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The Gold Bubble... Just how badly have the silly goldbugs failed?
Topic Started: 21 Jun 2014, 11:46 AM (27,208 Views)
Shadow
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FiatBug
20 Mar 2015, 03:16 AM
Just for you Blondie and for the silly Goldbugs and for the ever so clever Housebugs who also bought in 1999.
Nice work. Good to see another member who can create their own charts/analysis. That makes two of us now.

One other thing to consider is the yield on property, which puts the total return well ahead of gold.
1. Epic Fail! Steve Keen's Bad Calls and Predictions.
2. Residential property loans regulated by NCCP Act. Banks can't margin call unless borrower defaults.
3. Housing is second highest taxed sector of Australian Economy. Renters subsidised by highly taxed homeowners.
4. Ongoing improvement in housing affordability. Australian household formation faster than population growth since 1960s.
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Jimbo
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Shadow
20 Mar 2015, 09:40 AM
One other thing to consider is the yield on some property, which puts the total return well ahead of gold.
Edited by Jimbo, 20 Mar 2015, 09:47 AM.
Matthew, 30 Jan 2016, 09:21 AM Your simplistic view is so flawed it is not worth debating. The current oversupply will be swallowed in 12 months. By the time dumb shits like you realise this prices will already be :?: rising.
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Shadow
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The Whole Truth
20 Mar 2015, 07:31 AM
Well a retiree who put $200k in gold in 2004 @ $500 an ounce would have to disagree with you shadow
Sure, gold had a good run for seven years out of the past few decades. But that's all over now.

I doubt many people would dump $200K into a speculative gold play. Very risky. Rewarding if you get the timing perfect, but far too risky for most people.

Your own gold trinkets fit into half a shoebox, and you were buying when gold was at $1600, so I know for certain you didn't buy $200K of gold in 2004.

Meanwhile Sydney house prices are up 65% since the GFC, which is a 325% return on investment if leveraged at 80% LVR.

For most people, putting that $200K down as a deposit on a Sydney home would have been a vastly superior investment.
1. Epic Fail! Steve Keen's Bad Calls and Predictions.
2. Residential property loans regulated by NCCP Act. Banks can't margin call unless borrower defaults.
3. Housing is second highest taxed sector of Australian Economy. Renters subsidised by highly taxed homeowners.
4. Ongoing improvement in housing affordability. Australian household formation faster than population growth since 1960s.
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Shadow
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Jimbo
20 Mar 2015, 09:46 AM
some property
All residential property has yield when rented out. The national rental vacancy rate is 2-3%, which mostly just represents changeover period between rentals. Any residential property investor will have yield by renting out their property, and at any time 97-98% of them are doing so, and the other 2-3% are just in a few weeks of vacancy before the next tenant moves in.
Edited by Shadow, 20 Mar 2015, 09:52 AM.
1. Epic Fail! Steve Keen's Bad Calls and Predictions.
2. Residential property loans regulated by NCCP Act. Banks can't margin call unless borrower defaults.
3. Housing is second highest taxed sector of Australian Economy. Renters subsidised by highly taxed homeowners.
4. Ongoing improvement in housing affordability. Australian household formation faster than population growth since 1960s.
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Jimbo
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Shadow
20 Mar 2015, 09:51 AM
All residential property has yield when rented out. The national rental vacancy rate is 2-3%, which mostly just represents changeover period between rentals. Any residential property investor will have yield by renting out their property, and at any time 97-98% of them are doing so, and the other 2-3% are just in a few weeks of vacancy before the next tenant moves in.
Whether I bought an ounce of Gold in Karratha, Dublin, Menorca, Donetsk, Miami or Sunderland, it would have cost me the same amount.

You graph gold against one sector of the property market?

Gold is Gold, but not all property is in Sydney.
Matthew, 30 Jan 2016, 09:21 AM Your simplistic view is so flawed it is not worth debating. The current oversupply will be swallowed in 12 months. By the time dumb shits like you realise this prices will already be :?: rising.
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Shadow
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Jimbo
20 Mar 2015, 10:16 AM
Whether I bought an ounce of Gold in Karratha, Dublin, Menorca, Donetsk, Miami or Sunderland, it would have cost me the same amount.

You graph gold against one sector of the property market?

Gold is Gold, but not all property is in Sydney.
This is an Australian property forum and Sydney is the biggest market in Australia, and that's where I invest. Hence my response.
Edited by Shadow, 20 Mar 2015, 10:20 AM.
1. Epic Fail! Steve Keen's Bad Calls and Predictions.
2. Residential property loans regulated by NCCP Act. Banks can't margin call unless borrower defaults.
3. Housing is second highest taxed sector of Australian Economy. Renters subsidised by highly taxed homeowners.
4. Ongoing improvement in housing affordability. Australian household formation faster than population growth since 1960s.
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The Whole Truth
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Cherry picking, shadow's standard ploy.
Why talk about yields with property on IO loans anyway. We all know the money is swallowed up by the bank and then more is typically needed to balance the books. That's why many property investors have sold out of their IP's in the last few years. They are tired of subsidizing them with their day job because rents never rose enough to cover the promise and capital gains vanished.

IO loans are tread water loans. Pointless waste of money.
"Panics do not destroy capital; they merely reveal the extent to which it has been previously destroyed by its betrayal into hopelessly unproductive works." John Stuart Mill
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Shadow
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The Whole Truth
20 Mar 2015, 11:59 AM
Why talk about yields with property on IO loans anyway. We all know the money is swallowed up by the bank and then more is typically needed to balance the books
Only if the property is purchased using leverage (which isn't mandatory when buying property).

But if you are assuming leverage then don't forget that you need to multiply the capital gain on property by the amount of leverage, which puts the total return well ahead of gold.

Quote:
 
Cherry picking, shadow's standard ploy.
You mean like cherry picking the only seven years out of the past few decades when gold rose in value faster than Australian property?
Edited by Shadow, 20 Mar 2015, 01:12 PM.
1. Epic Fail! Steve Keen's Bad Calls and Predictions.
2. Residential property loans regulated by NCCP Act. Banks can't margin call unless borrower defaults.
3. Housing is second highest taxed sector of Australian Economy. Renters subsidised by highly taxed homeowners.
4. Ongoing improvement in housing affordability. Australian household formation faster than population growth since 1960s.
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Kuyuss
Unregistered

The Whole Truth
20 Mar 2015, 11:59 AM
Cherry picking, shadow's standard ploy.
Why talk about yields with property on IO loans anyway. We all know the money is swallowed up by the bank and then more is typically needed to balance the books. That's why many property investors have sold out of their IP's in the last few years. They are tired of subsidizing them with their day job because rents never rose enough to cover the promise and capital gains vanished.

IO loans are tread water loans. Pointless waste of money.
Actually, if you had dropped 500K on the gold ETF back when it was launched, your capital gain is likely to have gifted you the equivalent of a median priced home in Sydney in the space of 11-12 years, without lifting so much as a fly. Of course, you could argue that you could have taken the 500K and leveraged into a squadron of rental properties and be many times better off. It's kind of like Kiyosaki thinking back when he was a champion among suburban dwellers. In Australia, the majority of us still carry that Kiyosaki spirit, with a tacit understanding that the establishment will pull through for us.
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Shadow
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Evil Mouzealot Specufestor

Kuyuss
20 Mar 2015, 01:18 PM
Actually, if you had dropped 500K on the gold ETF back when it was launched, your capital gain is likely to have gifted you the equivalent of a median priced home in Sydney in the space of 11-12 years
If you had $500K twelve years ago then you could just have bought a couple of Sydney median priced homes outright and be done with it.

Or you could put it on a trifecta at the Melbourne cup and be worth millions the following day.

There are a few good reasons why more people invest in property than speculate on ETFs...

1. Much lower risk
2. Much easier to leverage
3. Yield
4. Superior long term risk adjusted return

But sophisticated investors like yourself should probably stick to your esoteric 'financial instruments' rather than messing about with common property.
1. Epic Fail! Steve Keen's Bad Calls and Predictions.
2. Residential property loans regulated by NCCP Act. Banks can't margin call unless borrower defaults.
3. Housing is second highest taxed sector of Australian Economy. Renters subsidised by highly taxed homeowners.
4. Ongoing improvement in housing affordability. Australian household formation faster than population growth since 1960s.
Profile "REPLY WITH QUOTE" Go to top
 
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