Debt requires servicing. Large debt requires a lot of servicing. Debt levels will only continue to increase over the longer term if interest rates are falling.

But that is a catch 22. Because if interest rates are falling, the capital required for the debt will be harder to come by.

Perhaps I could coin a term "peak debt". I doubt i'd be the first though.

2) I don't own any gold bullion.
I 'probably' will within approximately 12 months time, assuming things go as I expect.
The exit point for gold is the point at which it either
a) becomes completely mainstream (not ETF's, I mean bullion), or
b) at the height of hyperinflation, before another currency is adopted.

c) And option C is some other time that appears convenient. Being too 'idealistic' would certainly be a weakness.

I think Australian's assume that the "Australian Dream" is home ownership. It is not my dream. Homes are nice, but so is financial freedom and flexibility.

Oil is sharply down. Chaos that central planners can't control, they are just fighting their corner and looking more like the communist central planning committee at each turning. They are on the streets protesting against bankers in Chicago today.

I have always been worried about the way that equity in a home has been marketed as some sort of cash pool people can use for just about anything.It just sends the wrong message in my opinion, but then again maybe I am just not "hip".

I guess my point was that it is easy to say "as long as you manage debt" but I have heard that a lot from people that I am sure cannot manage extremes in debt - such as sharply rising interest rates.

The idea of people "managing debt" with a tolerance of only say 2% is pretty poor in my opinion. And the idea that debt is so great because it gives you the prosperity of the future - right now(!) sounds like pure consumerism to me. I don't think consumerism should involve debt.

And as you say, when people start to use home equity is when there is trouble. I have spoken to many young people who are overjoyed when their house price goes up...because now they can get it revalued and borrow into the equity. They treat equity like it is their money, yet it is far from it.

Personally I think that debt has allowed consumerism to extravagant degrees...even to the extent that I think many property sales are consumerism too.

"I'd really like to live in a mansion, and if we pay interest only we can afford it by using 60% of our joint salaries! It's a dream come true!". Etc. It doesn't need to be a mansion to qualify.

And yes, then comes the cars, the boat, the swimming pools, the new furniture, the extravagant renovations, etc.

Incidentally, I keep seeing these ads on TV from "Motor Finance Wizards". Basically they are saying that no matter who you are, we'll approve your credit. Unemployed? No problems. And they show some poor bloke with a good looking lass egging him on saying "Wow I love your car". It is clearly aimed at young adults.

A year or so I saw a news piece where they interviewed some young adults who had bought these fancy new sports cars with all the trimmings. These people had lost their jobs and couldn't pay off the car. So they had to sell the cars, and then still owed money on them. The rates offered are quite extreme, but young adults (possibly lacking guidance or better judgement) don't think twice about it.

Anyway, thats my rant. I know there is not much of moral value in the world, but it still seems a shame when you see someone being taken advantage of due to their lack of knowledge. Like the majority of the Australian public for instance.