Keen rubbished by RBA!

[BoatBoy]

I see Steve Keen now has a blog now over on Business Spectator, so has the perfect opportunity to go head to head with Christopher Joye and other's and back up his claims and statistics.

He threw up his usual stuff, said hi and then appears at this stage to have run away leaving all the questions unanswered.

Rather disappointing at this stage to say the least.

Add:
Didnt Keen do a similar thing on the ourfinanceblogs forum. up against Michael Yardney?

Keen came on for 2 or 3 posts then vanished in a poof of smoke when the tough questions were asked.

Certainly lost what little cred if any he had with me, but I suppose its much easier to play with the captive audience of believers on his own site.

Dave

 

[farmilor]

a wife at home with another in the oven

wife in the oven

 

[Aaron Sice]

yeah unfortunately i'm stuck with the MSN popup when i log on to use chat - so i pop my head over there every now and then to have a laugh at the "stories" - it's like reading a TT special.

 

[yorke]

I see Steve Keen now has a blog now over on Business Spectator, so has the perfect opportunity to go head to head with Christopher Joye and other's and back up his claims and statistics.

He threw up his usual stuff, said hi and then appears at this stage to have run away leaving all the questions unanswered.

Could be busy house hunting.
These days astute buyers find it a lot harder to buy in Sydney because of the large number of FHBs. By the time you go back for a second look and a lowball offer some unsophisticated FHB has already bought it.

 

[TheAnalyst]

I wonder why how he got his professorship? how the Uni wastes money to employ such a person? Sad!

 

[BayView]

At the core of all this debate about whether Aus will follow the US is the subprime mess.

The majority of the problem with that in the US was there were soo many people who were not qualified to borrow, who were given ARM loans and the like.

The honeymoon rate ended, the "real" rate kicked in, and everyone was unable to repay their loans.

At the same time, property had peaked, so many of these people suddenly were left with loans they couldn't afford, and properties they owed more on than they started with after the remaining interest from the honeymoon rate was capitalised onto the loan.

Voila; loads of properties on the market, no-one able to get funding to buy, and no-one able to sell - sold for massive losses and values plummeted.

Don't forget; the average Yank penguin is over 100% in (consumer and student) debt most of their lives too.

We didn't have anywhere near the same volume of this type of lending going on here, and we didn't have anywhere near the same volume of over-supply either.

Also, their implosion happened before ours, so we were able to watch from a safer distance after the event and apply the brakes harder here before a similar disaster could possibly occur.

It's a pointless comparison; us and them.

I have no doubt we will have a period of little or no growth - maybe another year or so, but it's more to do with the finance climate - lack of it and tougher lending criteria - rather than a sub-prime caused disaster. Our sub-prime % was almost non-existent, and now is even more so.

Idiots like Steve Keen are purely sensationalising it.

 

[BoatBoy]

Could be busy house hunting.
These days astute buyers find it a lot harder to buy in Sydney because of the large number of FHBs. By the time you go back for a second look and a lowball offer some unsophisticated FHB has already bought it.

LOL


Dave

 

[our obsession]

Nonrecourse:

A lot of people come to grief because they deposit their brain at reception when they go and seek advice from "the chosen one". To be fair to the sprukers a large percentage of the individuals that come to them are just plain greedy, they are lazy and they have no investment plan they just "wanna get rich".

I think this forum might have a higher than average questioning mindset ? of basic human behaviour toward some of their actions/inactions, quite a few forumites remark upon the sheep (following each other a little blindly) affect, discuss why only so few take charge of their financial independence decisions...all that stuff, it is interesting.

Anyway, I am always interested why's and wherefore's, psychologys, physiologys etc of human behaviour, this is also quite interesting:

http://www.newscientist.com/article/dn16826-brain-quirk-could-help-explain-financial-crisis.html

from Newscientist by Ewen Callaway

 

[Aaron Sice]

dont forget the fact that the US also builds EVERYTHING first, then hopes to house people in it.

we're still 40k odd dwellings short

 

[nonrecourse]

At the core of all this debate about whether Aus will follow the US is the subprime mess.

The majority of the problem with that in the US was there were soo many people who were not qualified to borrow, who were given ARM loans and the like.

The honeymoon rate ended, the "real" rate kicked in, and everyone was unable to repay their loans.

At the same time, property had peaked, so many of these people suddenly were left with loans they couldn't afford, and properties they owed more on than they started with after the remaining interest from the honeymoon rate was capitalised onto the loan.

Voila; loads of properties on the market, no-one able to get funding to buy, and no-one able to sell - sold for massive losses and values plummeted.

Don't forget; the average Yank penguin is over 100% in (consumer and student) debt most of their lives too.

We didn't have anywhere near the same volume of this type of lending going on here, and we didn't have anywhere near the same volume of over-supply either.

Also, their implosion happened before ours, so we were able to watch from a safer distance after the event and apply the brakes harder here before a similar disaster could possibly occur.

It's a pointless comparison; us and them.

I have no doubt we will have a period of little or no growth - maybe another year or so, but it's more to do with the finance climate - lack of it and tougher lending criteria - rather than a sub-prime caused disaster. Our sub-prime % was almost non-existent, and now is even more so.

Idiots like Steve Keen are purely sensationalising it.

Unfortunately BV the truth is a bit more complex than that. The entire world banking system is stuffed. The arabs back in 1973 were the first ones to wake up to the American three card trick of printing money. The quantitative easing as the spin Dr's like to call it first got out of control in the modern era after Tricky Dicky (Nixon) took American off the Bretton Woods monetary system in 1971. For those of you who were only a twinkle in your fathers eye back then; Bretton Woods was developed after the second world war as a proxy gold standard. It allowed governments to cheat (print more money than gold they actually had) under limited restraints. The American dollar fixed at $35 became the currency that you could convert to under limited conditions to then cash into gold. This worked well after world war two because the US represented 65% ++ of the world economy.Gradually as Europe retooled this imbalance was corrected

In 1973 we had the first world oil crisis not because the world was short of oil but because of the Vietnam War (a country in south east asia) and the american monetary system was maxed out paying for the war. The arabs were responding to the first major quantitative easing that meant they were being paid in devalued US currency. The German Government demanded that their foreign exchange in US dollars be converted into gold in 1971 and Nixon pulled the plug. Oil was $2 a barrel in early 1973 but the value of the dollar had dropped from 4 marks to 1.3 ( I remember because I was a long haired hippie backpacking in Europe, specifically in Germany and Nixon was being impeached). The arabs jacked the price of oil up to $8-12 a barrel which reflected the true devaluation of the US currency. A lot of people complain today about the Chinese currency being manipulated but they learned from the masters the septic tanks (Yanks)

Fast forward to today. We now have the Europeans lead by the Germans again in revolt because again we have the Americans printing funny money.
The Germans are particularly sensitive to devalued currencies because their people suffered so much in the 1920's because of hyperinflation brought on by the severe treaty obligations imposed on Germany after the first world war.

I get acused of not explaining my rational but when I look back over my posts the reality is that most people don't like the message I am pushing. We are doomed to repeat history because the majority are ignorant of our past history C'est la vie.

 

[nonrecourse]

Nonrecourse:

I think this forum might have a higher than average questioning mindset ? of basic human behaviour toward some of their actions/inactions, quite a few forumites remark upon the sheep (following each other a little blindly) affect, discuss why only so few take charge of their financial independence decisions...all that stuff, it is interesting.

When I see some of the posts on this site about how does what happens in the US and Europe have any bearing on property prices in Australia I seriously question your premise of a higher average on this forum

 

[turk]

When I see some of the posts on this site about how does what happens in the US and Europe have any bearing on property prices in Australia I seriously question your premise of a higher average on this forum

Hi NR

Are you referring to your posts or others

Cheers

Pete

 

[chilliaa]

Non Recourse,
Whilst i still think that post is still a bit extreme, you are actually presenting some valid areas of risk, and further more you are taking the time to explain your position/ideas in more detail.

Dare i hope that this continues

 

[nonrecourse]

Hi NR

Are you referring to your posts or others

Cheers

Pete

Hi Turk have a look at my preceeding post prior to the post you commented on and tell me its not rational

 

[turk]

Hi Turk have a look at my preceeding post prior to the post you commented on and tell me its not rational

Hi NR

Rational or not NR I think you missed the smiley at the end of my post,
sometimes it's good to just kick back and relax, there was no criticism
involved.

Cheers Pete

 

[chilliaa]

Unfortunately BV the truth is a bit more complex than that. The entire world banking system is stuffed. The arabs back in 1973 were the first ones to wake up to the American three card trick of printing money. The quantitative easing as the spin Dr's like to call it first got out of control in the modern era after Tricky Dicky (Nixon) took American off the Bretton Woods monetary system in 1971. For those of you who were only a twinkle in your fathers eye back then; Bretton Woods was developed after the second world war as a proxy gold standard. It allowed governments to cheat (print more money than gold they actually had) under limited restraints. The American dollar fixed at $35 became the currency that you could convert to under limited conditions to then cash into gold. This worked well after world war two because the US represented 65% ++ of the world economy.Gradually as Europe retooled this imbalance was corrected

In 1973 we had the first world oil crisis not because the world was short of oil but because of the Vietnam War (a country in south east asia) and the american monetary system was maxed out paying for the war. The arabs were responding to the first major quantitative easing that meant they were being paid in devalued US currency. The German Government demanded that their foreign exchange in US dollars be converted into gold in 1971 and Nixon pulled the plug. Oil was $2 a barrel in early 1973 but the value of the dollar had dropped from 4 marks to 1.3 ( I remember because I was a long haired hippie backpacking in Europe, specifically in Germany and Nixon was being impeached). The arabs jacked the price of oil up to $8-12 a barrel which reflected the true devaluation of the US currency. A lot of people complain today about the Chinese currency being manipulated but they learned from the masters the septic tanks (Yanks)

Fast forward to today. We now have the Europeans lead by the Germans again in revolt because again we have the Americans printing funny money.
The Germans are particularly sensitive to devalued currencies because their people suffered so much in the 1920's because of hyperinflation brought on by the severe treaty obligations imposed on Germany after the first world war.

I get acused of not explaining my rational but when I look back over my posts the reality is that most people don't like the message I am pushing. We are doomed to repeat history because the majority are ignorant of our past history C'est la vie.

This issue about governments trying to fund fiscal expansion financed by debt is raging amongst institutional money managers.

Its too early to tell, and i am purely speculating here, but i think the MARKET, may actually prevent it from getting out of control.

We had the British government issue a government debt issuance a couple of days ago, and guess what? there was insufficient demand. This made international finance headlines, and put Gordon Brown on the immediate defensive. Now this could have just been due to a technicality because the next days issuance went through fine.

But it does show that the market is nervous, and the market is watching everything like a hawk. I think this is good for the protection of the value of 'money'. However it still links back to my quandry:

How the hell do we get out of this economic structural mess that we have got ourselves into (and in this case the GFC is only a peripheral issue, its not even the MAIN GAME).

 

[WinstonWolfe]

Its too early to tell, and i am purely speculating here, but i think the MARKET, may actually prevent it from getting out of control..

So who bought the US's March debt issuance?

 

[nonrecourse]

This issue about governments trying to fund fiscal expansion financed by debt is raging amongst institutional money managers.

Its too early to tell, and i am purely speculating here, but i think the MARKET, may actually prevent it from getting out of control.

We had the British government issue a government debt issuance a couple of days ago, and guess what? there was insufficient demand. This made international finance headlines, and put Gordon Brown on the immediate defensive. Now this could have just been due to a technicality because the next days issuance went through fine.

But it does show that the market is nervous, and the market is watching everything like a hawk. I think this is good for the protection of the value of 'money'. However it still links back to my quandry:

How the hell do we get out of this economic structural mess that we have got ourselves into (and in this case the GFC is only a peripheral issue, its not even the MAIN GAME).

Hello Chillie;
I normally don't have much time for the Europeans because of their free trade shenanagans that have kept the third world in poverty. I see red when French diplomatic souffle's lecture Australians on free trade

But the German's, French and Czechs have read the threat to world banking stability correctly when they refuse to get sucked in to the U.S Federal reserve ponzi scheme euphemistically called quantitative easing... theft in any other language.

I'm afraid Chillie unlike you I don't trust either Mr Market, the property or the share market to act rationally. I put my trust in solid gold and blue chip real estate preferrably unencumbered so I stand away from the madness.

When I talk about the asx at 2200, or for that matter 3500.. I believe that is a market that is out of touch with reality as is property collapsing 50%. Unfortunately we live in a time that is neither rational or is looking to the future. The daily share market reports of the market being up or down is useless information.The real estate clearance rates and values at the moment are fraudulent

For any rational investor its time to keep the gun powder dry there are a number of false dawns yet to arise.

 

[BoatBoy]

I put my trust in solid gold and blue chip real estate preferrably unencumbered so I stand away from the madness.

That worked well for those that purchased Blue Chip Tokyo real estate in the late 80's and those that purchased Gold in 1979.

They probably told anyone who'd listen how smart they were and thought they were standing away from the madness as well.

Dave

 

[our obsession]

NR:

When I see some of the posts on this site about how does what happens in the US and Europe have any bearing on property prices in Australia I seriously question your premise of a higher average on this forum

Because I think it is like trying to compare apples and oranges.

People's behaviour, even though allowing for cultural/country differences can still tend to act in their predictable/unpredictable manner, (hence see my newscience link), it's interesting btw..whereas we have a somewhat different structured housing market, bank loaning...all that to USA and Europe, you surely are aware of that? You don't need me to point it out.

My interest lies in people'e behaviour and actions..the biological/pyschological/innate etc attitude toward money/finance/investing.