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Bo, the article you refer to conveniently leaves out the fact that most Australian debt is in private hands.
If one has $500,000 worth of assets but $400,000 in loans, the net wealth is $100,000. Several years of declining property values could see that wiped out and if your job disappears you're suddenly bankrupt.
Take a look at 100 years of Australian house price history, look at what happened in Japan and the US real estate over the last two decades and assess the likelyhood of world economic recession given levels of debt in the worlds major economies.
Life is pretty good for most of us right now but that does not reflect conditions in the rest of the world, conditions that will impact on us sooner or later.
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