<a href="https://www.apartments.com.au/developers/capital-corporation">Capital Corporation</a> has announced that its <a href="https://www.apartments.com.au/new-townhouses/lovedale-farm-1054-1184-wine-country-drive-lovedale-nsw-2325">Lovedale Farm</a> residential, resort and golf project has secured $24.6 million in sales in just three weeks since the opening of its display home, underscoring the appetite for premium lifestyle property in the Hunter Valley countryside.

The sales milestone has been driven by a diverse mix of buyers, including owner-occupiers and investors from Sydney, Newcastle and the local Hunter region, purchasing both land-only lots and house and land packages across the development.

<img alt="Lovedale" data-entity-type="file" data-entity-uuid="e173edc9-e60e-4f19-a060-9dc4421a3233" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/LovedaleFarm_20250215-1.jpg?VersionId=1LY6CvOaD.Dzrt8tWpWxXtPyfchixNIo" />

&nbsp;

The result builds on the momentum generated at the display home opening on 22 March, which attracted more than 460 attendees.

With house and land pricing from $1.14 million, Lovedale Farm continues to attract strong interest from buyers seeking a premium lifestyle offering at a compelling price point. The development’s vision, a championship golf course, future epicurean village and access to the Hunter Valley’s celebrated wine country, has resonated with a broad buyer profile, from first-time investors to those looking to make the move and call the Hunter Valley home.

<img alt="Lovedale Farm records $21.4 million in sales in three weeks" data-entity-type="file" data-entity-uuid="b358e789-e1eb-40ed-8105-ed5c8297136f" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/20260321LovedaleFarmDisplayHomeOpening--6.jpg?VersionId=6GUO8TNnxuELONrsM6n9imDB6oc82Bor" />

Jim Hunter, Managing Director of Capital Corporation said the response since opening the display home has been encouraging.

"To reach $24.6 million in sales in just three weeks speaks to the genuine demand for a lifestyle community of this calibre in the Hunter Valley," Hunter says.

"We’re seeing buyers from across the region and beyond, including investors who recognise the long-term value, and owner-occupiers who simply want to live somewhere truly special.

“Lovedale Farm is two decades in the making, and the market’s response is everything we hoped for. We’re excited to see these first buyers become part of the Lovedale Farm story from the very beginning."

<img alt="Lovedale" data-entity-type="file" data-entity-uuid="54d985cf-2ac2-400b-ac02-4401f3421ac7" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/20260321LovedaleFarmDisplayHomeOpening--5.jpg?VersionId=3866bPoqpLZsm.3ACg9EafAr1W3miC_f" />

&nbsp;

Spanning 240 hectares on Wine Country Drive in <a href="https://www.apartments.com.au/developments/lovedale-nsw-2325">Lovedale</a>, the $1 billion development is expected to deliver around 1,250 jobs during construction and inject more than $300 million into the local economy. The first 200 homes and championship 18-hole golf course are anticipated for completion in late 2027.

Capital Corporation has also lodged development plans for the Lovedale Farm clubhouse, set to become a vibrant hub for residents and the wider Hunter Valley community. Further releases are planned for later this year.

[smartcode_project_cta:default project_id=14476]

Joel Robinson

Lovedale Farm display home opening triggers $24.6 million in sales in three weeks

Prominent Malaysian developer <a href="https://www.apartments.com.au/developers/osk-property">OSK Property</a> has unveiled <a href="https://www.apartments.com.au/new-apartments/aura-at-melbourne-square-7-hoff-boulevard-southbank-vic-3006">Aura</a>, the next stage of its $3.5 billion Melbourne Square precinct in Southbank, continuing its push into wellness-led, amenity-rich apartment living.

The $800 million tower, planned for 7 Hoff Boulevard, will rise 67 storeys and deliver 673 apartments, with COX Architecture drawing on both Japanese design principles and Australia’s natural landscape to shape the building’s identity. A rectangular grid aesthetic defines the building’s exterior, with COX drawing design cues from New York high-rises and Tokyo’s skyline.

Aura builds on a growing trend in high-density living, where wellness is no longer an add-on but central to the product. The development is structured around four key pillars, combining calm, minimalist residences with layered communal spaces, landscaped gardens, and a suite of wellness amenities designed to support both physical and mental wellbeing.

[smartcode_project:default project_id=151921 project_image_fid=367465]

At the core of the project is what OSK describes as a vertical wellness ecosystem, a multi-level approach to amenity that integrates health, lifestyle, and social spaces throughout the building rather than confining them to a single level.

The main resident hub, the Aura Club on level seven, will include a pool, cold plunge, spa, gym, Pilates and yoga studios, alongside more lifestyle-driven inclusions like a golf simulator, music rooms, library, and work-from-home spaces. Above, a series of higher-level amenity zones, including the Meridian Club and Cumulus Club, introduce more refined, social and retreat-style environments, with private dining, lounges, and premium wellness spaces positioned to take advantage of city views.

[smartcode_project:default project_id=151921 project_image_fid=367467]

The residences themselves will largely include balconies, a key design move in a market increasingly focused on natural light, airflow, and connection to the outdoors. Views will extend across the CBD, the Arts Precinct, Royal Botanic Gardens, and beyond.

Aura also introduces approximately 1,600 sqm of retail across the lower levels, further activating the Melbourne Square precinct, which already includes Kennedy Park, a Woolworths, childcare, and a growing mix of hospitality operators.

[smartcode_project:default project_id=151921 project_image_fid=367474]

“Aura stands tall as an exemplar of holistic wellness – its focus on social, physical and mental health culminate in a building that is calming, restorative and relaxing, where residents will have their own sanctuary within the well-connected and sought-after <a href="https://www.apartments.com.au/developments/southbank-vic-3006">Southbank</a>," says&nbsp;OSK Property CEO Chong Boon Woon.

“We have been very encouraged by the market’s response to the BLVD offering, and we know there is a strong demand for the level of amenity, service and design that the Melbourne Square precinct is known for.

“Complemented by work-from-home lounges for professionals, family friendly outdoor garden spaces, and state-of-the-art fitness and wellness facilities, Aura will continue our focus on maximising physical, emotional, and mental wellbeing,” he said.&nbsp;

[smartcode_project:default project_id=151921 project_image_fid=367475]

The project follows the strong performance of BLVD, which is now around 80 per cent sold, and reinforces OSK Property’s long-term commitment to Melbourne Square as a fully integrated, mixed-use precinct.

Construction is expected to commence in late 2026.

[smartcode_project_cta:default project_id=151921]

OSK unveils AURA, the latest stage in Southbank's $3.5 billion Melbourne Square precinct

National developer Time &amp; Place appears to have settled on a design for its long-anticipated Potts Point project.

After several years of back and forth with local council and the NSW Government, the developer, which has spent seven years targeting the former The Chimes site on Macleay Street, has now progressed its plans.

Following a concept design submission last year by SJB, Time &amp; Place has lodged a full State Significant Development Application with the NSW Government, this time for a scheme designed by Kerry Hill Architects.

<img alt="Time &amp; Place" data-entity-type="file" data-entity-uuid="504d2a27-d65f-4227-8189-1e35e3376e62" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-04-20%20at%209.38.24%E2%80%AFAM.png?VersionId=_XqFKATYHF30KnVByPxhaI9UBzmkmfn7" />

The 16-storey proposal includes 44 apartments, 21 of which will be build-to-sell. These will comprise 19 three-bedroom apartments and two four-bedroom units.

More than 50 per cent of the development will be dedicated to affordable housing, with 23 studio apartments to be delivered in line with the NSW Government’s Housing SEPP.

Kerry Hill Architects said the proposal is driven by a strong response to place.

“Our proposal for a new residential building for Potts Point in Sydney is driven by a deep consideration of place,” the practice said in its submission.

“This operates on multiple levels, including a landscape approach that reinstates endemic flora of the Sydney peninsula and provides a ground-floor garden for residents, reconnecting the site to its pre-European history. A brick podium further strengthens this relationship to context, integrating planting and fine bronze detailing that references the predominant material language of Macleay Street.”

The three-level podium will be topped by a communal resident space, featuring a covered pool designed to receive direct afternoon sun in winter, a neighbouring reflection pool, dining and event areas oriented to maximise sunset views, and an outdoor exercise zone.

<img alt="Time &amp; Place" data-entity-type="file" data-entity-uuid="8d3eedc1-babb-44a3-bd96-d8a42f3adf1f" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-04-20%20at%209.37.48%E2%80%AFAM.png?VersionId=Ii7.4dvqNatu5GQi6bhqNjAswrMB998." />

The design also incorporates highly crafted shopfronts and a clearly defined residential entry to activate the street. Juliette balconies to the podium residences will provide passive surveillance and a strong sense of habitation.

Above, the larger apartments are housed within a light-coloured masonry and bronze tower.

“The tower steps back in a series of gently curved volumes that reference the rich Art Deco context of Macleay Street,” the architects said. “Carefully calibrated vertical fins frame the views while providing privacy and a sense of refuge.”

<img alt="Time &amp; Place" data-entity-type="file" data-entity-uuid="6fab60f4-3140-4469-b47a-48c781e0a30b" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-04-20%20at%209.28.44%E2%80%AFAM.png?VersionId=e5XxrM3kzdASdKlcIACHAHbOSZhSKC9O" />

Time &amp; Place has been one of the most active developers nationally in the last 12 to 24 months. Late last year they completed&nbsp;The Queensbridge in&nbsp;<a href="https://www.apartments.com.au/developments/southbank-vic-3006">Southbank</a>, a mixed-use tower with 353 apartments and a hotel. They are currently selling Park Modern, 246 apartments near the famous Botanic Gardens in South Melbourne.

The developer has approval for The Burke, a mixed-use project in&nbsp;<a href="https://www.apartments.com.au/new-apartments/glen-iris-vic-3146">Glen Iris</a>&nbsp;being delivered in partnership with Woolworths. The 60 apartments, positioned above a new Woolworths supermarket, are expected to launch in the coming months. Time &amp; Place is also progressing plans for the redevelopment of&nbsp;<a href="https://www.apartments.com.au/developments/northcote-vic-3070">Northcote</a>&nbsp;Plaza, and have recently submitted plans for a <a href="https://www.apartments.com.au/news/vic/time-place-unveils-plans-22-storey-south-melbourne-tower">22-storey tower</a>, another in South Melbourne.

In&nbsp;<a href="https://www.apartments.com.au/developments/sydney-nsw">Sydney</a>, the developer has two projects in Manly: Two Tides, which is currently under construction, and an ultra high-end building on&nbsp;<a href="https://www.apartments.com.au/buildings/shoreline-manly-beach-89-90-north-steyne-manly">North Steyne</a>, fronting the beach. It is also continuing to work through the redevelopment of The Chimes building on Macleay Street in&nbsp;<a href="https://www.apartments.com.au/developments/potts-point-nsw-2011">Potts Point</a>, as well as Marlborough House, the redevelopment of the original David Jones warehouse building in&nbsp;<a href="https://www.apartments.com.au/developments/surry-hills-nsw-2010">Surry Hills</a>.

First look: Time & Place settles on design for The Chimes, Potts Point redevelopment

<a href="https://www.apartments.com.au/developers/develotek">Develotek</a> is joining the likes of TOGA, Deicorp, and One Global Capital, betting on a boom in Five Dock ahead of the 2032 mooted opening of the Five Dock Metro Station.

Develotek, which is currently developing Bianca on the Drummoyne waterfront and has plans approved for a tower in Chatswood, has filed a State Significant Development Application for a <a href="https://www.apartments.com.au/new-apartments/79-81-queens-road-five-dock-nsw-2046">two-building project in the evolving Kings Bay precinct</a>.

The buildings, one more boutique just five storeys and the other 26 storeys, will rise from an 3,158 sqm site across&nbsp;79–81 Queens Road and 2–8 Spencer Street, will home 134 one-, two-, and three-bedroom apartments, above ground-floor retail and five basement levels of parking.

A key component of the proposal is the inclusion of 15 per cent of residential floor space as in-fill affordable housing, unlocking additional height and density under the Housing SEPP.

<img alt="First Look: Develotek lodges State Significant shop top housing project in Five Dock precinct" data-entity-type="file" data-entity-uuid="3ee31bf7-75ba-4bc5-b190-49885193219f" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/podium_2.png?VersionId=730UbrduuwK3C1sO28RHjiLPUPqXqjkh" />

Designed by <a href="https://www.apartments.com.au/architects/plus-studio">Plus Studio</a>, the scheme adopts a podium-and-tower configuration, with a five-storey street wall along Queens Road transitioning to a 26-storey tower set deeper into the site. The ground plane prioritises activation and permeability, with retail frontages and a new through-site link connecting Queens Road to Spencer Street.

At the upper levels, the tower façade has been conceived using a modular system to support prefabrication and reduce construction waste, while improving build efficiency. The splayed form draws on the geometry of surrounding industrial rooftops, reinterpreting the area’s heritage in a contemporary expression while also helping to reduce solar heat gain to east and west-facing apartments.

“This project aspires to transform a former industrial site into a connected, resilient and people-focused urban community, grounded in Country, shaped by history, and designed to enrich everyday life within the evolving Kings Bay Precinct,” said John Walsh, Principal at Plus Studio.

The proposal reflects the broader transformation of the Kings Bay Precinct under the Parramatta Road Corridor Urban Transformation Strategy, marking a shift from its industrial past to a higher-density, mixed-use urban neighbourhood.

<img alt="First Look: Develotek lodges State Significant shop top housing project in Five Dock precinct" data-entity-type="file" data-entity-uuid="abde734c-1e31-4a97-a1d2-fa9bcf31c380" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/building%20podium.png?VersionId=fNUupP6u146yEytQT31kKVRxwtACgPpP" />

Develotek is emerging as an active participant in the state’s affordable housing-led uplift pathway. The developer recently secured approval for a 34-storey mixed-use tower in Chatswood, where it similarly leveraged the in-fill affordable housing provisions to increase scale and deliver a 101-unit scheme with dedicated affordable apartments.

Their entry into Five Dock places them alongside a growing list of developers targeting the suburb ahead of its anticipated transport uplift, with Sydney Metro set to extend into the area. Major players including TOGA, Deicorp, and One Global Capital are all progressing large-scale precinct-style developments nearby, collectively reshaping the low-rise industrial fabric into a higher-density mixed-use corridor.

The Five Dock site sits within the Kings Bay Precinct, a key renewal area under the Parramatta Road Corridor Urban Transformation Strategy, where planning controls support significant uplift tied to affordable housing delivery. The consolidated 3,158 sqm site is currently occupied by low-rise industrial uses, including warehouses and vehicle workshops, earmarked for transition.

First Look: Develotek joins in Five Dock apartment boom

Ascot’s Racecourse Road continues to be a hive of activity for Brisbane developers.

Following Fortis and GRAYA, which are both preparing new projects along the key strip connecting Kingsford Smith Drive and Eagle Farm Racecourse, local developer <a href="https://www.apartments.com.au/developers/skyhold">Skyhold</a> is the latest to lodge plans for its own development.

The group is proposing One One Two Residences, a boutique project comprising just seven apartments, named after its address at 112 Racecourse Road.

The proposal outlines a five-storey building on an 810 sqm site. The built form slightly exceeds the four-storey expectation under the neighbourhood plan, aligning instead with the emerging character of the strip. As the planning report notes, “the locality is characterised by a transition toward medium-rise residential development, with a number of recent developments… above the stipulated height limits.”

<img alt="First Look: Skyhold lodges plans for boutique Ascot apartments as Racecourse Road revival gathers pace" data-entity-type="file" data-entity-uuid="ec577631-8c51-4163-960e-e7b3a77d655b" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Ascot.png?VersionId=iAzQ46D4Uu1UqiS0mVnlcy9jeFKBpJIj" />

Designed by 111 with landscape architecture by <a href="https://www.apartments.com.au/landscape-architect/paul-bangay-garden-design">Paul Bangay Studio</a>, the scheme adopts a layered architectural approach with strong articulation and a subtropical response. Deep balconies, integrated planters, and a mix of masonry and textured finishes define the façade, while upper-level setbacks reduce perceived bulk. The architectural statement describes “a series of horizontally expressed layers, defined by deep balconies and a consistent robust material palette,” aimed at delivering a refined streetscape presence.

Apartments are configured as large-format residences, including multiple three-bedroom layouts and a full-floor penthouse, supported by ground-level parking. A rooftop terrace will provide communal amenities including a pool and landscaped recreation areas. The design prioritises privacy, natural ventilation, and greenery, with planting integrated across all levels to soften the building form and contribute to the public realm.

<img alt="First Look: Skyhold lodges plans for boutique Ascot apartments as Racecourse Road revival gathers pace" data-entity-type="file" data-entity-uuid="1e1219bd-b45a-4d7f-bbc7-7207d7b2fc94" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Ascot%20entry.png?VersionId=JIoUOLMgQ5xWpEF0etEI3ffIoIVjD7gO" />

The proposal sits within the Racecourse Road precinct, a key mixed-use spine in Ascot that continues to attract renewed development interest.

Later this year national developer Fortis will launch its own boutique development, which, pending council approvals, will be 16 apartments designed by Koichi Takada Architects, just down the street.

“Racecourse Road is going through a massive revitalisation and we’re proud to be a part of that transformation,” said Fortis's QLD General Manager, Dan Boman.

Nearby, GRAYA is advancing its larger-scale The Gallery, a mixed-use shop-top housing project designed to act as a “catalytic project for Racecourse Road.”

First Look: Racecourse Road, Hamilton revitalization to continue as Skyhold joins the party

Financial Crisis

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<img src="https://counter.theconversation.edu.au/content/80186/count.gif?distributor=republish-lightbox-advanced" alt="The Conversation" width="1" height="1">
GUEST OBSERVER
The Reserve Bank of Australia Governor Philip Lowe was not taken to giving boring speeches. This week, Federal Reserve Chair Janet Yellen went him one better with her remarks to the British Academy. 
Yellen said of the prospect of another financial crisis like that of 2008: 
"I do think we’re much safer, and I hope that it will not be in our lifetimes, and I don’t think it will be."
Her rationale was that the regulatory changes put in place since the crisis have made the system a great deal safer.
Yellen expressed her hope that these regulations would not be overturned, saying of attempts to do so:
"We’re now about a decade after the crisis and memories do tend to fade, so I hope that won’t be the case, and I hope those of us who went through it will remind the public that it’s very important to have a safer, sounder financial system and that this is central to sustainable growth."
One piece of evidence supporting Yellen’s view were the so-called “stress tests” that the Federal Reserve has performed on US banks since 2011.
Just hours before this writing, the Fed approved plans for proposed dividend payouts for all 34 firms taking part in their annual stress tests. This is the first time since the annual stress tests began that all participating firms got a passing grade from the Fed.
So what should we make of Yellen’s prediction? This doesn’t have the ring of “confidence-boosting” rhetoric. It seems as though this is her genuine view.
At this point I should make two things clear. One: I have enormous respect for Janet Yellen, and two: I was fairly surprised by her remarks. So how does one reconcile these?
We still don’t know what caused the global financial crisis
It’s important to understand that the proximate cause of the financial crisis was a kind of “bank run on the system”. In a classic bank run - like the ones of the Great Depression - depositors go from believing that other depositors think their banks are safe, and are therefore willing to leave their money there, to believing that others consider the banks unsound.
Once investors believe that other investors are going to run on the bank, they want to run too (because banks typically hold less than 10% of the cash required to pay back all depositors). In the language of game theory, there is a switch from the “good equilibrium” to the “bad equilibrium”.
In the financial crisis there wasn’t a run on traditional banks so much as on investment banks and other financial institutions. This led to credit markets drying up (such as the commercial debt and “repo” markets).
What caused this shift in beliefs is a hotly debated issue. The large increase in US house prices and imprudent lending by US mortgage originators played an important role. The use of collateralised debt obligations (CDOs) and synthetic versions of CDOs were important. Lack of regulator controls allowed these things to happen, and incentives within financial institutions facilitated and encouraged risk and bad behaviour.
Yet for quite a long time the “good equilibrium” prevailed. What caused the switch?
That is the big question, and I’m pretty confident that not even Yellen knows the answer.
It all comes down to what we believe
What Yellen does seem to be saying is that regulatory responses to the crisis have made it much less likely that bad behaviour is going to occur. That certainly seems plausible. And if there is no - or very little - bad behavior, then beliefs about what other believe may not be particularly important.
But if there is a view that some new form of moral hazard is taking place, and people lose faith in the regulatory regime, then perhaps 2008 could occur again. And soon.
As game theory - and the lessons of the classic depression-era bank runs - teach us, it all comes down to what people believe about what other people believe.
That seems like a pretty slippery object to me.
<a href="https://theconversation.com/profiles/richard-holden-118107" target="_blank">Richard Holden</a> is a Professor of Economics and PLuS Alliance Fellow at UNSW and author for The Conversation.
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jchancellor-FAypfDUnLy

How likely is another financial crisis? It comes down to what we believe

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Nearly three in four respondents to a new banking survey believe a major bank would not give them the best service should they be in a financial crisis.
The survey for State Custodians Home Loans, conducted by Galaxy Research, asked people who they considered would provide the best service when re-negotiating a home mortgage or investment loan should they hit hard financial times.
Some 72 percent of those polled believe in these circumstances a big bank is not their best option for service.
Joanna Pretty, State Custodians general manager said 37 percent of survey respondents believe they’d receive the best level of specialised attention from a smaller lending institution such as a credit union or building society, 28 percent nominate a big bank, 25 percent say a mortgage broker, 22 percent nominate an accountant, lawyer or financial planner, and 10 percent say a non-bank lender.
“Smaller institutions tend to specialise with different products and services, and are very good at helping people who fall outside traditional parameters,” she said.
“They can also have more of an open mind as to what kind of deal they’d be prepared to do with a customer, as they’re used to evaluating extenuating circumstances.
"If you are faced with a big personal crisis and need to source a new housing loan or re-negotiate an existing one, there are practical steps you can take which will make life much easier.
Firstly, understanding your financial situation is key. You need to totally be across all your essential and non-essential expenses. Secondly, don’t rely solely on well-meaning family or friends to advise you as they’ll always colour their advice with their own personal experiences. Finally, contact various experts – not just one – and explain your situation.
"The more you talk to people, the more likely it will become clear as to who is most able to assist you.”
The survey found 43 percent of youngest adults aged 18 – 24 say they’d turn to a financial planner, accountant, or lawyer first compared to just 15 per cent of those aged 50 plus. Of those aged 25 – 34, a majority 34 percent would seek out a smaller lending institution and for Generation X-ers in the 35 – 49 age bracket, 34 percent would head to a mortgage broker and 35 per cent to a smaller lending institution. Of those aged over 50 years, a majority 46 percent would consult a smaller lending institution first.
 
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jonathanchancellor-7SQnKwU6yx

Big banks may not be financial saviour in hard times: Survey

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<img src="https://counter.theconversation.edu.au/content/69474/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1">
GUEST OBSERVER
Asian currencies hit a seven year low in November, on Donald Trump’s election and the potential for his policies to spur US inflation and bond yields.
Investors who fanned out across emerging markets in recent years are now bringing their money back to America.
The steep drops, and the seeming inability of some central banks to do much about it, has led to worries of a financial crisis. Some columnistsare even drawing comparisons to the currency meltdown that preceded the 1997-1998 Asian Financial Crisis (AFC). 
The AFC’s impacts were dramatic. It led to the sudden collapse of President Suharto’s regime in Indonesia and triggered the 1998 Russian bond default. Everyday economic life was upended as the five worst hit economies saw unemployment surge, inflation balloon, and investment as a share of GDP plunge more than 10%. 
It took five years for GDP per capita to reach parity with pre-AFC levels. Austerity was imposed to pay for large financial sector bailouts, in Indonesia the net cost of rescuing the financial sector exceeded 40% of GDP.
But much has changed since 1997. China’s rise means an increasingly multipolar economic order, new regional partnerships are in place, and central bankers and policymakers are less likely to repeat some prior mistakes. Even if a crisis were to materialise, it would look quite different from that of two decades ago. 
<h2>What triggered the AFC?</h2>
The AFC began in July 1997, when Thailand gave in to speculators and devalued the Baht. Many Asian nations had long either pegged or closely tethered their currencies to the US dollar. After the baht, speculators quickly turned on the currencies of Indonesia, Malaysia, and South Korea. To fight the attacks on their exchange rates, central banks had to sell dollars (Thailand) or abruptly raise interest rates (Indonesia), but eventually caved - sometimes after depleting foreign exchange reserves - and allowed their currencies to fall. 
The exchange rate declines wreaked havoc by driving up the cost of the money private companies had borrowed from abroad. Many were already struggling, amid an economic slowdown, with large foreign exchange borrowings and poor investments in overheated sectors like property. Once currencies floated, the companies’ flight to the US Dollar put pressure on domestic banks. Financial sectors became rapidly insolvent, triggering state interventions and bailouts. 
The use of fixed or managed exchange rate regimes meant central banks assumed the risks of sudden foreign exchange movements. This perceived security further prompted capital inflows and resulted in real exchange rate appreciation and asset bubbles. Hedging, an investment tool limiting the risk of exchange rate changes damaging the price of an asset, was not widespread. 
Governance problems and “crony capitalism” exacerbated these issues. The Indonesian central bank governor, for example, was part of cabinet and had little power to resist instructions to pump liquidity into ailing banks. In the end, US$14 billion was pumped into an insolvent banking sector and state auditors later found more than 60% of the funds were misused. 
<h2>A lot has changed since the AFC</h2>
It was in the reaction to the AFC that a lot of changes were made. In return for cash infusions, these countries committed to IMF supervision and extensive programmes of economic reform and liberalisation. In addition to financial sector restructuring, the programs also included “structural reforms,” such as dismantled barriers to foreign investment and liberalised trade regimes. 
From Indonesia, the IMF demanded dismantling of the monopolies and rent-creation schemes at the heart of the regime; from South Korea, it demanded large layoffs and union-busting measures. In both cases a back and forth between leaders and the IMF played out in real time as the currencies continued to fall and financial sector insolvency accelerated.
Many of these countries have also built up huge foreign exchange reserves over the past decade. Banking supervision has also greatly improved, and countries like Indonesia have created genuinely independent banking supervisory agencies and monetary authorities. 
Regional financial integration has also deepened, with initiatives like the Chiang Mai Agreement, a framework adopted by members of ASEAN as well as China, Japan, and South Korea, for bilateral currency swaps and repurchase agreements. 
China also has expanded its role, including a web of bilateral currency swap agreements with Indonesia, Malaysia, and Thailand. These Chinese renminbi (RMB) swaps are designed to facilitate trade – the RMB is the world’s second-largest trade finance currency – but swapped RMB can be converted to USD through offshore RMB trading centres and have been used to provide emergency liquidity to countries facing currency challenges (Pakistan in 2013, Argentina in 2014).
Central banks have reacted to the dollar’s sudden strength by announcing currency interventions, discussing rate hikes, and pressuring banks to curb “speculative” trading. China has announced closer scrutiny of some outbound transactions and Malaysian authorities have asked banks to limit some investments used for offshore ringgit hedging. This has prompted fretting among financial analysts who recall that Malaysia imposed some capital controls - effectively preventing ringgit from being exchanged and transferred out of the country - during the AFC. 
<h2>Going forward</h2>
This is not to rule out a crisis (although markets may well reevaluate assumptions about Trumpnomics), as the end to years of plentiful dollars will have an impact. Debt levels are higher than pre-AFC levels, and foreign currency-denominated emerging market debts have more than doubled in the last ten years. Instead, global economic polarities are much changed because of China’s emergence, weakness in Europe, and isolationism in the US. Any crisis would play out differently than in 1997/98. 
Economic managers are far less in thrall to economic orthodoxies as they were in the 1990s to the “Washington Consensus” and are therefore likely to blaze their own trails. The IMF, which remains the global lender of last resort, has also fine tuned its approach and is far less prescriptive than after the years of heady growth during the 1990s.
Whereas Malaysia during the AFC imposed capital controls and snubbed the IMF, just across the Malacca Strait Indonesia provided free movement of capital, which allowed the mass exit of both foreign and domestic capital. Combined with efforts to provide liquidity to the banks, the absence of capital controls undermined the government’s ability to carry out monetary policy. Many countries prudently used some capital controls during the global financial crisis, and as a result, some mild to moderate capital controls are likely.
A final variable is China, which despite its own currency challenges is keen to further the end of the US’s sole leadership of the international financial order. The aforementioned currency swaps, though likely insufficient for seeing off a systemic, regional crisis, show its ambitions to position itself as emerging markets’ preferred economic partner. 
Efforts like the recent purchase of US$4 billion in assets from Malaysia’s disgraced 1MDB further shows an opportunistic approach to emerging geostrategic events. As a result, the likes of the IMF and friends, which dictated large, condition-laden bailouts in return for AFC assistance, are no longer the sole port of call for a beleaguered economy, and any post-crisis order, much shaped by these institutions after the AFC, might end up quite different.
Matthew Busch is PhD candidate at Melbourne Law School, University of Melbourne and author for The Conversation. He can be contacted <a href="https://theconversation.com/profiles/matthew-busch-284580" target="_blank">here</a>.
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Don't expect a rerun of the Asian Financial Crisis

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GUEST OBSERVER
A QUICK OVERVIEW OF CHINA’S DEBT
International estimates of China’s debt levels vary widely. The Bank for International Settlements (BIS) estimated China’s debt at around 255 percent of GDP in Q1 2016. In contrast, the International Monetary Fund (IMF) recently reported a lower estimate – at around 225 percent of GDP. Both of these measures are based on China’s official Aggregate Financing data – which (as we’ve previously noted) captures only some of the country’s shadow banking sector – the major contributor to debt growth since 2012.
WIDE RANGE OF DEBT ESTIMATES 
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Our estimate of debt draws on a broader measure of shadow banking, combined with bank loans and corporate and government bonds. This produces a much larger value for debt– at almost 323 percent of GDP in Q2 2016 – a level that places China among the highest debt advanced economies – an unprecedented position for a still developing economy. Risks related to shadow banking are distributed unevenly across the financial sector – with the IMF reporting that smaller banks are far more exposed (in terms of capital buffers) than the big four state-owned banks.
The majority of the debt sits in China’s corporate sector, particularly State-Owned Enterprises (SOEs), which effectively ties the strategies of authorities in managing the debt to the broader challenges of SOE reform. Misallocation of debt to SOEs has contributed to excess production capacity in a number of sectors – particularly heavy industry – as well as expanding the debt-to-GDP ratio.
Standard &amp; Poor’s notes that China’s private sector leverage declined in 2015, while SOE leverage continued to grow. Median SOE debt levels in 2015 were six times earnings (EBITDA), meaning that a large amount of cash flow would be required to service debt, reducing the amount available for re- investment or debt reduction.
DEBT BY SECTOR 
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Earlier this year, the IMF estimated that the potential losses from the corporate loan portfolios of China’s banks could be around 6.9 percent of GDP – an estimate that the organisation described as conservative, given that it excluded potential additional risks related to shadow banking exposures.
WARNING SIGNS DON’T GUARANTEE
CRISIS
In many respects, China’s financial system is shielded in ways other countries are not – allowing credit to accumulate rapidly (near or above the BIS danger level since 2009) without yet enduring a crisis. Domestic banks are relatively well capitalised, maintaining an internationally high reserve ratio (as mandated by Chinese authorities) and have a strong deposit base.
This means that banks are less reliant on international wholesale funding – which has a tendency to be withdrawn during periods of high risk concerns – while remaining capital controls restrict the capacity of residents from migrating their wealth (albeit not completely prevent it, as capital outflows in recent years demonstrate).
That said, the stability of funding is beginning to weaken – with banks increasingly using the short term interbank market. According to IMF’s October Global Financial Stability Report, wholesale funding (primarily domestic interbank and repo markets) provided over 30% of total bank funding in 2015, up from around 18% in 2014, with smaller banks particularly reliant on these sources. The short term nature of this funding is mismatched to the longer term loans to corporates.
CHINA’S FUNDING STABILITY DECLINING 
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Despite the relatively shielded nature of the financial sector, these characteristics do not mean that China’s government can afford to ignore the debt issue (particularly as funding stability declines), but provides them with some time to appropriately address it. 
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HOW CAN CHINA ADDRESS THE GROWING 
DEBT RISK? 
In the short term, Chinese authorities should seek to control, rather than reduce the debt-to-GDP ratio – as severe cuts to credit necessary to produce the latter would likely lead to a sharp slowdown in economic growth. Standard &amp; Poor’s estimates that banks would require around RMB 11.3 trillion in recapitalisation if current credit growth rates persisted for the next five years. Controlling the debt issue will require increasing the efficiency of lending, particularly reducing the share of funding directed to SOEs. 
The IMF note a range of measures that Chinese authorities should consider – noting that a comprehensive response to the debt issue, while it is still manageable, offers the greatest chance for success. These include imposing harder budget constraints on SOEs, restructuring or liquidating highly indebted firms and managing losses across a range of parties, including the government where necessary. The IMF also recommends introducing social assistance for displaced workers and encouraging the entry of private firms across the economy. 
Plans to restructure SOEs have focussed largely on mergers and partial privatisation. Allowing firms to swap debt for equity (a policy approved by China’s State Council in early October) is one way to address the debt issue, but poorly performing, highly indebted firms are unlikely to be attractive opportunities for investors – particularly those still scarred by the 2015 share market bubble burst. Similarly there are concerns that banks could be forced to swap bad loans for equity in so-called zombie firms, achieving little in terms of restructuring. Harder decisions around the weakest SOEs – including liquidation – must be considered. This would require the development of a sound and consistent bankruptcy framework understood by all market participants. 
Greater competition is also a way to improve the efficiency of lending – particularly if banks are incentivised to lend to more innovative private sector firms. SOEs continue to enjoy preferential barriers to entry in a range of industries – including fast growing service sectors such as communications. Greater market access for private banks in the finance sector would likely contribute to reducing SOEs share of corporate debt – as profit rather than relationships would likely drive lending decisions. 
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CONCLUSION 
Warnings from the BIS and IMF have elevated concerns around China’s corporate debt levels. While the nature of China’s financial markets provides authorities with some additional time to address the issue, urgent reform to SOEs and increased competition across the economy will be necessary to avoid a medium term financial crisis. 
Gerard Burg is senior economist, Asia for NAB and can be contacted <a href="https://www.nab.com.au" target="_blank">here</a>.
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China’s authorities must manage debt to avoid a financial crisis

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GUEST OBSERVER
It is surely time for governments around the world, including Australia’s, to remember the first law of holes: if you’re in one, stop digging.
Governments have been digging madly since the global financial crisis, injecting massive amounts of monetary and fiscal stimulus. It hasn’t worked. 
We don’t have much to show for it in Australia - an interest bill of $16 billion on government debt compared with zero before the crisis, and a growth rate and unemployment rate that are struggling to meet long term averages. 
The International Monetary Fund (IMF) has repeatedly downgraded its global growth forecasts over the past decade and is about to releaseanother downbeat global growth forecast.
The world economy is in its 6th year of below average growth since 1990. Japan has not grown at all - its GDP in 2016 is exactly at the level it was in 2008 – despite massive amounts of monetary and fiscal stimulus over a decade. 
Growth in Europe has remained below 1% every year since 2008, well below its pre-crisis levels, despite the United States Federal Reserve relentlessly pumping new money into the banking system with interest rates already zero. And the US also remains in a funk with growth at 1.5%, less than the 2.5% long run average, having also pumped new money into its banking system and running budget deficits every year that have seen government debt steadily grow as a share of the economy.
Incredibly, the IMF and some governments have not given up. They now accept that perhaps cheap money and plenty of it hasn’t worked, but they still cling to fiscal stimulus as the last great hope as long as it’s the right kind. 
According to the IMF, debt-financed government infrastructure spending is the answer – think roads, ports, power and communication networks. They have constructed a mathematical model showing that such infrastructure spending, funded by borrowing, actually reduces the government debt to GDP ratio in a world of low interest rates. This is because it boosts GDP by more than it raises debt, and boosts overall economic wellbeing.
This will be music to the ears of those politicians who want to spend big on infrastructure. It is however a pipedream. 
The problem is not so much what the debt is used for, although that does matter, it is more the size of debt itself. Since 2008, government debt has increased in almost all advanced countries as a ratio to GDP. 
In the US total government debt has increased from 92 to 125%, in the UK from 63 to 114%, in Japan from 184 to 246%, in Australia from 34 to 65%, and even in relatively austere Germany from 68 to 82%. The combination of rising government debt and booming asset prices (stocks and housing) financed by monetary stimulus is dangerous. 
We have seen through the global financial crisis the devastating effects of a collapse in asset prices on the economy, especially on economies with debts whether held by the private or public sector. Indeed it’s this memory that is surely one of the factors currently holding back spending by households and firms.
In this environment, it would be reckless of governments to embark on major fiscal stimulus that raises their debt levels further. The IMF’s model does not take account of the risk of an asset price collapse in a world of high debt and the effect this has on private sector spending. 
It needs to be said that the IMF’s model is essentially the same type of model that it uses to forecast GDP growth of countries and which The Economist found had an appalling record of inaccuracy. The Economist team took a sample of 220 instances from 1999 to 2014 where a country went from growth in one year to recession in the next, and found that the IMF had never once predicted the looming recession in its April forecasts of the previous year.
There is at least one prescription to the world’s low growth problem that governments have not yet tried. That is to do precisely nothing – stop digging. We may even discover things about the economy’s restorative powers that we didn’t know, or had forgotten.
A related idea is to actively unwind government intervention where evidence suggests it is not working. It is easy to dismiss such prescriptions as the old-hat 1990s deregulation agenda. 
But that was a period of great prosperity in Australia and elsewhere. In any case it’s not about deregulation, but more like what David Cameron in the UK called “better regulation” which was enabled through the Deregulation Act 2015. It is worth noting that growth in the UK has been the strongest in Europe in recent years.
Back to home, the Reserve Bank of Australia should keep its power dry when it meets today and hold its official interest rate steady at 1.5 percent. And so it should for some time to come. 
The Australian government should do the same and not be seduced by the siren call from the IMF and others to spend up big on infrastructure.
Ross Guest is professor of economics and National Senior Teaching Fellow, Griffith University and author for The Conversation. He can be contacted <a href="https://theconversation.com/profiles/ross-guest-13155" target="_blank">here</a>.
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Governments and central banks should stop trying to stimulate the economy

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GUEST OBSERVER
In the fallout of the 2008 global financial crisis, the financial media were criticised for failing to fulfil a watchdog role, for boosting the global asset boom that contributed to the crisis, and for exacerbating the crisis when it happened.
Among the strongest accusations was that financial journalists had been captured by the small coterie of elite sources they used for information, and by a newsroom culture that favoured free markets and encouraged a pro-business attitude.
The corollary of this was that perceived doomsayers and others providing alternative viewpoints and warnings were left out of the debate. While people have called out these trends, there has been little hard evidence measuring the extent of the problem.
<h2>A captured sector</h2>
As economic policies have favoured deregulation and minimal regulation of financial markets, they have encouraged a process known as financialisation, which prioritises the finance industry and related interests at the expense of all others. The general public has been actively encouraged to become players in the finance marketplace, either directly or indirectly through loans, credit cards and savings.
Yet, while this has been happening, the public’s financial knowledge has not kept pace. Nor has the mainstream financial press concerned itself with the task of increasing general financial literacy. In fact studies suggest the trend is in the opposite direction, catering even more exclusively for finance insiders.
In the US, for instance, Columbia Journalism Review blogger Dean Starkman notes the predominance of what he calls “access reporting” – providing information to investors and corporate elites – over “accountability reporting”, which investigates corporate misdeeds and developing trends.
In Australia, <a href="https://www.tandfonline.com/doi/abs/10.1080/10361146.2014.963025?journalCode=cajp20" target="_blank">a study by Melbourne University academic Andrea Carson</a> has shown that while there has been an increase in press investigations overall, there has been a decline in investigations that deal with big companies.
Is financial news addressing the public interest, or the interests of the financial elites? Are there observable trends over the years?
<h2>The evidence</h2>
To answer these questions we conducted a comparative and longitudinal study of mainstream financial journalism in three countries during three periods of economic crisis. We looked at the coverage of the New York Times in the US, the Guardian in the UK, and the Sydney Morning Herald in Australia during: the 1990 recession, the Dot Com boom of 2000 and the global financial crisis (GFC) of 2007-8.
We analysed the number of articles that provided warning and discussion about an impending downturn in the two years before each crisis, the sources that framed the discussion, and the kinds of topics and narratives that shaped the coverage pre- and post-crisis.
Our results back up concerns that financial journalism standards have been falling.
There has been a narrowing of the range of sources used to explain events, with public relations more and more predominant. There is less context and critique and little or no warning given to the public of problems that may be looming. These tendencies worsened from case study to case study.
Of the 1990 recession data set, 60% of the coverage appeared before the recession was officially called and the discussion was broad, with a lively debate about the implications of the deregulation of the finance industry. In the two years before the bursting of the Dot Com bubble, 20% of the data set discussed various features of the boom and contemplated the possibility of a potential bust. But by the time of the global financial crisis only 8% of articles in the data set appeared before August 2007, at which time coverage suddenly explodes.
Also, by the time of the Dot Com boom and GFC the range of topics that defined and framed each crisis had narrowed, dominated now by two master narratives. First, the “new economy” idea pushed the concept of the end of financial booms and busts – something that was not completely disproved until the GFC. The GFC is shaped by the narrative of a natural disaster, which spreads like a disease from the US.
The research also found a difference in approach between financial and economics journalists, with the latter providing the most warnings, more breadth and explanations of trends.
<h2>Part of a bigger crisis</h2>
The crisis in financial journalism is but one dimension of the crisis in professional journalism generally. The traditional business model for news is under threat from reduced revenues, while the 24/7 production process directly impacts the quality of reportage. Conflicts of interest between business and media further impede the capacity and desire for critique that may damage the free market. All the evidence suggests that news quality has taken a hit and it is the general public that suffers.
Without financial journalism providing the context and critique required to understand the complexities of the financial environment, we must explore new opportunities for fair and fearless scrutiny of a sector which now impacts everyone.
Sophie Knowles is unit leader in lournalism at University of the Arts London and can be contacted <a href="https://theconversation.com/profiles/sophie-knowles-180608" target="_blank" style="line-height: 1.3em;">here</a>.
Gail Phillips is emerita associate professor at Murdoch University and can be contacted <a href="https://theconversation.com/profiles/gail-phillips-181103" target="_blank">here</a>.
Johan Lidberg is senior lecturer, School of Media, Film and Journalism at Monash University and can be contacted <a href="https://theconversation.com/profiles/johan-lidberg-7473" target="_blank">here</a>.
All are authors for The Conversation.
The paper “Reporting the Global Financial Crisis: A Longitudinal Tri-nation Study of Mainstream Financial Journalism” will be published by Journalism Studies in August 2015.
 
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