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FHB Strike: Australia's first home buyers - where have they gone?; Pull forward due to FHB grant changes will subdue FHB demand into 2014
Topic Started: 23 Aug 2013, 03:33 PM (8,183 Views)
genX
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b_b
18 Sep 2013, 12:24 AM
Trade deficits are a national benefit. We get real goods and services, and in return we send a bank statement domiciled in our own fiat currency.
That worked out so well for Zimbabwe.
barns
18 Sep 2013, 12:17 AM
As the US moves to be self-sufficient with oil and we become more efficient uses of it the price of oil will trend down to $50 a barrel.
Do you mean North America, or the US? The US currently consumes 93M barrels of oil per day, and produces 7.5M barrels of oil per day, estimated to rise to 9M barrels per day by 2020. When do you expect the US to make up the 85.5-84M barrel shortfall?
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This will also diminish the importance of certain middle Eastern producers stabilising that region for the first time in multiple decades.
:lol :lol
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Oil isn't going to be a problem for the foreseeable.
What on earth do you do for a living that pays so well that doesn't require the slightest hint of intelligence? I want to be in THAT profession.
Edited by genX, 18 Sep 2013, 08:36 PM.
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barns
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genX
18 Sep 2013, 08:27 PM

Do you mean North America, or the US? The US currently consumes 93M barrels of oil per day, and produces 7.5M barrels of oil per day, estimated to rise to 9M barrels per day by 2020. When do you expect the US to make up the 85.5-84M barrel shortfall?

:lol :lol

What on earth do you do for a living that pays so well that doesn't require the slightest hint of intelligence? I want to be in THAT profession.
US Oil Independence within 10 years

I think your US oil consumption figures are a bit out.

I'm not surprised that you want a well paying job that requires no intelligence.
“You Keep Using That Word, I Do Not Think It Means What You Think It Means” - Inigo Montoya
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genX
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barns
19 Sep 2013, 12:25 AM
US Oil Independence within 10 years

I think your US oil consumption figures are a bit out.

I'm not surprised that you want a well paying job that requires no intelligence.
:lol :lol

10 years. So, not actually anywhere close to independence then. So awesome that it will be replaced with all that expensive to extract shale oil, so China can buy the cheap stuff from Russia and MENA.

And yes, US oil consumption is 19Mbpd, so current production is less than half of consumption. Just 11M more bpd to go!

I'll be looking out for the $50 oil though. Thanks for the heads up!

Of course I want the same well paying job as you that requires no intelligence. My current one requires the expenditure of too much brain power. I want the same income that requires only an IQ of 80. How did you get this work?
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barns
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genX
19 Sep 2013, 01:14 AM
:lol :lol

10 years. So, not actually anywhere close to independence then. So awesome that it will be replaced with all that expensive to extract shale oil, so China can buy the cheap stuff from Russia and MENA.

And yes, US oil consumption is 19Mbpd, so current production is less than half of consumption. Just 11M more bpd to go!

I'll be looking out for the $50 oil though. Thanks for the heads up!

Of course I want the same well paying job as you that requires no intelligence. My current one requires the expenditure of too much brain power. I want the same income that requires only an IQ of 80. How did you get this work?
So I see that you agree with me now about the US moving to oil independence and have conceded that you were about 5x out in your oil consumption number.

You imply that you disagree with my oil price forecast. We'll have to wait on that one.

You're not painting yourself as the smartest guy in the room here.

“You Keep Using That Word, I Do Not Think It Means What You Think It Means” - Inigo Montoya
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genX
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barns
19 Sep 2013, 01:32 PM
So I see that you agree with me now about the US moving to oil independence and have conceded that you were about 5x out in your oil consumption number.

You imply that you disagree with my oil price forecast. We'll have to wait on that one.

No, I don't agree, but I do concede my error. Increasing production and oil independence are two different things. The US is producing more shale oil, but is still only producing 40% of it's domestic production, and there are all sorts of supply response issues and externialities over a period of a decade that makes a prediction of independence meaningless.

North America, on the other hand IS moving toward oil independence, but shale oil and tar sands are expensive oil, and China (the growing competitor for oil) has ready access to Russian, Iranian and even North African oil, which is cheap oil. What the US doesn't buy, China (and increasingly Japan as they wind down their nuclear power) will. So there is no $50 oil on the horizon.
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You're not painting yourself as the smartest guy in the room here.
Yeah, you got me. I'm a dummy. At least you provided some source material for your claims this time. I thought you didn't 'do' facts?
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b_b
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genX
18 Sep 2013, 08:27 PM
That worked out so well for Zimbabwe.

You obviously know very little about Zimbabwe
(S – I) + (T - G) + (M - X) = 0
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barns
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genX
19 Sep 2013, 10:11 PM
No, I don't agree, but I do concede my error. Increasing production and oil independence are two different things. The US is producing more shale oil, but is still only producing 40% of it's domestic production, and there are all sorts of supply response issues and externialities over a period of a decade that makes a prediction of independence meaningless.

North America, on the other hand IS moving toward oil independence, but shale oil and tar sands are expensive oil, and China (the growing competitor for oil) has ready access to Russian, Iranian and even North African oil, which is cheap oil. What the US doesn't buy, China (and increasingly Japan as they wind down their nuclear power) will. So there is no $50 oil on the horizon.

Yeah, you got me. I'm a dummy. At least you provided some source material for your claims this time. I thought you didn't 'do' facts?
Yeah, strange of me to provide a link. I was actually at a private talk by a visiting Oxford professor that specialises in the US economy and politics the other week and he had a much more optimistic time frame for US oil independence but as that was anecdotal I thought I'd try to find some (imperfect) support. Don't worry, it's unlikely that I will make a habit of it.
“You Keep Using That Word, I Do Not Think It Means What You Think It Means” - Inigo Montoya
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genX
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barns
19 Sep 2013, 10:35 PM
Yeah, strange of me to provide a link. I was actually at a private talk by a visiting Oxford professor that specialises in the US economy and politics the other week and he had a much more optimistic time frame for US oil independence but as that was anecdotal I thought I'd try to find some (imperfect) support. Don't worry, it's unlikely that I will make a habit of it.
Again, you would need to make the distinction between the US and North America. Canada and Mexico have a lot of conventional and unconventional oil. The US is now exploiting unconventional oil, which is really only economic at $100/barrel, which is why oil wouldn't go down to $50/barrel even if production eventually met consumption (at current extraction costs). This also assumes that US consumption will decline or stay flat, which it never has when new supply has come online.

And again, every barrel the US doesn't buy will find a buyer in emerging markets. If we want the oil, we will need to pay. The alternatives are invade East Timor or become an electric economy (we have plenty of coal).

But I'm the dummy here, so why don't you elaborate on how this will happen, or are you just whistling into the breeze again?

b_b
19 Sep 2013, 10:15 PM
You obviously know very little about Zimbabwe
:lol Why don't you tell me how Zimbabwe had a capital account problem rather than a current account problem. This should be interesting.
Edited by genX, 19 Sep 2013, 11:16 PM.
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barns
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genX
19 Sep 2013, 11:14 PM
Again, you would need to make the distinction between the US and North America. Canada and Mexico have a lot of conventional and unconventional oil. The US is now exploiting unconventional oil, which is really only economic at $100/barrel, which is why oil wouldn't go down to $50/barrel even if production eventually met consumption (at current extraction costs). This also assumes that US consumption will decline or stay flat, which it never has when new supply has come online.

And again, every barrel the US doesn't buy will find a buyer in emerging markets. If we want the oil, we will need to pay. The alternatives are invade East Timor or become an electric economy (we have plenty of coal).

But I'm the dummy here, so why don't you elaborate on how this will happen, or are you just whistling into the breeze again?


Both of us are making forecasts. Neither of us can claim to be right at this point.
“You Keep Using That Word, I Do Not Think It Means What You Think It Means” - Inigo Montoya
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FHBs need to return to the market to underpin next recovery stage: BIS Shrapnel

By Nicola Trotman
Wednesday, 18 September 2013

The Reserve Bank of Australia is to go easy on interest rates in the next 18 months and there could be the possibility of more cuts if property conditions worsen, according to BIS Shrapnel.

BIS Shrapnel has forecasted 156,800 dwelling commencements across the nation as the final result for 2012/2013, an annual increase of 8%.

BIS Shrapnel says investors and upgraders/downsizers have underpinned this upturn in dwelling commencements, however first home buyers will need to return to the market to support the next stage of recovery.

“The changes to the First Home Owner Grant (FHOG) are so far limiting any increase in demand from FHBS, with all states/territories except for the Northern Territory having either made changes or announced changes to the policy,” says BIS Shrapnel.

FHBs are forecasted to gradually return to the market and are expected to play an important role in 2014.

BIS Shrapnel says the gradual return of FHBs will see growth accelerate in 2014, with private house commencements picking up strongly.

There is forecasted to be 166,150 building commencements in 2014, an 8% increase, with private dwellings reaching their highest annual level since 2004.

BIS Shrapnel says New South Wales is leading the way as the strongest growth region for total dwelling commencements, an annual increase of 24%, but the residential property market remains tight.

This tightness is supporting strong growth in dwelling prices and rents and makes Sydney the least affordable out of the Australian capital cities, with a vacancy rate of 1.8%.

BIS Shrapnel says the number of loans given to FHBs in New South Wales dropped by 44% over 2012/2013.

“Filling the void left by FHBS has been the investor segment of the market, which is increasingly competing for properties at the lower end of the established market.

“Although this makes it difficult for FHBs, it still provides a market into which upgrader/downsizers can sell their existing dwellings and creates the desired turnover required to encourage the development of new dwellings.”

Meanwhile, BIS Shrapnel says Melbourne is the opposite as its property market is estimated to have moved into oversupply with the vacancy rate increasing to 2.8% in the past year.

BIS Shrapnel expects the vacancy rate in Melbourne to continue to rise with a sizeable number of dwellings coming through the supply pipeline.

BIS Shrapnel forecasts Melbourne’s oversupply to continue in 2014, which will limit the prospects for future increases in residential building activity.

Read more: http://www.propertyobserver.com.au/news/fhbs-need-to-return-to-the-market-to-underpin-next-recovery-stage-bis-shrapnel/2013091865099
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