Caarn, Kouk!


The delightful irony of invoking a shadowy real estate sock puppet as a riposte to a deconstruction of Kouk’s real estate busting rate forecasts! Who’s doing the “low flying” here?

Houses and Holes
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  1. First they ignore you, then they laugh at you, then they fight you, then you win.
    Mahatma Gandhi

    • v110.v112.v116

      “All truth passes through three stages. First, it is ridiculed. Second, it is violently opposed. Third, it is accepted as being self-evident.” -Arthur Schopenhauer

      ROFL – keep those pearlers coming Kouk!

  2. migtronixMEMBER

    low altitude flyer eh? Can’t match that high flying MSM lack of credibility that’s for sure.

  3. As the ‘Kook’ reads this site he might learn a thing or two and not resort to ad hominem attacks.

      • Sure. But this site is no different.

        You have the self righteous agreeing with each other and the deniers austracised and demonised.

        I still think the Kouk has been more right than wrong in the past. (In the past).

      • + 1 Escobar

        The Kouk was ridiculed by many here for his 10% house price call for 2013 – and he nailed it within a couple of basis points.

        And from memory, Christopher Joye still owes The Kouk a “nude run” around the RBA headquarters for his call in interest rates in 2012.

        Not bad for a profession which is known to get it wrong more than they get it right.

      • mine-otour in a china shop

        Yes people find their own camps in these debates, but I think this site is more evidence based than others.

        The only thing I think this site has got wrong is Australia’s (and most of the world’s) policy response to the GFC, and some peoples irrationality in making investments based on those policies.

        How do you cure a debt fuelled crisis? Add more debt to it, to fuel wealth effects and consumption further, and use this time to ignore and fudge the structrual changes needed to repair long term growth.

        Rational thinkers didnt think that pouring further policy petrol on the fire was a possible option, or that China would follow the same model, or that investors would be fooled into thinking this was a good response to the crisis.

        The Kouk has read CB’s, Governments and some short term investor behaviour perfectly. Though when it all goes pear-shaped people will soon forget bank economists and twatter pundits, and ask others for solutions.

      • Thanks for your comments mine-otour

        I stopped myself previously from saying much the same thing.

        I think the Kouk can read the political status quo and it’s easy for him to predict 6-12 months.

        If MP or foreigner property purchases were curbed (denied or taxed) or that NG and other preferrential taxes were reigned in then he’d be wrong.

        It never seems to be about what should happen – always what will happen. Apathy is never modelled.

        PS to all the doom sayers. Remember, in the 90’s we had say 12% unemployment (however determined) and that means 88% were employed who ultimately made out like bandits over the ensuing years.

        Our next recession maybe not be MUCH different.

  4. A five-minute conversation with any of these “all good” types would leave me wanting a shower.

    • Yes

      Though the Bull Hawk flaps with the grace of a flock of Lowes Menswear models Bear Hawks don’t complain as they race up towards the sun.

      The Bear Hawk just waits until the flapping and bellowing is done and the Bull Hawk and their debt machine plummets downwards.

      Eventually, when all alternatives have been explored and the debt machine has been rebuilt in tight chains (or perhaps dismantled by Op8 🙂 ) a sensible slow and gradual ascent in rates can commence.

      • “dismantled”?

        Hey!! No fair Pfh007! 😉 I’ve no problem at all with debt.

        Debt is great. Debt is fine.

        That non-existent legal obligation tacked onto all the debt — called Usury — that is the problem.

        If b_b were right, and Debits did exactly match Credits, with nothing whatsoever added to either side of the balance sheet, then there’d be no problem at all.

      • casewithscience

        This again Opinion8red?

        Why would anyone loan if there wasn’t a hook (ie usuary)?

        Without an incentive to give loans, the economy would stall as new market entrants would face a much higher barrier to entry. What would remain is the wealthy having even more power.

      • Opion8,

        I am right. Debit = credit. To suggest otherwise is silly.

        The loan (bank asset) creates the deposit (blank liability).

        Interest accrued = interest payable.

        When deposit meets loan, both deposit and debt is extinguished.

        FWIW – I am a big believe interest rates should be zero. I do not think it is helpful in society for people to be paid to simply own digits in a bank. They should be encouraged to add to the real resources of the community.

      • b_b,

        No, you are wrong.

        This fact was categorically demonstrated to you last time you stuck your brainwashed head up.

        Not just by me, but by several others also.

        Go away. Read the links that Pfh007, I, and others gave you last time.

        EDIT: For any who missed previous discussion, a loan creates the principal. The resultant deposit equals the Principal. The usury component also owed is NOT created at the same time… it does not exist. Another loan, itself owing even more uncreated usury, must be created in order for there to be sufficient “money” in the system for usury owed to be repaid. Total DEBT owed is ALWAYS greater than the total of money in the system. Hence, artificial scarcity of “money”, competition to obtain it, all economic and environmental and (most) social evils ….

      • Opion8

        You need to stop reading dogma and learn some practical skills of accounting.

        Interest accrued = interest paid. The accounting entries are no different to the loan creation process (just a few more parties involved). The deposit interest plus bank staff cost equals interest paid.

        There is no gap. I have shown this on a number of occasions.

        No one can show me the accounting entries which prove otherwise. I keep showing facts, and all you have is emotion.

      • b_b,

        Learn it.

        Then think.

        EDIT: Try this …

        And this, re how endogenous money works…

        If there were only one “loan” in a whole monetary system, then the only place the “Interest” can come from, is the creation of a new loan (also bearing another interest obligation, accounted for by a new set of entries), OR, by taking some of the money already in the system out of it, to pay the banker.

        Hence usury-based money = DEBTS OWED (P+I) > Money in existence.

      • b_b,

        Since I am confident from last time that you do not bother reading links provided for you, I’ll simply quote from Steve Keen’s seminal piece linked above:

        “Two hypothe­ses about the nature of money can be derived from the money mul­ti­plier model:

        1. The cre­ation of credit money should hap­pen after the cre­ation of gov­ern­ment money….

        2. The amount of money in the econ­omy should exceed the amount of debt…

        Both these hypothe­ses are strongly con­tra­dicted by the data.

        It doesn’t take sophis­ti­cated sta­tis­tics to show that the sec­ond pre­dic­tion is wrong—all you have to do is look at the ratio of pri­vate debt to money. The the­o­ret­i­cal pre­dic­tion has never been right—rather than the money stock exceed­ing debt, debt has always exceeded the money supply—and the degree of diver­gence has grown over time.”

        The proofs are all there, if you can be bothered to study it.

  5. mine-otour in a china shop

    I come here for economic guidance beacuse of its stronger evidence base, its willingness to look at more than the next few hours in economic history, its willingness to challenge thinking and policy and finally its ability to also assess risks to the economy and its baseline scenarios.

    Everyone is entitled to an opinion but I prefer MB quality compared to a Twatter feed.

  6. What I find hugely amusing is that he doesn’t understand how easily Twitter followers can be bought or synthesized. Never mind. Now he can add “technology illiterate” to his list of achievements.

  7. Sheesh! What does it take to get a hat tip around here?

    My impression of The Kouk is he looks at things from a very macro quantitative point of view (if that makes sense). He doesn’t try to think too much about the details, or why things are happening, just that they’re happening. So when he sees interest rates at record lows, he forecasts rapid house price growth. When he sees the broad commodity price index rising, he forecasts that Australia’s ToT will rise and the AUD will strengthen.

    Mr Holes and his crew are much deeper thinkers. You dig into the long term implications of policy decisions and global economic forces, but maybe you over think things sometimes? Its certainly easier to look at the macro settings and come to the obvious conclusions. Its worked a treat for The Kouk in recent months.

    I bet the Kouk doesn’t lose any sleep over the long term implications of a hollowed out economy. He’s too busy cheering house prices higher.

  8. IMHO, now with the benefit of hindsight, people who are trained economists and who have worked all their careers in
    the financial field should have concentrated on I R movements, especially in relation to the price rise here in most of Aus cities
    in the past 15 months…they only know too well the Aus fetish for property investment….but instead “slow melt” was the catch cry
    and many of us fell in line and put off buying or even sold too early…such is life! For some it has been a costly decision and I find it
    hard to forgive that lack off basic vision from as I said qualified people….but NO ONE not even the ones who seem
    at this point in time to have gotten it right had a smidgen off a clue that the sudden weight of foreign buyers was what would really
    drive up house prices as we now see.
    Maybe we all had too much faith in the likes of the FIRB to be on top of their game and do what they are paid to do
    By us taxpayers.

    • mine-otour in a china shop

      Some trained economists failed to unravel the irrationality and behaviour of policymakers, investors and others to repeat the mistakes of a recent crisis.

      But that is your problem? Doctors make mistakes, lawyers make mistakes, teachers make mistakes even politicians make mistakes – yes!!!

      You should perhaps empower yourself to take on board differing financial advice and make decisions yourself. Maybe enrole in an economics degree yourself?

      I’m off to make sure I dont make any more mistakes by opening up a nice bottle of red, and try and work out where the models went wrong, wonder at the forecasting accuracy of the Kouk (and then probably finish the bottle).

      • Cheers mine-otour, might have a drop myself later.
        For me seeing with my own eyes the RE carnage in Ireland,Spain and Florida a few years ago probably skewed my decisions a bit on the cautious side.
        I did start a diploma in Financial planning about 12 years ago…but silly me only completed the first year as I thought
        Engineering was the the way to continue. 🙁

  9. While everything continues on as it has done, the Kouk will still be right. When it ceases to be; he won’t.