RMIT economist Alberto Posso talks about the spectacular growth figures coming out of Western Australia with the WA Chamber of Commerce upgrading growth from 1.5% to 3%. This will drive the Australian economy but the resources boom so far has not affected manufacturing. He also talks about the IMF’s decision to hit banks with a double tax for future bailouts. This can create a moral hazard problem as it might make make the banks less risk averse if they know they will be bailed out, leading to the same sort of behavior that created the subprime crisis. The bank tax also has to be global. Otherwise, it would result in distortions as capital would flow to low tax countries.