RBA's Lowe: Not seeing signs of any stress in Australian financial system
Lowe is in the Q&A session of his speech now
- Banks have access to all the liquidity that they need
- Super industry does not need RBA liquidity support as of yet
- The longer lockdown lasts, the more damage there is to the economy
- Not concerned that government will have trouble borrowing in markets
- There is suggestion of strong demand for Australian government debt
- Should look at how we tax incomes and land in Australia
The last point is what stands out to me most here. There's a saying that 'spending is taxing', basically meaning that government spending is but a reflection of tax timings.
While stimulus measures and tax breaks now are helpful, it just means that they will have to be paid for by higher taxes in the future.
In the case of Australia, if the government isn't looking to "even out the pain" via GST or land tax, then the burden will fall back on consumers if this feeds through to income taxes.
Of course, this is a conversation for the longer-term picture once the virus crisis is behind us.