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Beware! The Asians Are Coming! Tidal wave of Asian money rushing into Oz cities!; Asian banks lend at low interest rates and do not have Australian bank lending restrictions
Topic Started: 19 Jun 2014, 11:54 PM (4,743 Views)
Chris
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Curious Non-Economist
22 Jun 2014, 04:13 PM
Excellent post, I agree with all of your recommendations except negative gearing. Interest is expensable in every other business, so there is no reason for property to have an exemption. I don't believe it has that much effect regardless. If property was a free market, with unlimited supply capacity, a property's price would go into decline as soon as it was built. There are only two ways to create a boom in property prices. The first is to restrict supply, and the second is financial repression (like China) where the investment options are limited. Both of these methods are the sole province of government, because governments around the world control land use. Where-ever land use is highly restricted by a central authority, you get property booms (and their attendant busts).

I think we should open the floodgates to Chinese investment. Better them holding the bag than us when it all goes pear shaped, and it would do wonders for our current and capital accounts as well. Invest a trillion, take home 500 billion.

Your post is basically wrong. There is no rampant free market activity in the city. There is rampant corruption in government that sells access to public land (public good, private profit). There is no free market in banking in Australia either, it is the most highly regulated banking markets in the developed world.

As for overseas investors who couldn't care about the long term social impact of increased housing density with no corresponding infrastructure to support it, I got news for you mate, local investors couldn't care less either. It's all about profit. Nobody involved in the property industry gives a flying fuck about the social or economic impact of their actions, they just want to get theirs, regardless of who they fuck over.

As for every cent earned going back to China, well, if you have a way to attract investors with the promise they will never get their capital or profits returned to them, I am sure the property industry would love to hear your ideas.
If thats your demented take my post I will refrain from correcting any misconceptions as you are either an antagonist or a raging lunatic.

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Curious Non-Economist
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Chris
22 Jun 2014, 08:29 PM
If thats your demented take my post I will refrain from correcting any misconceptions as you are either an antagonist or a raging lunatic.
Why can't I be both?
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Chris
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Curious Non-Economist
22 Jun 2014, 08:48 PM
Why can't I be both?
Once you are in either realm there are no restrictions so feel free to embrace both in equal or lesser amounts as you see fit.

You might however find benefit in taking the polar opposite approach.
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herbie
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Ex BP Golly
20 Jun 2014, 09:18 AM
The Chinese are like financial 4 year olds.

They love chasing bubbles and popping them..

Its fantastic that they now treat our housing market like yum cha!

As opposed to the Yanks who love making bubbles 'n then popping them maybe?

Hmmm - If you're a Yank, the Mexicans are coming; If you're a Brit, the Poles 'n Russians are coming; And if you're an Aussie, the Asians are coming - It all gets a bit ho hum after enough decades No?

Expect if you're in an even halfway decent place ta be, someone's always coming - Leastways 'til they aren't.

So be happy while they are - As that means you're still at least a halfway decent place ta be ... :)
Edited by herbie, 22 Jun 2014, 10:11 PM.
A Professional Demographer to an amateur demographer: "negative natural increase will never outweigh the positive net migration"
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Curious Non-Economist
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Chris
22 Jun 2014, 09:45 PM
Once you are in either realm there are no restrictions so feel free to embrace both in equal or lesser amounts as you see fit.

You might however find benefit in taking the polar opposite approach.
Tell me more. I assume you see yourself as both a protagonist and sane. How has that benefited you?

herbie
22 Jun 2014, 10:02 PM
Hmmm - If you're a Yank, the Mexicans are coming; If you're a Brit, the Poles 'n Russians are coming; And if you're an Aussie, the Asians are coming - It all gets a bit ho hum after enough decades No?
If you were a Mohican, the Europeans were coming. Didn't work out so well for them.
Edited by Curious Non-Economist, 22 Jun 2014, 10:13 PM.
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herbie
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Curious Non-Economist
22 Jun 2014, 10:11 PM
If you were a Mohican, the Europeans were coming. Didn't work out so well for them.
I'm not full bottle on Mohican History - Were they more 'go with the flow' or 'the old ways are the best ways' types? ... :)
A Professional Demographer to an amateur demographer: "negative natural increase will never outweigh the positive net migration"
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Curious Non-Economist
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herbie
22 Jun 2014, 10:21 PM
I'm not full bottle on Mohican History - Were they more 'go with the flow' or 'the old ways are the best ways' types? ... :)
The latter. So you could say their obstinacy killed them.

On the other hand, the Cherokee were more 'go with the flow' types, and they were stripped of all their possessions and then sent on a death march known later as the 'Trail of Tears'. More than a third of the population died, but at least they got a nice piece of land that no European wanted and are now the proud owners of some fine casinos. Maybe that's what Australians could do in future, work at casinos for their new Chinese landlords.

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herbie
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Curious Non-Economist
22 Jun 2014, 10:38 PM
The latter. So you could say their obstinacy killed them.

On the other hand, the Cherokee were more 'go with the flow' types, and they were stripped of all their possessions and then sent on a death march known later as the 'Trail of Tears'. More than a third of the population died, but at least they got a nice piece of land that no European wanted and are now the proud owners of some fine casinos. Maybe that's what Australians could do in future, work at casinos for their new Chinese landlords.
"Better Red than dead" is an old adage I've heard - But personally suspect Yanks 'n Brits 'n Aussies today just could be a bit more sophisticated than Mohicans 'n Cherokees 'n Choctaws were then. As in a bit better equipped to compete.
Edited by herbie, 22 Jun 2014, 10:50 PM.
A Professional Demographer to an amateur demographer: "negative natural increase will never outweigh the positive net migration"
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Curious Non-Economist
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herbie
22 Jun 2014, 10:49 PM
"Better Red than dead" is an old adage I've heard - But personally suspect Yanks 'n Brits 'n Aussies today just could be a bit more sophisticated than Mohicans 'n Cherokees 'n Choctaws were then. As in a bit better equipped to compete.
There was a joke that Seinfeld used to tell about spectators at sporting matches. "We won, we won" they say. No, they won, you watched.

And that pretty much sums up most people in the Western world today. There are a few bright and capable people keeping things running, the rest of the population are not much more sophisticated than a Cherokee or a Cocktaw.

The American Indians were much more skilled in war than the Europeans, especially in melee, they had been almost constantly at war with each other for hundreds of years. But the Europeans had firearms and Sheffield steel. In other words, a technological advantage. Today the war is fought in economic dominance. Westerners are fighting over baubles and beads (property and fame), while the Asians (and others) are slowly developing the next generation of weapons of economic warfare.

Curious Non-Economist
22 Jun 2014, 11:40 PM
There was a joke that Seinfeld used to tell about spectators at sporting matches. "We won, we won" they say. No, they won, you watched.

And that pretty much sums up most people in the Western world today. There are a few bright and capable people keeping things running, the rest of the population are not much more sophisticated than a Cherokee or a Chocktaw.

The American Indians were much more skilled in war than the Europeans, especially in melee, they had been almost constantly at war with each other for hundreds of years. But the Europeans had firearms and Sheffield steel. In other words, a technological advantage. Today the war is fought in economic dominance. Westerners are fighting over baubles and beads (property and fame), while the Asians (and others) are slowly developing the next generation of weapons of economic warfare.
Ooops, Freudian slip?
Edited by Curious Non-Economist, 23 Jun 2014, 12:00 AM.
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Foreign buyers add 10pc to home prices

Rick Wallace
June 23, 2014 12:00AM

UNLAWFUL foreign buying of established houses is rife in Melbourne, as well as other capitals, and is adding a 10 per cent premium to prices that is crushing the hopes of local buyers, leading buyers’ agents have revealed.

They also warn authorities don’t understand the impact the foreign buying is having on affordability.

Veteran Melbourne buyer’s agent David McRae said:

“We regularly get knocked off by certain sections from overseas and money is not an object to them,’’ Mr McRae said. “We don’t expect to win when I come up against people from Malay­sia or China…Let me tell the Reserve Bank: it is a problem and it’s going to ­become a much bigger problem if they don’t do anything about it ­because the local population is being priced out…These guys really don’t understand the impact that it is having.”

Another long-time agent, David Morrell, said the FIRB’s enforcement regime was akin to “being slapped with a wet lettuce…The rules are so lax — it’s wrong…I think the FIRB have a fair job ahead of them.’’

Read more: http://www.theaustralian.com.au/business/property/foreign-buyers-add-10pc-to-home-prices/story-fniz9vg9-1226963069100#
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