You have got to give it to labour governments the are the fiscal trogo (d) lytes of the universe;
Want another try at the correct spelling
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You have got to give it to labour governments the are the fiscal trogo (d) lytes of the universe;
Did you also read today that 52,000 wealthy Americans who have Swiss bank accounts are in a spot of bother as the once mighty Swiss gnomes at UBS have the IRS putting the blow tourch to them ?
Its tough times for the super rich world wide.
Wife and I
Did you also read today that 52,000 wealthy Americans who have Swiss bank accounts are in a spot of bother as the once mighty Swiss gnomes at UBS have the IRS putting the blow tourch to them ?
Its tough times for the super rich world wide.
In the event of deleverage, [we don't assume that it may not happen], other variables will also change. There should be a corresponding deleverage in ALL other stuff even cabbages and bread. Then my rental that's halved will STILL buy the same amount of goods and services.
What we object to NR's 'position' is the assumption that house prices and currencies collapse while other things remain constant.
KY
Whats this got to do with the topic.
You always just fly off on tangents inserting random pieces of bad news
Oh i forgot those 52,000 wealthy Americans are the ones who will determine the fate of Australia.
Mate you really need to focus, your inability to focus and your tendancy to fly off on tangents detracts from the thoughts you are trying to present.
NR,have a read about what George Soros thinks when he makes a financial bet, im told he keeps looking for instances that prove him wrong,but he still makes the bet, which will be more important in 3 months time in China
the price of a kilo of rice or the price of a can of coke??..willair..
As has been stated on this thread by top cropper and others. Australia is 12-18 months behind the rest of the world with regards to the unfolding financial tragedy and really its just the last two months that some of my customers have woken up.
The fact that 18 months ago I started talking about the soft depression counts for nothing on this site because some will continue to argue because they don't want to have to face up to reality....yet.
There are lots of economists in Australia who can't chew gum and walk who continue to tell us we will avoid a recession
The federal government ad nasum keeps telling us our banks are sound
We read the financial times and the finacial review from front to back every day, We attend about 6- 10 auctions most weeks. We are on half a dozen property and investment sites and instead of watching TV we surf the net learning and developing our financial literacy day in day out. We have owned and operated successful businesses since 1991 and we are comfortable with our own judgement and we will give you an example.
When we joined this site16.04.2007 the first few months we contributed a bit on SMSF's and Trevisan trusts as we were keen to share our good story that lasted up to 11th of August 1999.The large retail funds lobbied the government and had that option closed off as is so often the case. When property warrants were offered we could again see an opportunity for individuals to take control of their own super through investing directly in property.
Super the way the retail and industry funds want to run it is a scam designed to skim the cream off of working people for life.
When we first borrowed the term soft depression, (I think it was from a book that talked about demographics and the coming financial dislocation of so many boomers retiring and accessing their (U.S.) 401 retirement accounts selling down shares). it was around July 2007.
It was also then that we discovered the gorilla in the closet called subprime through surfing the net. We can accept that probably right up to July 2008 what we were saying looked like an unlikely scenario. Anything that we did post was viewed anti-property and D&G.
We only have limited time and as time went on anything we posted that suggested (a) a soft depression was coming, (b) the asx would drop below 3500 by the end of Oct 2008, (c) the reserve rate would drop to 2%, (d) the dollar would evenually drop to 38 cents and the final straw as far as the optimists on this site was that (e) residential property would drop 40-50%
sending the blue sky brigade into paroxysms of horror.
All along more and more demands are made to prove it. Anything we post is met with derision and scorn and is cast off as having no merit. Because we have kept posting the message and warning novice investors to protect their seed capital, this has infurriated what we call the blue sky brigade that advocate being geared to the back teeth. This term was coined in response to the continued abuse.
The moderators have done a great job of removing our vitriole when the abuse got too much. In the last few months we note a lot of people starting to say we don't like the message but NR's runs on the board are starting to add up.
Turk we are not prepared to continuely post to support what is now bleedingly obvious. The world banking system is insolvent, we are in a depression and world trade is collapsing. If you don't believe that or are not sure we have a suggestion.
Get on the net and arrange a three month subscription of the financial times. Also purchase a hard copy subscription of the financial review and read both from front to back for three months.
If at the end of that time you disagree with us then you are invited to click on the ignore facility on this site, that will hide our posts and you can get on with investing.
The only reason we believe we are still allowed to post on this site is that the moderators have scrutinized us closely and they recognise that we are indeed bonified property investors all be it unpopular ones
The fact that one of the owners of this site saw it necessary to post his long term optimistic view on property because of his genuine concern that the site has been polarized says it all, this discussion is going nowhere.
We would like to suggest that perhaps we will focus more on the posters who are interested in what to do with regards to protecting and expanding your property portfolio in a depression.
For those who wish to continue to flame us; "you will get a post from us saying have a nice retirement on the government pension." That means we have used the site facility that allows us not to see any of your further posts.
Someone we met many years ago who became a very wealthy man during the depression in Canada told us the secret to making a lot of money in a depression was to have no debt in your business and internally fund all your growth from profit, trim your overheads, look after your employees and those less fortunate than you.
Having just reread a book about Warren Buffett that was published in the late 1980's. He started with about $10'000 after the war, he was worth around 25 million by the late 1960's and as of 18.02.2009 his net worth was 62 billion. Warren has always eschewed debt. That is more difficult to do when investing in property initially. But in unstable times you should be preserving your seed capital.
NR
Hiya red hot chillie my call on the asx reaching 2200 in October 2009 is looking a tad conservative don't you think with all the bad news
Funny how you cannot draw a parallel between the gnomes in Switzerland demise in banking, the wholesale wealth destruction of our American cousins especially the well heeled Yanks and Australia's precarious financial situation when you consider the fiscal pygmies that control all but West Australia politically.
As for focus well "mate" I think it is time someone took those Chess certificates of yours that some faceless board controls rolls them up and whacks you on the bridge of your nose like a naughty sock puppy that you are for believing you have any say at all in the companies you speculate in
Hi NR
Nice post, I'm also bearish but not to the same extent as you, we agree in a number of areas, I have no money in retail or industry funds, novices need to preserve seed capital, my contingency plan includes enough cash to pay 2 years interest should all rents stop tomorrow or should they remain the same
a 18 year buffer plus further alternatives.
Much of my time is also spent surfing the net learning more about world economics, amazing the different spin put on the same events, so my interest is not in the what but in the why "it" will occur and then make my own decisions and act on what I think will happen but also plan for the worst.
Congratulations on 18 years of business success, I started in 1981 and retired from business in 2004, went on a 20 month holiday in the U.K. with my wife and daughter, now work partime at something I enjoy, however longevity doesn't neccessarily make us any smarter than the next person.
Getting back to your predictions for the last 18 months,
(a) a soft depression was coming,
You have now called a depression happening in Australia, to date I have not seen any data showing that we are in a reccession much less a depression yet.
So the question still being ducked is what is your definition of a depression
and where is your data to support this claim of an Australian depression?
(b) the asx would drop below 3500 by the end of Oct 2008,
Correct call,I've been shorting the market since March '08.
(c) the reserve rate would drop to 2%,
Hasn't happened yet.
(d) the dollar would evenually drop to 38 cents
Hasn't happened yet.
(e) residential property would drop 40-50%
Hasn't happened yet.
To date a strike rate over 18 months of 1 in 5, your predictions may still happen and I believe you when you state that you hope they don't, but agree that a plan should be in place should this happen.
You tell us you borrowed the term "soft depression" from a book, how did the author define this expression?
Cheers
Pete
Further more we have to be sensitive to the current times.
There are alot of nervous people out there, including myself.
Highlighting potential areas of investment risk is beneficial to the board so long as they are adequately explained. I think Token Funder is a prime canditate for this. Whilst many might not like to hear his views, they are informed, well presented and logical.
Comming out with irrelevant or highly circumstantial/low correlation pieces of data or opinions and then blasting other peoples investment views when Non-Recourse doesnt have access to their personal information, know their risk strategies etc just encourages this board to become a flaming site.
Again if Non-Recourse gets his kicks out of such activities there are plenty of other more extreme based boards where he can go.
After reading this post many times, I think it does make some senses and some nonsense.1. ASX 300 to fall to 3500 (mid September 2008 call)
2. Reserve interest rates to drop to 2% (mid July 2008 call)
3. Financial tsunami call (Feb 2008 in an SMSF thread)
4. Put 5% of your assets into gold (March 2008 call)
5. Dollar to drop to 38 cents 2009/10 (July 2008 call)
6. Unemployment not to go above 6.5% (September 2008 call)
7. Rents will not appreciably fall when property prices collapse (called September 2008 call)
8. Residential to drop 40-50%, Commercial up to 70% ( called March-April 2008?)
9. Deflation in Australia will largely be confined to property and share values initially ( call Oct 2008)
10. ASX 300 to fall below 2200 (call early November 2008)
it is time someone took those Chess certificates of yours that some faceless board controls rolls them up and whacks you on the bridge of your nose like a naughty sock puppy that you are
Like people with split personalities sparky
Did you also read today that 52,000 wealthy Americans who have Swiss bank accounts are in a spot of bother as the once mighty Swiss gnomes at UBS have the IRS putting the blow tourch to them ?
Its tough times for the super rich world wide.
Mmmm More abuse fair enough have a nice retirement on the pension yorkie
Good. Then you would also have seen the commentary by David Hunt (p.45) calling bottom and the comments by the debt collector that people have never had so much spare cash (cant find the page reference).
NR,If the Aussie stock market does go that low in the 2200 range by Oct.
I keep saying properties turn is coming and it is probably after Oct 2009 when the share market hits rock bottom at or below 2200. There I go again painting a bulls eye on my back for the blue sky crowd to give me a kick