What did you think of the figures today and then the Treasurer's spin on it?

Well, I think this final budget outcome document, FBO, I can't recall much attention being given to this basic document before.

It's really what says the budget came down in May for really the next financial year.

And for the financial year, it's just ended in the end of June.

So it's only a couple of months.

It's comparing what they forecast in May to the final outcome.

So it doesn't really move around, doesn't really tell you a lot.

but because they're taxing us all more, right?

mean, tell us, how bad is this going to get?

Well, I think we are seeing a significant house price correction.

House prices in Australia, as everybody has said, have been pumped up a lot.

There's been restrictions on the supply of housing because of government zoning and planning laws that's pushed up the price of houses over the last 10, 20 years.

And now we're seeing the combination, I think, of three Reserve Bank interest rates, which weren't expected a year ago, and, of course, the federal government's tax crackdown on capital gains tax, particularly on investors, and negative gearing in the May budget.

Together, that's a bit of a whammy, and it's hit particularly Sydney and Melbourne house prices.

They're down about 5%, I think, on the numbers, and you're getting these forecasts that overall national house prices could fall about 10%.

Do you think this could be a recession?

So what does it say about the nature of the Albanese government's economic reform, if you can call it that, that he's speaking so publicly?

Yes, well, I call Alex Sanchez part of the Hawke-Keating lost Labor tribe.

You know, the Labor Party under Hawke and Keating in the 80s and into the 90s instituted really an economic revolution in Australia, pro-market, floated the dollar, deregulated the financial sector, brought down the import tariff wall, privatised government businesses and so forth, cut income tax rates, particularly the top rate of income tax, from as high as 60% down to 49%.

cut the company tax rate, but we don't see any of this now.

And Alex Sanchez's point, as being a former advisor to Anthony Albanese, and he wanted to get some of that into this government, is that Labor seems to have just lost the whole idea that markets and getting government out of the way is the best way to promote economic growth that we did see before and we really produced the prosperous Australia we see today out of that.

Now it's really more about redistribution, bigger government, higher taxes, more regulation.

It's taking away those benefits that their baby boomer parents had.

Alex Sanchez's point would be intergenerational equity and fairness really relies on getting the economy growing again.

So, uh, we'll let you take it away, Michael.

Thanks, Gerry.

Thanks, Hamish.

Look, as inflation has bubbled back up, the pundits have started speculating that the Reserve Bank will increase interest rates again rather than cut them.

Struggling to tackle their budget deficits, federal and state governments have withdrawn electricity bill subsidies that have been suppressing CPI inflation.

After the reassuring talk of a soft landing for the economy, more people are getting antsy about the cost of living squeeze again because, you know, prices haven't fallen back to where they were before the pandemic.

They're just rising less rapidly than before.

Do you think it's inspired by Trump? Is it just a symptom of the inequality Geraldine's talking about that people feel? What do you apportion it to?

[laughing]

You know, we've been at a, we've been at a, at a high watermark of Australian prosperity, which sort of peaked at around two thousand eleven, twelve.

Since then, I think the whole system has deteriorated, and that we've been largely arguing over what you might call the rent of Australia.

So you can see politics has deteriorated.

You don't have consensus over reasonably centrist grounds about how to grow the pie.

We're talking about dividing up the pie.

That's the debate.

How do you see it?

So, uh, we'll let you take it away, Michael.

Thanks, Gerry.

Thanks, Hamish.

Look, as inflation has bubbled back up, the pundits have started speculating that the Reserve Bank will increase interest rates again rather than cut them.

Struggling to tackle their budget deficits, federal and state governments have withdrawn electricity bill subsidies that have been suppressing CPI inflation.

After the reassuring talk of a soft landing for the economy, more people are getting antsy about the cost of living squeeze again because, you know, prices haven't fallen back to where they were before the pandemic.

They're just rising less rapidly than before.

How would you have the conversation, the pithy conversation, that changes the barbecue discussions around what we do next?