Re: Financial Crises Over
 

Australian exports are written in US$ so the actual price to the importing countries has not risen but Australian exporters are getting substantially less.
Average house price is still in the band 5 to 7 times average wage
in the 1950s boom it was approaching 10 times.

Re: Financial Crises Over
 

What happened after the boom ended? Don't think anyone would argue we're in a boon ATM :)

Re: Financial Crises Over
 

Why so you can know which ammunition to load in your rifle? :D......... only joking(or am I) Firstly the money the government gave to the banks has done nothing but put the country in to more debt; effectively not even papering the cracks. The money system ie banking, stocks is really an illusion there is nothing of any value in them; countries have effectively just printed more money with nothing to back it up with real value such as gold etc..If you flood the market with paper money backed by nothing the value of the dollar goes down.The federal reserve is actually a privately run corporation not a government body. So in essence the whole thing is a fraud and you can't continue a fraud like this forever. Banks will collapse leading to further corporations going bust, then mass unemployment.

Re: Financial Crises Over
 

That's roughly how I see it, if anyone's interested in the subject & how the monetary system works I would recommend a vid on YT "the history of money" - you may be surprised how banks & govts create money out of thin air.

Re: Financial Crises Over
 

The crisis was the complete freeze in lending and employment last year. Stagnation and zero growth maybe the order of the day but a 1920s style depression has been avoided.

Re: Financial Crises Over
 

Or "postponed" as some would have it :unsure:

Re: Financial Crises Over
 

True, but in the 1950's there would have been a genuine supply/demand situation with high immigration in relation to then existing housing stocks. Thats not the case now, no matter what your local friendly real estate agent will tell you. Now its largely a bubble caused by people speculating in property investing, believing the crap spouted by others with a vested interest that the Australian property market can only increase.
You would have needed a much larger % deposit to apply for a mortgage in the 1950's, which is/was not the case in the last few years. Thats why people start worrying when rates go up as little as .25%. The prospect of being mortgaged to the hilt and negative equity is staring a lot of people in the face. Thats why I cannot begin to understand Howard and Rudds first home buyers bribe. All its doing is artifically inflating prices and allowing people who cannot afford to, to get a property with a minimal deposit of their own.
Its Mickey Mouse ecomomics of the highest order and is going to blow up in a lot of peoples faces.
Its symtomatic of the Australian nanny state and generation Why and includes such nonsense as Fudds $900 stimulus payment to Chinese electrical exporters and pokie machine operators, and that other piece of outdated rubbish the Baby Bonus. FFS why gift taxpayers money to peolpe who choose to have kids? Thats surely a left over relic from the 1950,s and an underpopulated country. I choose to drink expensive malt whisky, and get bugger all of a wedge from Swan to help.:thumbdown:

Re: Financial Crises Over
 

Thanks for that. You know what.. I had given number of interviews in such kind of a call centers. These all are commission based.. no basic salary & the biggest condition is that one have to do 3 sales in 1st week otherwise they will kick you in the second week even if you did 2 sales they wont pay a single penny as one didn't fulfill there criteria of 3 sales in 1st week..
Anyways thanks I will call to them aswell. (Fingers Crossed)

Re: Financial Crises Over
 

I tend to agree with Easty that there are much more nasty events to unfold at some point.

You say the American economy may contract but not fall over? What about the influential American Senator who went on the record earlier this year in an interview to say that he was in the room last Sept 2008 when Bush and Paulson called an emergency meeting amongst the top officials. He said that the American financial system had come with about 3 hours of a complete and utter meltdown!

If you want to see the future look back at what has happened in the past. All of the great powers in history had to face their day of reckoning at some point. The thing that has kept the US in such a dominant position for so long is the fact that it hold the worlds reserve currency in the USD. China and the emerging countries has copped on that the US finances are a total mess and would love nothing more than to get out of the USD. Combine that with the massive amounts of debt the US Govt is taking on - $1.4 Trillion defecit for 2009 alone - and the Americans are facing many more problems than most of its citizens realise.

Re: Financial Crises Over
 

What you say is true , people borrow more and interest rates will go higher than the very low rates on offer at this time.
The property bubble is mainly caused by bad state govt. policy
Land Corp (whatever their equivelent is called) being in charge of land release and land development trying to maximise profit instead of keeping supply ahead of demand . Labor State govt. in NSW and WA
are good examples.
Re the home buyers grant ,it has been around in various forms since the 1970s , it has been a long standing policy of both parties but maybe more generous recently( as a % its not a lot )

Re: Financial Crises Over
 

Sorry easty1976 but you sound like any other armchair expert, just more dramatic. I don't profess to be an expert, not my field, but I know enough to know that this is another crisis among many others that have preceded it. On the basis of your theory, the US should have collapsed a long time ago.

Re: Financial Crises Over
 

Sorry but I dont own an armchair and I readily admit I am no expert either but we will see what happens very soon.

Re: Financial Crises Over
 

Over history empires have come and gone, none have suddenly collapsed overnight. The Romans, Greeks etc all took centurys to dissapate into civil separate countries, there was no sudden collapse into anarchy. More recently the demise of the British empire from ruling over 1/2 the world has fallen, Britain although not in a good state now, didn't descend into anarchy (yet - another 5 years of Brown who knows!), so more than likely the American empire will just fade away slowly and the Far Eastern empires rise over the next century.

Re: Financial Crises Over
 

I'm fairly sure there was anarachy in the distant Roman provences in the early days. I'd say it's our only real precedence though. America is already fading away, the gaps are being filled. I doubt if people will really accept this until the Chinese start to buy the American financial insitutions though.... if there is anything left worth buying.

Plagerised from my other site from someone that is something in the City....

Gold is up (suggesting inflation)

Bonds are up (suggesting deflation)

Stocks are up (suggesting impending economic nirvana).

The whole situation does not make a great deal of sense.

As for the dollar, the one nation least likely to worry about its demise is the US. A cheap dollar will help boost domestic growth, so long as it does not fall too fast and make its bonds unsellable. China, however, owns something in the region of $1trillion of US assets, so it has a decent incentive to maintain its value.


Looks like the Chinese have to protect the USD to me.

Re: Financial Crises Over
 

Although bad state policy doesn't help, it's only a small part of Australian property bubbles.

Increasing numbers (immigration and birthrate) are another part.

However, there are two things that make it intractable:

1) The Australian gambling mentality - many thousands of homes are owned as "investment" properties by people who cannot really afford them in a rational economy. They are drawn in by the tax breaks and by thinking (usually correctly in the past) that they can get substantially more than they paid in a year or two's time. If the bubble burssts many are in deep trouble, as are the lenders.

2) Government tax breaks have enabled the above people to buy, and rent at a loss and still come out on top. This is madness from any sane point of view, but I doubt whether any government will have the cojones to abolish the breaks. For one reason, the rented properties effectively replace public housing in some ways.

In a rational economy you would buy a house as a home to live in and not as "investment". Or to run as a business renting it out, on a business footing. To have investment property treated in many ways as personal income just leads to worse bubbles than otherwise would be the case, and tempts lots of folk into the market who shouldn't really be there.