The Nobel prize-winning economist Paul Krugman conveyed a singularly bearish view of the economy on his visit to Australia at the weekend. Not everyone agrees with his assessment. 
Peter Jolly, National Australia Bank's global head of research, sought to defend the economy from the popular offshore view that it is in deep trouble. The mood towards Australia has cooled since China's slowdown dominated headlines, and Australian assets are out of favour with global investors, culminating with the Australian dollar at a six-year low.
Australian economic insiders often have a more nuanced view of domestic policy.
Mr Jolly said not only was Australia unlikely to witness further interest rate cuts, but the non-mining areas of the economy were performing solidly.
Mr Krugman, a former adviser to collapsed energy company Enron, told Fairfax Media the Reserve Bank of Australia should keep cutting rates because "there's going to be a hit to the Australian economy, maybe even a recession".
While some Australian economists agree that the RBA has more work to do - markets are pricing in a 60 per cent chance of a cut by the end of 2015 - and a recession has not been ruled out by the RBA, Mr Jolly came up with seven reasons why the Nobel laureate is wrong:
The Chinese economy is slower but it's not collapsing. Commodity prices are lower but Australian producers have in turn lowered their costs and are profitable. The Australian dollar has fallen a long way. It has also fallen more than commodity prices. The non-mining economy is improving. The RBA normally hikes rates when business conditions are this strong. The unemployment rate has stabilised and jobs are being created. The RBA is concerned about house prices. The RBA governor implies the hurdle to cut again is high, and there's a need to consider near and long-term factors."Yes, stuff happens and the RBA could well cut the cash rate again," Mr Jolly said. "But I expect a fair amount would need to go wrong, not just fail to get better, for the RBA to do so."
He argued there was no economic case to cut rates below 2 per cent by the end of 2015, estimating the probability of that at 20 per cent.