The warnings of an impending financial crisis are starting to come in from all corners. So, maybe they’re worth listening to. If the warnings materialise, Australia looks to be lining up for something much worse than anyone is anticipating, and we may not escape quite as easily as we did during the GFC. According to Carmen Reinhart and Kenneth Rogoff – who studied eight centuries of financial crises in their New York Times bestseller, ‘This time is different’ – there are four leading indicators of a crisis. The first is a rapid inflation of asset prices, particularly residential housing. The second is excessive debt accumulation, either by the government, banks, businesses or consumers. The accumulation of debt almost always poses greater systemic risks than it seems during the boom, and the injection of cash makes the growth that results look more sustainable than it really is.