Australia, you’ve officially jumped the shark

This is a magnificent read on the Australian economy and property market.

Australia, you’ve officially jumped the shark

http://rationalradical.me/2015/08/australia-youve-officially-jumped-the-shark/



Cue:

Nit picking the small parts you don't agree with or take issue with
Comments about youth spending on gadgets and travel
Comments to the effect the writer is just having a whinge
Comments about the 'entitled' younger generation
Comments about how it was just as hard back then as it is today
Comments to the tune of 'if I can do it, anyone can do it', missing the point completely

Before posting any of the above, take a deep breath, give it some thought and try to add something that contributes intelligently to the discussion (but the article is as much about the Australian economy and society in general as it is about property)

 

At a quick scan, the author seems to be having a generic whinge about everything. My guess is he's just another young (gen-y?) renter who is angry because he's not willing to pay the going price for a home. He thinks they're 'unaffordable' (even though most of his peers already own one), so he blames everyone and everything apart from himself.

He's the sort of person who reads sites like Macrobusiness in order to absorb self-reinforcing bearish commentary and dogma. There is nothing in his diatribe that we haven't heard before from countless bears over the years.

You can tell by the highly emotive language that he's just another bitter and angry young bear who feels compelled to vent impotently on the internet. There's no shortage of them.

 

I think we all know China is going to ta

That's generally what turns me off straight away. I'm happy to hear both sides of the argument but the bitterness usually stands out pretty clearly.

 

Cue:

For those who haven't yet read it, don't let shallow digs put you off. The article is about far more than having a whinge.

 

The author is spot on. That is why I never borrowed a cent in my life. Only cash. If you have it, you buy, if you don't have cash - sit on the sidelines. And I'm not young and I have a house without a mortgage.

 

I have read the whole article, i really cant stand the "im smarter then you so **** you" writing style. Dont really see anything new here i havent heard quite a number of times before though.

 

There's no doubt it's an opinion piece, but much of the content could be backed up with fact.

What do you mean by 'credibility'? Are there any specific claims made that you don't agree with and would counter with evidence & facts to the contrary?

 

The majority of people (in all capitalist western countries) buy homes using mortgages, and it has always been that way.

So you think the majority of Australians should sit on the sidelines and not buy a house. Where will everybody live?

 

I’m not even going to aim for a pretence to quality ‘posting’ by citing sources, evidence and facts.

 

Rent. When the market falls to their level - buy. Like I do.
But don't create a bubble that will hurt everyone. It happened in a lot of countries before and it will happen here.

 

I have a house. I don't need to rent.

 

The author really isn't stating facts, he's just voicing his opinion. But lets start with these ones...

1. Nearly everyone assumed that these mining riches would go on forever, permanently paving the streets with iron ore and gold.

2. We organised a commodities boom

3. We didn’t actually have the cash we needed, so we just borrowed the rest, mostly from overseas lenders

4. House prices exploded over the last two decades, outstripping our so-called ‘economic fundamentals’.

5. The bubble re-inflated in one last giant blow-off, sending investor lending straight to Pluto, as the scale on everyone’s graphs broke

6. The twin columns of the Aussie economy – mining and housing – sucked the life out of every other possible means of making money

7. Nearly the entire sum of new credit loaned since the GFC went to housing

8. Blue-chip manufacturing, services and tourism businesses were crippled by the inflated currency and high cost economy

9. A once diverse and dynamic economy and society was completely transformed into a one-trick pony

10. The long and grinding rise in unemployment chipping away at consumer and business confidence

11. Convincing young people to blow their financial futures on a lifetime of unprecedented debt slavery

12. Our beverage-and-decor-obsessed nation has forged a whole economy and society around selling expensive food, drinks and houses to each other

 

Exactly. If people (including investors) stopped using mortgages to buy homes, then where are they all going to find a home to rent, while they save up the cash to buy outright.

 

Things that are not good, or if as I prefer to say ‘stupid ****’ (again, in no particular order):

• Paying $12 for a beer.

Well that's the standout right there,, paying 12 bucks for a beer when you can buy a six pack for 12 bucks,that within itself tells me something,but some of that link is good ..

Or with what anyone that reads from various angles and with the next stage in this country outside the public service will come the rapid un-certainty of on-demand part-time employment ,walked in a brand new CBA inner city branch to get some statements for the "ATO" last week and before the refit there was about ten people out the front section,maybe the same out the back working away,new outlet 2 well dressed
people and very good at helping most that walked through the second security doors and that only one small branch..

 

That is the problem. It has gotten out of hand. Remember the price of a standard Sydney house 25 years ago and how many people could afford it easily? And what happens now? Can an ordinary bloke afford a house in Sydney or Melbourne without a 500-700 thousand dollar mortgage with a salary of 80K a year? NO.
All thanks to debt, negative gearing and greed of some plus the ability to buy from abroad. And now - what we have - a bubble.
If it wasn't like that all those years, people wouldn't need to rent, they could have their own houses. But the market has gone crazy and now all the majority can do is rent. The circle is complete. It will end someday, like it had in Japan, Spain, Greece, USA, Russia, parts of China now. And it will hurt a lot of people.
Why, because some are GREEDY.

 

haven't had a read of it in detail, but as soon as I read not reference statistics or sources I was turned off its validity.

Remember, no one has ever erected a statue of a critic.