Yesterday the Reserve Bank of Australia decided to increase the interest rates by 0.25% once again. The banks already started to move with the Commonwealth Bank increasing their rate by almost twice as much as the RBA increase.
The government then starts to make a lot of noise, the shadow treasurer continues to blame the government and the average bloke feels the pinch.
I must confess that I feel very fortunate. I have never lost any job that I have ever had and, in fact, I took advantage of the low interest rates back in 2008 and bought our family home.
When I did buy our house I knew that interest rates were low and that they would eventually go up. I can;t help think however that if you were not prepared or did not plan for this you will probably be feeling the pinch. And to make matters worse the Reserve Bank says that the interest rates will continue to go up.
Australia is apparently doing very well, the resources sector seems to be keeping the economy going. Now the big question is, how am I supposed to be taking advantage of the resources boom if I don’t work in the resources sector? My industry is not even remotely linked to mining and I don’t have extra money in my pocket.
So explain to me, if Australia is doing so well and we need to contain inflation I want to know how most of the population who is not involved in the resources industry is supposed to be coping with the pressure?
Interest rates are up, groceries prices are up, electricity is a total absurd, council rates are up, petrol is also ridiculous and last year I got only 4% increase in my pay which has been absorbed already higher cost of living.
So if Australia is doing so well and we need to increase rates why is it that myself and the friends I talk to have less money now than this time last year. Why is it that $300 per week is not enough to buy groceries for a family of four?
The experts will probably say that the reason I have a job and that I even got a pay increase last year is because of the resources sector, that might be the case. They may also point out that many people lost their jobs. I feel for them, I really do. But now that employment figures are up, interest rates are going up and so is the cost of living, how is it that I am going to benefit from it? All that is happening to me is that I have less and less money due to the increase in the cost of living.
I will continue to manage my finances and to strive to do well. However I would like someone to tell me how is it that I will benefit from the resources boom? All I can see is financial doom and gloom for the average Australian bloke who is not involved in the mining industry.