Welcome Guest [Log In] [Register]


Reply
  • Pages:
  • 1
  • 7
China property bubble set to burst. Australia to pop too.
Topic Started: 14 Mar 2013, 03:13 PM (20,503 Views)
miw
Member Avatar


newjez
18 Apr 2014, 05:52 PM
External indicators are a good indication
An indicator of what?
The truth will set you free. But first, it will piss you off.
--Gloria Steinem
AREPS™
Profile "REPLY WITH QUOTE" Go to top
 
noopsy05
Default APF Avatar


themoops
14 Mar 2013, 03:13 PM
And if it doesn't, you have to admit you were wrong (again) to everyone on this forum....
Profile "REPLY WITH QUOTE" Go to top
 
Admin
Member Avatar
Administrator

Quote:
 
Ken Rogoff warns China is next bubble to burst

By Katherine Rushton, in New York
8:25PM BST 17 May 2014

"Chess teaches you to think about what the other person is thinking. What do they want? What are they trying to do?” Kenneth Rogoff, the Harvard economist explains.

He should know. Before he turned to academia, Rogoff was a professional chess player, travelling Europe and competing in five-star hotels as an undergraduate. He enjoyed considerable success, but what started as a game quickly became an obsession, and he gave it up to concentrate on studying.

“I’m very addicted to it. I still think about it,” he says, even though he has played only a handful of games in 30 years. “I’m trying to check it. I’m not thinking about it right now,” he adds — making me think that, really, he is.

It is just as well for us all that Rogoff did change course. The American’s knack for divining his opponent’s next moves goes hand-in-hand with an instinct for when other kinds of trouble are brewing.

Back in 2001 and 2002, when it seemed that US house prices could move only northwards, and Rogoff was chief economist of the International Monetary Fund, he wrote a number of papers predicting their collapse. “It got no interest from anybody,” he recalls with a wry chuckle.

However, as his predictions of a housing bubble came to pass, people started to listen more closely. In 2009, shortly after the collapse of Lehman Brothers, he and another Harvard professor, Carmen Reinhart, published a book drawing parallels and spotting patterns between 800 years’ worth of economic disasters.

This Time Is Different is pretty dry reading, but fears about the downturn made it into an unlikely bestseller.

Later, Rogoff was among the first economic commentators to predict a crisis in the eurozone. He is a strong advocate of the European Union as a political bloc, but maintains that moving to a single currency as soon as it did was a “giant historic mistake” that has left the continent in slow growth mode.

“I don’t know how much of it was naïveté — I think there was a fair amount of that — but there was also political calculus,” he says. He suggests that the EU’s architects were trying to use the euro to accelerate the hopes for political and fiscal union.

Now that we have headed down this track, however, he suggests making the euro work by restructuring debt, especially for periphery countries.

“You can’t go backwards very easily. It is not an easy divorce…the legal complications, the political complications,” he says. “It would be a very good investment of German taxpayers’ money to write down debt in the periphery countries. There are a lot of ways to do it. You can be very opaque about it. The taxpayers don’t ever need to know it happened.”

He adds that Mario Draghi, head of the European Central Bank, has already done it “to some extent”. Rogoff predicts that Europe’s recovery will be “very slow…over a very long period. Maybe not quite as extreme as Japan, but a milder version.”

Rogoff also wants Europe to pull much closer together, so that France and Germany “feel more like a [single] country”. This still feels like a pipe dream to many Europeans, but the 60-year-old economist is convinced it can and must be done.

“Sometimes the US needs help. Sometimes the US gets it wrong, and Europe needs to be there,” he says. “By becoming more integrated, Europe has more weight in the world, and that is a good thing for everyone.”

Part of that “weight”, he argues, should be better defence. America spends more than 4pc of its gross domestic product on its military. Most European countries are closer to 2pc and, as Rogoff points out, tend to have many older soldiers who stay in the forces in order to qualify for pensions.

Europe needs to have its “own military capability”, he says. “The events in Ukraine are kind of frightening… You can’t just depend on the US to do everything, especially as China rises, as Russia rises… And then [Europe is also necessary] as a moral anchor: Europe has somewhat different values than the US. Europe is right about some things. The US is wrong about some things.”

From his perspective, Europe needs to pull together fast, in order to have a hope of surviving another economic curveball.

“If they don’t do that, and the euro is stress-tested, then it is going to be ugly again — for example if China were to collapse,” he says. This is a rather more pressing threat than many people realise, he adds.

China has experienced explosive growth over the past decade, putting it ahead of America as the largest economy in the world, according to some measures.

However, the odds of a dramatic slowdown or “hard landing” are high and rising, and probably rank as “the number one risk to the global economy today”, Rogoff says.

“You sometimes see a basketball team win 20 or 25 games in a row. It means they are a very good team, but it doesn’t mean they are going to win 20 more.

“The Chinese leadership has done a remarkable job of bringing hundreds of millions of people out of poverty and growing in a way that is really starting to set all records, but it doesn’t mean that it can just go on for ever,” he explains.

A decade ago, Rogoff argued that there was a one in 10 chance of a sharp slowdown in China in any given year. These days, he says, it is more like one in five.

“Their economy is more imbalanced than ever. The advanced countries [it sells to] are both growing more slowly and a touch more protectionist than they were, so the Chinese growth model is running out of steam.”

America will probably be robust enough to withstand the fallout but it is developing countries across Asia, northern Africa and Latin America that will be hardest hit.

“People who have just edged out of poverty or who are just about to escape — suddenly they’re going to be thrown back.”

Perhaps it is Rogoff’s early chess tours to Europe that have made him adopt such a broad world view. Certainly, the young Rogoff encountered a fair bit of life. He would occasionally sleep rough in railway stations between chess tournaments.

These days, he still cuts a low- key figure. We meet on the 35th floor of New York’s Mandarin Oriental Hotel, which has a lift that makes your ears pop and sweeping views north to the far side of Central Park, even when everything else seems to be shrouded in mist.

Rogoff jokes that the tea will “probably cost $40”, adding: “I’m not used to this kind of real estate.”

That is not entirely true. Over the past decade, he has visited some of the world’s most notable addresses. He was an adviser to President Obama, and spent many hours with George Osborne. Those conversations went a long way towards shaping the Government’s decision to back austerity measures.

Oli Rehn, the EU’s economic and monetary affairs commissioner, and Paul Ryan, chairman of the US House Budget Committee, also cited Rogoff and Reinhart’s 2010 paper, Growth in a Time of Debt, as the basis for further cost-cutting.

However, their endorsement was undermined last year, when economists from the University of Massachusetts accused the authors of making serious mathematical errors, and so “inaccurately represent[ing] the relationship between public debt and growth”.

Rogoff and Reinhart issued a correction but rejected the notion that they had drawn the wrong conclusions. These days, Rogoff wants to put the ordeal behind him.

He affords the same privilege to the figures who were pulling the strings of the global economy at the height of the financial crisis.

Last week, Tim Geithner, the former US treasury secretary, came the closest he has come to admitting he was too soft on banks in the financial crisis. “It’s clear we didn’t do enough”, he said in his new book, Stress Test.

In particular, he argued, the US government could have pushed for tougher banking laws or done more to keep people in their homes following the collapse of the housing market.

As America was bailing out the banks, Rogoff recommended nationalising them. He still thinks that was the right course but, faced with the same circumstances again, he would follow Geithner’s imperfect route.

“There is the academic world I live in… and there is the real world where time doesn’t move instantly.

“I disagree with what they did in the US and the UK, just bailing everything out, but the other side of the coin is that we could have had a second great depression.

“People just have no idea how bad it could have been if they had screwed up. Do I want to go back, replay it and do it my way? I don’t.

“It’s very easy if you know that the system is not going to fall apart: you can go in there and, using fine surgical instruments, carve out the most egregious bank executive, but in a system-wide panic, that was not easy to do,” he says.

“Mistakes were made, there are things that weren’t done perfectly, but to say that it was done horribly misses the big picture. The world was really on the edge.”

Dealing with past errors is another thing chess has helped Rogoff with.

He has no impulse to unstitch the euro or play “I told you so” over the bail-outs. Instead, he is focused on the situation as it stands now, and how to make the best of it.

“Playing real championship level really steels your nerves,” he explains. “Chess players learn to be calm after they have made a mistake, because they don’t want to make another.”

Read more: http://www.telegraph.co.uk/finance/economics/10838674/Ken-Rogoff-warns-China-is-next-bubble-to-burst.html
Follow OzPropertyForum on Twitter | Like APF on Facebook | Circle APF on Google+
Profile "REPLY WITH QUOTE" Go to top
 
Blondie girl
Member Avatar


Bloody chess crap...

Really, all eyes should be glued on yes how the Chinese economy develops but wouldn't it be more of a drama on the impact of the Oz stock market not just housing stuff?
Newjerk? can you try harder than dig up another person's blog. My first promo was with Billabong and my name in English is modified with a T, am Perth born but also lived in Sydney to make my $$
It's Absolutely Fabulous if it includes brilliant locations, & high calibre tenants..what more does one want? Understand the power of the two "P"" or be financially challenged
Even better when there is family who are property mad and one is born in some entitlements.....Understand that beautiful women are the exhibitionists we crave attention, whilst hot blooded men are the voyeurs ... A stunning woman can command and takes pleasure in being noticed. Seems not too many understand what it means to hold and own props and get threatened by those who do.
Banks are considered to be law abiding and & rather boring places yeah not true . A bank balance sheet will show capital is dwarfed by their liabilities this means when a portions of loans is falling its problems for the bank.
Profile "REPLY WITH QUOTE" Go to top
 
Admin
Member Avatar
Administrator

Quote:
 
Chinese property prices fall in July

The average price of new homes in 70 Chinese cities fell for the third straight month in July, as property developers continued to cut prices to reduce inventories amid the market downturn.

The average price of new homes in 70 cities slid 0.89 per cent in July from June, according to calculations by The Wall Street Journal, based on data released Monday by the National Bureau of Statistics.

This compares with a 0.47 per cent on-month fall in June and a 0.15 per cent fall in May, which was the first drop in two years.

On an annual basis, the average price in July rose 2.43 per cent, moderating from the 4.05 per cent increase recorded in June.

Real estate and construction are important drivers of growth in the Chinese economy, accounting for more than 20 per cent of gross domestic product in the world's second largest economy, when cement, steel, chemicals, furniture and other related industries are factored in, analysts estimate.

Excluding public housing, private sector home prices fell in 64 of the 70 cities in July, up from the 55 cities that posted declines in June. Home prices only rose in coastal Chinese city Xiamen and Dali, a city in southwest China, and were flat in the remaining four cities.

Housing sales have slipped this year, falling 10.5 per cent in the first seven months and analysts expect further price cuts as the local governments and property developers continue to grapple with a glut of apartments and tight credit environment. Some property developers have also issued profit warnings on their first half earnings in recent weeks.

In recent months, the local authorities in around 30 cities have also loosened property restrictions to lure buyers back into the market, but there has been little effect.

Read more: http://www.businessspectator.com.au/news/2014/8/18/china/chinese-property-prices-fall-july
Follow OzPropertyForum on Twitter | Like APF on Facebook | Circle APF on Google+
Profile "REPLY WITH QUOTE" Go to top
 
noopsy05
Default APF Avatar


noopsy05
19 Apr 2014, 09:14 AM
And if it doesn't, you have to admit you were wrong (again) to everyone on this forum....
2nd half of the year....still waiting!?!?!?!?
Profile "REPLY WITH QUOTE" Go to top
 
miw
Member Avatar


noopsy05
21 Aug 2014, 11:45 AM
2nd half of the year....still waiting!?!?!?!?
You won't get any reputation as a seer by revisiting your predictions that went wrong.

Bury *all* of your predictions in a flurry of new predictions, just as a cat buries its shit to hide its tracks.

Then later on, uncover just the ones that turned out.
The truth will set you free. But first, it will piss you off.
--Gloria Steinem
AREPS™
Profile "REPLY WITH QUOTE" Go to top
 
2 users reading this topic (2 Guests and 0 Anonymous)
« Previous Topic · Australian Property Forum · Next Topic »
Reply
  • Pages:
  • 1
  • 7



Australian Property Forum is an economics and finance forum dedicated to discussion of Australian and global real estate markets and macroeconomics, including house prices, housing affordability, and the likelihood of a property crash. Is there an Australian housing bubble? Will house prices crash, boom or stagnate? Is the Australian property market a pyramid scheme or Ponzi scheme? Can house prices really rise forever? These are the questions we address on Australian Property Forum, the premier real estate site for property bears, bulls, investors, and speculators. Members may also discuss matters related to finance, modern monetary theory (MMT), debt deflation, cryptocurrencies like Bitcoin Ethereum and Ripple, property investing, landlords, tenants, debt consolidation, reverse home equity loans, the housing shortage, negative gearing, capital gains tax, land tax and macro prudential regulation.

Forum Rules: The main forum may be used to discuss property, politics, economics and finance, precious metals, crypto currency, debt management, generational divides, climate change, sustainability, alternative energy, environmental topics, human rights or social justice issues, and other topics on a case by case basis. Topics unsuitable for the main forum may be discussed in the lounge. You agree you won't use this forum to post material that is illegal, private, defamatory, pornographic, excessively abusive or profane, threatening, or invasive of another forum member's privacy. Don't post NSFW content. Racist or ethnic slurs and homophobic comments aren't tolerated. Accusing forum members of serious crimes is not permitted. Accusations, attacks, abuse or threats, litigious or otherwise, directed against the forum or forum administrators aren't tolerated and will result in immediate suspension of your account for a number of days depending on the severity of the attack. No spamming or advertising in the main forum. Spamming includes repeating the same message over and over again within a short period of time. Don't post ALL CAPS thread titles. The Advertising and Promotion Subforum may be used to promote your Australian property related business or service. Active members of the forum who contribute regularly to main forum discussions may also include a link to their product or service in their signature block. Members are limited to one actively posting account each. A secondary account may be used solely for the purpose of maintaining a blog as long as that account no longer posts in threads. Any member who believes another member has violated these rules may report the offending post using the report button.

Australian Property Forum complies with ASIC Regulatory Guide 162 regarding Internet Discussion Sites. Australian Property Forum is not a provider of financial advice. Australian Property Forum does not in any way endorse the views and opinions of its members, nor does it vouch for for the accuracy or authenticity of their posts. It is not permitted for any Australian Property Forum member to post in the role of a licensed financial advisor or to post as the representative of a financial advisor. It is not permitted for Australian Property Forum members to ask for or offer specific buy, sell or hold recommendations on particular stocks, as a response to a request of this nature may be considered the provision of financial advice.

Views expressed on this forum are not representative of the forum owners. The forum owners are not liable or responsible for comments posted. Information posted does not constitute financial or legal advice. The forum owners accept no liability for information posted, nor for consequences of actions taken on the basis of that information. By visiting or using this forum, members and guests agree to be bound by the Zetaboards Terms of Use.

This site may contain copyright material (i.e. attributed snippets from online news reports), the use of which has not always been specifically authorized by the copyright owner. Such content is posted to advance understanding of environmental, political, human rights, economic, democratic, scientific, and social justice issues. This constitutes 'fair use' of such copyright material as provided for in section 107 of US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed for research and educational purposes only. If you wish to use this material for purposes that go beyond 'fair use', you must obtain permission from the copyright owner. Such material is credited to the true owner or licensee. We will remove from the forum any such material upon the request of the owners of the copyright of said material, as we claim no credit for such material.

For more information go to Limitations on Exclusive Rights: Fair Use

Privacy Policy: Australian Property Forum uses third party advertising companies to serve ads when you visit our site. These third party advertising companies may collect and use information about your visits to Australian Property Forum as well as other web sites in order to provide advertisements about goods and services of interest to you. If you would like more information about this practice and to know your choices about not having this information used by these companies, click here: Google Advertising Privacy FAQ

Australian Property Forum is hosted by Zetaboards. Please refer also to the Zetaboards Privacy Policy