Brace yourself for the next stage of the property boom

http://www.news.com.au/business/story/0,27753,26042511-31037,00.html

"The actual increase in the commodities prices is mainly driven by appetite for more risk," he added.

This appetite could also be "reversed at short notice, depending on the pace of recovery and financial market sentiment".


Chief economist Heiner Flassbeck said the markets had been fuelled by financial speculation that in turn was driven by expectations of recovery.



If it has got into media - this only means that sharemarket crash (the real one) is now overdue. Current sucker's rally can run for some time, but the higher it runs, the more spectacular fall will be.

This means:

a. Interest rates going down. There is absolutely no reason why we can afford highest in the world interest rates.
b. Massive deinvestment from the share market
c. Massive deinvestment from cash


Massive shortage of properties in Australia with no new supply in sight due to flagging construction, shortage of land in capitals, strongest economy in the developed world leaves Australian property as the only asset in the world worth investing into.
 
If it has got into media - this only means that sharemarket crash (the real one) is now overdue. Current sucker's rally can run for some time, but the higher it runs, the more spectacular fall will be.

This means:

a. Interest rates going down. There is absolutely no reason why we can afford highest in the world interest rates.
b. Massive deinvestment from the share market
c. Massive deinvestment from cash


Massive shortage of properties in Australia with no new supply in sight due to flagging construction, shortage of land in capitals, strongest economy in the developed world leaves Australian property as the only asset in the world worth investing into.

mate your post headlines/titles reek of nonrecourse - but you actually make sense.

i agree with banks being caught on the back foot and have so much cash tied up that they missed the boat with the last rally.

i too feel that the XAO will be sold down artificially so larger institutions can get back in at a better price, where it was better buy - the buy they missed, and then they'll ride the sharper inflated upswing and profess to being pros.

i wouldnt say there'll be a de-investment from shares - but a sell down? abso-freakin'-lutely.

trouble is, the RBA have had pretty much no control over the spending habits of average australians. their movement on IRs was to keep people in their homes, reduce their interest bills so they could get on top of things with the advice to pay down pay down pay down from Yardney and Kochie and attempt to help buisnesses.

the RBA is the wealth confiscation vehicle of the Australian Economy. i've said this before

i have found that is ever the XAO (all ords) drops below it's 200DMA at the time of the RBA meeting, rates rise at least 25 basis points.

i would not be at all surprised to see this little tidbit comes back into play. it's been by the wayside - but an interesting phenomena (sp?) might be if the XAO was UNDER the 200DMA AND the 50DMA at the RBA meeting, rates were CUT - if it was between 200DMA and 50DMA they were held steady. i'm just putting the graphs together now - but it would be a nice little "forecaster".

so i don't think rates are EVER going to be cut unless a 747 flies into the Opera House - which again, is likely because our economy is looking like a runaway.
 
If negative 8.7% GDP "growth" is a sign of the "strongest economy", then your doctor is not doing a great job.

i wish they'd just call it a contraction in the economy - "negative growth" is an oxymoron and blackwhite doublespeak.

there isn't any GDP because if there is none, being less than zero, it's in deficit, so it SHOULD be Gross Domestic Deficit.
 
"The actual increase in the commodities prices is mainly driven by appetite for more risk," he added.
this is Crap! I actually think the opposite.
Actually there is a lot of crap in the report.
In any case i believe if money flow out from somewhere not necessarly create a bubble somewhere else, they can just disappear, where did the money went in major countries during last year in the share market and commodity crash? on property? don't think so (ask US, UK, Canada and europe just in case is hard to see in australia). Also I don't see how can you have more shortage of property when the money around is less from share market/commodity losses.
 
A Gross Domestic Product will always be a +ve number, ergo it can't be a "deficit". It can, of course be a smaller +ve number than the previous period so you may wish to say Gross Domestic Product Contraction, but I'll stick with neg growth as simple and we all know what it means.
 
this is Crap! I actually think the opposite.
Actually there is a lot of crap in the report.
where did the money went in major countries during last year in the share market and commodity crash? on property?

http://business.smh.com.au/business...0-as-investors-seek-refuge-20090908-femh.html

Spot gold topped $US1000 an ounce for the first time in six months on Tuesday as the US dollar's weakness and concerns about the sustainability of the global economic recovery underpinned sentiment.
 
http://business.smh.com.au/business...0-as-investors-seek-refuge-20090908-femh.html

Spot gold topped $US1000 an ounce for the first time in six months on Tuesday as the US dollar's weakness and concerns about the sustainability of the global economic recovery underpinned sentiment.

My english is not that good but doesn't that report mean gold is rising because of more incertainty?
how does that bond with this:
"The actual increase in the commodities prices is mainly driven by appetite for more risk," he added.
is gold that much different then a commodity?
But it was not all crap as I agree with this:

Current sucker's rally can run for some time, but the higher it runs, the more spectacular fall will be.

This means:

a. Interest rates going down. There is absolutely no reason why we can afford highest in the world interest rates.
b. Massive deinvestment from the share market
c. Massive deinvestment from cash
I also add the same thought for the AU$ (more it rise and bigger will be its fall)
 
http://www.news.com.au/business/story/0,27753,26042511-31037,00.html

"The actual increase in the commodities prices is mainly driven by appetite for more risk," he added.

This appetite could also be "reversed at short notice, depending on the pace of recovery and financial market sentiment".


Chief economist Heiner Flassbeck said the markets had been fuelled by financial speculation that in turn was driven by expectations of recovery.



If it has got into media - this only means that sharemarket crash (the real one) is now overdue. Current sucker's rally can run for some time, but the higher it runs, the more spectacular fall will be.

This means:

a. Interest rates going down. There is absolutely no reason why we can afford highest in the world interest rates.
b. Massive deinvestment from the share market
c. Massive deinvestment from cash


Massive shortage of properties in Australia with no new supply in sight due to flagging construction, shortage of land in capitals, strongest economy in the developed world leaves Australian property as the only asset in the world worth investing into.

I doubt it - the sharemarket took five years to reach the high and then fell aroound 50%, it is clearly on the way back up to where it should be.

Its property that has not yet fall in value and will soon.

Tim
 
http://www.news.com.au/business/story/0,27753,26042511-31037,00.html

"The actual increase in the commodities prices is mainly driven by appetite for more risk," he added.

This appetite could also be "reversed at short notice, depending on the pace of recovery and financial market sentiment".

Chief economist Heiner Flassbeck said the markets had been fuelled by financial speculation that in turn was driven by expectations of recovery.


If it has got into media - this only means that sharemarket crash (the real one) is now overdue. Current sucker's rally can run for some time, but the higher it runs, the more spectacular fall will be.

Of course increase in commodities is mainly driven by appetite for more risk. If everyone is buying government bonds who is going to buy commodities.

Flassbecks comment DOES NOT mean the real crash is over due. Merely that Share prices have appreciated based on expectations of recovery WHICH ARE HAPPENING.
The extent of any future pullback in markets will be determined by the expectations of the degree of market recovery vs actual market recovery.
THe lows seen in March are the lows. Future pull backs: yes definately.
 
is gold that much different then a commodity?
QUOTE]

Yes and no. Apart from being a commodity gold carries the function of universal money. And it is different from paper, copper and nickel money as it is inflationproof.

I have explained economy a lot on this forum, nobody seemed to listen and I have neither time nor inclination to waste my effort on it any longer.

If you genuinely want to understand what happens in the economy - read Das Kapital of comrade Karl Marx. Be careful though not to become the next Steve Keen, who got his inspiration from the same source. Reading Marx, have in mind his split personality. Brilliant economist and typical jealous angry "not have" strangely lived in the same body.

If you are able to distinguish brilliant analysis from sour grapes - you will be on easy street for the rest of your life.
 
I have explained economy a lot on this forum, nobody seemed to listen and I have neither time nor inclination to waste my effort on it any longer.

We are truly blessed to have your contribution. Alas it is wasted on those here at SS. Spread your wings ToDo and fly, fly, fly away. :rolleyes:
 
I doubt it - the sharemarket took five years to reach the high and then fell aroound 50%, it is clearly on the way back up to where it should be.

Its property that has not yet fall in value and will soon.

Tim

I would give a damn of what you think, but you are seriously deluded. Your thinking is in fact not your thinking but News Limited.
I write here not to engage in futile discussion with economically illiterate individuals, but to warn those who is willing to listen.
Back in 2008 you were so convinced that there will be no property boom - so who turned to be correct?
Cherish the hopes of the property crash - and you will learn your lesson the hard way.
 
The markets dont really know whats going on.

The increased risk appetitie mearly means the easing of credit. Access to more money by the machine means that demand increases.

The rise in gold is partly due to the fact that this increase in cashflow has no real direction and therefore alot of it is finding its way into defensive assets.

And yes it could be reveresed at short notice....

And yes Aussie property is one of the best asset classes..

What this all means though looking into the future - no one knows..
 
Its property that has not yet fall in value and will soon.

Property prices fell by a few percent in 2008 after mortgage rates started to approach double digits.

What do you believe will be the catalyst for a more significant fall?
 
individuals, but to warn those who is willing to listen.
Back in 2008 you were so convinced that there will be no property boom - so who turned to be correct?

Listen to you mate, nah i'l pass. Listening to you posses a hazard to my wealth.
 
Property prices fell by a few percent in 2008 after mortgage rates started to approach double digits.

What do you believe will be the catalyst for a more significant fall?

There are four factors that can cause the property crash in Australia:

1. People start to dissolve in the thin air en masse
2. Houses start falling from the sky
3. Benevolent dictatorship will replace democracy, and all greenies will be deported from the country thus paving the way for relaxed planning laws
4. Next Jesus Christ will be born and will make more land in our capitals

I exclude some fairy tale scenarios like builders all of the sudden start building at a loss.
 
Top