100 basis points RBA cut

[Patosan]

Tokyo down almost 10% today ... AUD is now 68 yen on Sunday it was 82 !!!
That's 17% in just 3 days ... this is truly exciting and scary !! Good or bad savor this time ... it will be recounted for many years in the future.

I don't see how anyone could even breathe a word of "buy" in stocks or houses in the near future. Then it is interesting that as the market dives the new low prices are only achieved IF a buyer comes forward. i.e. there are buyers all the way down recently ... scary.

 

[boomtown]

Someone said being president is like being a jackass in a hail storm - you just have to stand there and take it.

That's how I feel today.

But I gotta say its bloody exciting too !

 

[dfer]

If you draw a trend line from 1991 to today, it looks like either gold is expensive or houses are cheap..... waddya reckon

Well what you have here is a break in the trend line which confirms a bear market according to chartists. Using their theories the average house price would be expected to fall to 300OZ. This is determined by the ceiling like graph formation that formed at 300OZ before. What was the ceiling before becomes the floor support for the fall. Nothing is impossible and the price can always fall below 300OZ.

There is definately some more falling to do i my opinion. I reckon houses will fall for the next 2-3years before it goes up again. Time will tell.

When interest rates are cut it signifies a weak economy so you may save yourself form working a bit harder to pay off the interest rate but don't expect your investments to start climbing in value until the official interest rate is low like 3% or something. Examples of interest cuts and market crashes are 1987 and the great depression in 1929. Both extremely significant.

Interest rate cuts are a double edged sword.

Just my 2 Cents

 

[RumpledElf]

LOL Im going over to GHPC to check out how the other half lives.

Hey, I was at GHPC and they had a thread on how the other half live on SS so I came over to this thread

 

[plusnq]

If you draw a trend line from 1991 to today, it looks like either gold is expensive or houses are cheap..... waddya reckon

Hi Keith

I have managed to get data back to 1986. My main stumbling block prior is median Australian house prices (not individual capital cities as per Abelson paper).

The trend seems confirmed.



Cheers

Shane

 

[perky29]

Well the Fed and BOE have cut rates by .5% - and the result is instant. Dow has gone up 500 pts in 1 hr, and FTSE up 400.
Interesting times...

 

[Patosan]

Well the Fed and BOE have cut rates by .5% - and the result is instant. Dow has gone up 500 pts in 1 hr, and FTSE up 400.
Interesting times...

Dare I say remember Oz yesterday ... we were temporarily up too.
The fact that the response is instant is clear enough that it's only a bump in the long road down.

 

[plusnq]

http://www.bloomberg.com/apps/news?pid=20601087&sid=aXSJ6B94iw3M&refer=home

Co-ordinated rate cut effort. The ECB and central banks of the U.K., Canada, Sweden and Switzerland and US.

Gold 913.40 AUD 0.6742

Seems like gold was undervalued Keith :-(

Average house price now 338 oz of gold.Below 2002 levels. At 1000USD oz and 0.65 AUD we would be at 1999 level for house prices in gold oz. Not that far away really.

Very interesting times.

Cheers

Shane

 

[boomtown]

And if the DOW drops another 10% overnight?! LOL



Liquidity trap

 

[BV]

If you draw a trend line from 1991 to today, it looks like either gold is expensive or houses are cheap..... waddya reckon

I would have said that they are both expensive but looking at the chart
it seems like they are following their long term trend and should be about right.

Cheers

 

[Peter 14.7]

What the coordianted World Banks interest rate drops says to me is everyone accepts that it is world problem, and are willing to do something about it.

This is very encouraging and one of the points I see that this time will not be 1930 because technology and globalisation means we are all interconnected more than every before and can act as whole.

No-one wants to see 1930 again.

Lets hope that should Climate Change be proved right that the world can also respond as such.

If even half of what is predicated comes true, todays meltdown will be a speed hump compared to going off a cliff (in economic terms) that will occur.

Peter

 

[Dis]

Maybe you need to be paid in gold

Attached chart shows house prices in oz's of gold.

Would be funny to see a house for sale with the price listed in Gold.

I'm sure it would make the papers!

 

[quoll]

These will be interesting times ....

Keep an eye on Sydney property and we will wait and see when it starts moving upward again.

Cheers
Graeme

 

[Peter 14.7]

These will be interesting times ....

Keep an eye on Sydney property and we will wait and see when it starts moving upward again.

Cheers
Graeme

FYI

Bedsit in my building listed 2 month back asking $249k , sold after 4 weeks, dont know number

Another Bedsit now listed at $269k.

Form this the other must have got around the mark but I will watch the listing.

FYI these rent for $300 plus a week.

Peter

 

[craigb]

i would be interested to see the house value vs earnings vs unemployment chart ehem!WW! please!

 

[BayView]

No!

I reckon we should do what rusty said and give everyone a million dollars!

I wonder how many of them would buy a $200k car, a $100k wardrobe, a $100k holiday and spend the rest?