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Baby Boomers Are Evil - visit Reform Australian Housing on Facebook; I bought a house a year ago, paid some snivelling undeserving ageing hippy boomer far more than they deserved
Topic Started: 11 Jul 2014, 02:01 PM (10,205 Views)
Count du Monet
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Bardon
13 Jul 2014, 05:26 PM
No, I mean that the housing market is determined by willing buyers and sellers. Those seeking housing reforms best understand that transaction first and then decide how they want to attempt to influence change.

Blaming the banks and the government for your woes is a dead set sign that your woes will continue.
I assume the slave workers in the Nazi concentration camps could make a few choices too?

I can tell you no uncertain terms that high house prices are the result of permanent money printing. Saving money via ordinary bank savings doesn't work because the currency is constantly devalued. Hence to save capital people invest in tangible things like property and shares creating a permanent bubble that merely varies a bit with market cycles.

The winner is the government that prints the money and then the financiers who are first in line in the money food chain.

Even better now with compulsory savings, so you can borrow you own money back and pay interest on it. Like a thief who stole your wallet and then loaned you your own stolen money at interest so you could buy food.

Free choice......Ha!

Give me sword and I would cleanse the world of these people in manner that would make Stalin look like a kindly old man.
The next trick of our glorious banks will be to charge us a fee for using net bank!!!
You are no longer customer, you are property!!!

Don't be SAUCY with me Bernaisse
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Bardon
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Nazi concentration camp victims, no they are different form house buyers and sellers in Oz.

Yes some of us know about inflation, maybe the average buyers and seller don't.

You would like to take a sword to the evil doers, that's okay.

So how does any of this advance the case of the Housing Reform?

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Count du Monet
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Bardon
13 Jul 2014, 09:07 PM
Nazi concentration camp victims, no they are different form house buyers and sellers in Oz.

Yes some of us know about inflation, maybe the average buyers and seller don't.

You would like to take a sword to the evil doers, that's okay.

So how does any of this advance the case of the Housing Reform?

Quite obvious, a non-inflationary money standard would see residential (and commercial) land prices cut in half......this is good, no?
The next trick of our glorious banks will be to charge us a fee for using net bank!!!
You are no longer customer, you are property!!!

Don't be SAUCY with me Bernaisse
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Bardon
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Count du Monet
13 Jul 2014, 09:27 PM
Quite obvious, a non-inflationary money standard would see residential (and commercial) land prices cut in half......this is good, no?
I believe that land prices lead the cycle, monetary and credit inputs merely follow land speculation and other inflationary drivers, they do not lead.

I also believe that any analysis of what drives the land value and economic cycles really need to take into consideration the motives of the market players if it is to get to the point.

Every single inflationary cycle in the past has not been driven by money or credit either.
Edited by Bardon, 13 Jul 2014, 09:42 PM.
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Mike
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Count du Monet
13 Jul 2014, 01:56 PM
MAD was a real doctrine once. Because they had no means to stop a ballistic missile once it's in sub orbit and interception prior to stage was unlikely. But new technologies are making interception a possibility. This will override MAD and give somebody the idea they can be the winner! The problem is ballistic missiles are crude but effective and can be created in large numbers!




That would be against the historical trend.

Spain emerged as the new world order after the fall of Byzantium. And went on to overate its degree of control and ground itself into dust during the 80 years war. After 1648 it was Frances "new world order", it overrated itself and was challenged. Losing strength mid point onwards total loss during the Napoleonic wars.

Britain emerged as commander post 1816, but was increasingly challenged half way onwards. Losing it all from WW1 to WW2.

The US emerged as commander then 1945 (they had become the real power prior to that), but is suffering an increasing string of failures.

These "New World Orders" so far have had an expiry date of little over a century.

Germany may prove the dominant culture, although the Russians have proved the,selves stuff of iron. As for the US it would collapse if its door is ever kicked in!
The US lead order is far stronger and diversified then any that proceeded it. The alliance system is massive and nothing in history comes close to comparison. The US is also the first superpower to not dominate the world via conquest and holding large chunks of territory in an empire. It has bases in allied nations and leaves when the host nation no longer wants them aka Iraq and Philippines are recent examples. Nearly all prior powers would never accept this and fight wars to sustain it presence.

The US certainly uses its power at times but is far more restrained then previous world leaders.

China will never be the global leader in terms of the US is today. It lacks the geographic position in the world that enables it to move massive forces around the globe. It is surrounded on all side by potential threats of varied nature requiring massive forces to be maintained in the homeland to deal with any of the many threats.

The US on the other hand has no threats to its homeland other then terrorists, it can deploy if required during a major conflict the bulk of its military in one direction. It keeps forces spread out now but during war they would concentrate and provide overwhelming advantage against any foe, including China.

Coupled with the US huge lead in military power by itself is it's dozens of allies which could aid it in any conflict. China relies on sea lanes for its energy and economy. The US controls the world sea lanes and will for decades to come. To fight the US and protect it seaplanes means the PLA navy must venture away from its shores and outside the range of its land based missiles and air power and into the range of the hundreds of US bases around the globe which can then employ the same strategy of area denial Chinese uses close to its shores.

The simple answer is China will not want a war vs the US for decades as it will lose in a matter of weeks, as it's economy crumbles due to lack of oil and the many other resources it imports let alone losing its exports market which make up the bulk of its GDP growth.

As I said China needs decades to build an ocean going fleet to have any chance 1vs1 for the US let alone combat the many allies that are certain to support the US in any large war. This is why China does not use force now to start a war despite its talk it's understands who holds the true power in the world and this will remain the case for at least the next 20 years. Even then China will not be able to beat the US alliance, it needs to try and dismantle it as direct conflict leads to certain defeat for China, a situation they fully understand.
http://mike-globaleconomy.blogspot.com.au/
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Count du Monet
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The US is also the first superpower to not dominate the world via conquest and holding large chunks of territory in an empire.


Nothing new there, this reveals your lack of historical references. They all start out on the basis of influence and when can use the boot and they succumb to it.

The weakness of the US is it is one of dumber super powers that history has thrown up. It's problem is that is has united all the Asian powers against it, China, Russia and a few others (normally these are all at each others throats). Pissy on their own but invincible when they united.....against this unity while it prevails the US has snowball chance in Hell! :lol

Despite every man and his dog warning them they overreached themselves in Iraq and began their demise.
The next trick of our glorious banks will be to charge us a fee for using net bank!!!
You are no longer customer, you are property!!!

Don't be SAUCY with me Bernaisse
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skamy
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Curious Non-Economist
13 Jul 2014, 02:32 PM
OK, so 1999 - 1980 = 20 and 1999 - 1960 = 40. Got it!





So, in 1999 or thereabouts, all Baby Boomers sold their property to GenX and became renters, thus missing out on all those price gains that GenX enjoyed?


I see. And yet the fact that you still own a property that you didn't sell to Gen X would seem to bring the point into dispute.


So if home ownership rates are high across all age groups in Australia, how did the Baby Boomers miss out on the gains from 1999 to present?


As stated previously, it is the seller that makes the profit, not the buyer. I am not sure if you just don't understand that concept, or you do, but it doesn't fit your narrative so you falsely claim otherwise. So let's turn it around. Yes, those who sold to the tail end of Gen X in 2009/10 and collected $14K from the public purse in grants and $56K in the higher sale price that results from levering up $14K, did very well indeed. Are you saying that it is factually undeniable that it was early GenX selling property to tail-end GenX at that time and no Baby Boomer has profited from selling a property since 1999?


For goodness sakes housing stock increased and the older generation to the boomers would be selling up through those years. It has nothing to do with boomers selling up.

My point is that Gen X could very well outperform the boomers in capital gains from housing. They certainly got off to a much better start that we did.

It is very likely that the home owning Gen x cohort will retire richer than the home owning boomers. It is so silly to look at the wealth of someone who has worked for 35 -45 years and cry foul because you are not as wealthy as them when you have only worked and saved and invested for 15-20 years.
Veritas
13 Jul 2014, 02:58 PM


Seven times one income or two?

Median price paid by an FTB in June was 466k

Average full time wage (GRoss) is about 80k.

After tax and taking into account the relative youth of FTBs their after tax income is somewhere around 60k on average (at best)

That means the FTB price is 8 times single income after tax. And one pays their mortgage after they pay the tax man.
What is the average wage of the first time buyer? How much equity do they have? To take this into account you need to use the ABS statistics.

According to the ABS the average first home buyer loan is serviced using 20% of their income. How silly to think other than that.


Your whole post is just a load of made up numbers to claim a completely non existing proposition ie that banks will lend 7 times someones income. That is just laughable Veritas.


Edited by skamy, 13 Jul 2014, 10:44 PM.
Definition of a doom and gloomer from 1993
The last camp is made up of the doom-and-gloomers. Their slogan is "it's the end of the world as we know it". Right now they are convinced that debt is the evil responsible for all our economic woes and must be eliminated at all cost. Many doom-and-gloomers believe that unprecedented debt levels mean that we are on the precipice of a worse crisis than the Great Depression. The doom-and-gloomers hang on the latest series of negative economic data.
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Curious Non-Economist
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skamy
13 Jul 2014, 10:36 PM
My point is that Gen X could very well outperform the boomers in capital gains from housing.

Oh, right. Could. Yeah. If the price gains from 1997 to 2003 are repeated for the next 20 years. Sure.
Quote:
 
They certainly got off to a much better start that we did.

So, when you left high school or University, the country was in a deep recession and youth unemployment was 20% also? Bummer.
Quote:
 
It is very likely that the home owning Gen x cohort will retire richer than the home owning boomers. It is so silly to look at the wealth of someone who has worked for 35 -45 years and cry foul because you are not as wealthy as them when you have only worked and saved and invested for 15-20 years.

I agree, that is very silly. It is also irrelevant. As are hand waving predictions about future price growth leading to GenX riches.
Quote:
 
According to the ABS the average first home buyer loan is serviced using 20% of their income.

Got link? I don't think your memory is all that reliable.

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peter fraser
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Curious Non-Economist
13 Jul 2014, 11:02 PM
Oh, right. Could. Yeah. If the price gains from 1997 to 2003 are repeated for the next 20 years. Sure.


So, when you left high school or University, the country was in a deep recession and youth unemployment was 20% also? Bummer.


I agree, that is very silly. It is also irrelevant. As are hand waving predictions about future price growth leading to GenX riches.


Got link? I don't think your memory is all that reliable.
According to Genworth in 2013 the average FHB loan was $280,000 so an average 20% commitment doesn't seem far fetched.
Any expressed market opinion is my own and is not to be taken as financial advice
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Curious Non-Economist
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peter fraser
13 Jul 2014, 11:23 PM
According to Genworth in 2013 the average FHB loan was $280,000 so an average 20% commitment doesn't seem far fetched.
OK, assuming you could actually buy a house in Sydney for $350,000 in 2013 ....

If the loan was P+I (5% interest, 30Y term), in the first year the borrower would pay around $14K in interest and $9K in principal. Which is $23K in the first year, divided by 0.2 gives $115,000. :huh:

Does that mean that the average FHB is earning $115K per year? That doesn't sound right. If it was dual income, that would be two people on $57,500 per year, which still seems high, but at least feasible.

That would mean that the 20% commitment is of household income, not single income. So taking $57,500 and dividing it into $280,000 gives a debt to single income ratio of 4.86, and $57,500 into $350,000 is a price to single income ratio of 6.08

That sounds precarious to me. If one person lost their job, I don't know if someone on $57K per year could cover their payments. Maybe, but they would have to cut back on almost everything else, shop at Vinnies for clothes, eat 50c instant noodles. Could have a feedback effect on local businesses and the people they employ.
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