Next Wednesday will see the release of the national accounts for June. Those figures will probably show the economy being less bad than previously expected. That might lead to the end of the “emergency setting” of the RBA cash rate at 3%, which will precipitate the decline and fall…
August 28th, 2009 | Dan Denning | 92 comments | ContinuedReal Estate
Commentary on real estate and the worldwide bubble by your Daily Reckoning editors in Melbourne, Australia. Still haven’t subscribed to the Daily Reckoning? What are you waiting for… sign up here, it’s free!
A chronological listing of articles is below.
Evidence of a Turn in the US Economy
The bounce in existing homes sales reported last week is yet one more sign that even in the most bombed-out part of the economy, there is some activity stirring.
August 26th, 2009 | Rob Parenteau | 1 comment | Continued
Property Buyers Are Not Buying Property at All
Regularly we receive emails into the Money Morning mailbag asking us for advice on whether the reader should buy a home now, or sell their home now.
Our response is always the same – no response. That’s because unfortunately our licence prohibits us from offering personal financial advice. All we can do is keep things nice and general in these emails.
August 25th, 2009 | Kris Sayce | 41 comments | Continued
Property Spruikers Claim Australia Suffers from a ‘Chronic Housing Shortage’
Shortly, I’ll show you once and for all that Australia does not have a ‘chronic’ housing shortage. Further, I’ll show you that as soon as government runs out of ways to manipulate the housing market, prices will collapse.
To be honest reader, your editor is almost speechless.
August 24th, 2009 | Kris Sayce | 42 comments | Continued
Property Sector Has Seen the Value of its Assets Wiped Out
The “wipeout” in the sector was especially bad news for Babcock & Brown, Rubicon Asset Management, and Record Funds Management. These heavily leveraged firms didn’t survive the steep rise in global borrowing costs. It didn’t help that asset values began tumbling when the leveraged dried up.
August 17th, 2009 | Dan Denning | 1 comment | Continued
A National Mortgage Bubble
This brings us to a quick point about the Aussie property market. A frequent complaint in the e-mail box is that house prices are a local and not national phenomenon. If that’s right, then it doesn’t make any sense to talk about a national property bubble…because there can’t be one, can there!?
August 11th, 2009 | Dan Denning | 2 comments | Continued
The Cash Flows Are Coming
National governments are demanding a larger portion of global savings. Government welfare transfer schemes and bailouts have to be funded from borrowing (unless from money printing), which also makes capital harder for private companies to get. Corporate cash flows will revert to the mean in the absence of huge infusions of credit to finance the growth of the balance sheet.
August 10th, 2009 | Dan Denning | 13 comments | Continued
Australian Property Market is “Recovering”
As we said at the ‘Australia in the Red’ debt summit, “recovering from what?” For something to recover you generally need to show symptoms of sickness. So far all the Australian property market has shown is a couple of spots.
But these ’spots’ are potentially hiding something much, much worse.
August 7th, 2009 | Kris Sayce | 34 comments | Continued
This Reflation is Not Yet a Monster Hyper-inflation
The market begins the month of August trying to prove that the Great Recession is over and the earnings recovery has begun. On Friday, US GDP data came out and seemed to confirm that just maybe the worst is behind us. According to the cryptic figures, US GDP is shrinking at annualised pace of just 1% – considerably less than the 6.4% from late last year.
August 3rd, 2009 | Dan Denning | 0 comments | Continued
Building a National Economy Around the Housing Industry
Let’s also assume that the government cannot borrow its way to larger stimulus payments. With lower spending forecast for government, businesses, and households, you begin to wonder if Australia’s economy has a home grown engine, or if it will rely on something else, or someone else beyond the borders.
July 30th, 2009 | Dan Denning | 9 comments | Continued