i called it first! GFC Mk2.

here we go.

someone mentioned greece was the canary in the mineshaft - couldn't be more true. the ramifications of an insignificant economy (~1.5%) laden with debt affecting a larger economic zone is a hyperreaction - all because that little economy can't change it's own independant fiscal policy because it's now tied to the euro.

we now see funds refusing to lend to certain GERMAN interests because of their primary debtor concerns (greece/italy/spain). that spells disaster for the eurozone and the euro, but is a good thing at the same time because euro exports are suddenly great value, so german manufacturing looks likely to ramp up.

britain - what a basketcase - pass on comment.

what does it mean for the US? no one really cares, they're out of the spotlight now, the media don't report anymore on the (again) very poor data coming out of the USA. could see a lot of "made in detroit" tags on your clothes soon.

australia - rates to be cut back to around 3.50% and to sit there for a while IMPO - although they could go up in the short term as the RBA steers while drunk, bu i expect them come down in 50bp blocks at a time if they do. rents to only see moderate growth in the west and qld over the next year and then expect rampant runaway rises but mid-upper end values to rage like a wounded bull, sydney likely to get two feet on the ladder and melb a little too early to call - market could either be re-assessing or taking a breather for another leg up. quiet winner will be Darwin again.

affordable housing will be where it's at - anyone selling wants to be under median, anyone buying wants to buy at median or just above - to avoid the HUGE competition at anywhere under median. the sub $350k market is going to be VERY VERY VERY VERY (did i mention very?) strong in QLD and WA, any new developed product under this value will be hot to trot for OOs, IPs and renters alike.

my advice in any state is get as close to public transport as possible - if you're renting sign a 24m lease and lock in your rent now, if you're an OO look forward to good CG and if it's an IP only sign your leases for 6m at a time and you will get CG as well. you can bet your fat behind that oil companies will use this global turmoil as an excuse to ramp down production and raise prices - i expect $1.50 petrol by dec.

and there it is. i look forward to revisiting this in a year.
 
here we go.

someone mentioned greece was the canary in the mineshaft.........

Guilty :p :eek:

I also recall a phrase that echoes my own sentiments on an unrelated fiscal endeavour, that was espoused by a true Blue fella from the west; His name is Mr. Card

Short term pessimistic.....long term optimistic ;)
 
you can bet your fat behind that oil companies will use this global turmoil as an excuse to ramp down production and raise prices - i expect $1.50 petrol by dec.


Surely you're not suggesting that oil producers will knowingly take advantage of the economic turmoil for their own personal gain?! Wouldn't that be immoral?:confused:
 
here we go.

someone mentioned greece was the canary in the mineshaft - couldn't be more true. the ramifications of an insignificant economy (~1.5%) laden with debt affecting a larger economic zone is a hyperreaction - all because that little economy can't change it's own independant fiscal policy because it's now tied to the euro.

we now see funds refusing to lend to certain GERMAN interests because of their primary debtor concerns (greece/italy/spain). that spells disaster for the eurozone and the euro, but is a good thing at the same time because euro exports are suddenly great value, so german manufacturing looks likely to ramp up.

britain - what a basketcase - pass on comment.

what does it mean for the US? no one really cares, they're out of the spotlight now, the media don't report anymore on the (again) very poor data coming out of the USA. could see a lot of "made in detroit" tags on your clothes soon.

australia - rates to be cut back to around 3.50% and to sit there for a while IMPO - although they could go up in the short term as the RBA steers while drunk, bu i expect them come down in 50bp blocks at a time if they do. rents to only see moderate growth in the west and qld over the next year and then expect rampant runaway rises but mid-upper end values to rage like a wounded bull, sydney likely to get two feet on the ladder and melb a little too early to call - market could either be re-assessing or taking a breather for another leg up. quiet winner will be Darwin again.

affordable housing will be where it's at - anyone selling wants to be under median, anyone buying wants to buy at median or just above - to avoid the HUGE competition at anywhere under median. the sub $350k market is going to be VERY VERY VERY VERY (did i mention very?) strong in QLD and WA, any new developed product under this value will be hot to trot for OOs, IPs and renters alike.

my advice in any state is get as close to public transport as possible - if you're renting sign a 24m lease and lock in your rent now, if you're an OO look forward to good CG and if it's an IP only sign your leases for 6m at a time and you will get CG as well. you can bet your fat behind that oil companies will use this global turmoil as an excuse to ramp down production and raise prices - i expect $1.50 petrol by dec.

and there it is. i look forward to revisiting this in a year.
Blue Card,from what i read there seems to be a cautious optimism out there,while talking too a Real Estate Agent this morning at the 5 dollars per side local barber,he tells me the market in our local area is very slow double the amount of listings from last year,very few investors asking the question,had to happen at some time:rolleyes: :rolleyes:,but something he said sort of stand out,when you look at all the inner city "CG" in the very small pockets all the old Queensladers have had 100k"s spend on them some off the reno's i walk past have been going on for years,but it all comes back too one item the land value,so once you take that into the mix if you were to take the reno costs off the total reno then you may see the real value in dollar terms..
Greece to me looks like the US Banking system 2 years ago,and it may well take the Euro with in all the way into the gutter,good time to be in US hard dollar faced cash,Oil at $1.5o by the end of this year,not sure on that one,but if it does goes up too those numbers then as the ASX tracks the price of Oil--"IMHO"-- no good shorting the market if that happens
imho ..willair..
 
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This chart shows that Greece is only the beginning of the problems. Look at the other PIGS

http://www.ritholtz.com/blog/2010/05/europes-web-of-debt/

Yep, thanks Coasty; another poster (Jonril) also posted that link in the PIGS thread I started a couple of days ago. The diagram is also in The Age today in Melb, no doubt SMH and others.

Gives another slant to the word "pentagon" alright. :rolleyes:

Don't you love the inter-connectedness of each others borrowings/debt also......not dis-similar to those smoke and mirros merchants and derivative creators of the merchant/investment (sic) banks of 2007/2008 et al. ;)

Spain is next. Lock up the Pamploma bulls......it will be the "running of the bears" this year :cool:
 
Greece to me looks like the US Banking system 2 years ago,and it may well take the Euro with in all the way into the gutter.

The Greek debt is small, in fact Euro zone debt is nothing compared to the US debt.
Yet none is talking about a debt problem in the US.
Do you think that 5 or 10% of GDP is a significant debt?
Well it is for the Euro zone because they have a set standard they want to keep but look at Japan which has a debt which is 200% of GDP. None is betting on Japan defaulting.

It's a joke. The same financial companies, rating agencies and hedge funds etc who caused the problems in the US are playing the system again and this time in Europe but sooner or later their bet will come true so they'll lose billions.

Even if that doesn't happen then regulation will come and slap them in the face.
It has to, they can't bet that someone will fall down and at the same time make him trip.
Currently they are getting away with it but for how long?
 
rents to only see moderate growth in the west and qld over the next year and then expect rampant runaway rises but mid-upper end values to rage like a wounded bull, sydney likely to get two feet on the ladder and melb a little too early to call - market could either be re-assessing or taking a breather for another leg up. quiet winner will be Darwin again.

this seemed inconsistent with your other forecasts? why woud you see mid-upper values raging amongst all this other turmoil?
 
The Greek debt is small, in fact Euro zone debt is nothing compared to the US debt.
Yet none is talking about a debt problem in the US.
Do you think that 5 or 10% of GDP is a significant debt?
Well it is for the Euro zone because they have a set standard they want to keep but look at Japan which has a debt which is 200% of GDP. None is betting on Japan defaulting.

It's a joke. The same financial companies, rating agencies and hedge funds etc who caused the problems in the US are playing the system again and this time in Europe but sooner or later their bet will come true so they'll lose billions.
BV,Should that happen then the money map of Europe will be transformed forever,something like that is just impossible to imagine..
..willair..
 
It's a joke. The same financial companies, rating agencies and hedge funds etc who caused the problems in the US are playing the system again and this time in Europe but sooner or later their bet will come true so they'll lose billions.

Even if that doesn't happen then regulation will come and slap them in the face.
It has to, they can't bet that someone will fall down and at the same time make him trip.
Currently they are getting away with it but for how long?

Yes i agree totally. It would be funny if it wasnt so true.
But at the end of the day i have highlighted this as a fundamental reason to be weary of the financial sector as a whole (including peoples superannuation).

The basic problem lies in the fact that people are forgetting the primary purpose of the financial system: to allocate funds to capitalism and to partake in the profits (either known with debt intruments, or residual with equity intruments).

Instead increased focus is being given as to how to 'shortcut' the process.
Essentially how to play the financial intruments themselves, rather than invest in the financial instruments.

Its ok for this to occur so long as the % of total funds allocated to 'shortcuting' is minute compared to the % that is investing in the financial intruments.
But as the % of shortcutting funds increases the end result will be chaos.
 
aaahhh... anyone who thinks interest rates are dropping is my friend :) but if interest rates do start to drop due to europe, it clearly reflects on the reserve bank's incapability to assess world events.

don;t forget about gold. looks like this europe mess is going to give a push upwards.
 
BV,Should that happen then the money map of Europe will be transformed forever,something like that is just impossible to imagine..
..willair..
Hi Willair

Yes I know....:eek:
That's what the speculators believe as well, but it's hard to know what the Germans will do.

Last night Merkel was warning the markets saying that they will be prepared to let a problem child leave the Euro. The Greeks lost public opinion support in Germany because in the early stages of the crisis when they were critisised of their high spending and relaxed attitude to work some Greek people & media called the Germans Nazi's and asked for compensation for war attrocities during WW2.

Germany lost the war but the Germans managed to take over Europe without guns so they won't let this remarkable achievement go to waste.
The Greeks are only a tiny % of the Eurozone so I wouldn't be surprised if Merkel was willing to cut them off if she had to, in order to win German public opinion and at the same time to stop speculators and to force the rest of the Eurozone team stay focused.

Yes, German & French banks will lose money but Eurozone countries could lose even more due to speculation and higher interest rates.
On the other hand, turbulance and a lower Euro means cheaper European products ( and property :D ) and more jobs for everyone so maybe that's what they need atm. IMO they should stop speculators by letting the ECB buy bonds of any Eurozone member regardless of their credit rating and they should get on with the job of reducing debt.
 
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BV, the courts and the politicians can do/say as they please. What else are the talking head going to say, "panic sell, it's over" - of course not.....their words are meaningless drivel.

In the end, many will be taking a hair cut. Credit conditions will certainly worsen. Spreads are blowing out again.

Aus housing bubble is indeed in grave danger, I think the top has just blown off - wouldn't want to be a seller over the next 24 months.

Peace

SYDB
 
So lots of grim scenarios, but where are the money making opportunities?

And I agree with the 'grimness'. I see hyperinflation and subsequent undermining of currency as the catalyst. And this is occuring because of multiple multinational causes. Greece, USA, Germany, UK, wars, oil, political instability, environmental instability.

But where are the opportunities people?
 
Have to agree with you SYDB. Despite the attempts to calm the situation, spreads continue to increase, even for Portugal despite attempts to calm fears by paying an May 20 maturing bond earlier.

Greece was first. I think Portugal or Ireland will be next, then Spain and Italy. The problem is that as the dominos fall, it makes things harder for other European contries (as they all contribute to rescue packages).

Don't hold much hope for the Aus property market staying up, heading into 2011.
We all know that the hugh amounts of money governments spent has hidden the real problems that still exist. Now there is no money left.

I find it amusing that the uneducated masses who voted the socialist governments in (in Greece, etc), and here in Aust (Rudd), are the ones who are going to feel the pain the most.
 
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