Canada a bubble or a bargain? Decide for yourself. http://www.crackshackormansion.com/
Im not sure of Qatar, do foreigners have property rights?
Which way is the economy heading?
- Thread starter TMNT
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Canada a bubble or a bargain? Decide for yourself. http://www.crackshackormansion.com/
Im not sure of Qatar, do foreigners have property rights?
My understandng is that very generally speaking, property markets work in the opposite direction of the overall economy. When things are unstable with the economy, people prefer to invest in bricks and mortar. It's a case of being 'fearful when others are greedy' and vice versa.
Cheers
Jen
Cheers
Jen
Interest rates are not a panacea and if anything low interest rates means trouble ahead.
Economy, % rates, and all of the above. But I see plain old cash flow as the underlying driver - up or down.
If a household has dual income supporting a mortgage, and 1 looses their job - its only a matter of time before the financial burden leads to default (obviously based on LVR, etc). Maybe a better example is the USA where % rates went up overnight in 2008-ish (to their post-honeymoon rate), people couldn't pay an walked away.
Mackay is a similar situation (and to large degree small mining towns) - with the fall in new mine exploration/construction and subsequent loss of employees, vacancy rates have risen, rents are under pressure and Im sure some price falls are inevitable. In my home town of the Gold Coast which relies strongly on confidence (aka tourism and people opening their wallets) we have got smashed, especially the top end, and we are only seeing a small support base know.
My concern is that this recovery is still fragile, cash flow is not that liquid, a sniff of a cold scares the markets like a rabbit in a spotlight, if a significant event (911, country default, etc) re-occurs??? Well Im still sitting on precious metals. Yes Im buying RE, but Im damn cautious.
If a household has dual income supporting a mortgage, and 1 looses their job - its only a matter of time before the financial burden leads to default (obviously based on LVR, etc). Maybe a better example is the USA where % rates went up overnight in 2008-ish (to their post-honeymoon rate), people couldn't pay an walked away.
Mackay is a similar situation (and to large degree small mining towns) - with the fall in new mine exploration/construction and subsequent loss of employees, vacancy rates have risen, rents are under pressure and Im sure some price falls are inevitable. In my home town of the Gold Coast which relies strongly on confidence (aka tourism and people opening their wallets) we have got smashed, especially the top end, and we are only seeing a small support base know.
My concern is that this recovery is still fragile, cash flow is not that liquid, a sniff of a cold scares the markets like a rabbit in a spotlight, if a significant event (911, country default, etc) re-occurs??? Well Im still sitting on precious metals. Yes Im buying RE, but Im damn cautious.
LVR makes no difference you still need to pay the loan and the difference between 90 and 80 percent is pretty negligible if you have no income
Maybe... but I'm not sold.
I don't think enough people look at global economics to get a perspective of where we sit in Australia and what the future may hold for us. We are a global village now. So much of our economy is tied to world events. Our manufacturing base is effectively gone. We are left with mineral exports ... one of our biggest customers is China. If you think we have a debt problem in Australia, just think about how our biggest customer is travelling ...
If you think China will run and continue to consume our exported iron ore and coal then we have boom times ahead. Currently our export volumes are up on lower prices. If our volumes drop significantly or prices tank lower we are stuffed... If China decides to do something about it's polluted environment and change energy sources (read this as reduce coal consumption) we are stuffed...If we had alternate meaningful export markets (other than minerals) or even a multiple customers to equal China's consumption we would fair better, but we have tied ourselves to China (great while it lasted) and are now at the mercy of it's consumption demands or lack of demand.
Any talk of our domestic economy must be viewed in the context of world economies and the effect on us here....particularly if you want to invest a large chunk of money (or worse, borrowed money that is highly dependant on your ability to repay it) into a domestic investment with no research into the economics of the day and any effects on the same economy from external forces..
If China trips we fall over a cliff...very simple.
I sometimes wonder that as investors how much research some people do before investing in any form of investment. I sometimes get the feeling that there is the tendency to push "there is no better time to buy" and "get in now or you'll miss the boat" ... I believe there are times when it is better to sit on the side lines for a while and see how the play unfolds. Personally I think it will flip one way or the other over the next 12 months. I see our economy flat or slightly declining at the moment with never ending rising govt debt as a cherry on the cake....This is a bad outcome considering we have just exited a "once in a lifetime mining boom". Proceeds of the said boom have been squandered. We have had the boom now maybe comes the bust...
That's one of the problems that face the investing public in Australia,and with other miners in other countries all going for the same market in China
then it come back too price and location something that only a few countries control..
China accounts for approx 27 percent of our total export market.
India 7 percent, Indonesia is just over 2 percent.
Are you suggesting that India and Indonesia pick up the 27 percent we drop from China
It should be noted that both India and Indonesia heavily rely on China as an export market...
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China accounts for approx 27 percent of our total export market.
India 7 percent, Indonesia is just over 2 percent.
Are you suggesting that India and Indonesia pick up the 27 percent we drop from China
It should be noted that both India and Indonesia heavily rely on China as an export market...
Is that a realistic out look, 27% to 0%?
Angels comment was very ambiguous:
I took this to mean could these markets replace China (I could be wrong.. further explanation / expansion of the comment from Angel would be required). Calling Angel to the thread....
My point (maybe not well put across previously) was if India currently consumes approx 7 percent and Indonesia is just over 2 percent of our total export market, how much would you expect them to soak up of China's 27 percent consumption in the event of any meaningful downturn in China's consumption? I suspect if China slows then both India and Indonesia would also slow...why would theses two economies expand if China is slowing? China is an export market for these countries as well.
I agree exports to china will not drop to 0%, but don't believe any drop will be able to be ratcheted up to any other country either. If the drop is 1%, 2%, 5%, 10% or any other value you wish to allocate it is lost export. With China consuming over 25% of our exports our eggs are truly in one basket.
Hope this is clearer Turk
Ciao
Hello
I have read previously that India and Indonesia, Philippines etc will take up a significant amount of any slack from a potential downturn in China. I don't have the articles in front of me, they were on Somersoft somewhere when there was an economic scare sometime. Probably articles about all the countries who have long term contracts to buy CSG.
I have read previously that India and Indonesia, Philippines etc will take up a significant amount of any slack from a potential downturn in China. I don't have the articles in front of me, they were on Somersoft somewhere when there was an economic scare sometime. Probably articles about all the countries who have long term contracts to buy CSG.
Yep correct.
China's growth will slow significantly as their economy is more mature. China will be the first non-developed country to have a rapidly ageing population. Young people consume more than an ageing population and it also take more and resources to look after an ageing population. The Chinese are now realising the issues from a 1 child policy....
India, Vietnam, Indonesia, and Phillipines have much younger populations and are still growing at a good rate.
Whilst Chinese consumption will slow...and their economy will grow slower. So their size of GDP in the world will stablilise and have a less percentage of the total world GDP...similar to what happened in the US. The at one point was 50%+ of the world GDP. It is now more like 30% with the rise of BRIC, EU, and ASEAN. China might be like 15% and may get to 19% but it will slow as other countries mature...just a way of the world. But the good news is economic might will be more evenly distributed. This should keep China..and the US in check!!
China's growth will slow significantly as their economy is more mature. China will be the first non-developed country to have a rapidly ageing population. Young people consume more than an ageing population and it also take more and resources to look after an ageing population. The Chinese are now realising the issues from a 1 child policy....
India, Vietnam, Indonesia, and Phillipines have much younger populations and are still growing at a good rate.
Whilst Chinese consumption will slow...and their economy will grow slower. So their size of GDP in the world will stablilise and have a less percentage of the total world GDP...similar to what happened in the US. The at one point was 50%+ of the world GDP. It is now more like 30% with the rise of BRIC, EU, and ASEAN. China might be like 15% and may get to 19% but it will slow as other countries mature...just a way of the world. But the good news is economic might will be more evenly distributed. This should keep China..and the US in check!!
I was in China last week. Those wind thingies are everywhere. None of them doing anything though. The locals were of the opinion the government is just doing it to look good to the rest of the world.
The Australian economy is heavily 'subsidised' by the Japan and China through importation of our resources. In turn the government has been subsidising the manufacturing industries here. The minute the government stops the subsidy there is no reason to be here anymore as our cost of production has bypass many lower cost countries like our living standards.
That is why we need a sovereign fund like the Future Fund to invest for Australia not to subsidise foreign own entities.
That is why we need a sovereign fund like the Future Fund to invest for Australia not to subsidise foreign own entities.
Analysing world economics is good.
But some people here analyse too much and forget to do one very important thing: make money and make lots of it.
But some people here analyse too much and forget to do one very important thing: make money and make lots of it.
Some people prefer to be right and get side tracked.
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