Why have you gone off on some pointless non-sequitur about the abstractness of fiat money and non-tangible assests? All wealth and ownership is 'abstract'. The value of your home is 'abstract', as is your ownership of it. The latter is there only by decree of the sovereign, itself an 'abstract' concept . Your "home is my castle" justification for ridiculous valuations is typical of the nonsense spouted around here that tries to pass for a logical argument. The sober reality of this though is that you end up sounding a silly as one of those dribbling goldbug conspiracy theorists.
The point I was making is that the abstract wealth tied up in housing wealth is illiquid, meaning we can't convert that capital easily to more productive uses should the need arise; let's say tanking commodity prices. Neither is it fungible or portable - we can't just say "hey theres too many units of housing in melbourne, lets shift a few to sydney", so again we have this problem of allocating capital to put it to its best use.
In summary the only positive effect of high property prices to the broader economy is the retail spending fillip it provides via the wealth effect - and anyone with half a brain can see that's a zero sum game. Pete, if you can go market maker for a fixed Monet <--> Picasso conversion rate then let's play ball
Of course it is a zero sum gain, but it is deeply embedded into our psyche. Whether Mr Frum likes it or not people will continue to buy homes for status, location and other castle type attributes.
Some Bulls hark back to the old days when house prices in Sydney were 3 times income and Irish labourers, fresh of the boat, could buy homes in Centennial park and set up lodging houses for their peers. As if these days are ever going to return. Centennial Park homes are castles now, not lodging houses. You can cry about it all you like and claim that the house has not changed and all the added value since the sixties is abstract and meaningless. However, that would be denying the reality of the huge economic growth that has seen Sydney change from a backwater of Sheilas and Bruces and "prawns on the Barbie" to a rich, vibrant, diverse cosmopolitan city.
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.
Of course it is a zero sum gain, but it is deeply embedded into our psyche. Whether Mr Frum likes it or not people will continue to buy homes for status, location and other castle type attributes.
Some Bulls hark back to the old days when house prices in Sydney were 3 times income and Irish labourers, fresh of the boat, could buy homes in Centennial park and set up lodging houses for their peers. As if these days are ever going to return. Centennial Park homes are castles now, not lodging houses. You can cry about it all you like and claim that the house has not changed and all the added value since the sixties is abstract and meaningless. However, that would be denying the reality of the huge economic growth that has seen Sydney change from a backwater of Sheilas and Bruces and "prawns on the Barbie" to a rich, vibrant, diverse cosmopolitan city.
Another non-sequitur - anyone care to provide a response that actually addresses my comment?
"It were not best that we should all think alike; it is difference of opinion that makes horse races." - Mark Twain on why he avoids discussing house prices over at MacroBusiness. "Buy land, they're not making any more of it." - Georgist Land Tax proponent Mark Twain laughing in his grave at humourless idiots like skamy that continually use this quip to justify housing bubbles.
..you are clearly one of those bears I was referring to in my post who are embittered with self worth doubts as a result of seeing the Credit Suisse wealth study indicating their relative poverty which has resulted from their doom and gloom attitude of imagining the evils of debt and forever expecting a crash in house prices.
More fail from you. By Australian standards, I am wealthy. By Indonesian standards, you are wealthy. You prefer the latter because you are deluded self-important fucktard.
Quote:
I mentioned one of the chosen solutions adopted by the gloomers to such studies - denigrate the study. You have chosen another solution to ease your inferiority complex arising from the study - abuse.
There are studies that show anything you want. I guess your position is that we should just believe all studies because only bitter gloomers denigrate studies. There were studies in the 50s showing nuclear radiation is good for you, and in the 60s showing tobacco is good for you. How those bitter gloomers denigrated those fine studies. The funny thing about you is you aren't even aware how stupid you sound.
Here is something you should aspire to, because otherwise your life will have been a waste of time and a drag on anyone who has come in contact with you in any way shape or form.
Quote:
To laugh often and much; To win the respect of intelligent people and the affection of children; To earn the appreciation of honest critics and endure the betrayal of false friends; To appreciate beauty, to find the best in others; To leave the world a bit better, whether by a healthy child, a garden patch, or a redeemed social condition; To know even one life has breathed easier because you have lived. This is to have succeeded.
Aim for success.
------------------------------ " ... which is that all-too-familiar dynamic in Irish life where people tell lies, cover them up and create all sorts of collateral damage, sometimes spread out over decades, and never take responsibility." - Alan Glynn
I'm sure he has rented a few DVDs that have made people happy.
With any luck they didn't have their mood ruined by his obnoxious political views when bringing it back.
Property acquisition as a topic was almost a national obsession. You couldn't even call it speculation as the buyers all presumed the price of property could only go up. That’s why we use the word obsession. Ordinary people were buying properties for their young children who had not even left school assuming they would not be able to afford property of their own when they left college- Klaus Regling on Ireland. Sound familiar?
The evidence of nearly 40 cycles in house prices for 17 OECD economies since 1970 shows that real house prices typically give up about 70 per cent of their rise in the subsequent fall, and that these falls occur slowly. Morgan Kelly:On the Likely Extent of Falls in Irish House Prices, 2007
you are deluded self-important fucktard you aren't even aware how stupid you sound your life will have been a waste of time and a drag on anyone who has come in contact with you in any way shape or form
Why u so mad bro? U make a bad call on the house prices?
Of course it is a zero sum gain, but it is deeply embedded into our psyche. Whether Mr Frum likes it or not people will continue to buy homes for status, location and other castle type attributes.
Some Bulls hark back to the old days when house prices in Sydney were 3 times income and Irish labourers, fresh of the boat, could buy homes in Centennial park and set up lodging houses for their peers. As if these days are ever going to return. Centennial Park homes are castles now, not lodging houses. You can cry about it all you like and claim that the house has not changed and all the added value since the sixties is abstract and meaningless. However, that would be denying the reality of the huge economic growth that has seen Sydney change from a backwater of Sheilas and Bruces and "prawns on the Barbie" to a rich, vibrant, diverse cosmopolitan city.
''has seen Sydney change from a backwater of Sheilas and Bruces and "prawns on the Barbie" to a rich, vibrant, diverse cosmopolitan city.''
NO it has not. Bogans may be driving more expensive cars and many living in McMansions but they are the same aggressive, rude, uncouth boofheads they were 30 years ago. Instead of Prawns on the barbie, its take away pizza and burgers. And your explanation does not tell us why that should lead to bubble house prices?
Another non-sequitur - anyone care to provide a response that actually addresses my comment?
That is the best you have got? You post all this nonsense about unsustainable house price growth and hark back to the good old days. Yet when you look at the reality of the market then you can see clearly the change is permanent. There is always money in all kinds of things that do not reflect their inherent value. You are dreaming if you think this will change, humans will always put values on things and good Sydney homes in the lower north shore are very desirable and they wont be getting any less so in a hurry.
Steve99
18 Oct 2014, 10:14 AM
''has seen Sydney change from a backwater of Sheilas and Bruces and "prawns on the Barbie" to a rich, vibrant, diverse cosmopolitan city.''
NO it has not. Bogans may be driving more expensive cars and many living in McMansions but they are the same aggressive, rude, uncouth boofheads they were 30 years ago. Instead of Prawns on the barbie, its take away pizza and burgers. And your explanation does not tell us why that should lead to bubble house prices?
Show me the bubble
I do not share your negative views of Australians.
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.
That is the best you have got? You post all this nonsense about unsustainable house price growth and hark back to the good old days. Yet when you look at the reality of the market then you can see clearly the change is permanent. There is always money in all kinds of things that do not reflect their inherent value. You are dreaming if you think this will change, humans will always put values on things and good Sydney homes in the lower north shore are very desirable and they wont be getting any less so in a hurry.
Show me the bubble
I do not share your negative views of Australians.
ITs not a negative view, just an observable fact. I am one as well but having lived overseas for many years can see the lack of 'couth' in the oz population. Even more so amongst those that call themselves 'middle' class who behave on the whole more like a bunch of council house 'C_words' in the UK but with more money. You can see it on the roads too, more road rage than the vast majority of countries Ive spent time in and far more 'in your face' type of aggressive behaviour. I can see the next time we have a proper recession the boofheads will be unmanageable and vast tracts of soulless suburbs will become domestic violence central on par with the ferral burbs right now... A blue flashing light in every street.
I even suspect that diet of take away burgers and pizza may have a lot to do with the agro cloud that the average bloke drives around with more often than not, in fact this has been mooted recently in the scientific press.
An after thought to this, if you are young enough and butch enough, want an increasingly challenging, recession proof job, joint the cops, you could be the driver of the in-demand blue flashing light
Houses and land are personally owned property and are "real" tangible assets.
Would you prefer to own abstract paper assets which represent property held by other people? Bank accounts represent abstract money lent to banks, held and employed by banks for their own purposes. A $100 currency note represents abstract money which the government declares is exchangeable for an abstract $100. Bonds represent abstract money held and employed by the bond issuer for their own purposes. Share certificates/registry entries represent abstract money held and employed by company directors for their own purposes.
What a daft argument!
Yes, I'd rather hold "abstract paper assets" which will grow many fold, which I can then use to buy "real tangible assets" if I choose to do so. And at the ned of the day, the value of of your "real tangible asset" is still abstract, since the profit will become real and tangible only once you sell it and bank the profits (turning it into so called "abstract $$$ in the bank)
ITs not a negative view, just an observable fact. I am one as well but having lived overseas for many years can see the lack of 'couth' in the oz population. Even more so amongst those that call themselves 'middle' class who behave on the whole more like a bunch of council house 'C_words' in the UK but with more money. You can see it on the roads too, more road rage than the vast majority of countries Ive spent time in and far more 'in your face' type of aggressive behaviour. I can see the next time we have a proper recession the boofheads will be unmanageable and vast tracts of soulless suburbs will become domestic violence central on par with the ferral burbs right now... A blue flashing light in every street.
I even suspect that diet of take away burgers and pizza may have a lot to do with the agro cloud that the average bloke drives around with more often than not, in fact this has been mooted recently in the scientific press.
An after thought to this, if you are young enough and butch enough, want an increasingly challenging, recession proof job, joint the cops, you could be the driver of the in-demand blue flashing light
Steve it is a negative view. Australians can sometimes be so down on other Aussies, I just don't get it.
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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