Business conditions are not so bad and 'business investment, outside the mining sector, has been growing at a good rate," RBA deputy governor Guy Debelle argued at a business lunch yesterday.Debelle's speech on "The State of the Australian Economy" drew on little noticed good economic data drowned out by the now typical gloom. He also omitted any direct reference to credit supply and demand variables at all, such as this week's sharp reversal in business credit flows.Business surveys, Debelle explained, show "business conditions have declined from their high levels of the first half of 2018 but still remain consistent with around trend growth in the economy. "This is also the sense I get from the RBA's extensive business liaison program.""Dwelling investment and residential construction is at a historically high level," he said, though "the recent flow of building approvals implies a much lower level of activity once the current pipeline of activity is completed."Debelle added colour wealth effects in the two major markets."One puzzle related to the possible wealth effect is that the slowdown in household spending has been much more pronounced in New South Wales than it has been in Victoria, despite similar declines in housing prices. "While population growth in Victoria is higher than in New South Wales, that doesn't account for the whole difference."In my view, the main explanation as to why consumption growth has slowed is the low growth in household income, and an increasing expectation that it is likely to remain low."