Clearly Shane Oliver did..........And to think he called it "Housing Market Collapse"
But you weren't quoting Shane Oliver. If you did it would make sense in context.
Oliver's reasons are:-
Quote:
So with debt levels and house prices on a tear, what factors could potentially lead to a collapse in house prices, say of more than 20%? According to Oliver, there are three:
A recession β much higher unemployment could clearly cause debt servicing problems. This looks unlikely though.
A surge in interest rates β but rate hikes are unlikely until 2018 and the RBA knows households are more sensitive to higher rates so itβs very unlikely rates will reach past highs.
Property oversupply β this would require the current construction boom to continue for several years.
Now which one are you banking on Simon?
Take risks - if you win you will become wealthy, if you lose you will become wise
Trying to teach Simon_S to debate logically is like trying to teach a turnip to fly an aeroplane.
Stop insulting turnips, they have a far greater chance of flying a plane. They could roll forward and hit the auto pilot button, a task simon could never hope to achieve.
But you weren't quoting Shane Oliver. If you did it would make sense in context.
Oliver's reasons are:-
Now which one are you banking on Simon?
In the 21st century, you can have high unemployment without a recession, if the government is unwilling to take on much higher debt. Industry can still produce without labour, keeping GDP growth positive while incomes and employment goes south.
That's what I am banking on, an income recession, which initially will drive rates to zero, but eventually will cause a sharp correction everywhere except probably Sydney and Melbourne.
In the 21st century, you can have high unemployment without a recession, if the government is unwilling to take on much higher debt. Industry can still produce without labour, keeping GDP growth positive while incomes and employment goes south.
That's what I am banking on, an income recession, which initially will drive rates to zero, but eventually will cause a sharp correction everywhere except probably Sydney and Melbourne.
Somehow I can't see you settling in Chinchilla no matter how cheap. TBH I don't think the prices are that cheap, even though I can see that they have fallen considerably.
CSG I assume?
Take risks - if you win you will become wealthy, if you lose you will become wise
Somehow I can't see you settling in Chinchilla no matter how cheap. TBH I don't think the prices are that cheap, even though I can see that they have fallen considerably.
CSG I assume?
Yes, coal, gas and power.
However, getting away from the specific and to the general, I think that the income recession will kill even more country towns, pushing people to the cities, where the only jobs for them will be in construction, which the RBA will have to keep pumping to fight unemployment. However, if you think of the economy as a whole as a single business entity, then housing would be an operational expense and construction of housing would be capital expenditure. And if you put capital expenditure into items that are ultimately an expense, the return on capital goes into constant decline, and GDP per capita continues to fall, leading to lower incomes, and the cycle perpetuates itself.
In the countryside this process will be fast and brutal, but in the big cities it will be a slow grind, as people's standard of living is slowly eroded by income deflation. Planning and timing of this are obviously tricky, given the long time scales, but I am not planning on living out my later years in a dangerous third world shithole city unless it is dirt cheap and I have plenty of liquid assets.
Speak when you are angry and you will make the best speech you will ever regret. Ambrose Bierce
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