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Perth property sets new all time high.; Bears smashed, again.
Topic Started: 10 Jun 2013, 06:43 PM (52,375 Views)
Pig Iron
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Bogan scum

Veritas
17 Dec 2013, 11:56 AM
Timmy,

This is really basic stuff.

Here is a definition for you: The multiplier effect

Every time there is an injection of new demand into the circular flow there is likely to be a multiplier effect. This is because an injection of extra income leads to more spending, which creates more income, and so on. The multiplier effect refers to the increase in final income arising from any new injection of spending.
oh wow you made up your own definition. sure showed me up there :wak:

mining produces new income, but there very little multiplier effect. yes 1 dollar is created and can be spent, but that's it. 1x1 = 1 you genius.

housing produces 3 dollars to every dollar spent http://australianpropertyforum.com/single/?p=8415628&t=9928093
I am the love child of Tony Abbott and Pauline Hanson
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newjez
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Mike
21 Dec 2013, 02:07 PM
http://www.rpdata.com/research/back_series.html

Perth property prices rebounded over recent days much to the demise of some so call "expert" bear by the name of Newjez.

Newjez was last seen packing bags in London from the state commissioned housing project. He was evicted after hordes of angry Aussies descended upon him demanding compensation as they followed his advice only to be out of pocket tens of thousands of dollars.

Witnesses in the crowd spoke with the BBC describing lost years and the lost opportunities as they listened to this "expert" bears. Legal action is due to follow soon, although you cant get blood from a stone.

Newjez is apparently on a flight to Moscow where Vladimir Putin is keen to talk with him!
I assume this was a new thread Mike. My last one got merged in too. Well at least I achieved something. Haven't heard any complaints from bears. Perthite, double view, veritas, any complaints guys?
Whenever you have an argument with someone, there comes a moment where you must ask yourself, whatever your political persuasion, 'am I the Nazi?'
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Foxy
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Zero is coming...

Pig Iron
21 Dec 2013, 02:41 PM
oh wow you made up your own definition. sure showed me up there :wak:

mining produces new income, but there very little multiplier effect. yes 1 dollar is created and can be spent, but that's it. 1x1 = 1 you genius.

housing produces 3 dollars to every dollar spent http://australianpropertyforum.com/single/?p=8415628&t=9928093
No wait a minute.
If that one dollar is used as a deposit on a home you can borrow 80% on.
If you use that $ to put down a deposit on a new car.
New money can give you more bang than just that one buck.
Peter
:wak:

Perthite
16 Dec 2013, 01:47 PM
So the 70,000 job losses coming to mining construction...

Supply and demand.



Obviously a bit hard for you to understand.
Yes if those jobs are not replaced at the same wage rate there will be a drop off in demand.
Simple.
Peter
:lol
Edited by Foxy, 21 Dec 2013, 07:45 PM.
http://www.afr.com/content/dam/images/g/n/2/1/u/8/image.imgtype.afrArticleInline.620x0.png/1456285515560.png
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goldbug
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Pig Iron
21 Dec 2013, 02:41 PM


housing produces 3 dollars to every dollar spent
For every dollar borrowed you idiot! And there is a limit to how much debt a nation can service. We have obviously reached that limit, 160% of GDP abouts, and that is why property has stalled and will not move forward until the whole system is reset (depression) and most of the current debt wiped off the ledger. That's tough shit for your retirement plans I know, but life wasn't meant to be easy.
Shadow was hopelessly wrong about the Gold Bull Market.
What else is he wrong about?
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peter fraser
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goldbug
22 Dec 2013, 06:56 AM
For every dollar borrowed you idiot! And there is a limit to how much debt a nation can service. We have obviously reached that limit, 160% of GDP abouts, and that is why property has stalled and will not move forward until the whole system is reset (depression) and most of the current debt wiped off the ledger. That's tough shit for your retirement plans I know, but life wasn't meant to be easy.
Maybe a lot of money is being freed up as people dump gold.
Any expressed market opinion is my own and is not to be taken as financial advice
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Pig Iron
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Bogan scum

goldbug
22 Dec 2013, 06:56 AM
For every dollar borrowed you idiot! And there is a limit to how much debt a nation can service. We have obviously reached that limit, 160% of GDP abouts, and that is why property has stalled and will not move forward until the whole system is reset (depression) and most of the current debt wiped off the ledger. That's tough shit for your retirement plans I know, but life wasn't meant to be easy.
one flaw in your rant - house prices have been rising strongly and your gold has been falling.
that's tough shit for your retirement plans I know, but life wasn't meant to be easy.
I am the love child of Tony Abbott and Pauline Hanson
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Veritas
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Pig Iron
21 Dec 2013, 02:41 PM
oh wow you made up your own definition. sure showed me up there :wak:

mining produces new income, but there very little multiplier effect. yes 1 dollar is created and can be spent, but that's it. 1x1 = 1 you genius.

housing produces 3 dollars to every dollar spent http://australianpropertyforum.com/single/?p=8415628&t=9928093
Timmy,Timmy Timmy, :re:

This is not my definition. Posted again.

http://www.economicsonline.co.uk/Managing_the_economy/The_multiplier_effect.html

Quote:
 
Every time there is an injection of new demand into the circular flow there is likely to be a multiplier effect. This is because an injection of extra income leads to more spending, which creates more income, and so on. The multiplier effect refers to the increase in final income arising from any new injection of spending.

The size of the multiplier depends upon household’s marginal decisions to spend, called the marginal propensity to consume (mpc), or to save, called the marginal propensity to save (mps).



A multiplier effect is caused every time new demand is created in the economy. By say, I dont know, engaging in the largest single investment in the mining industry in Australian history.

Guess what happens when that demand falls Timmy?

Pig Iron
21 Dec 2013, 02:41 PM
oh wow you made up your own definition. sure showed me up there :wak:

mining produces new income, but there very little multiplier effect. yes 1 dollar is created and can be spent, but that's it. 1x1 = 1 you genius.

housing produces 3 dollars to every dollar spent http://australianpropertyforum.com/single/?p=8415628&t=9928093
Actually read that again.

Timmy what a hoot you are.

Maybe i need to tell you a story again so that you understand.

Actually, fuck that do your own research.

Just remember: my income is your spending and your income is my spending.

Then you will get that picture.

Its really quite simple.

Edited by Veritas, 22 Dec 2013, 01:55 PM.
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
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skamy
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Veritas
22 Dec 2013, 01:53 PM
Timmy,Timmy Timmy, :re:

This is not my definition. Posted again.

http://www.economicsonline.co.uk/Managing_the_economy/The_multiplier_effect.html





A multiplier effect is caused every time new demand is created in the economy. By say, I dont know, engaging in the largest single investment in the mining industry in Australian history.

Guess what happens when that demand falls Timmy?


Actually read that again.

Timmy what a hoot you are.

Maybe i need to tell you a story again so that you understand.

Actually, fuck that do your own research.

Just remember: my income is your spending and your income is my spending.

Then you will get that picture.

Its really quite simple.
Veritas you miss the point completely.


How much of every dollar spent on Capex do you think remains in Australia?

Capex spending on new mines does not have anywhere near the multiplier effect that building new homes does. Much of Capex spending goes to big US multinational project management companies and on equipment sourced overseas. Then there is the fact that many Australian construction companies actually lost money on these projects. I would be very very surprised if any of these projects show any kind of positive multiplier effect. The effect is much more likely to be negative.

Whereas it is well documented that new home building creates about $3 in new business in the economy for every 1$ spent, this is what is known as a multiplier effect. The truth is that any multiplier effect comes AFTER the new mines are built for the extra export income/tax revenues etc that come from the added capacity.

You do not need to worry about a housing crash in Perth due to the movement from an investment boom to a revenue boom, quite the opposite in fact.

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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Veritas
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skamy
22 Dec 2013, 02:12 PM
Veritas you miss the point completely.


How much of every dollar spent on Capex do you think remains in Australia?

Capex spending on new mines does not have anywhere near the multiplier effect that building new homes does. Much of Capex spending goes to big US multinational project management companies and on equipment sourced overseas. Then there is the fact that many Australian construction companies actually lost money on these projects. I would be very very surprised if any of these projects show any kind of positive multiplier effect. The effect is much more likely to be negative.

Whereas it is well documented that new home building creates about $3 in new business in the economy for every 1$ spent, this is what is known as a multiplier effect. The truth is that any multiplier effect comes AFTER the new mines are built for the extra export income/tax revenues etc that come from the added capacity.

You do not need to worry about a housing crash in Perth due to the movement from an investment boom to a revenue boom, quite the opposite in fact.
:re:

Cool, so all those FIFO workers can lose their jobs and that will have no effect on demand in the economy.

Jesus, some slow learners around this place.
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
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Foxy
Member Avatar
Zero is coming...

goldbug
22 Dec 2013, 06:56 AM
For every dollar borrowed you idiot! And there is a limit to how much debt a nation can service. We have obviously reached that limit, 160% of GDP abouts, and that is why property has stalled and will not move forward until the whole system is reset (depression) and most of the current debt wiped off the ledger. That's tough shit for your retirement plans I know, but life wasn't meant to be easy.
Really, what if real interest rates go negative??
As i think they have just done.
Peter
i.q.133.
Idiot does not quite fit the job description.

Veritas
22 Dec 2013, 02:20 PM
:re:

Cool, so all those FIFO workers can lose their jobs and that will have no effect on demand in the economy.

Jesus, some slow learners around this place.
Slow??
They are not even in the race.
Stationary at best.
Peter
:pop:
Although with inflation they are slowly becoming less than irrelevant.
That is of course where they have to be, they must be removed from the system. (Go watch the football, have a beer and meat pie boys)
Other wise you get the dumb fat son in charge of the empire.
And that is not good.
Always ends in tears.
Go quantum or go home.
Peter
:pop:


Edited by Foxy, 22 Dec 2013, 02:30 PM.
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