" house.

No one made the decision to buy for them.

The RBA didn't at least and if anything, it was the culture of wanting to own a "piece of the Australian dream" at any price that was the largest driver. The average level of fiscal responsibility and apparently economic literacy is incredibly low at the moment, which seems to be driven in large part by the have now, pay later mentality that increases debt to satisfy the instant gratification, on-demand society in which we live. Everything is at our beck and call.

If we are hungry, there is a 24-hour store open. If we are bored, there is a screen feed available. If we are horny, there is an app to provide a partner.

We live in a world where patience isn't required so is it really any wonder that people can't delay their gratification when it comes to economic decision-making? It shouldn't, but it does, because while people want to be free to make their own decisions, they want to be protected when the decisions they make are fucking stupid.

It comes down to greed where we want what we want now, like Veruca Salt demanding from her Daddy, because we have been spoiled by choice and hold the misaligned belief that we are entitled to have whatever we want, whenever we want it. It doesn't matter if what we want is not good for us and has a detrimental effect on our quality of life, because when that happens, we will blame others for our decisions, like all the people who blame McDonald's for getting fat, as if they were forced to roll their car up to the drive-thru window and order three Big Macs, two large fries and a chocolate bloody thickshake.

The advertising!!

But, you know it is bullshit, right? Isn't it the same with bankers and politicians? People know they are full of shit yet when what they say conveniently supports our greedy decision making, we choose to believe them blindly.

Skin in the game.

We are the ones who have to live without our decisions, who have to lay in the bed we have made for ourselves, so when we are making the biggest financial decisions in our lives, we should bloody well get a second opinion and do our own due diligence. Which means getting a third and fourth opinion too perhaps, if we are unable to work this crap out for ourselves.

For ourselves.

This is a big problem, because we want the good results for ourselves without the potential of the bad result, even though the decisions we make are clearly riskier than we treat them. Pretty much, all the people who have bought a house in the last two years should have known that the decision they were making is riskier than it has been for a long time, because for a long time there was stability. And in terms of interest rates and inflation, it isn't like people weren't talking about how printing massive amounts of money and crushing supply chain possibilities wasn't going to lead to inflated prices.

All of this was being discussed, but because people hear what they want to hear, they weren't listening to anything that went against what would get them what they wanted. It is no different to the people who give up their private keys in Discord to people who offer free tokens with a million rocketship emojis - just at a much larger scale.

Getting a resignation from a single person does nothing for them, as they will still be stuck with an over inflated house purchase and a mortgage they will struggle to manage. But they will feel like they have made a difference, by "punishing" the head of the RBA. At the end of the day, people will have to live with the decisions they make, no matter who they blame and at the end of the month, the mortgage payments will still be due.

Taraz [ Gen1: Hive ]