Thanks for making up a story about what I think. It was interesting.
I can only go on what you write.
One of your favourites is: “It’s all part of the cycle”
That suggests that you believe the future is pre-determined. That’s how cycles work in case you haven’t noticed. Things repeat.
So are you saying a Perth boom large enough to produce million dollar medians by 2021 is pre-determined or not?
What if it doesn’t happen? Is that “ all part of the cycle” too?
No matter what happens it’s all part of the cycle?
See how easy it is to expose this nonsense?
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
Incorrect. Cycles are not predetermined, nor is the future.
But according to you it is:
What does "all part of the cycle" mean if not that stuff is going to happen because it is a function of that process (cycle)?
Here is a definition which might clarify your thinking: An interval of time during which a characteristic, often regularly repeated event or sequence of events occurs. A single complete execution of a periodically repeated phenomenon. A periodically repeated sequence of events.
That clearly suggests that for something to be a cycle the observer must have confidence that certain occurrences in that cycle are predictable or pre-ordained?
If that were not the case, it wouldn't be a cycle.
Can you think of something that is commonly described as a cycle that does not have this characteristic?
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
for something to be a cycle the observer must have confidence that certain occurrences in that cycle are predictable or pre-ordained
In property/economic cycles, it is predictable that prices/activity will cycle between periods of growth, decline and stagnation. There are also various drivers of cycles that are relatively predictable - for example, deteriorating affordability often leads to a period of price decline or stagnation until incomes catch up. But that doesn't mean the precise drivers, timings, magnitudes and durations are 'preordained'.
In property/economic cycles, it is predictable that prices/activity will cycle between periods of growth, decline and stagnation. There are also various drivers of cycles that are relatively predictable - for example, deteriorating affordability often leads to a period of price decline or stagnation until incomes catch up. But that doesn't mean the precise drivers, timings, magnitudes and durations are 'preordained'.
Moops is just another bear who disappeared when all his predictions failed.
There have been so many of them over the years... Foundation, Hired Goon, Wulfgar, Raveswei, Earthsta, WiseBear, Crazy Ted, Audas, John Frum, Goldbug, FrankRider, The Whole Truth etc.
They were all convinced a big crash was imminent. They hurled abuse at the bulls and called us idiots for (correctly) predicting prices would rise.
But when their own predictions failed they vanished without a trace. A decade later and still no 40% crash. Prices have more than doubled in Sydney.
A few bulls have gone too, but they all left because their predictions were spot on, and they simply retired after making a fortune from the property boom.
In property/economic cycles, it is predictable that prices/activity will cycle between periods of growth, decline and stagnation. There are also various drivers of cycles that are relatively predictable - for example, deteriorating affordability often leads to a period of price decline or stagnation until incomes catch up. But that doesn't mean the precise drivers, timings, magnitudes and durations are 'preordained'.
In property/economic cycles, it is predictable that prices/activity will cycle between periods of growth, decline and stagnation. There are also various drivers of cycles that are relatively predictable - for example, deteriorating affordability often leads to a period of price decline or stagnation until incomes catch up. But that doesn't mean the precise drivers, timings, magnitudes and durations are 'preordained'.
So now you are conflating economic cycles and property cycles?
I thought the property cycle is standalone phenomenon? That is what you so frequently contend. It is interesting, however, that there is virtually nothing on the web from an academic source that describes the property cycle as you do. Unless you count, stuff put up by businesses trying to sell houses and I don’t. The conflict of interest is to great. There are economic cycles for sure, they are observable. And they determine property cycles. So really the property cycle, such as it exists is entirely at the mercy of the economic cycle rendering the concept that you espouse of it being this standalone phenomena nonsense.
You then say things like “deteriorating affordability often leads to a period of price decline or stagnation until incomes catch up. But that doesn't mean the precise drivers, timings, magnitudes and durations are 'preordained'.”
So incomes catch up, then what? The Perth median doubles in 5 years. Why? Why not 750k.
And your explanation for what happened in Sydney is complete laughable in the face of the facts. Although there were a lot of factors that produced a boom, clearly the largest ones were:
1. A massive drop in the price of money which led to: 2. A self-fulfilling inflationary spiral in prices as the number of investors, armed with all this cheap cash, started chasing the capital gains.
What has that to do with a property cycle? The GFC happened, it impacted monetary policy and the major effect in Australia and elsewhere in the world was to inflate asset prices.
Rat
11 Aug 2017, 12:03 AM
Moops is just another bear who disappeared when all his predictions failed.
There have been so many of them over the years... Foundation, Hired Goon, Wulfgar, Raveswei, Earthsta, WiseBear, Crazy Ted, Audas, John Frum, Goldbug, FrankRider, The Whole Truth etc.
They were all convinced a big crash was imminent. They hurled abuse at the bulls and called us idiots for (correctly) predicting prices would rise.
But when their own predictions failed they vanished without a trace. A decade later and still no 40% crash. Prices have more than doubled in Sydney.
A few bulls have gone too, but they all left because their predictions were spot on, and they simply retired after making a fortune from the property boom.
Meanwhile, The mighty and valiant WA bears have been proved right and right again.
The ungracious bulls refuse to admit defeat. In fact, many of them have scurried back under their rocks like Skamy. The army of investors that were promised lordships have instead becoming serfs, kept awake at night by dark thoughts about falling rents and higher interest rates.
Those wise bears, not taken in by voodoo economic theories like the ‘Property cycle’, knew that its economic fundamentals that determine house prices saw them deteriorate and predicated the trajectory of the housing market accordingly.
Would you like your bowl of humble pie warm or cold?
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
In property/economic cycles, it is predictable that prices/activity will cycle between periods of growth, decline and stagnation. There are also various drivers of cycles that are relatively predictable - for example, deteriorating affordability often leads to a period of price decline or stagnation until incomes catch up. But that doesn't mean the precise drivers, timings, magnitudes and durations are 'preordained'.
So now you are conflating economic cycles and property cycles?
I thought the property cycle is standalone phenomenon? That is what you so frequently contend. It is interesting, however, that there is virtually nothing on the web from an academic source that describes the property cycle as you do. Unless you count, stuff put up by businesses trying to sell houses and I don’t. The conflict of interest is to great. There are economic cycles for sure, they are observable. And they determine property cycles. So really the property cycle, such as it exists is entirely at the mercy of the economic cycle rendering the concept that you espouse of it being this standalone phenomena nonsense.
You then say things like “deteriorating affordability often leads to a period of price decline or stagnation until incomes catch up. But that doesn't mean the precise drivers, timings, magnitudes and durations are 'preordained'.”
So incomes catch up, then what? The Perth median doubles in 5 years. Why? Why not 750k.
And your explanation for what happened in Sydney is complete laughable in the face of the facts. Although there were a lot of factors that produced a boom, clearly the largest ones were:
1.A massive drop in the price of money which led to: 2.A self-fulfilling inflationary spiral in prices as the number of investors, armed with all this cheap cash, started chasing the capital gains.
What has that to do with a property cycle? The GFC happened, it impacted monetary policy and the major effect in Australia and elsewhere in the world was to inflate asset prices. Meanwhile, The mighty and valiant WA bears have been proved right and right again.
The ungracious bulls refuse to admit defeat. In fact, many of them have scurried back under their rocks like Skamy. The army of investors that were promised lordships have instead becoming serfs, kept awake at night by dark thoughts about falling rents and higher interest rates.
Those wise bears, not taken in by voodoo economic theories like the ‘Property cycle’, knew that its economic fundamentals that determine house prices saw them deteriorate and predicated the trajectory of the housing market accordingly.
Would you like your bowl of humble pie warm or cold?
You're rambling. Please make a point, if you have one.
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