- Scamp wrote:This ofcourse is a worst case scenario, but in the end we might be better off without the USA than with them. The FED is the only cause of this massive global creidt problem, and they are doing everything they can to offload their problem to other countries.
I don't expect anyone to see the real implications of this crisis : But I can tell you , so far we have seen only the very beginning of what is to become the worst financial and economic crash in history, making the 1929 crash look like a breeze.
Things are not getting out of balance they are getting back in balance. Americas best days are now behind it. The US has had the lions share and had it to good for too long, cheap energy, world dominance, the worlds currency, the US used to be creative and synonomous with what is good now they are an example of the worlds worst, all this while BRIC nations are racing ahead.
Teh economic cycle is geting back to its long term balance.
bardon wrote:Scamp wrote:This ofcourse is a worst case scenario, but in the end we might be better off without the USA than with them. The FED is the only cause of this massive global creidt problem, and they are doing everything they can to offload their problem to other countries.I don't expect anyone to see the real implications of this crisis : But I can tell you , so far we have seen only the very beginning of what is to become the worst financial and economic crash in history, making the 1929 crash look like a breeze.
Things are not getting out of balance they are getting back in balance. Americas best days are now behind it. The US has had the lions share and had it to good for too long, cheap energy, world dominance, the worlds currency, the US used to be creative and synonomous with what is good now they are an example of the worlds worst, all this while BRIC nations are racing ahead.
Teh economic cycle is geting back to its long term balance.
I wouldn't count on America being down and out completely just yet. I agree with you on all things being on a cycle. Just look at Japan in the past at its peak and its state of economy now. US was on a peak the last few years and is just starting on a downturn and eventually some day even Dubai and the UAE will be the same as well.
On the same note, I think that Australia has also probably peaked with the resource boom over the last few years. Its troubling to find that even with the extremely high commodities prices, there are a lot of resource companies that are barely making ends meet (see recent report on AFR). This shows just how badly run a lot of these companies are – to be unable to capitalize on their basic products.
Just imagine if they have trouble now with peak commodities prices, how are they going to survive once the bubble burst?
There is a very high likelihood that in the event of a world commodities price slump, a lot of Aussie resource companies will start failing. The ripple effect across the stock market and housing will probably be felt for years if that happens.
I believe Peak Oil is imminent and proven. I believe we have neither the will or the capability to prevent a collapse. I feel that our entire economy is based on an ever escalating consumption process and must be wiped clean if we ever have a chance at sustainability. I believe that we are in population overshoot and must have a reduction. I believe most everything about our current way of life is possible only because of oil and almost everthing will change. I believe Climate Change is a possible human extinction level event if we don't crash soon. I believe that nuclear war is likely in comming resource wars. There is no magic bullet.
Scamp wrote:Another free tip : the real value of your house is what you can sell it for : Not what banks tell you.
If a fool buys it for 500.000, then it does NOT mean it's 'worth' 500.000. It just means it's worth whatever the NEXT fool will give you for the house ( that might be 1.000.000 or 200.000 ). Seeing that fools are running low on money, you can bet that property prices aren't going up , but down.There are two sorts of property owners out there – the over committed (wait for the bargains, they will come – we haven't seen the half of it yet!) and the ones that would sell their mother before selling their property. These will ride out the stupid stuff and keep accumulating wealth.
The problem for many is their over willingness to spend tommorrows money today on frivilous BS using 100% loans and credit cards.
I remember renovating our first home – lived in it as was (worst house in a good street) with the bathroom vanity hanging off the wall shaving in a bucket for at least 6 months whilst accumulating capital to continue renovations. The "MUST HAVE NOW – AT ANY COST" is what brings people undone. We are already seeing businesses shed staff and some have even closed down. The MINING BOOM cant carry everything!!.
People BINGE and then CRASH DIET and then BINGE again – welcome to the bull and bear markets. Buy reasonable yield properties or shares and keep doing it. The more income you have the more investments you can make and become less reliant on your own personal exertion to fund living!
By the way – to many think that because the bank johnies say they CAN do something then it must be the RIGHT thing to do! Yeah right!! Not all, they want you over a barrel so all you can do is pay the minimum repayments for the rest of your life.
Remember – high NET worth – not high assets high debt!
Im going to sum this up simply. From a quote i read.
"The best time to buy is before tomorrow"
Free Beer Tomorrow
woogy wrote:Im going to sum this up simply. From a quote i read."The best time to buy is before tomorrow"
Woogy
Was that book writen by a realestate agent by any chance.
Hey Woogy, I'm with you.
I bought my first house in Adelaide in 2001 and at the time I thought we had bought at the peak of the market. Everyone was saying that prices were only going to go down. Seven years later and, despite prices having gone through the roof, people are still saying that the market is going to crash.
I'm not saying that prices are going to continue to go up. I'm just saying that there are a lot of henny penny's out there.
Buy property. Just make sure you do your research beforehand. If the doomsayers are wrong then your property will increase in value. If they are right then people will lose their homes and will need to rent somewhere – hopefully your house.
There may not be the crazy money that there was to be made a couple of years ago but, trust me, there will always be a demand for housing.
Cheers
K
Scamp
Your theories are fine and you have based your predictions on many good facts. I agree that the world property prices are and will continue to fall over the next few years.
Reading this article ( takes a few days ) has made me think – I think back to when I was young. Back in the old days ( not so good old days ), I battle to think of anyone back then talking about buying investment properties, shares, etc. This was reserved for the rich people – people we never knew.
Then as ime went by, we all went to school , got jobs and then the 70's come along and money started flowing to the workers, inflation took off, more money, young people buying new houses in new landcom estates, paying like 3 or 4 times their yearly wages for houses. Then getting pay rises, excess money, paying off houses, buying new cars etc etc.
Then we start talking about shares, shares go up, superannuation becomes compulsory, people put lots of money into super and shares etc. House prices rising as more young people buy houses etc.
Wow time has passed, we now all talk about making money with super, shares, houses.
But, suddenly the world starts to change, bosses get huge pay rises, workers pays are fixed to small increases, cost of living skyrockets with water, fuel, electricity, food, interest rates rises. Suddenly the average person is headed back to the bad old days of not having money to spend, credit cards are used ( not heard of in the 60's ). One must now think we are going backwards not forward for the next few years at least.
I guess I am starting to get lost with my thoughts, but seriously, we all need to take a look around us and think about at least the next 10 years of property growth. I think it depends on inflation and wages growth obviously but the multiple factor of 10 times wages is unsustainable, it must come back if there is going to be any possibility of young people every getting into the housing market. Lets hope it happens for the sack of our kids and a future of fairness for all.
We can still make money with our property investments, but hopefully not at the expense of a future for the following generations.
At the end of the day our economies are based on exponential growth, unfortunately the minority understand that the world is a finite area of habitable and sustainable limits on population growth. The laws of physics tell us that we are on a massive course of global correction for the dominant species. Has anyone here ever considered this possibility happening?
GPT share is now LESS THAN A$ 1.50….. Time is coming and haunting all the property investors…
If GPT property with blue chips company as tenants being hammered….Surely, the house and commercial prices will crash
soon…Any comments about the latest email video steve just made today….there's that under supply of houses and more needed to keep up with growth rates? hehe
thought I'd throw more wood into the fire;)If we end up with a 30% unemployment rate from the oil shock I am sure it will turn into an oversupply when our mortgage stressed Australians move back into Mum n Dad's and start living a more wholesome life.
ormeau wrote:At the end of the day our economies are based on exponential growth, unfortunately the minority understand that the world is a finite area of habitable and sustainable limits on population growth. The laws of physics tell us that we are on a massive course of global correction for the dominant species. Has anyone here ever considered this possibility happening?The human race is headed for armageddon. There are too many people in the world and we are using the finite resources and energy at unsustainable levels. It cannot go on globally. Again, Australia is a separate microcosm. Our country and resources are vast and our population relatively small. Evolution determines that our species is on a collison course with extinction as our behaviour will not be sustainable.
In the meantime, buy lots of properties. Australia needs plenty more of them. Greed is goodJust curiously. When looking at multiples of yearly income – anyone know what Singapore is? I know their property is REALLY expensive. And they seem to be doing well (certainly loads of buildings)
rudyl wrote:Just curiously. When looking at multiples of yearly income – anyone know what Singapore is? I know their property is REALLY expensive. And they seem to be doing well (certainly loads of buildings)One thing in their favour is they have one singular superannuation fund. "And no commissions paid to advisers"
rudyl wrote:Just curiously. When looking at multiples of yearly income – anyone know what Singapore is? I know their property is REALLY expensive. And they seem to be doing well (certainly loads of buildings)I can probably answer that. First off – finite land. This is a country with only 700+ km sq, roughly the size of Manhattan, but with 4.6mi population. Same thing with HK or Tokyo or Manhattan, when you cram a lot of people into a very finite piece of land, that land is going to be very, very expensive.
The economy is another contributing factor – Its probably the most successful nation at attracting foreign investments next to Hong Kong. With a maximum of 20% tax rate in Singapore, ZERO capital gains tax on property OR shares, and NO ESTATE DUTIES, it is extremely attractive as a place for wealthy investors who are savvy enough to see the benefits.
Add to this an extremely efficient govt, low corruption, very strong prospects from IR projects in 2009 and very advance private banking facilities and you have all the ingredients to be an extremely successful nation.
Re Singapore
" With a maximum of 20% tax rate in Singapore, ZERO capital gains tax on property OR shares, and NO ESTATE DUTIES, it is extremely attractive as a place for wealthy investors who are savvy enough to see the benefits."
Not to mention the babes.
Maybe we should chip in and buy Kevin Rudd a plane ticket so he can get a few new ideas.
My first post in an important and relevant discussion
Doom and Gloom article, if you dare read on……..http://www.investmentpostcards.com/2008/07/05/market-fundamentals-are-appalling/
Tony B wrote:Re Singapore" With a maximum of 20% tax rate in Singapore, ZERO capital gains tax on property OR shares, and NO ESTATE DUTIES, it is extremely attractive as a place for wealthy investors who are savvy enough to see the benefits."
Not to mention the babes.
Maybe we should chip in and buy Kevin Rudd a plane ticket so he can get a few new ideas.
I second that!! In that hot climate.. the girls are known to be…. skimpy on clothes perpetually.. rrrrrrrrh~
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