If you want to see how 10 consecutive interest rate rises hit us, when the RBA took the cash rate goes from 0.1% to 3.6%, then just consider the range of related issues that are grabbing headlines today. Here in Australia we’re learning that many of us are rifling our savings to cope and women in particular are shrinking their squirrelled away money because the proverbial rainy days have arrived.

News.com.au tells us: Aussie women’s dramatic savings move amid cost-of-living crisis.

The SMH reveals that More looking into bankruptcy as financial stress rises.

Another from the SMH says: Shoppers spend in store but eat and drink at home.

And this is what the The Australian ran with: RBA mea culpa: We did a terrible job after the pandemic.

After letting too many economically untrained Australians believe that interest rates wouldn’t rise until 2024, 10 rate rises look like a crap job but the central bank was always going to have to hit us hard after the pandemic.

Why? Well, we needed governments (federal and state) to spend wildly to prevent a really bad recession or even a potential Great Depression Mk II. Then the lockdowns caused supply-side problems, which drove up costs and sparked an inflation surge. Then Putin’s war added more cost problems via higher oil prices. And inflation was pushed higher by the demand left over after all that government stimulation, the unbelievably low interest rates and the fact our recession lasted only six months!

Because we dodged a serious recession or depression (where unemployment would’ve gone to 10% or higher) meant we ended up with this problem of Aussies scurrying to make ends meet now, with some going into bankruptcy. Before this ends, unemployment will go much higher from the 3.5% it is now, people will have to sell houses, businesses will go broke and the Labor Government’s budget deficit will worsen. So, the pressure will be on the RBA and Treasurer Jim Chalmers not to do a crap job going forward.

Ironically, the crap job is bringing down inflation here, and overnight the Yanks, who have had a very aggressive central bank, saw March inflation come in at a low 0.1%, instead of the economists’ predicted 0.2%, but now Wall Street is worrying about a probable recession.

Things weren’t helped by the Fed, whose recent minutes from the last rate rise said it expected a mild recession because of the effects of those recent bank failures. They think their rate rises to KO demand have been helped by the fear that a banking crisis creates, so this has increased the chances of a recession.

Here in Australia, a Finder survey found 47% of Australians have taken money out of their savings account in the past 12 months. An average of $2,365 was withdrawn for each respondent, which would equate to a staggering $47 billion nationwide.

The need to dig into for savings to make ends meet was because of higher mortgage and rental payments, everyday essentials and unforeseen emergencies such as medical costs. And then there are debt repayments and school fees/expenses which are also draining funds of other Australians.

This is what the RBA’s goal was in raising interest rates: they wanted to take money off us to bring down spending and then inflation. Yesterday, Professor Ian Harper, who’s a bright guy and on the RBA board, candidly and honestly admitted that the central bank had done a crap job post-pandemic. I think he’s right but I will add it was always going to be a tough job because there was no script to handle what the Coronavirus brought to the economy.

The important job now is for the RBA and Dr Chalmers to navigate us out of these tricky recession-threatening waters.

One final point —the Finder data revealed women spent more of their savings over the past year than men – withdrawing $2,524 on average, compared to $2,199 for men but that could be because a lot of women are better money managers and therefore run family finances. This is not a sexist or old-fashioned view of the sexes, as lots of research also has shown women are better investors as well!