Do you ever get the feeling you were born into the last phase of a dieing society-a bit like when a star expands just before it explodes and all hell breaks loose?
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Do you ever get the feeling you were born into the last phase of a dieing society-a bit like when a star expands just before it explodes and all hell breaks loose?
that is a Haunting statement skid......
but then.... look at the other dead societies through history.... they did die and most historians dont know why.
Strat your post bought back memories of my April 2008 post Fall of the Roman Empire page 9 on this thread..however of more interest look at Tricha's posts below mine..thought by many posters to be extremely negative at that time..how true his posts turned out to be...well done Tricha.
There is no WAY the Dow is going to 30K.
Have a look at Japan's exchanges since 1990.
It's like a ball bouncing down the stairs.
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Lots of folks calling for doom in the US...and while much of it is justified......peopple are failing to undertand that they are only perceiving the US as falling faster off of a cliff, faster relative to themselves.
I'm doing a lot of travel between NZ/OZ/US this year...and back again to both from NZ in the coming weeks yet again.
One thing that is absolutely insane right now is the price of housing and the price of a draft beer.....in Australia.
At the moment you could exchange 1 average modern home in the Brisbane/Gold Coast region for possibly up to 3 average modern homes in the Orlando Florida region.
Roughly comparable homes
Roughly comparable infrastructure
Roughly comparable non-mining economic bases
Roughly comparable quality of life and standard of living amenities
Same for a draft beer......1 in Aussie, for 3(and not cr@p budweiser, something like a Yingling) in the US.
Things are getting VERY weird.
It reminds me of 2000-2001 when it was incredibly cheap to use US Dollars to buy NZ or OZ assets...it didn't last for long.
So while it is very much worth keeping an eye on the US economy......how it relates to the economy here in NZ and across the ditch is equally important.
Is a house in Brisbane/Gold Coast REALLY worth 3 times as much as a comparable one in Orlando/Florida all things being roughly(emphasis roughly) equal?
Is there still downside to housing in the US?
Absolutely....lots of inventory is still not moving....but the downside now is far far less than it was 2,3,5 years ago.
The vast majority of the detrimental credit bubble effects have been purged in some markets.
Hi Lakedaemonian
Interesting Post
A few questions if don't mind
From you first hand experience.
1....Do you think that in the USA now that some of the bubbles (particularly Housing) have popped..there has been deflation occurring on other sectors such as service industries food etc due to loss of personal assets.
2...There has been rumblings that OZ housing market is in a huge bubble...Is NZ housing market in a similar sized bubble?
3... Is the cost to build in the USA more expensive than to buy an existing House ? This is the argument used by NZ property investors that replacement value is similar to existing house value therefore no bubble no trouble....This argument neglects to mention a possible section price bubble Has USA Section prices taken the biggest hit with this rapid property deflation?
Thxs in advance
Hoop
Not sure about new build in the US, but I would presume(I think safely) that building the same house from scratch would probably cost more since all of the post early 09 liquidation of labor and materials is gone....now it's just the labor portion that is under serious pressure....I don't think the cost of materials would be lower than it was when the comparable house was being built.
Just my opinion......but with so much inventory still sitting around(although the velocity of sales has come off the bottom in a number of the worst affected markets) why bother building when you can negotiate buying existing property from a position of strength.
The problems of buying now are:
Only those with dry powder can get the insanely cheap long term fixed mortgages.
When the US faces a bond crisis(and it will, probably by the middle of the next administration circa 2014) and interest rates rise it will not benefit housing prices...so there is STILL downside risk.
But the US market possesses a huge(but now nationalized) mortgage banking industry where you can buy an assumable 30 year fixed interest loan for 3.5%.
As long as you can pay freehold or make the cheap payments you are sweet.
The genuine issues is home owners insurance and property taxes(rates) can hit you depending on the location.
I wouldn't touch bare residential section in the US with a barge pole, unless it was being given away. And even then I'd ask why and what the outgoings would be.
In no way am I suggesting anyone should BUY property in the US, BUT if someone was looking at diversifying(and had investment property experience) and/or moving to the US.....now would be a good time to look.
I also view it as an indicator of possibly a mirror image of 2000-2001. When this very situation was reversed.
My guess is that we will eventually revert to somewhere where we probably should be....somewhere between 2000 and 2012 relative to the US.
But $150k USD for a modern 3-4 bedroom home in Florida, with a semi-indoor inground pool and/or a boat dock on a lagoon in a small satellite city less than an hour from major metro centre is insanely cheap by any measure.
Things are getting weird........at this stage I feel a little more confident about prospects in the US than I do in OZ/NZ for the next couple of years.
Although that may be a bit like saying I would prefer Chinese water torture over being waterboarded. :)
i think the main reason we are seeing this present situation in Oz can be summed up in 2 words--Resources--China.
If one or both of these things change,the whole ballgame could change IMHO
If was thinking about buying a winter home in Queensland ,I would personally hold off for the moment.
Florida seems safer if you had the cash ,except its a long plane ride and ..well..its the states
http://myeffusions.wordpress.com/200...ued-destroyed/
For anyone with the time ,intelligence,and balls ...have a read
Game on, cash is trash, there no alternative to this situation we live in, we all know the printing presses are running red hot.
We all know China is looking for an escape route from the US$.
We need to protect our equity, unfortunately cash is not an option.
The item below might be contrieved as a ramp for gold and silver.
Every one to the lifeboats, happy hunting folks!
Less than 900 days for hyperinflation in the US?
Gold Silver Worlds | September 30, 2012
http://goldsilverworlds.com/gold-sil...ion-in-the-us/
It is all unfolding, Skol and his mates are in for a rude awakening. Unfortunately it will effect all.
China, Russia, and the End of the Petrodollar
By John Rubino10/09/2012
http://www.financialsense.com/contri...nd-petrodollar
The only problem with that theory is that China cannot afford the $US going into a tailspin-They just have to much of the stuff[much to their dismay]I think thats the direction they want to go,but with great care and slowly slowly.
There is always the chance that if inflation happens to fast and things really go pear shaped that the crash will force major debt write offs,decreasing the money supply, and then we could have deflation.
Its a crazy game out there,with potential booby traps around every corner[and I aint talkin bout your girlfreinds bra]
Question....Who does USA owe the most money to ? (2010 figures)
China???...nah not even close...
The top 10 are:....
10: Luxembourg
Amount of U.S. Debt Owned in 2010: $78 billion
Percent of U.S. Debt Owned in 2010: 0.9
9: Switzerland
Amount of U.S. Debt Owned in 2010: $112 billion
Percent of U.S. Debt Owned in 2010: 1.2
8: Hong Kong
Amount of U.S. Debt Owned in 2010: $122 billion
Percent of U.S. Debt Owned in 2010: 1.4
7: Russia
Amount of U.S. Debt Owned in 2010: $125 billion
Percent of U.S. Debt Owned in 2010: 1.4
6: Taiwan
Amount of U.S. Debt Owned in 2010: $155 billion
Percent of U.S. Debt Owned in 2010: 1.7
5: Brazil
Amount of U.S. Debt Owned in 2010: $165 billion
Percent of U.S. Debt Owned in 2010: 1.8
4: United Kingdom
Amount of U.S. Debt Owned in 2010: $459 billion
Percent of U.S. Debt Owned in 2010: 5.1
3: Japan
Amount of U.S. Debt Owned in 2010: $865 billion
Percent of U.S. Debt Owned in 2010: 9.6
2: China
Amount of U.S. Debt Owned in 2010: $884 billion
Percent of U.S. Debt Owned in 2010: 9.8
1: United States of America
Creditor Name: American public and the Federal Reserve
Amount of U.S. Debt Owned in 2010: $4.7 trillion
Percent of U.S. Debt Owned in 2010: 53
Surprise! The country the United States is most indebted to is itself. Actually, it borrows from a host of domestic investors, including private citizens, the Federal Reserve, and local and state governments. Here are the various groups of creditors who divvy up those trillions [source: CNBC.com]:
Insurance Companies: $261.8 billion
Depository Institutions (commercial banks, credit unions, etc.): $269.8 billion
State and Local Governments: $511.8 billion
Mutual Funds: $637.7 billion
Pension Funds: $706.4 billion
Other Investors/Savings Bonds: $1.458 trillion
Federal Reserve and Intragovernmental Holdings: $5.351 trillion
Ref:--http://people.howstuffworks.com/5-united-states-debt-holders.htm