Keen is hardly neutral

What I find interesting about this article and Keen himself is that he has declared his 'emotional' hand. Not only does he think that housing prices will drop but he he 'thinks' that housing prices are too high!

Hardly a neutral position. If for example the Prof saw nothing wrong with high prices yet he belived the market was in a bubble then fair enuf. If he did not have a view either way (house prices are eithe too high or low) - fair enuf. But because he has an open view and then spends hours trying to pove it - well thats not a very academic approach is it! Wonder if he had 5 houses and 2 million in debt - if he would be so vocal!

http://www.theage.com.au/business/walking-warning-on-crazy-house-prices-20100216-o4h5.html
 
I do recall making the point especially when an alternative property forum doomsday protagonists came here to express their opinions about the impending property market armageddon, that much of it was based on a political and philiosophical basis that housing shouldn't be exploited as a profit making venture, that it should be only for social means and used for shelter.

Good to see Keen, finally outed himself. Nothing wrong with that per se, but it does provide a vastly different context to his prognostications of doom.
 
The comments on the article are the best.... many lulz ensued.

So many people have their head buried so deep in the sand (or so far up their own ar$3) that they openly believe and agree with SK.
What a bunch of clowns.
 
The comments on the article are the best.... many lulz ensued.

So many people have their head buried so deep in the sand (or so far up their own ar$3) that they openly believe and agree with SK.
What a bunch of clowns.

actually this gets back to the pyschology of profit from investing.
People receive less marginal satisfaction from making $1 of profit compared to $1 of loss.

Understand investment pyschology and you are on a long term 'winner' based on probability.
So simple, yet few people can do it.
 
Aww...comments for the article are now closed. I was going to post an opposing view, but then I remembered: DON'T FEED THE TROLLS. :)
 
Hands up all those who saw the GFC coming.
Hands up all those who know what's going to happen in the European Union re PIIGS contagion.

Let's face it. Keen isn't a lone voice regarding the perils of the developed world's run up in debt over the last 30 years.

Taleb, Hendry, Faber, Gross, El-Erian, Chanos, Soros, Martin Feldstein, John Mauldin, Gary Dorsch are all voicing similar concerns about unsustainable debt.

Am I investing in property still? yes, but I am also hedging to cover the risk the guys above are concerned about.

Good luck to you if your sole source of economic data is the RBA and Fed Govt. Hopefully they've got the PIIGS, Japan, and China better sussed than they had the GFC.
 
actually this gets back to the pyschology of profit from investing.
People receive less marginal satisfaction from making $1 of profit compared to $1 of loss.

Understand investment pyschology and you are on a long term 'winner' based on probability.
So simple, yet few people can do it.
If it was that simple In any market,the 10% make the money,while the other 90% fight and try to make what the 10% has already made,never happens no matter if it's real estate-equities trading-high end Australian Art Work second hand cars,the 10% make what the other 90% try,from the numbers in front of me 10% of real estate ba's non title holders only 10% make it the rest get blown out the back door in the first year,or hang around property investing sites playing the milking game..imho willair..
BTW,i still think Mr Keen sometime within the next five years will be right the media can only control people mindsets for so long...
 
Hands up all those who saw the GFC coming.

I did. I could not draw a picture or give you the time of arrival though. But I did see it looming out of the fog. I didn't keep it a secret and gave warnings here, but they were not well received. LOL The fact that the majority of SS posters disagree with Keen proves nothing. You didn't see GFC I coming and you will not see GFC II either and property is unlikely to escape next time.

Yesterday I put one of my properties on the market and I'm seeking advice about selling my PPOR of 40 years. The risk/reward ratio is out of whack.
 
Yesterday I put one of my properties on the market and I'm seeking advice about selling my PPOR of 40 years. The risk/reward ratio is out of whack.

We have been weighing up whether to sell one property (half share) in order to reduce our debt to enable hubby to "retire" from his job. We began pondering this before the GFC so it was not the driver in our ponderings, but it certainly does add another layer of "what if" to the many we are already grappling with.

I am curious Sunfish, why you are considering selling your PPOR?

There are two main issues for us. If hubby leaves his job, then the timing of the sale is really important to reduce tax and give us money to live on while he is not earning. If he doesn't leave his job, I don't want to have offloaded this house unnecessarily. The longer we hold it while the market is rising, the more profit we will make.

We really need to wait and see how he feels when his long service leave is close to ended. It is too early now, so we are holding on.

We are aware though that should things slip backwards, we may wish we had sold when the selling was good.
 
Sunfish

Seeing an impending financial disaster is not hard to do. There is a little part of all of us that know it will probably happen. So one doesnt need to be nostradamus. Markets are cyclical, assets bubble occassionally - period!

Plus its only a 3 horse race. Market goes up, market stays neutral, market goes down!

The point about keen is that he may see it coming (as we all do) but he is hardly as neutral as he claims to be.
 
If the government didn't pour billions into stimulus and RBA lower rates to 50 a year record, introduce the FHBG boos etc etc, Keen could have been correct.

If anyone on here can say they predicted the (overcooked) stimulus and the resultant increase in property prices, please put your hand up.

If not, get over your self guys. :rolleyes:
 
I am curious Sunfish, why you are considering selling your PPOR?

That makes it sound as if I will go renting, doesn't it? No, I'm a big believer in owning the house I live in, but it's a development block and I have another IP which is nicer. (Or I might flee to NZ if Rudd is re-elected :D)

aussierogue
The point about keen is that he may see it coming (as we all do) but he is hardly as neutral as he claims to be.

Maybe not, but that means nothing to me. He is not my advisor.

BTW: Are us property owners any more neutral? There is plenty of advice given without disclaimers of interest here.
 
Offcourse we are not neutral and anyone taking advice on this forum should know that - its a property investing forum full of true believers.

But we dont masquerade as neutral. Having professor after your name just adds to the fact that he needs to be more neutral than ever, or alternatively to declare his hand! Now he has done that but a long time coming.
 
If the government didn't pour billions into stimulus and RBA lower rates to 50 a year record, introduce the FHBG boos etc etc, Keen could have been correct.

If anyone on here can say they predicted the (overcooked) stimulus and the resultant increase in property prices, please put your hand up.

Surely it was obvious the govt would do SOMETHING. No one knew whether it would work, but not expecting the government to do anything is like saying 'this patient would have died if the ER doctors hadn't saved him'. There's no guarantee the doctors would have been successful, but does it make sense to think the doctors wouldn't do everything they could?

I certainly didn't expect the rise in property prices, but then, I didn't sell either.
Alex
 
Thats true, the odds were that the govt would do something. But is was not definite at the time. And as you say - noone knew the results until after the fact.

Can be seen plainly now that it was overdone for such a small population/GDP with the RBA raising rates. The only country in the world raising.

Surely it was obvious the govt would do SOMETHING. No one knew whether it would work, but not expecting the government to do anything is like saying 'this patient would have died if the ER doctors hadn't saved him'. There's no guarantee the doctors would have been successful, but does it make sense to think the doctors wouldn't do everything they could?

I certainly didn't expect the rise in property prices, but then, I didn't sell either.
Alex
 
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