Will Australian property repeat the Irish crash?

From Martin North:

Comments

  1. I suppose if the economy tanks, the braindead ALP could cap the unemployment rate at the current 11% (unacceptably high) by putting a massive tax on each 482 visa while simultaneously changing the law to allow rich foreigners to buy Aussie houses legally.

    That would keep house prices as high as possible while lowering the unemployment rate.

    • that never worked anywhere.
      The reason why unemployment goes up is reduction in jobs not who gets the jobs. Tax on foreign workers visas would make foreigners more expensive than domestic – in a recession people with mortgages work for anything

      Allowing foreigners to buy would not make much difference – it was legal for foreigners to buy in US, Spain, Ireland, … but it made things even worse. In a slump market foreign investors are first to sell because for them the property is just money that is disappearing at fast rate

      • USA probably has 10x as many houses as Australia and is nowhere near as foreign-born as AUS. Of course, rich Asians can influence the Aussie real estate market a lot more than the US real estate market.

        If foreigners were allowed to purchase Aussie houses from 1 Oct 2018 onwards, the house prices would probably go up again. It is a tap that can be turned on and off.

        The reason why unemployment goes up is reduction in jobs not who gets the jobs.

        Oh dear. People turn 21 in Australia every day and they are not given jobs because bosses can import 45 year olds with 20 years of experiences and pay them $2/day. So the unemployment rate is now 11% while the unemployment rate in Britain is at a 40 year low because Theresa May kicks out foreign “students” after they complete their “studies”.

      • And with a diving currency (AUD) it is disappearing doubly fast than it appears to be. 10 % drop plus drop in currency OUCH !

      • That’s a good observation and no new buyers (investors) will enter a market with declining asset prices. Also in both Spain and Ireland temporary workers left as the debt driven jobs in the FIRE sector dried up. This also flowed in supporting service jobs. Once the decline accelerates I don’t anything will slow or stop it.


      • What’s particularly staggering is how dramatic the impact of this policy change was. You can nearly pick the day it came into effect !

        Late November 2012?
        Hey, wait a minute…

    • @rj2k000
      How do you have time to watch a Mike Martins post that is 1hr20min long and still refer us to it at
      0200hrs today! Whew!
      That Aussie guy says he has been watching the market since 2008. That hardly makes him a “Seasoned
      Insider” I purchased my first block of land in 1972 for $1900 and have been watching the market off
      and on since then. People I meet haven’t heard of the “Tulip Bubble”, Poseidon Bubble etc. and think that what has happened to the Aussie market is normal. It’s not, and will correct eventually.
      Ever heard of the “Carrington Event” of 1859 (or so)? Now that is something to worry about!

      • boomengineeringMEMBER

        Similar here Hooksey, paid mine off (house) 1975, Didn’t stop me losing the lot (11) after the 89 crash though.

      • Long stints of programming need a decent rest in between and at the end, hence spare time i don’t actually want to do any work.
        Usually need a decent vege out after gym late at night.
        Doing repetitive production work during the day gives a ton of utube time too.

        Utubes with less detail i play at 2x speed.

  2. Martin North is the Bullshit Terminator – living tissue over a metal endoskeleton of logical analysis. He absolutely will not stop, ever, until the bullshit artists are dead. Hasta la vista rent seeking bubble blowers.

      • ResearchtimeMEMBER

        I saw a lot of Eire before it crashed, and had family as big constructors… its massively different set of circumstances than Oz.

        I doubt it will drop much at all. The AUD will take most of the shock.

      • Yeah, Eire and other PIIGS don’t have their own money, so when the credit stopped, the cash just ran out. Not like Oz, here the RBA-Megabank complex will whirr into action to support asset prices, and the more inflated the more they’ll whirr into action…..so much so it will aggravate the downward pressure on the AUD, so housing might not lose that much in AUD terms (though, 10 % in Sydney is already looking likely in the coming year), in USD terms, the crash could be large, inflation will spike, retail, services, housing construction would tanks….so yeah, it will look less like Eire and more like friggin Argentina as everyone tries to dump Aussie dollars for other currencies, gold, whatever and inflation spirals since we import nearly everything.

      • RBA has maybe two 25 bps rate cuts left in its armoury, it missed the opportunity to cut and force some deleveraging, now its out of ammo. Currency depreciation is going to cause more problems than it solves for our consumption led economy – petrol and energy prices, food prices, imported goods prices likely to skyrocket. Good for exporters but that is mostly mining, not a big employer.

      • St J re looking more like Argentina – That’s my reasoned GUESS as well. Although I go for Venezuela – our social cohesion is going to break down very quickly (JMO)

      • I wonder if we could get a double-whammy: The RBA swings into action and the AUD begins to rapidly depreciate. Consequently, foreign investors panic and sell their Australian property holdings, causing the bottom to fall out of the housing market anyway. I guess it depends on the prevalence of foreign ownership of Australian.

    • You got Martin North very incorrectly.

      He’s not some sort of public educator or justice warrior, neither he’s emotional about anything.
      This is what makes him very credible.

      Have you noted that he’s never told *anyone* that he(r) is an _idiot_?
      (unlike other analysts)

    • Lol at all the nuthuggers.

      Lets not forget that your new crash hero stated that a 40%+ crash only has a 20% chance of eventuating and that “My best call would be in the region of 15-20% from top, over 2-3 years…”

      Put it back in your pants….tards

  3. … CONSIDERING THE 2007 IRISH EXPERIENCE …THE MASSIVE RISKS OF MULTIPLE STRETCH … CENTRAL BANK OF IRELAND RESEARCH …

    The unweighted average median multiples of its metros in 2007 was 4.7, which crashed to 2.8 in subsequent years … putting all its Banks to the wall and requiring bailouts of in excess of 70 billion euro … about $NZ109 billion.

    Currently the average Median Multiples for the Australian and New Zealand metros overall are about 5.9 and 5.8 respectively … refer …

    Demographia International Housing Affordability Survey: All Editions

    http://www.demographia.com/db-dhi-index.htm

    Research by the Central Bank of Ireland found high lending multipoles was the greatest problem (more so than loan to value ratios) … and subsequently imposed a general mortgage cap of 3.5 times annual household income. A year earlier the Bank of England had capped at 4.5 times annual household income …

    Mortgage Measures | Central Bank of Ireland
    … access extensive background research via link …

    https://www.centralbank.ie/financial-system/financial-stability/macro-prudential-policy/mortgage-measures

    A helpful television discussion about the 2007 Irish experience …

    Prof. Bill Black & Vincent Brown – Ireland’s Bank Guarantee … Youtube

    https://www.youtube.com/watch?v=t7zd5dRILBw

    • Why are the Aussies clueless about the structural differences of, for example, the normal Texas housing market and the abnormal California one ?

      Exposing Australia’s housing crisis | 60 Minutes Australia … h/t GF …

      Part 1

      https://www.youtube.com/watch?v=smPR0s2W-Ck&feature=youtu.be

      Part 2

      https://www.youtube.com/watch?v=BbFvwYVfwq0

      Back early 2010, I wrote about the critically important differences of the strangled California housing market and the open and normal Texas one.

      For housing bubbles to form, scarcity or perceived scarcity is essential … finance (in all its forms … equity … bubble equity … debt) is just the fuel.

      Remarkably … the Australian 60 Minutes team appears to be unaware of these ‘basics’ … read on …

      Housing Bubbles: Jumbo Mortgages = Jumbo Problems … Hugh Pavletich … Scoop New Zealand News

      http://www.scoop.co.nz/stories/WO1003/S00019.htm

      Why is the Australian 60 Minutes team ignorant of normal Texas housing markets … such as Texas (check out the Annual Demographia Surveys) ?

    • I think thee are some fundamental differences between Ireland and Australia and they centre around our resources. We are willing to sell these off holus bolus to try to maintain some sort of (short term) stability. We are also willing to sell off any and all key businesses. If I understand it Ireland also indulged in this practice. I’m not too sure how much of our resource industries remain to be sold off. There have been numbers quoted that more than 90% of it is already gone. We have a fair bit of farmland the Chinese would be interested in but you have to sell a lot of acres to get a Billion dollars!
      So, in my view, direct comparisons with Ireland don’t hold a lot of water. That said, perhaps we’ve sold already off most of the meaningful resources and are now at the pointy end.

      Once the crumbling starts we don’t have an ECB backing our economy. So that will make a huge difference to any possible recovery path.
      Just thinkin’!

      • Andrew Bydder: Housing crisis is all about land and how councils regulate it | Stuff.co.nz

        https://i.stuff.co.nz/waikato-times/opinion/106901970/is-it-a-housing-or-a-land-crisis

        OPINION: Which is worth more: a million-dollar section with a $100,000 house or just a million-dollar section?

        The answer is the million-dollar section and the reason is capitalisation.

        Anyone buying the section wants to put a big flash house on it, not a small, simple one. A $100,000 house isn’t going to cut it, so the buyer will have to spend $10,000 demolishing it before building their dream home. The section was undercapitalised…. Read more via hyperlink above …

      • ” I’m not too sure how much of our resource industries remain to be sold off. There have been numbers quoted that more than 90% of it is already gone ”
        Oz has been running regular trade surpluses for a while now. I wondered how this can be when we still need massive amounts of foreign capital to grow ie we have trade surpluses and at the same time perpetual current account deficits. I have to figure that foreign money funds the mines that create the surplus and then the money just flows back overseas with us skimming a little bit for taxes. I’m not saying anything new but it just hit home to me how much of our mining sector must be foreign owned.

    • ResearchtimeMEMBER

      Reu. is correct on this one… the two are not even remotely similar. Eire had little immigration other than Baltic workers in construction who left after the bubble bust. And it had the Euro!

      I doubt Sydney will even lose 10%

      • Love your alternate hadle 3d1k, as well as your alternate facts. ‘Research’ makes it sound like you are actually well read & knowledgeable about the subject matter in question and not just a paid troll. Good to see that you’ve expanded your paid activities to more than just the minerals council.

      • Yikes, insecure much?

        It’s all 3ds-under-the-beds here these days. Suggestive of weakly-held bear-beliefs. Faith faltering? Just as some good bearish news is finally being reported? Man up.

      • Some of RT’s posts and links have been first rate and some less so. Keep an open mind.

        This call I think is a “less so” moment. I’ll go withMartin North.

      • RT
        I think the falls will be the same but over a longer period
        Ireland was in the Euro so they didn’t have a currency to deflate
        The same in Japan the yen rose into their crisis
        AUD falling to 40 to 50c will cushion our falls
        QE into banking
        As house prices fall 20 to 40% initially and RBA starts QE watch the cash pour into stock market, share buy backs etc
        It’ll be ground hog day after watching US and Europe
        The gov will bail out the banks after bond holders and shareholders take a trimming

      • reusachtigeMEMBER

        Losers on all blogs and forums love to call “troll”, “astro-turfer” etc etc when they can’t handle alternative views to the local circle-jerk!

        Some of the best contributors to the comments here have been shut down because the weak of mind couldn’t cope with their alternate views. The best one was Shadow. That carnt was spot on. Legend.

      • Shadow was indeed a legend. As was his, erm mate, BearTrap. They were 110% right, guaranteed.

        But I don’t remember them being on this forum!

        We do have M North here – he is the latter-day Ed Karan!

      • “Losers on all blogs and forums love to call “troll”, “astro-turfer” etc etc when they can’t handle alternative views to the local circle-jerk!

        Some of the best contributors to the comments here have been shut down because the weak of mind couldn’t cope with their alternate views.”

        ↑ THIS

        https://imgur.com/a/1fg3stz

      • Genuinely curious if Rubicon could answer the question who would be paying Researchtime to leave comments about there not being a significant housing crash in Australia and why the payer would think that leaving semi-optimistic comments on MB would have any bearing on the market?

      • @ BCNICH

        “I think the falls will be the same but over a longer period
        Ireland was in the Euro so they didn’t have a currency to deflate
        The same in Japan the yen rose into their crisis
        AUD falling to 40 to 50c will cushion our falls
        QE into banking
        As house prices fall 20 to 40% initially and RBA starts QE watch the cash pour into stock market, share buy backs etc
        It’ll be ground hog day after watching US and Europe
        The gov will bail out the banks after bond holders and shareholders take a trimming”

        Your sequencing is wrong. Deflating the AUD is not the means to saving housing. It is the consequent effect AFTER stimulus measures are implemented eg rate cuts, QE. A floating sovereign currency allows greater flexibility in regards to introducing stimulus measures, something the EURO couldn’t provide in the case of Ireland.

      • Researchtime is not 3d.

        Shadow hasnt been sighted for years…..even in the Bull Pen 🐂.

        Probably retired after making a fortune selling his range of Bear2Bull hormones after the RBA and APRA went full bubblicious in 2012.

        Anyone making comparisons to Ireland needs to identify the natural resources and other goodies that the Irish refused to sell after the GFC in vast quantities.

        Anyone doubting the RBA commitment to Bubble-time clearly hasnt been listening to the RBA.

        https://theglass-pyramid.com/2017/02/17/rba-watch-luci-and-the-platypus/

        They will double down damn the consquences in a heart beat.

        QE for Home Buyers!

        https://theglass-pyramid.com/2018/06/14/crystal-balls-when-will-aussie-house-prices-crash/

    • I love it. Newcastle has completely different banks to the rest of the country, is exempt from APRA and has excised itself from the Royal Commission. Therefore the reasons behind the downturn elsewhere don’t apply!

      Seriously though, there is scope for an MB article about contagion if Syd /Melb falls to the regions. Two forces: fleeing Sydney money keeping regions up vs credit restrictions operating nationwide (dragging on everything). Who wins? Perhaps regions go up this year, but next year…..?

      • They don’t call it god’s country for nothing!
        I don’t see upside (maybe my bias showing). Spillage over from Sydney has been a huge factor but I think this stops with price drops. If people are under water (or struggling with repayments) then nothing in the regions will help them.

    • And quite a few of these new “developments” are not what you would call quality builds. And btw, “peak hour” road congestion in Newcastle is now from 3pm through to past 7pm week days. And just about impossible to find a park in Newcastle CBD and inner suburbs after 6pm any day of the week. Oh, the vibrancy!!! Suggest Reusa sets up a branch office here. Plenty of action if the personals sections of the local rags are anything to go by.

      • Was it you that posted the photos of the boarded up shops? This city certainly has issues.
        Interesting to see unit prices in the next 12mo

  4. Great stuff. 80% falls. Im going to post that right now on the Property Forum websites.
    (PS If you never see any of my replies again, you know what happened.)

  5. Anyone care to provide cliffnotes or at least explain the clickbait video title? I’m presuming even North doesn’t think a single phone call would drop prices by 80%…

    • It’s a reference to the phone cal which demanded that the Irish government guarantee its private bank liabilities. To save (ostensibly) European bondholders.

    • 80% if the Government doesn’t play ball and bail out the banks (which would include foreign investors) which would plunge the economy here into a depression.

      My own take on this is to emulate Iceland, you’ll endure short term pain, but the recovery will be much faster. Unlike many of the PIIGS in Europe which are still sandbagged with debt and struggling under austerity.

      Government here will chicken out and bail out the big 4.

  6. The RBA can never hold a gun to the Australian Parliament, it is a creature of the Australian government and will implement policy and actions proposed by parliament in a crisis. The ECB is not a creature of the Irish government which is subject to the bond vigilantes. So the question for Australia is, will parliament, in a crisis, sanction the same old solution of saving the banksters/fraudsters (moral hazard) or do something different like save the economy and the defrauded without resort to moral hazard (Not an option is to allow the economy to collapse into a depression).

  7. Two important differences:
    1. Ireland did not have a currency it could devalue.
    2. It was relatively easy for anyone living in Ireland (skilled, semi-skilled or unskilled) to move to another country.

    • Yogi
      I agree on currency (see above comments)
      Q What will all the Indians (who are the ones buying the homes on Melb Syd fringe) do when they are in negative equity for a decade
      A they can either fly home direct one way with air India or the Thai airways flight via Bangkok they can stop over night and have a pad Thai for dinner on way home
      They’ll drive past the bank throw their keys at the bank and leave their cars in the car park at mc Donald’s at the airport if they can’t sell the car

      • bcnich suggests a useful adverse departure index: the number of cars abandoned in airport car parks. The condition they are left in would provide an insightful sub-index as not all would be clapped out bombs. Audi A4’s will be a snip at the auction houses soon.

      • Stupid comment. How much is Perth down from peak? ~12% over four years!

        And lets not forgot the common denominator in all those cities you listed – transient employment boom from the resource industry. Tard!

      • @ solar – Yes and Perth managed to fall that far with the credit taps welded open. With very low interest rates.

        Calling every other poster a “tard” doesn’t add inches to your dick. The inches you have to worry about will be up in you before you even know it.

      • Nah mate, the inches are well and truly embedded in the depths of you tards.

        Have you enjoyed the reaming the Oz housing market has given you tards over the past 15 years? Your prolapsed anus must be in a real sorry state by now. ….oh, but not to worry right? Cos a massive nominal crash is coming to save the day! Martin North said so! LMAO

      • Oh and not everyone on here is a tard.

        Prime tard list –

        Brenton
        Treibs
        rj2k000
        Timmeh
        Arrow2
        yourself
        plus many more

        Tards can usually be identified by the conclusive bold statements they post; brainless comments that are posted reflexively anytime someone posts something contrary to their ‘crash’ view. They usually just parrot the typical bear arguments they’ve read in some article (or watched on youtube) with no thought as to whether they actually apply in the current situation. Another typical tard behaviour is annualizing daily movements in an index to extrapolate an annual trend. Looking at you lswhcp

      • Got it.

        Tards = Everybody else.

        Smart money = Trollar, plus any other envoys/refugees from PropertyScat.

        Pretty cute that you put your crush at the top of the list. Not that there’s anything wrong with that.

      • “Tards = Everybody else. ”

        As I’ve mentioned several times previously – you tards often have trouble reading carefully or paying attention.

        Ps. You should probably go see a doctor for that prolapsed anus. Its a disgusting look

      • Come on mate, don’t waste your time on no tards.

        I’m sure you’ve got some empty rentals you could be installing shower cams in. You know, for when the booms starts up again in a few weeks. Not all FIFO’s are old fat guys, you know.

      • Weak ass reply. Another typical tard behaviour is assuming ppl must have investment properties if they dont share the crashtard view. Tard

      • You’re a serial troll (and not a very capable one), who got some of Brenton’s hot sauce in his eye and now is doomed to hang out forever on a forum you don’t like with people you despise, having to change your handle every few weeks……if only your crush would see you aren’t like all the other investors.

      • You seem to keep mentioning brenten, are u his bf or something? You do make a good couple, both of you are prime examples of clueless tards locked out of the property market such that you’re only hope is to keep wishing for a housing ‘crash’

      • LMAO! Its a good meme isn’t it? It is amusing and true on so many levels.

        poorboy brenten is the epitome of tardness, that is why he has a special place in that meme. However from reading the comments here it seems we have some serious competitors to the tard throne. The stupidity exhibited by triebs and yourself really is next level stuff!

      • The AUD will make a difference, I just don’t think that it will make as much of a difference as many imagine it will. The Japanese had the Yen, a supremely more powerful and useful currency than the AUD, that didn’t stop their bubble from unleashing chaos and suffering across their society. Where we differ from the Japanese is that they have a diversified and functional economy. We have construction and dirt. We won’t be Ireland, but we won’t come out the other side of a crash in the same shape as America or Japan have managed to.

      • We also have loose immigration restrictions compared to Japan.

        And a mass of wealthy Chinese looking emigrate and/or get funds out of China

      • Key difference in the build up was Germany needing low interest rates and Ireland with exploding growth (of everything but especially house prices) needing much higher rates to constrain explosion of debt. Obviously interest rate policy from ECB was set to maximise benefit to the core of the EU….and rates were artificially constrained with the result that we accelerated into the crash with people getting 30 year tracker mortgages at ECB +0.6-0.9%. The cheap money was not a policy decision made in Ireland but in Frankfurt it clearly is a reasoned policy decision in the case of Australia which makes it all the more myopic and inexcusable given the recent reference examples open to them to consider.

  8. Martin asks the question? Should the government prop up Aussie banks if they are failing?
    As much as I hate the idea of Public money being used to prop up Private lending, I don’t believe that we have any real choice in the matter.
    My question for Martin would be: What is the primary product of the Sydney basin?
    I don’t know the answer myself, however whatever it is one thing is certain is that it’s an intangible.
    Some might even go so far as to say Faith in the future is the most important product of the Sydney population, it’s what is rewarded, it’s what is traded in, it’s the commodity that is most leveraged, yet in reality it is the most fragile of all products.
    My reason for pointing this out is that this Sydneysider net product (faith…belief in the future) is foundational to the Sydney economy, if this faith is ever really challenged it’s not just 1 in 10 jobs that are at risk rather 8 out of 10 jobs within the local economy derive their value from this faith in the future and the cash-flow that underpins this stupidity.
    Remove the cash-flow and you’ll see the stupidity boil over.
    Ideally in a recession industries that compete outside the bubble see an incredible increased value and they grow while the layers of stupidity unravel, however in Sydney’s case I’m not sure that much exists beyond the stupidity. I’m not sure that anything good will rise from the ashes.

    • Absolutely spot on! What does the Sydney basin produce? The question that nobody asks in relation to immigration or real estate. The answer of course is ‘damned all’ In particular it produces NOTHING that is not Real Estate related.
      Of course we will then have a big problem with our ‘culturally diverse’ Sydney population.

      • boomengineeringMEMBER

        Fisho/ Flawse
        What does Syd produce?
        Too true, thought of that for years seeing all the old factories pushed down for housing wondering if it all becomes housing then where are the jobs. Some old machines I repair eg Hobart mixers ( made a new bronze worm wheel (for gearbox) made in Sydney would be the best in the world, told a client to buy a second machine while I repaired his, ysk, it over heated after 20 mins and didn’t have the planetary action that made the Hobart very user friendly.

    • What is it we do here?

      Why are there so many people here? What do we do?

      Why do we need so many more people each year? What do we do?

      These are very important questions to answer. I don’t think many people would like the answers.

      • Dangerous questions especially when you realize we’re all part of the problem.
        who here would really prosper if the local Sydney economy collapsed?
        I suspect as much as some of us might be able to raise our hands and scream ME, this analysis ignores many of the external costs that would flow on as a consequence of Economic collapse.
        Would our kids have jobs?
        Would some low life unemployable be hopping over our fence every day to steal anything and everything?
        Would we actually be able to grow those few industries where real advantage was created by the recession?
        – I have grave doubts on this exact point
        – our universities are simply not producing graduates with the right skill sets (because that’s not what the local economy has rewarded over the last 50 years)

      • We have a Real Estate PM, who luckily is a Happy Clappy Chappy, who’ll keep the faith, belief, credit in our RE heaven, otherwise known as the Sydney Basin.
        He is of the Shire, a gun for hire, when it gets dire he will light the fire… on the bonfire of our Vanities and other renovations.

    • Just to be clear, I believe Sydney would adjust but it wouldn’t be with a quick sharp reset accompanied by labour reallocation to real value growth industries, That’s not waht will happen because these “real value” industries just don’t exist anymore.
      Over the decade frame 1992 through 2002 we saw the Sydney job market discovering it’s real external value, however it was all quickly replaced by the Mining boom forever followed by the credit boom and housing boom.
      It took a decade to just begin to see the growth of a skilled human capital centered growth engine. And it’s worth pointing out that it was only a decade prior (early 80’s) that the life was kinda stomped out of Sydney Manufacturing, so there were still a lot of residual manufacturing skills within the labour pool.
      It’s a very different situation today, it’s not simply a matter of resurrecting the near dead, it will be a case of building these valued industries of the future from scratch.
      For those that have never done it, think for just a moment about:
      what’s required to build a $1Bpa gross revenue business from nothing?
      Try doing the sums assuming 10 years to go from $0 revenue to $1B
      What cash needs to be maintained year on year to fund your growth?
      What margins are necessary to make this growth even possible?
      Is it even imaginable that you can achieve this growth while simultaneously training new staff?
      Ok so lets see what number sequences get us there
      year 0 = $0 1=$5M 2=$10M 3= $20M 4=$40M 5=$80M 6=$160M 7=$320M 8=$640M 9=$1280M
      wow it only took a decade to grow a significant business IF our revenue doubled every year, year in year out for 10 years straight.
      Now try to figure out how much money is typically required to design/develop the products necessary to generate $100M pa revenue? (what percentage of last years revenue was that (greater than 100% you say….hammm how does that work, especially within an economy that’s going through it’s own liquidity crises?)
      How do you fund this growth, assuming that you have the right product, and the right pool of skilled labour?
      Bottom line: is Catch 22 ….you’re economy can’t actually make this transition while in a recession.

      • Well said fisho – just two add two things (which I know you realise) There are two further problems
        1. The right pool of skilled labour. The structure of our education system is completely stuffed. Because of the structure of the economy now, and idiocy in educational bureaucracies and teachers unions, we now have an education system that is facing 180 degrees from anything productive. It’s taken three generations to get to here and it will take longer than three generations to get back.
        2. Trying to raise the cash which you rightly emphasise. We have been running CAD’s for 60 years. This is going to come with a collapse in the currency (odds are). It’s almost guaranteed that most of your technological machinery (and the cars utes tools etc) necessary to construct run this business is going to be imported so that is now going to be very costly.

        Generally speaking we are like Gary Larson’s ‘car load of idiots’ driving straight into a brick wall.

  9. Initially thought this was a bit over the top based on the title, but watched it and it was very educational. A very important message for general public to understand – tax payer funded bank bailouts bail out creditors (London, Wall St, Zurich, Frankfurt, etc.) and leave the country. To get this message across, similar to how most people now undestand ‘first home owner grant’ was really a ‘vendor boost’, this needs a good name for what it really is. As it definitelly not only bailing ‘OUR’ banks out.
    What is even more shocking these credit counterparties have been though private debt bombs and housing bubbles before and clearly understand the risks, but still insist on sticking AAA rating to our banks. So there is only one conclusion to make – all this triple AAA rating is, is our tax payer capacity to bail out London and Wall St. They are expecting it and counting on it.

    • We have massive external debts that have to be paid – like $1Trillion ($1,000,000,000,000) That’s going to be a lot of printed A$ in the hands of people who don’t want them any more. Best solution will be to just sell the whole country to the Chinese who still have about USD3T (as near as I last read)

    • Worth looking at the research done into who these unsecured creditors were… commentary at the time focussed on the fact that most (not all) of the major banks had gotten out of the unsecured debt and had sold at a discount to a variety of groups who were willing to make a punt on the Irish government bailling out secured and unsecured alike……the message that was really hard to swallow was that the billions being pulled out of education, health, aged care etc was being channeled into windfall gains for hedgies and speculators in London, Frankfurt, Zurich and NY…..who had in many cases just bought the unsecured debt at massive discounts.

  10. Solar, Perth dropped a L O T M O R E than 12%! Lot of their mansions and houses are listed for less than 50% since their boom. Darwin is even worse and other mining towns like Morandah ere virtually unsaleable. Hope you’re not in debt or you will learn the same way as all the other speculator/masterbators

    • Lol

      Can you read this, tard?

      YouTube videos and random bear porn articles are not a credible substitute for the ABS or Corelogic figures.

      • “You can get a family home for less than $200,000 in certain areas, under certain circumstance, which is remarkable,” he said.
        “Don’t be frightened of this market, this is a really good opportunity to buy”.

        Bahaha. Yeah, BEARPORNZ FROM THE WEST STRAYAN.

        You don’t have to try so hard Solar. Chin up bro, Perth is going to boom again, and soon. LOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLLOLOLOLOLOLO

      • Once you understand the significance and meaning of “median house price” come back and post something semi intelligent. Tards

  11. I liked the Irsh TV Programme where they were saying that, paraphrasing, “economists agree, it will be a soft landing”.

  12. @36:20
    “people die, women get bashed and children go hungry”
    I wonder if all these things would really happen if we choose not to bail out the banks.
    Lets just not bail out the banks and see what happens. I doubt any of those things will happen.

    Didnt Iceland not bail out the banks? what happened to them?

    • That’s what happens when you introduce austerity. Poverty is a terrible thing to suffer and it makes people do terrible things. If the banks get bailed out, and the populace is still suffering you get the double whammy of an increase in poverty and anger at those who were assisted from those who were just tossed aside. For a community to be civil the members need shelter, food, opportunity and to not see others being given the biggest free ride in history and then told that it is for their good.

      • The so-called ‘austerity’ is not the problem. The problem is the previous mis-allocation and the PREVIOUS reward of those who were non-productive parasites. The return to a productive economy requires major re-allocation of resources. Much of what is now paid for would be irrelevant.
        When this hits, those who have the power will exploit their position to maintain their unsustainable income and lifestyle. This WILL include politicians, public servants (you can already see this in the relative wage gains), Bankers, powerful unions (teachers, waterside, CFMEU et al ), big business, Lawyers, doctors. Those who really get screwed are ordinary people – pensioners, self-employed, small business and their employees etc. The ‘Left’ as it is now constituted, despite their loud proclamations on ‘fair’ don’t give a RA about such people. Of course, neither do those exercising the power.

        ‘Austerity’ isn’t a choice. Austerity is the cost of what’s gone on beforehand. It’s a question of who bears the cost!

      • I politely disagree, flawse.

        Austerity is a problem separate to what has gone beforehand. It is a choice made as a response to some thing and it is not the only option available. Choosing to do that kills what little is left of the economy.

        However they got to that position beforehand is irrelevant because austerity will always lead to the same outcome. Unless there is a way for an economy to grow when internal demand has collapsed, exports aren’t happening and the government stops spending.

      • I thought austerity is what happens when you bail out the banks at the expense of the people…So the people have to pay by the cutting of social services etc…so the bailing out of the banks is what causes the “people” to “die, women get bashed and children go hungry”..the guy in the video said the complete opposite. He said that if we DONT bail out the banks people will die and women get bashed. I thought it was the other way round….bailing out of the banks is what leads to austerity which leads to the cutting of social services etc which leads to the poor getting poorer leading to e.g. children starving, women getting bashed etc…
        Maybe I have it wrong?

  13. The reason the ECB threat worked is because Ireland doesn’t haveits own currency. The better case to look at is Iceland. It’s better to let the bond holders lose money like Iceland did.

  14. MediocritasMEMBER

    If we’re prepared to accept short, sharp booms, then we must also be prepared to accept short, sharp busts. To do otherwise creates an asymmetry that has a habit of depending on external inputs in order to persist (international bailouts). Beyond an onerous interest burden, these inputs typically come with political strings attached, resulting in a loss of sovereignty in the receiver nation as its government is forced to implement policies pushed by external parties as a condition of bailout. Over and over again in history, this has been the case, from developing nations being “rescued” by the IMF and World Bank, through to EU nations being “rescued” by the ECB.

    It’s unlikely that our leaders will choose the Iceland route, even though we could easily do so as we’re in control of our own currency. Instead, I expect that Australia will end up even more under the control of the international neoliberal consensus as we run up an enormous level of government debt and put taxpayers on the hook to protect the wealth of international speculators with exposure to Australian assets.