Australians Face Large Increase In Repayments As Interest-Only Home Loans Expire

You know that a story is big when they run it in Zero Hedge. Zero Hedge today ran a story that Australian's are now facing a large increase in repayments on their home loan as interest-only loans expire each year for the next few years. The median increase according to Zero Hedge and the RBA, is $7,000. Given the current economic climate would people be able to pay an additional $7,000 per year on their mortgage? The answer is no and this increase will only force people to sell in a falling market. Zero Hedge reports that the RBA says that it isn't worried, and as Zero Hedge says, “yeah, good-luck with that.” Watch this space.

Citizenship crisis flares again, with four MPs and one senator on the way out after High Court ruling

It is reported by ABC that there will be five by-elections in four Australian states following a series of resignations from Federal Parliament earlier today. After the High Court ruled that Labor senator Katy Gallagher was ineligible because she did not renounce her British citizenship in time, a total of four federal MPs also announced their resignation from Parliament. MPs Rebekha Sharkie, Josh Wilson, Susan Lamb and Justine Keay all announced that they were resigning from Parliament following the Gallagher ruling. The fifth by-election will occur because ALP's Tim Hammond is also resigning for family reasons. It is not clear at this stage when the polls will be held.

Budget 2018.

Scott Morrison announced the Budget last night and the Turnbull Coalition government has put itself into election mode with a $13.4bn tax plan offering relief to middle-income earners who have experienced a long period of wages stagnation. In the first phase of the seven-year tax plan, 4.4 million middle-income tax payers will be given a $530 cash rebate, this is the main centrepiece of the 2018 budget, and it will cost $140bn over the medium term. Last night the treasurer, Scott Morrison, also released the economic projections which would apparently have the budget return to balance in the year 2019-20, this is a year ahead of schedule, and he also said that it would deliver a surplus of $11bn in 2020-21 and a surplus of $16.6bn in 2021-22. Considering that under the Liberals the debt has ballooned to half a trillion dollars this projection assuming growth of 3% (currently at 2.5%) seems a bit far-fetched.