Comments by "John Woodrow" (@johnwoodrow8769) on "Home owners have 'every right' to feel 'aggrieved' after RBA hiked interest rates up" video.

@benjamin4894 Do you think the banks just make money out of thin air? They have to borrow every cent. As the cost of borrowing increases, so does the cost of lending.
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Only a naive fool would have taken notice of Phillip Lowe's prediction that interest rates would remain at unsustainable low levels. At the time he made that stupid statement inflation was already skyrocketing in the US and Europe, and their central banks has started to crank up interest rates in response. To think little old Australia wasn't going to get drawn into the issue was always a ridiculous suggestion.
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If people look to the history of inflation cycles they will see they generally last 10-12 years. Why will this current high cycle be any different? It is not unreasonable to assume high inflation and corresponding high interest rates will be with us for quite a number of years.
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@benjamin4894 FFS, taking about 'gold standard'. When they say banks create money its only because they can lend the same dollar over and over a number of time i.e. what is lent comes back as a deposit to be lent again. The government has full control over this process by determining what level of reserves the banks are required to hold, effectually limiting the number of times each dollar can be lent.
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Well said, described the situation perfectly.
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