The Grand Angus Index

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–Uh oh. The price of your Grand Angus meal at Macdonald’s could be going up. It used to be that “The Big Mac Index” published by The Economist magazine measured currencies on a purchasing power parity basis. The more expensive the Big Mac, the lower your purchasing power. But when all paper money is declining in value relative to real things, the Big Mac Index isn’t as useful.

–In a world of competitive currency devaluations, we propose the Grand Angus Index, in which food increases in value relative to paper money are measured. According to today’s Wall Street Journal, “The United Nations Food and Agriculture Organization’s monthly food price index rose for the sixth consecutive month to 214.7, topping the previous peak, 213.5, reached in June 2008.” The U.S. dollar is also going down, in food terms.

–Food prices last spiked like this in 2008. That’s when the subprime compost really hit the fan in the financial world. At that time, it was a combination of bad harvests, bad weather, bad trade policy (export quotas) and bad monetary policy that drove the move. And the move drove people in the developing world – where food is a large part of what you spend your money on – into the streets with anger and, presumably, hunger.

–Food prices matter because they represent a kind of social limit on loose monetary policy. If low interest rates and money printing drive food prices up for people, that’s the bad kind of inflation. The good kind of inflation – a rising stock market and rising house prices – doesn’t make people angry or hungry. It appears to make them rich.

–But rising food and fuel prices are warning signs. Of what? Of the bear market in nearly all fiat money globally, not just the U.S. dollar. How do we know this? The chart below.

S&P GSCI Agricultural Index Spot Price
Click here to enlarge

–This is an expanded version of a chart we showed at the Gold Symposium in Sydney in November last year. And you’ll see that a green line has been added. That’s the U.S. dollar index. The black line is the Goldman Sachs Agricultural Index (spot prices). What does it tell you?

–Even after the bear market in stocks began in late 1999, the U.S. dollar stayed strong. It took two solid years of falling stock prices to reverse at least a little of the momentum from a 20-year bull market. But when the dollar fell, it fell hard.

–What’s interesting is that even though many major crops like wheat and corn and sugar and soybeans are priced in U.S. dollars, dollar weakness did not lead to surging food prices globally. In wasn’t until late 2007, in fact, that food prices (measure by the GSCI) really want stratospheric.

–Since then, you can see a pretty compelling correlation between dollar weakness and food strength. But the perplexing aspect of the chart is that the recent rally in the dollar index has been met by a new high in the Goldman Ag index. Food hasn’t fallen on dollar strength. It’s gone higher. Why?

–The dollar index measures the greenback versus other currencies. The green line tells you relative to other currencies, the dollar is trading a bit stronger now than it was in November (the Aussie dollar excepted). But here’s the important point: the dollar strength against other currencies has masked the decline of nearly all paper currencies against real goods like food.

–If we’re in a global bear market for fiat money – and not just a bear market but a kind of endgame for this kind of money – then real goods will continue to climb in value against government money, even if the U.S. dollar exhibits periodic strength relative to the Euro, the British Pound, or even commodity currencies like the Australian, New Zealand, and Canadian dollars.

–Is there an investment angle here? Well, even though they fell again yesterday, gold and silver are still handy tangible assets to own if we are indeed in a secular bear market for paper money. Lower prices are chances to lower your average purchase price and add to your position. This is a kind of “big picture” currency trade (paper for metal).

–But what about food? Well, if the food story is not really a story about shortages and droughts, and instead it’s a story about a global currency crisis, the investment angle is not as clear. You could keep it simple and invest, when possible, in arable land. In a world with six billion people and counting, food seems like it would a long-term winner.

–Yet as we’ve seen here in Australia with Timbercorp, straight-forward investments that correlate to higher food prices are few and far between. The idea seems simple. But if the investment vehicle isn’t properly structured, you can lose a lot of money. And even more straightforward angles like fertiliser and pesticides have been less than stellar over the last three years.

–The safest bet? Stock up on canned goods! And sugar and salt, which as you may know has been used as money in the past (a medium of exchange). Just keep it dry!

–Of course that recommendation that you exchange paper things for real things is part of the rough plan we have for 2011 to “definancialise” life. What it really means is to place reliance and confidence in the systems and axioms of wealth that have more or less worked for the adult life of the Baby Boomers.

–Modern portfolio theory…the efficient market theory….the stock market as savings account…the idea that over 20% of a nation’s population can spend a quarter of its adult life not producing anything…these are all unexamined assumptions about modern life that will turn out to be bogus in the next years.

–Tomorrow, we’ll have a closer look at what ‘definancialisation’ means to Aussie banks. If they’re required to keep more of their balance sheet in high quality, liquid assets like, ahem, government bonds, what will it mean to their ability to expanding their balance sheet with new loans? If loan growth declines as capital requirements kick in, what will that mean to bank shares and to the economy?

–It’s quite a bit to ponder. We’ll go stock up on some calories and protein and think about it…before the Grand Angus meal gets more expensive.

Dan Denning
for The Daily Reckoning Australia

Dan Denning
Dan Denning examines the geopolitical and economic events that can affect your investments domestically. He raises the questions you need to answer, in order to survive financially in these turbulent times.
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Comments

  1. How about definancialising into food by directly purchasing arable land and occupying it as your principal place of residence, then spending your spare time growing a variety of fresh and healthy fruit, veggies, nuts and (depending on space) annual grains and livestock?

    On a smaller scale, you can produce a surprising amount of good fruit and veg in your good old Aussie back yard. 300 – 500 square metres of garden space can get close to feeding a family of 4 or 5. If that’s not definancialising, I don’t know what is. This has got to be far more effective than stocking up on canned goods, salt and sugar.

    Nathan Chattaway
    January 12, 2011
    Reply
  2. Also, I would think that in most “western” nations today, most adults spend most of their time not actually producing anything of value to support human life. How many of us directly labour to produce food and clean water? Compared to all the people employed in financial, beauty, entertainment, insurance, marketing services “industries”, it can’t be very many of us…

    Nathan Chattaway
    January 12, 2011
    Reply
  3. “…directly purchasing arable land and occupying it as your principal place of residence…”

    By ’94, we’d set up sufficient infrastructure to achieve most of what you describe, Nathan. That includes 3km of drip retic, fed only by rainwater.
    By mid-2011 we’ll also produce all our own electricity. While we produce most of our fruit and some of our vegetables, we also trade with others.
    And because we enjoy seafood, our ability to meet our _real_ needs increases as our ‘leisure’ time increases.

    Not for everyone, but we enjoy a measure of independence and we ‘know’ our food’s history intimately. Still trying to achieve what my retired parents had in place by the eighties. New technologies may mean we can have it all in place by 2012.

    As you say: “This has got to be far more effective than stocking up on canned goods, salt and sugar.” Healthier, too!~ :D

    Reply
  4. Stocking up on canned goods is also stocking up on sugar and salt :-)

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  5. Hi Biker Pete,
    Great to hear it! We’re only 10 months into our self sufficiency “definancialisation” journey. We’ve moved onto 50 acres and are implementing our permaculture design. I’m trying hard to get all the infrastructure purchases done quickly while things like 40mm poly, brass taps and windmill pumps are available.

    Nathan Chattaway
    January 14, 2011
    Reply
  6. Go for levers, not wheel valves, Nathan. Lost count of those I’ve replaced. Also make sure you fit a little white sleeve to retain water on your mill’s uplift. Probably saved kilolitres since I fitted one.

    Our main lines are 40mm to 19mm. We set it all up with little rubber saddles before 40mm-to-19mm junctions existed. Too much work!!~ Recent extensions have been a breeze. Hope you’re mounding your fruit trees. Don’t forget a tangelo or few. Gold!~

    Reply
  7. Good Lord Biker … What a diverse character you are .. On the Perth Now site under the Round the World Traveller tag last year … you were a developer / builder one Day in Mexico next in Canada returning to Australia in March this year to knock up another 6 houses & now here you are spouting natural farming techniques … if your not careful they will make a action character of you ?? … Just wondering who looks after this farm of yours when your Building all these houses & traveling the world … Tell you what dont tell me now that would spoil it .. Write a book on your life & I will read it if you tell me now you will spoil it … i will make sure to keep an eye out for this book in our local Library in the Fiction section …. Tee Hee Hee

    Not Fooled By property Spruikers Hype
    January 15, 2011
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  8. “you were a developer / builder” – A source on that from Perth Now would be nice. As I’ve never seen Biker claim to be a developer or a builder???

    Reply
  9. Do you do sources when it comes to Biker, Not Fooled? – Or just drop in occasionally to chuck a bit of innuendo about? SOURCES! PLEASE!!! Because as much as it might surprise YOU(???), I’M not prepared to just take YOUR word for it when it comes to character assassination. SOURCES!!! PLEASE!

    Reply
  10. http://www.zerohedge.com/article/inflation-wins-tunisian-president-ben-ali-flees-country

    This one world idea just costs too much to work very long. Then again all systems eventually become overweight and fall apart. Bills “chislers” amongst other ensure that.

    BP I was a lever/ball valve man myself….well they’re quicker, don’t leak or fall apart as often. Although they are dearer and can be accidentally knocked on/off depending location. The first nursery I built was a zero tolerance for leaks type outfit. I collected all irrigation water off greenhouse roofs and growing surfaces and used drip and sub-irrigation in all growing systems to conserve water. Great fun.
    I do wonder though what the future will be for all this poly stuff in an oil price gone mad type world. I would be thinking in terms of how food trees will hold up on a long term basis with minimum intervention. Poly set ups can be used to speed establishment though.

    All this self sufficiency planning depends on our presupposition in the first place. Just as a more extreme example, if your view encompassed a lot of starving people, possibly disconnected from welfare etc and less policing in outlying areas….maybe you would plant food trees blended with natural vegetation to some degree to prevent becoming an easy target for hungry/violent people. If I lived in the USA I would definitely be thinking along such lines :(

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  11. Live a suitable distance from cities/towns also.

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  12. It’d difficult for a tosser like N Fool to imagine any kind of lifestyle outside a cubicle, Ned. He just doesn’t think outside the box. Ever.

    The concept of a sixty-plus-year-old having a few irons in the fire, being financially independent due to property, and being able to build a number of housing projects while travelling is _so far_ beyond his restricted, enclosed vision that it’s little wonder he posts this stuff. His total disbelief is quite delightful, in fact. It reassures us that we got most of it right…

    Reply
  13. Thanks for those ideas, Lachlan. One thing we learned from our earlier experiences is that it’s worth paying for better-quality UV-resistant poly.
    The cheaper stuff broke down _wherever exposed,_ within a decade. Piping drip-line to chook water basins, so they’re ‘watered’ when gardens are, has meant great freedom. Our six-station switches on every second day, Nov 30th to 6th May.

    Think you’re right about the cost of poly rising… . Maybe I’ll buy a few hundred metres of 40mm and 19mm. The missus says we’ve already over-planted, but some extra poly as back up is a good idea.

    Once our larger non-citrus trees got their feet down into the clay, watering became less critical. Citrus continue to need it. Issues with aphids and scale at present. Coffee grinds sprinkled around citrus (and mulberry) trunks deters the ant-farmers, but careful pruning has made control easier, too.

    Take your point about levers being knocked. We’ve placed ours adjacent posts and, in a couple of cases, trees; so it hasn’t occurred, yet. We just got fed-up with replacing seizing valves! An ex-orchardist, turned hardware specialist, advised me it would keep happening, unless we went to levers. End of problem! :D

    Reply
  14. Comment by Biker Pete on 15 January 2011:

    It’d difficult for a tosser like N Fool to imagine any kind of lifestyle outside a cubicle, Ned. [b]He just doesn’t think outside the box[/b]. Ever.

    Funny I have the same thought about you, Example.. My many trips to the USA ..

    Biker Pete replies “sure, sounds like hero worship”

    You did not stop to think that most of the early trips were Dublin to USA, Not very far and not very expensive.. ;)

    Stillgotshoeson
    January 15, 2011
    Reply
  15. I’m interested in your destination choice, Shoes. Nothing more than that.
    Expense never entered the equation.

    There’s a lot more world than the US. I guess you look forward to the pat-down regime.

    Surprised you’re communicating. Think my last comment to you queried your progress as property speculator, using your SMSF. How’s that progressing?

    Reply
  16. Have been to England, Scotland, Wales, France, Spain, Greek Islands, Turkey, Japan, New Zealand, Bali and Vietnam
    Tasmania too :) that’s overseas ;) sure it is another country even.

    Have flown “around” the world 3 times. This year will be my fourth.

    Destinations are Canada (BC) USA (5 States, Cali, Washington (State not City) Nevada, Arizona, Arkansas. Ireland (relo run) England and Japan…

    Auction on that house is in 2 hours.

    Stillgotshoeson
    January 15, 2011
    Reply
  17. @ Comment by Ned S on 15 January 2011:

    Do you do sources when it comes to Biker, Not Fooled? – Or just drop in occasionally to chuck a bit of innuendo about? SOURCES! PLEASE!!! Because as much as it might surprise YOU(???), I’M not prepared to just take YOUR word for it when it comes to character assassination. SOURCES!!! PLEASE!

    & @ Comment by Ned S on 15 January 2011:

    “you were a developer / builder” – A source on that from Perth Now would be nice. As I’ve never seen Biker claim to be a developer or a builder???

    Well Ned our Little Biker himself has confirmed what I said a couple of comments later …

    Comment by Biker Pete on 15 January 2011:

    It’d difficult for a tosser like N Fool to imagine any kind of lifestyle outside a cubicle, Ned. He just doesn’t think outside the box. Ever.

    The concept of a sixty-plus-year-old having a few irons in the fire, being financially independent due to property, and being able to build a number of housing projects while travelling is _so far_ beyond his restricted, enclosed vision that it’s little wonder he posts this stuff. His total disbelief is quite delightful, in fact. It reassures us that we got most of it right…

    So there you go our little Biker is also a Property Developer ….

    Whatever you do dont get him talking about Pirate Stories… The man never stops …

    BTW on The Perth Now site his Side Kick Dogman swears Biter Petes alter Ego TRAVS/RTW is a W*O*M*A*N* ….. What is that about biker? … You never corrected him?

    I guess they will make a series on TV about Biker … UNITED STATES OF BIKER …. Tee Hee Hee

    Not Fooled By Property Spruikers Hype
    January 15, 2011
    Reply
  18. Tee Hee Hee? Who’s the girl here? ;)

    (Very confused troll*… .)

    *AKA The Punter of Mindarie, John of Dullsville Perth, etc.

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  19. Your identification as Tasmania as another country is priceless, Shoes.
    Better get your laces tied if you’re going to make that auction, son!~

    Reply
  20. “being able to build a number of housing projects while travelling” – THAT does NOT make a bloke a builder Not Fooled! Or a developer!!! Unless you are just being plain difficult to get along with OR are just effing pig ignorant …

    So give me your source from Perth Now where Biker ever claimed to be a developer. Or a builder. OR DON’T YOU UNDERSTAND WHAT THOSE WORDS MEAN???

    Reply
  21. I know I’m not bright when it comes to finances, but sometimes I get the feeling I’m blogging with EFFING retards!

    Not Fooled, I was married to a woman once who would twist words to suit her meaning. DON’T try that crap on me – I’m way too experienced now. So just be a good chap, and give me your source/s from Perth Now as requested please! Or in the DRA allowable version of the vernacular: ‘Poo or get off the pot’ … EFF, you are frustrating!!!

    Reply
  22. “Auction on that house is in 2 hours.”

    How did that pan out Shoes?

    Reply
  23. Ned: “THAT does NOT make a bloke a builder Not Fooled! Or a developer!!!”

    Being cubicled means N Fool needs to compartmentalise, Ned. Hence, because we have two garden orchards of 300 trees, grow vegetables and run chooks, we’re ‘farmers’! Our ten acres is deemed ‘a farm’. Fidiot… .

    Our five most recent building projects in an eighteen-month period make us ‘builders and developers’. :D Utterly clueless… .

    N Fool is a serial nuisance. After posting years of anti-property hype, he has twice bleated to be left alone, following responses he could not begin to answer. Happy to post both those bleats, if required… . ;)

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  24. Drives a bloke nuts Biker. Just an effing time waster. I wouldn’t mind too much except he/she does actually seem to think he/she knows what a builder is? And what a developer is? AND fancies him/herself as some sort of property expert??? Which I sure don’t – Despite the fact I DO know what a builder is! And a developer!!!

    I’m tired. And when I’m tired my tolerance level for idiots lowers VERY significantly. :(

    Reply
  25. Just on the survival topic..
    Some basic food storage which could be not too costly/difficult and would be very effective in a crisis. Storage of wheat rather than flour is a longer term solution. Flour only keeps about a year or so.

    http://ambilac-uk.tripod.com/longtermsurvival/wheat.html

    ” For example; wheat (Kamut seeds) discovered in the Egyptian Pyramids and excavated bakeries was found to be edible even after the passing of Millenia.”

    Maybe grow a little wheat around the place too BP. They can keep their wheat juice drinks but ;)
    http://www.wheat-grass-seeds.com/
    Poor Job ;)

    Reply
  26. Comment by Biker Pete on 15 January 2011:

    Your identification as Tasmania as another country is priceless, Shoes.

    Probably should have said another world ;) Not strictly true though, I found Tasmania to
    very similiar in many respects to the South Island of New Zealand.

    Comment by Ned S on 15 January 2011:

    “Auction on that house is in 2 hours.”

    How did that pan out Shoes?

    Was withdrawn from auction, reason not given.
    I am sure I will find out…

    Omitted Russia as a country I have visited as well… Only been to Moscow..
    Dated a girl from Kharkov many many years ago when I was backpacking around.

    @Lachlan, Ate army rations that were over 40 years old, they tasted no different* to the modern army rations we had at the same time. By the words no different I mean just as horrible and tasteless….

    Stillgotshoeson
    January 16, 2011
    Reply
  27. @ Ned

    Harden up Princess …

    @ Travs / Biker Pete

    Happy to post both those bleats … Go on do it ?

    The two of you just Blow smoke at each other post after post

    Not Fooled By property Spruikers Hype
    January 16, 2011
    Reply
  28. “Harden up, Princess”… and… “OXYGEN Thief” are his two frequent PerthNow responses when he has nothing else, Ned. These smartarse quips are levelled at numerous folk who effectively disagree with him.

    His two PerthNow bleats:

    “Go away and don’t reply to anything I post from here on in and I promise to leave you alone as well.” October 14, 2009….

    Then, over a year later:

    “Hey Travs forget about me it is not about me …. why make me the centre of your focus …” December 04, 2010.

    The issues he has major difficulty responding to include * No CGT on family homes; * Reduced repayments on borrowing, due to inflation;
    * Double income effects on wages:home price ratios; and * Individuals’ income acceleration over a lifetime. He never, ever responds effectively to these issues; instead it’s “Go away, leave me alone…” or “OXYGEN Thief” or “Harden up Princess”. His frequent closing giggle “Tee Hee Hee” pretty much sums up this effeminate little roach.

    Reply
  29. Oh Dear Travs using Big Boy Words on this site to try & look like you had a education past 3 Rd Year High School? … Effeminate ?? Why not just say Feminine Little Roach? …. Think you look smarter when in fact it is pretty stupid to address your message at a higher level than your audience?
    What a Dipstick!!

    Pinhead Wages went up 38% & House prices 185% between 2000 & 2010 I understand the Person on $100K in 2000 is now earning $138K so his house is now more affordable… However when they need to sell to a new entrant in the market these people are priced out so the pool of buyers shrink & the PONZI scheme is over ….

    “Hey Travs forget about me it is not about me …. why make me the centre of your focus …” December 04, 2010.
    &
    “Go away and don’t reply to anything I post from here on in and I promise to leave you alone as well.” October 14, 2009….

    Both above are out of context Ned I think Travs has a bit of your Ex Wife in him… Copying & Pasting them out of context to T*W**I*S*T* my words to mean something completely different??

    BTW How Warm is the Water at at the Shallow End of The Gene Pool today?

    Not Fooled By Property Spruikers Hype
    January 16, 2011
    Reply
  30. “…a education” ?

    Your lack of mathematics also lets you down again, effeminate roach. Not only does the worker on $100K now earn $38K more, but he’s repaying 100c dollars with 60c ones, due to a decade’s inflation. Try to grasp the meaning of it all. It has been explained and re-explained, not just by me, but by several others. Try to master grammar and maths, before you commence Year Eleven economics, windbag. ;)

    Quotes out of context? Mate, you’re _wriggling_ on the hook.
    You said it, wear it. :D

    How many times can you copy and paste that Gene Pool analogy? Done to death on PerthNow. You got anything else, apart from that…
    and your girlie “Hee Hee Hee”(?)

    Reply
  31. That Ex Wife crack remind you of anyone, Ned?

    Reply
  32. You cant put my quote up in full because it would expose you copy / pasting / cutting so that it is out of context …

    You cant post it in full can you? Farmer Pete?

    Your 100c / 60 cents is VOODOO … Tut Tut Tut Primary school logic

    Not Fooled By property Spruikers Hype
    January 16, 2011
    Reply
  33. “300 trees, grow vegetables and run chooks, we’re ‘farmers’! Our ten acres is deemed ‘a farm’. Fidiot… .”

    For a general guide by a farming mate…

    <25 acres is classed as rural residential.
    ~100 acres is classed as 'small farm'
    ~500 acres is a 'farm'

    "Not only does the worker on $100K now earn $38K more, but he's repaying 100c dollars with 60c ones, due to a decade's inflation"

    After talking to quite a lot of people in Sydney's mortgage belt I get the impression that they are NOT having a lot more in their pockets. Cost of living is actually higher than CPI. The measurements are probably not broad enough. This is anecdotal I know. If you consider however that the 'new' status quo is for both partners working and a mortgage placed at 50% of income in a typical family on the city fringe you can see that the market is capped. There is simply no space left to encroach on in the competition to outdo the Jones's.

    2000-2003 I lived in Glenmore Park. Brand new house, made perhaps 25% per year. Upgraded and move a few k out of the CBD. That suburb hit the breakes hard and each time I check I can see that the house I sold back then barely worth more today. The problem is, a 400k buy price in that area is all the market can bare. I was lucky (not smart) to get out within 6-12 months of the top and to take away near double the price. The couple that bought from us make out every avenue the could to get my house. They were desperate and bought the house for ask and had the deposit down within -one hour-. Today, they would be lucky to have made 10-20% in the past 7.5 years.

    Yes, one small market, one example. But it make you wonder, what is pushing the price up. When you look at the demographics you see that yuppie\dink suburbs do best. Since the boom all those years ago so many of those have settled in and are now struggling with children.

    I honestly don't see much more leveraged to be absorbed by the new buyers now that handouts have stopped at the bottom end and in the top end, banking etc, we have seen a lot of cutbacks in the past 2 years. As you know, I'm in IT. Th two highest paid people in my area (of an investment bank) both rent. All of us look at the market and wonder when the cracks will starts. If we're sitting our capital out (one of us, not me! drives a porsche) how many others will sit in rental land for a while.

    Chris in IT
    January 16, 2011
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  34. Back in about April(I think) I suggested that I won’t buy a house in Haberfield 4br, no garage unrenovated 100 year old ish federation of 1.5mil. I stand by that. With the world as it is, and with Australia being so sensitive to foreign problems I cannot in good faith decide that I can commit to a 30 year contract, buying at near double historical average (wage to value of 5:1). Someone else will have to hold the bag during this risky period.

    One thought… unlike the US where this is no recourse for banks to borrowers excess capital after a forclosure we DO have the problem here. What it means is that the banks can ruin the marketplace with excess liquidity (bubble) and then leave the borrowers who often are not speculaors, just people who want to like in a house where they can paint the walls and hang pictures, etc. If a bubble popped… what would happen?

    I suggest that the wiser few will hit the market hard, knowing that any capital they pull out now is better than none later. Later we will see latecomers enter the selling and hit BE, meaning total loss of equity. Those left underwater would have to suffer, as most really would not bankrupt of their own choice.

    The last group however would be lumped with higher interest caused by increased overseas funding (haven’t we heard that before). Their ‘interest’ would occupy a larger portion of their budget and deepen the recession.

    Fr the record, I doubt the bubble will just decide to pop on it;s own. It’ll likely be either a euro default, US dollar problems or in fav, China cutting back on imports that will cause it.

    On that subject does anyone remember the article on DR from mid 2008 on the BHP\Rio stell contracts. They mentioned how we got ‘the sweet deal’ due to the current commodity bubble (which has returned) and because the baltic dry was at an all time high. (For those who don’t know what the dry is for, read it as cost of shipping). Today however, the baltic is at an all time low, as demand for shipping has caused a market glut. This could very well cause China to choose Chile as a resource partner.

    One other thing to consider I read recently is that China now has MASSIVE stocks of almost everything they buy from us. They clearly have an agenda
    as they buy things they don’t appear to need, like excess steel. (Read in to that if you care to). Either way, there is a decent chance of ‘something’ changing in our good fortune and any change will likely deflate the bubble.

    How many of use feel the confidence we had back in early 2007? Yeah… me neither…

    Chris in IT
    January 16, 2011
    Reply
  35. Oh, and a not to all the other would be farmers… Chicken manure smell is impossibly hard to get out of your hands! Dammit! I stink!

    Chris in IT
    January 16, 2011
    Reply
  36. Second time today one of my posts has been blocked. You’re running scared when you censor responses.

    Reply
  37. Let’s try again: Not Fooled, you poor careless sod, you’ve admitted you’re The Punter of Mindarie. Dogman figured the October 14th quote was yours.
    You’ve confirmed it. :D

    Reply
  38. Didn’t see a Perth Now quote in any of that where Biker says he’s a builder/developer? Until I do see one, Not Fooled remains on Princess’s windbag list! :D

    Withdrawn Shoes. We’re getting a bit of that lately I think?

    Reply
  39. “How many of use feel the confidence we had back in early 2007? Yeah… me neither…”

    Different picture over here, Chris.

    WA property has been even flatter for the last three years (providing some good buying for us) but things are lifting. I rarely attempt to predict any short-term movement online, but I think our market is ready to jump.
    So does our builder.

    “…a 400k buy price in that area is all the market can bare… ”

    Our last few projects all came in around that figure. In a beach setting, we think there’ll be more activity at that end than for our more expensive homes. The greatest movement of all will be in vacant beach blocks.
    We picked up two during the lull and inquiries are thick and fast…

    Reply
  40. Comment by Ned S on 17 January 2011:

    Withdrawn Shoes. We’re getting a bit of that lately I think?

    Does seem to be a little bit more of those occurring.
    18 months or so ago I was at one of my sons friends house having coffee with his parents (I had only known them a short time) while the boys played and we were talking about houses, the divorce situation and the kids etc, all the usual crap.
    I had said in that conversation that I was in no hurry to buy a house as a) my investments were outperforming houses and b) I thought houses in the area were overpriced and I expected a softening in those prices over the next couple of years.
    I said also that if a 4 bedder came up for around $400k I would consider it.. Well more 4 bedders are starting to show up in the low to mid 400’s now..
    The latest rismark figures show a suppossed 2.9% increase in the area, I am not seeing that in the prices now being asked, I see more like a 10% decline and an increase in numbers for sale.

    Stillgotshoeson
    January 17, 2011
    Reply
  41. Ned SMELL THE COFFEE … Farmer Pete has conceded the point that he dabbles in Building developments …” Our last few projects all came in around that figure. ” …. Move on Mr Irrelevent…

    BTW Farmer Pete … DR blocks your Posts & Perth Now Blocks your posts …but I have never experienced this once? …
    Could it be you?

    Not Fooled By Property Spruikers Hype
    January 17, 2011
    Reply
  42. Farmer Pete …. “Let’s try again: Not Fooled, you poor careless sod, you’ve admitted you’re The Punter of Mindarie. Dogman figured the October 14th quote was yours.
    You’ve confirmed it.”

    Are you in therapy?

    You do know the people on this site have no idea who The Punter of Mindarie is or Dogman for that matter& the relevance?

    BTW Post where is said what you claimed & give a link? … No cant making things up as we go again …

    Not Fooled By Property Spruikers Hype
    January 17, 2011
    Reply
  43. Blocked response… again… :D

    Reply
  44. What’s up, DRA? Don’t like watching Your Boy get slapped around?

    Reply
  45. For the record, five consecutive attempts to post a response. All blocked.
    You’re right about this crew, Ned. (Smell the fear… :D )

    Reply
  46. Farmer Pete … What can I say ? … Try writing in coherent sentences ?

    I bet I can even get the moderator to Post a song I wrote about property?

    Here we go ….

    Spruikers Song …. (Sung to 9-5) Tumble outta bed And stumble to the kitchen Pour myself a cup of ambition Yawning, stretching, try to come to life, Jump in the shower And my Heart Starts THUMPING Out on the streets PROPERTY IS SLUMPING And folks like me in a Job from 9 to 5, Workin 9 to 5 in a RUT to make a livin… Barely gettin by Its all takin And no givin….. I never use my mind & I plan to live on credit Its enough to drive me Crazy if I let it ____ 9 to 5 erning not ennuf to make a livin, You would think that I would some kinda of notion.. Want to move ahead But the HOUSING MARKET wont seem let me,I swear sometimes that this PROPERTY WORLD is out to get me Mmmmm…..I Had a dream & Just to watch em shatter. cause I just slipped down the property ladder, But Ive got dream they will never take away , In the same SINKING boat With a lot of my friends Waitin for the day My shipl will come in And finally the PROPERTY tides gonna turn my And it’s all gonna roll my away, Workin 9 to 5 in a Bank Rut Job is no way to Make a livin, Barely gettin by, Property will be my haven, I must use my mind & get me even more CREDIT Its enough to drive you Crazy if you let it .. whoooo Oooh

    Yup did it … thought so it must be you they dont like!!!

    Try telling one of your Pirate stories that will have broad appeal?

    Not Fooled By Property Spruikers Hype
    January 17, 2011
    Reply
  47. Don’t quit your day job, Punter of Mindarie. ;)

    Reply
  48. Post a link where Biker says he’s a developer/builder please Windbag …

    Spent last night painting a toilet! And hanging three curtains – From the multitude I have to choose from. Plus started on replacing two broken louvre blades (one in toilet and one in laundry – the bastard in the loo is a fixed one held in by timber strips!) . Plus moved a few light fittings around. And today I’ve arranged for a larger glazing job to be done, plus spoken to a sparky about installing some ceiling fans, arranged for some roofing to be replaced and … Shute, I’m a tradesman painter, interior designer and decorator, glazier and a BUILDER – As I’m arranging for some little genuine type ‘building’ jobs to be done I take it? Whilst also giving lots of thought to some more major ones over time – like combining a kitchen and laundry (the floor heights are different but the ceiling heights the same), a granny flat, a carport and a back deck. You really don’t have very many clues about property at all DO you Not Fooled??? :)

    But in the absence of them, I’ll still settle for a link to a Perth Now article where Biker claims to be a builder or developer as some sort of indication that you aren’t just totally full of it???

    Reply
  49. Ned … Pinhead …. Just look at this Period>>>>

    Comment by Biker Pete on 17 January 2011:

    “How many of use feel the confidence we had back in early 2007? Yeah… me neither…”

    Different picture over here, Chris.

    WA property has been even flatter for the last three years (providing some good buying for us) but things are lifting. I rarely attempt to predict any short-term movement online, but I think our market is ready to jump.
    So does our builder.

    “…a 400k buy price in that area is all the market can bare… ”

    Our last few projects all came in around that figure. In a beach setting, we think there’ll be more activity at that end than for our more expensive homes. The greatest movement of all will be in vacant beach blocks.
    We picked up two during the lull and inquiries are thick and fast…
    VA:F [1.9.5_1105]

    Get it Dummy he says …. ” O*U*R* L*A*S*T F*E*W P*R*O*J*E*C*T*S”

    I thought you cam across as being a little bit simple but seriously thought of taking some kind of medication?

    Not Fooled By Property Spruikers Hype
    January 17, 2011
    Reply
  50. Comprehension skills, Not Fool of Mindarie?

    Biker: “So does our builder…”

    So, you figure we’re developers?!~ Bwahahaha!

    I take it you think Shoes is a _broker_ and Dan’s a _goldsmith_?

    We are INVESTORS, dimwit… property investors… Get it?

    Reply
  51. JC! Finally allowed a say… . ;)

    Reply
  52. I agree you are a DIMWIT PROPERTY INVESTOR you wont get a argument from me on that one…

    You will understand I dont save a single quote you make { Why would I?}

    But on many an occasion on Perth Now you have spouted off about Developing a few more houses …

    The point is mute now … I give up … I will not call you a developer anymore just a … DIMWIT PROPERTY INVESTOR …. Your words not mine!!!

    WE are INVESTORS ….. DIMWIT PROPERTY INVESTORS …. GET IT?

    Not Fooled By Property Spruikers Hype
    January 17, 2011
    Reply
  53. Farmer Pete clearly you have no understanding how Developers work?

    MIRVAC (The Developer)are about to commence Tower #6 @ Burswood … They have invited … Diploma, Pindan, BGC (The Builders) to tender for the construction of the project.

    Some developers do the construction side themselves others outsource it.

    You claim to have a knowledge of property yet dont show it?

    Perhaps you should get better ventilation for your pesticide shed?

    Not Fooled By Property Spruikers Hype
    January 17, 2011
    Reply
  54. Irrelevant hogwash, N Fool Punter of Mindarie.
    Take your fluoxetine and have a good lie down, Prozak.

    Reply
  55. Just to repeat (AGAAAAAAAIN):

    “I’ll still settle for a link to a Perth Now article where Biker claims to be a builder or developer as some sort of indication that you aren’t just totally full of it???”

    POO OR GET OFF THE POT BRO! :D

    Reply
  56. Doesn’t exist… and The Enfooled Fool Punter of Mindarie knows it.
    We’re as much developers as we are farmers… .
    Totally full of it? This Troll has SFBs, Ned. ;)

    Reply
  57. Not Fooled: “Developing a few more houses”

    Ummmm – In my lingo BUILDERS build houses and developers develop land; Or maybe apartment blocks on that land using builders???

    This is SUCH FUN! (Beats the hell out of painting a loo anyway! :))

    Hey Not Fooled, where the eff IS that quote!!!

    Reply
  58. With things being down 10% in Melbourne and more stock on the market, I’d certainly consider holding fire for a while yet Shoes?

    The Brissie floods are a wildcard in the deck for me. Though my gut intuition still says there’s more potential downside than upside. And commonsense says the market just could begin to polarise in terms of flood and non-flood. With that being one I’m giving thought to.

    Reply
  59. See Farmer Pete you try to look super intelligent by using big boy words like FLUOXETINE ….

    All you needed to say was HAVE A BEX & A LIE DOWN?

    I know you want to impress me but using big boy words wont do it?

    Not Fooled By Property Spruikers Hype
    January 17, 2011
    Reply
  60. Have never once used the phrase “developing a few more houses”, here or elsewhere. This is an impaired individual who concocts any small lie to support his whoppers!

    What I find curious is that frequently his consecutive anti-property rants
    are printed and _every_ pro-property comment excluded.

    Here, for example: http://www.perthnow.com.au/business/a-tale-of-two-booms-as-city-blooms/comments-e6frg2ru-1225970115985
    I gave up trying to respond!

    Claims he’s more coherent, yet we read ‘a investment’, ‘a internet cafe’…
    Also refers to Year Ten secondary as “3 RD Year High School”.
    Fascinating stuff. ;)

    Reply
  61. Hey Ned

    I thought you were a man of your word …. you said from now on you were going to sign off like this

    “Oz Property Sucks”
    “Oz Property is in a Bubble”
    “Only Pudden Pullers Buy Oz Property”
    So say NOT FOOLED BY PROPERTY SPRUIKERS HYPE and his vocal backup band STEVENG:

    Oh wake up & realise that this was not very mature ???

    Poor Farmer Pete all he has for support on this site is You?

    Not Fooled By Property Spruikers Hype
    January 17, 2011
    Reply
  62. Is this what you mean Travs / Farmer Pete?

    Not Fooled By Property Spruikers Hype of Perth of Perth Posted at 10:05 AM December 13, 2010

    It is official Western Australia has no Housing Shortage. After years of implying that Perth house prices were safe because of a shortage of property in WA & demand would underpin Perth house prices REIWA president Alan Bourke said in Todays West Aust News (11th Dec 2010 Real Estate Section page #4 )” With the Exception of the Pilbara there is no housing shortage in WA “. So the foundation stone of Perth property prices has been that Under Supply would not allow house prices to fall. However now after years of saying that there was a MASSIVE under supply REIWA now say there in “NO HOUSING SHORTAGE” so much for investors buying recently at record high prices having the surety of a housing shortage keeping prices up…. Now just how sure can investors be that REINSW / REISA / REIVIC & REIQLD won™t come out next week or next month & confirm that in their States the Great Australian Housing Shortage was Just a Myth? Next year 200,000 Migrant & Student numbers cuts will further compound oversupply! Tenants & Buyers will be few on the ground driving down Rents & Prices.Just when interest rate rises exclude many buyers from entering the market further compound the glut of listings!!

    Comment 1 of 5
    #
    Not Fooled By Property Spruikers Hype of Perth of Perth Posted at 10:06 AM December 13, 2010

    Sunday Times 5th Dec 2010 Page#4 Article says Perth Average incomes went up from 2000 to 2010 by 38% … Think about this wages went up by 38% Tops { EVEN WITH A MINING BOOM IN THE MIDDLE}.. Now since 2000 house prices have gone up from $185K to $500K a rise of of 170% ??? … So wages go up 38% & house prices go up 170% ? Hands up who thinks this can keep happening? {Put your hands down Dogman / Travs / Mark }…. But wait a minute Property Spruikers Golden Rule is that property doubles every 10 years so shouldnt PRICES only be $370K? {$185K x 2} PLEASE dont forget 38% wage increases was with a mining Boom in the middle!!!…. So one could safely say that in the next 10 years that is all that wages should do up another 38-40%. even with our mining boom so todays average household income of under $70K pa will be $98K pa at most by 2020? The most a bank will lend someone is about 5 x incomes so that would be $500K on a $600K home with a 20% deposit. Now investors N*E*E*D property to double for Negative Geared investments to work & if property can only go to $600K by 2020 because of wages they will start dumping houses reducing demand & prices. This is happening today as we speak!!!

    Comment 2 of 5
    #
    Not Fooled By Property Spruikers Hype of Perth of Perth Posted at 10:57 AM December 13, 2010

    First Home buyers have abandoned the housing market …. This is what REIA said …. The number of loans to first home buyers decreased 2.8% to 22,823 over the quarter and 52.9% over the year – the September quarter saw the lowest quarterly participation of first home buyers for six years….. W*O* FHB down by 52.9% in the last year . I thought Dogman said they were back??? & this is what they said about A*L*L home loans … Over the year, the total number of loans fell 28.3% – the largest annual decline in Australia since March 2001….. Ouch a decline of almost 30% … they went on to say … “These all-time lows are extremely concerning, not only is affordability on the decline but loans being issued are down and first home buyer participation in the market is the lowest it has been in six years,” …. as usual happy to supply a link to support what I say …. http://www.reia.com.au/userfiles/MEDIARELEASE_1291765327.pdf ….. You would need to be one of the biggest optimists to enter the housing market today ….Tck Tck Tck BANG !!!!

    Comment 3 of 5
    #
    Not Fooled By Property Spruikers Hype of Perth of Perth Posted at 11:24 AM December 13, 2010

    Property Speculators will look at the great mining projects up north & talk of the 15,000 new jobs that they will need to get the projects but they ignore the following very conveniently. … 1) WA is in a drought thousands of jobs have been lost as there are no crops to harvest slashing incomes , plus job losses in support industries { most of these surplus farm workers then go & work on the mines driving trucks & graders etc to pay the mortgage on the farm result = ZERO NEW WORKERS ADD TO STATE} … 2) The high AU dollar has caused a crash in Overseas Tourist arrivals & a rush in internal tourists now holidaying overseas because their dollar goes further. These workers are taking up the jobs up North feeding miners cleaning rooms etc… 3) Over 40% of mining employees live in the East or NZ & commute to WA for work {They are not going to buy a house} 4) 457 Visa holders are not interested (& in most cases not able) in buying a property in Perth as the contract is only Temp they will not relocate family A) Kids schooling B) High cost of ownership due to exchange rates (up 50% since 2009) All this is academic as property has already started its slide down! Home loans down 28.3% !!!

    Comment 4 of 5

    Not Fooled By Property Spruikers Hype
    January 17, 2011
    Reply
  63. Comment by Ned S on 17 January 2011:

    With things being down 10% in Melbourne and more stock on the market, I’d certainly consider holding fire for a while yet Shoes?

    My 10% figure is suburb specific..
    Rismark say Melbourne prices are down .2% which means Flat
    Property Monitors say Melbourne house prices rose around 10%

    My figure is from viewing realestate.com.au all year keeping tabs on prices in the area, earlier in the year you could not get a 4 bedder under $450k in my suburb, now one can. A “needs tlc” is under the $400k

    Listings are up though without a doubt, were I used to see 4 or 5 pages of houses for sale now I am seeing 8 to 10 often.
    Upgraders/Downsizers/Profit Takers or financially struggling sellers.. Honestly can not say… More For Sale Boards up and longer sale times…

    Stillgotshoeson
    January 17, 2011
    Reply
  64. One of many examples, N Fool Punter of Mindarie. Now add in all your other AKAs and aliases and you dominate the site. But for your occasional bleating to “Go away… leave me alone” I’d assume you were winning.

    That and your ‘Tee Hee Hees’. You left Perth Girls HS mid-3 RD Year 1965 is my guess. Ned’s bundle-of-sticks ANALogy is probably closer…

    Reply
  65. I’d still be holding Shoes. Even in a ‘flat’ market a bloke is going to be better off doing that if he’s buying through a SMSF. And you certainly could be on the cusp of a correction. Though yeah, I’m pretty reluctant to make predictions these days too. We all just get to play our own gut instincts I guess?

    PS: Did anything ever come of that work in Gladstone?

    Reply
  66. “Hey Ned

    I thought you were a man of your word …. you said from now on you were going to sign off like this

    “Oz Property Sucks”
    “Oz Property is in a Bubble”
    “Only Pudden Pullers Buy Oz Property”
    So say NOT FOOLED BY PROPERTY SPRUIKERS HYPE and his vocal backup band STEVENG:”

    And I did. Until I forgot maybe? And stopped! Or did you assume it was like an old time marriage vow along the lines of “’til death do we part” or some such did you? :D

    “Oh wake up & realise that this was not very mature ???”

    YOU FOUND THAT PERTH NOW LINK FOR ME YET CUZ? ;)

    Poor Farmer Pete all he has for support on this site is You?

    Think you’ll find that if I dropped out of circulation for three months or whatever (as has happened in the past) Biker just might manage to battle on in this friendless and unloving world? :D

    PS: WHERE’S THAT LINK??? :)

    Reply
  67. Comment by Ned S on 17 January 2011:

    PS: Did anything ever come of that work in Gladstone?

    We submitted a Tender.. Tender applications have closed, still waiting on response

    Stillgotshoeson
    January 17, 2011
    Reply
  68. Where’s NV? Having a faggot or two on hand to use to help dry out underneath my houses just COULD be handy one of these days??? :D

    Reply
  69. “We submitted a Tender” – Be interested to hear how it goes – Let us all know hey? (Who knows – There’s just a one in a million chance the opportunity could come up to reminisce about our experiences with that evil bloody chili vodka the Ukrainians make … Including the effing pickled vegetables they feed you in an attempt to make it taste comparatively less bad! :D)

    Reply
  70. Mr “Developing a few more houses” just doesn’t keen on supplying that Perth Now link which ‘proves’ you are a builder/developer hey Biker?

    Suppose one can only continue to ask as and if and when he should pop back for a visit or three??? :D

    Reply
  71. In amongst all the stupid posts above, Ned thought it would be best to hold on to property. Ned, I guess we’ll see some “bargains” soon for river front property here in Brissie, much like what happened after 1974.

    Watching the continuous coverage over the latter part of last week, it was surprising that people went through 1974 and continued to stay in their house and get hit again almost 37 years later.
    For a few years after ’74, they would have had no chance to sell, but as the next generation came along, there was opportunity to sell at a good price.

    Everybody thought building Wivenhoe dam would save Brisbane. To a large extent, it probably did, but if the water that destroyed parts of the Lockyer Valley went down the Brisbane Valley, it would have gone straight over Wivenhoe. We wouldn’t be reading about 20 deaths in the paper but a large multiple of that figure.

    Problem hasn’t gone away – the dams are still full and if we get more serious rain, we may have a repeat performance.
    If the water can’t be held back by the dams, it has to go somewhere.

    I’m seeing a lot more sold signs around my suburb in recent times, but it’s too early yet to know if they have been sold at a discount to asking price. Guess if you don’t live in a flood area in Brisbane, you will be far more likely to sell your house than those inundated, even if they are repaired.

    Cheers

    Reply
  72. He was very very excited recently, claiming he’d been quoted on the radio!
    FAME!~

    Perhaps his best female impersonation was ‘Naomi’ the ex-St.Mary’s student turned Perth realtor who outed the Perth property market, Keen-style.
    Like most of his aliases, ‘Naomi’ imploded in a burst of BS.

    Complains that I ‘kopy-and-keep’ his posts. To an extent that’s true.
    He has made some extraordinary claims for 2011. It will be a lot of fun pasting them online as they progressively ‘mature’ this year. Like most punters, N Fool Punter of Mindarie is not only a bigmouth but a bigtime loser. First individual I’ve ever heard boast he’s lost money on property AND shares. (s)He’ll be back. Glutton for punishment… . :D

    Reply
  73. Comment by Ned S on 17 January 2011:

    “Where’s NV?”

    Ahoy! ‘ere I is boy. Now do what you are accustomed to and bend over while bi_ker peat punches ya doughnut luv.

    I would hate to awaken one day and realise I have two fathers. Eeewwwww!

    Reply
  74. Well holding as in holding off buying in Shoes’ case in Melbourne Davo.

    As to “we may have a repeat performance” – Fingers crossed that February doesn’t turn out to be as wet as it can be.

    And regarding “if the water that destroyed parts of the Lockyer Valley went down the Brisbane Valley” – It’s probably a case of when rather than if. Not too dis-similar to the case of San Francisco and Tokyo residents knowing that they are both going to get another major earthquake one day. Will be interesting to see if there are renewed efforts at flood mitigation.

    Plus if any insurers will be prepared to offer flood insurance in known flood areas in the future. And at what cost. My understanding for years was that you just basically couldn’t get it? But Suncorp at least have certainly been insuring against flood.

    Think I’ll always personally struggle a bit to see something that is in flood as a ‘bargain’ from a home owner’s point of view. (As do you by the sounds?) Though it will be interesting to see what happens with them regarding rental return.

    Reply
  75. “I would hate to awaken one day and realise I have two fathers. Eeewwwww!”

    I’m sure you’re always in a state of confusion every Fathers Day, Prozak.
    Probably brain damage from having been poked with a rectal thermometer. ;)

    Reply
  76. Well, that was not the least educational. Who cares which alias whom is using or whether Biker Pete is a woman and a property developer as well as a small holding owner?

    Anyone who is growing some or all of their own food and has provided water for their house and enterprise is on the right track, which was my original post.

    Biker Pete, your situation is inspiring. Keep it up. And head to permaculture global and make yourself known sometime.

    Nathan Chattaway
    July 5, 2011
    Reply

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