Our addiction to real estate...

Why governments don't want 'affordable' housing

 

The reasons? Some analysts argue last year's crackdown by the banking regulator on investor loans, who mainly use interest-only finance to maximise the benefits of negative gearing, finally is having an impact.

That's a NO
Its to maximize cash flow.

ABC always ....

 

The people who govern this place are all capitalists. Even the ones who pretend aren't, are. Many are still in the closet but behind closed doors are investing like mad. Real estate will continue to flourish medium to long terms. Nothing will ultimately change. And thank goodness for that. If I wanted to live in socialist/communist nations I'd move to China/Cuba.

 

Given what I know of the Chinese, I'd say that a lot of them are pretty good capitalists.

 

Dam right they are

The amount of money flowing and business China is doing is absolutely insane. Was there not long ago and we are many years, if not a decade or two behind them on a few fronts. Real estate is absolutely mad, mad, mad. Recently off loaded another property which had more than 1000% CG in less than 7 years. Yep, no typo. 1000%.

We bought 3 more slum places in good location where developers will buy us out within 3-5 years and pay us the value of brand new units which will likely be 7-10 times our initial investment. They have the money to be able to do it and the density increase to easily make it worthwhile for them. Very little red tape in China. They build 5 times as fast as we can in Australia - and good stock. People outside of China have little clue what the heck is going on there. Wealth is flowing and being created there like you wouldn't believe.

Wouldn't want to live there long term - but the opportunities are endless. Mandarin is a language which opens doors to massive opportunities and wealth. I think all business courses in uni should teach it.

 

The higher u climb, the harder u fall. There will be winners like u for sure, but when it all comes crashing down...

If u are making 1000% return investing in China , WTF are u doing developing small blocks in Brisbane? Just sayin'..

 

Risk mitigation .

Something alot of newbies and not so newbies struggle with .

I prefer to utilise a few different strategies with varying levels of risk/return to capital across different markets and within different timeframes, so the risk is further spread out over time.

Ultimately for me it all comes down to risk management (and greed management).

 

China is one of the most innovative countries in the world. They are far more entrepreneurial than just shifting capital around in dead land.

 

The Chinese started as copy cats but now are serious players in technological innovation. They have a 10yr plan of RD initiative in(around 500bn$ investment) for technological dominance by 2025.

Shenzhen is fast becoming the mecca of Robotics/AI.

Its sheer market size (with rapidly increasing middle class with real spending power) have made them too lucrative for any major company to ignore irrespective of all its follies.

They are rapidly deploying its massive reserves and excess engg capacity world over (CPEC/Africa/ME). They are strategically gaining favours around the world and building its base.

The global order is changing rapidly and new alignments are happing faster then we think, Like it or not, China is the new #Prince, preparing to take over from the old emperor (US) in not too distant future both Militarily and economically.

 

Hate it or love it, Capitalism is the great equaliser. Profits don't care if you are, White, Black, Yellow, Orange, or what religion you practice. It doesn't care if you are male or female. What matters is long sustained growth and profit.

It is Big Government and Government Intervention that causes a lot of problems. No problems with Tenant Protection laws, as well as some Landlord protection as well, however, if we let market forces dictate it we will have much better tenants and landlords.

With every Government Intervention, things have gone more expensive and made things worse, Pink Batt, First Home Owners Grant, Home Owners Savings, Bank Guarantee, Self Managed Super Fund and so on.

In so saying, Governments only care about being voted in at the next election, so with so much money filling their coffers through real estate, why give up their pay rises, why give up their brownie points by spending big.

It's high time we put Government Officials on a performance pay scale.

 

Parliament would be empty pretty soon.

 

Military - unlikely. They still struggle to innovate, but they're good in replication, for sure. Their aircraft carrier is a copy of soviet one. J20 flight technology is based on F35 technologies ("F35...been compromised by unknown attackers that appeared to originate from China"), missiles also based on soviet technologies,including latest DF17 (see russian Avangard/Sarmat for comparison). In military, China will be powerful, but still a few steps behind US and Russia.

 

That's a joke rite? Even Trump is smart enough to try and get them to respect intellectual property and regulate.

China is basically still a close market for overseas tech companies. Every foreign tech company there has to have a server reserved for 'government oversight'. Think about that.

As for robots, China still has a long way to go towards industrial robotic dominance. Japanese are still the dominant player in that space. A large R n D budget doesn't mean squat if the talent is not there and lack of IP laws will stifle any real innovation.

 

China
1. is enticing and quite successfully, China-born tech executives and scientists back home
2. has dedicated venture capital funds target executives and senior researchers at companies such as Google, Apple, Airbnb and Facebook etc, betting on the lure of high stakes in startups with unlimited funding.

A decade ago this would be an impossible task but rapid expansion of Alibaba, Baidu, Tencent is encouraging many.

Regarding trump being able to bend Xi.....
let him sort out the financing of trillion dollar tax cuts first.
Trump is actually getting played like a fiddle, he will end up accelerating the winding back of US military presence around the globe whilst China ends up expanding militarily.
it's already in motion in Korean peninsula, SE Asia, part of ME and in Africa.

China is the new prince with Russia very eager to support its claim.
We can close our eyes and keep repeating the narrative we like or wake up to the new reality.

 

They are doing really well in AI, which has surprised everyone. Like they are MILES AND MILES AHEAD OF Australia. In a way, the new trade war from Trump is his fear that China might catch up soon if US doesn’t do anything right now.

The next technology China wants to conquer is intel chip which is proving difficult...... it’s hard but China is pouring lots and lots of money resources into it. Again Australia in this area is LIGHT YEARS behind and won’t ever become a player.

Yes China starts from copying. But AUSTRALIA IS IN NO PLACE to say they are not innovative. It’s like the someone in the middle of the class critising someone near the top of the class for being TOO STUPID.

Technological advaces come in waves. And once a breaking point is reached, growth becomes exponential. Think about computer/smart phone. Australia is definitely not catching any of the latest wave. The driverless car side of AI could be achieved in maybe as little as ten years.


I love Australia. But govts lack of support in the tech industry is really dragging us behind. Our national chief scientist claimed not long ago a mining site is just as innovative as a semiconductor factory which is laugh out loud ridiculous.


Australia won’t be lucky forever..... Australia reminds me of a frog in warming water....one day we will die from our complacency......

We are in no place to say China is not innovative. Yeah sure US can claim that....We are sooooooo far down the innovation ladder that it’s practically laughable to point finger at others.

Govt should help Adelaide to become the next tech hub and provide supportive measures. After all, Silicon Valley was farm land not that long ago

 

China catching up to US in race towards artificial intelligence

FYI Aus has nothing. I work in an industry semi related to AI. It’s truely sad to see Australia doesn’t even try to innovate in this new age. No enough govt incentives or support.

Less and less interest of hard science and maths among students compared to a lot of other countries in the world.

 

If you’ve ever been to an information technology Olympiad where high school students particiate. The candidates end up the gold medals are always from US, Russia, China and India. Most Australians get the bronze. That should give you a glimpse that we are losing from the start. Schools are not teaching coding/maths to an international standards.

To be fair, we do do quite well in turns of medical research.

 

Part of the reason we are not innovating is because the large political donations from mining companies which keep us in the role of ‘dig stuff from the ground’ in the global economic chains. Aren’t going to work so well with a large population. GDP per capita is going backwards every year. Political parties can only increase absolute GDP through importing immigrants. Honestly we are digging our own grave.


Maybe instead of focusing on too much spending in the govt deficit, we can focus on the income side. Increase productivity through technology and increase wages and therefore more tax revenues

 

Nah..

 

Am I reading the graph wrong? Isn't per capita GDP diverging from GDP? Anything to do with the epic importing of people?

Cheers,
Inertia.