Australian Bubbles?

[quote=“GuyInTaiwan”]Hmm.

So you’re going to move to Caroline St?

Well, I suppose that if you played your cards right, you could pick up quite a little bargain before too long, if you were in the market for a house.

What are you going to do for work when you go back? Did I read somewhere recently that you were going to do further EFL study, or that you’d already done it? The question is, surely, that if property and the stock market tank, will there be some sort of recession in Australia? People would presumbably find simultaneously that money is a lot harder/more expensive to borrow, and also that their giant ATM (i.e. their house) was suddenly out of cash. Wouldn’t that mean less money to splash around in the economy generally? How would that potentially affect any line of work you would be looking to get into?[/quote]

I have my online editing and translation business, Planet Editing. That goes all the time then I have been thinking of having a homestay business. Most pay about 200 to 250 a week so I might just buy a big house and do that. I’ve also run tours to Australia in the past and I can teach. I think I can cobble together a reasonable income. If Australia had any set backs it would be good for me. I want a low Australian dollar and cheap housing. Asian education isn’t going away.

Why are you leaving Taiwan?

The weather. It rains too much. That is the actual reason.

It rains too much, are you from Alice Springs ? :slight_smile:

I once lived in Tully in Queensland, it rained 400 cms total in a year with afternoon rain showers pretty much EVERY day, make sure you don’t go anywhere near there!

I’m going to Surfers Paradise on the Gold Coast. It’s got a nicer ring to it than ‘In the Lake’ where I’m currently living.

GIT I’m surprised you don’t know about this effect and Fox you are too optimistic to be saying put your money back in the stock market towards end of the year, my guess is you won’t be doing that.
Banks drag down the whole stock index and when they run up major debts to capital they need to replenish capital before being able to loan,therefore they don’t lend, credit dries up, they call in their debts, companies that borrowed too much like construction developers are stranded and the economy tailspins…or has the strong potential to anyway. Consumer economies depend on strong credit flow.

GIT I’m surprised you don’t know about this effect and Fox you are too optimistic to be saying put your money back in the stock market towards end of the year, my guess is you won’t be doing that.
Banks drag down the whole stock index and when they run up major debts to capital they need to replenish capital before being able to loan,therefore they don’t lend, credit dries up, they call in their debts, companies that borrowed too much like construction developers are stranded and the economy tailspins…or has the strong potential to anyway. Consumer economies depend on strong credit flow.[/quote]

I think you are right.

HH: Oh I know that. I was just expressing surprise that he had the balls to really take a stand. Too many people don’t, and then they whine like stuck pigs when it hits the fan, even if they felt major reservations in the lead up.

It’s not really courage. I’m booking a profit of about 25% over two years. I want to hang on to it.

Well, it’s prudence then. Most people get greedy and want to keep getting even more.

You can’t go broke making a profit. I think the thing with shares I’ve leant is that the strategy of holding for ever is wrong headed, especially when your time horizon for holding has changed as in my case.

If your time horizon changes, sure.

Dunno otherwise. Buffett likes it. Hard to say, really.

Buffer got into the American stock market at the right time and held on when the ride was almost always going up (with expansion of financialisation of American economy), a lot of his success is to do with the era he worked in aswell as buying low. It’s like if you go into Chinese property 20 years ago…well there was only one way really except for the odd blip , up. That will stop soon and even if you are going for ‘value property’ you will still not do well over the next 10-20 years because the general market will be down.

Just think, if Buffer had been based in Japan would he have done so well, I think not.

If he’d been based in Japan, he would have invested elsewhere in all likelihood. He has said so himself that he doesn’t generally like Japanese companies because of their poor ROE.

Also, it’s easy to say he was in the right place at the right time, but then, why has his success been fairly unique? If it’s so easy, anyone could have done it, right?

Regarding China, not necessarily. Again, if it were that easy to do (and maintain over several decades), then anyone would be able to do it.

I’m not saying he hasn’t done a good job picking up companies cheap and running them well, but a lot of it was the ocean he was swimming in, seems people don’t get that. You really think he would invest in the US if he was from Japan…nah. You bought pretty much anything in Japan over the last two decades you would be down, all the things Buffer likes like insurance and banks and utilities and transport…

He doesn’t like Japanese companies because of their poor ‘roi’, well who would :laughing: . Let me guess, it’s hard for him to get sweet deals because he is a foreigner and doesn’t understand Japanese well nor understand Japan well. How would he do in the US if we was Japanese and didn’t have the network or links into government there? See what I mean?

His success and many other mutual funds heavily depend on investors and more money flow into the market among other things.

Except he doesn’t like Japanese companies because fo their low ROE, so he wouldn’t have bought any of that stuff there.

Hi all,

I’ve only just come into this thread and noticed that is has gone quiet in the last few weeks.

I am currently in Australia and looking for an exit. I think it will get ugly here in the next 6-18 months. I monitor the real estate here as I have a vested interest (4 properties) and monitor the markets and notice an adjustment coming through. Plus, the newly announced carbon taxe, the ever increasing cost of living and the situation with the government (ie, minority government and Abbott the mad monk running around poo-pooing everything) does not help.

Seriously, it is getting very expensive to live here as costs are just going up but salaries and incomes are not. As an example, the cost of electricity in NSW went up 18.1% on July 1st but wages and salaries did not. In fact, everyone earning over 50k recently got slugged with the flood levy in order to pay for the Brisbane floods.

The current situation is not sustainable. So I am looking at an exit and going back to Taiwan with my Taiwanese wife and enjoying a cheaper lifestyle there. We’ll hang onto our investment properties in Australia though as they are positive geared but the lifestyle and way of life in general is seriously going downhill. Retail is dying, the restaurant and cafe sector are all but dead and people are either hanging onto their money or don’t have the money to spend.

As already mentioned in this thread, people are in debt up to the eyeballs and so any interest rate increases will hurt - and cause hardship. Plus, real estate is going south and so there are probably alot of people out in Australian suburbia who have negative equity.

So watch out. We have an apartment in Taipai that we own outright and our Australia properties are positively geared. But i want to get out of here for a while as the cost of living is increasing too much and i can see a downhill slide coming. If you have the cash, then come into the market and buy, but don’t expect any capital gains in the near future.

My thoughts.

gg

@GG

Interesting post, I’d just comment that if those properties are really investment properties it doesn’t make financial sense to hold on to them, you will be stuck with them for a long time. I’m guessing there is more to it than that but now is the time to offload a few if you can.

I must be tired. I read the thread title a couple of times and really thought it was about an Antipodean chimp.

That’s no way to talk about me!