It is also telling us about the lack of affordable new supply.

Hugh Pavletich

I know, I know...it's Christmas Day... but it's all gone quiet, now....so more thoughts for Bernard.

http://www.bubblepedia.net.au/tiki-index.php

"It's different here (Australia) to other places.......Once the speculative mania (for property) has waned, the significant oversupply will become apparent."

@RT some ppl want a home....they want more than simply $...

Hugh Pav is beginning to sound like a stuck record....business must be slow for him....In the US they have surburbia stretching for miles....all of it needs too much energy to utilise in the future...so either we live more compactly so dont need the extra space or we need that space for food growing ie we spreadout...if you accept there is a paradym shift [about to] occuring of course ie peak oil/energy/minereals/society.

"The real story of the noughties is that of how borrowing was used to plaster over the deep structural problems of modern global capitalism. We have almost reached the end of that road, but not quite."

I think he's right on the first (as per my first para) but I Suspect he's probably wrong on the second....you cant fight an expotential curve of yet more debt for ever, I think we are hear...I cant see how we can get it going again, strikes me its like trying to stand on a ballon, its un-stable, wants to escape out the side and will likely pop any second. Even if we could the war chest seems empty...and round two's demands seems to be here....

"Policymakers are hoping a renewed appetite for debt by firms and households will enable governments to cut borrowing without causing a second leg to the recession."

Policymakers? they are insane then....

Banks facing tough times?

http://www.guardian.co.uk/business/2009/dec/20/bank-of-england-calls-ban...

But some it seems get a great Xmas present, healthcare....USA passes healthcare bill (Senate anyway),

http://www.telegraph.co.uk/news/worldnews/northamerica/usa/6880904/Presi...

regards

One to leave you with this evening,

"Behind all of this lies the central political fact of the limits to growth: the reduction of First World nations New Zealand to a Third World lifestyle that will be the inevitable result of any transition to a postpetroleum world, whether that transition is deliberate or unplanned. Metaphors about elephants in living rooms don't begin to touch the political explosiveness of this fact, or the degree to which people at every point on the political spectrum have tried to pretend that it just isn't so."

8><----

"Let's walk through the logic. The most reasonable estimates suggest that, given a crash program and the best foreseeable technologies, renewable sources can probably provide the United States New Zealand with around 15% 25% of the energy it currently gets from fossil fuels (can NZ do 25%?). Since every good and service in the economy is the product of energy, it's a very rough but functional approximation to say that in a green economy, every American Kiwi will have to get by on the equivalent of 15 25% of his or her current income [ which is an average of $40k]. Take a moment to work through the consequences in your own life; if you made $50,000 $40,000 in 2009, for example, imagine having to live on $7,500 $10,000 in 2010. That's quite a respectable income by Third World standards, but it won't support the kind of lifestyle that the vast majority of Americans Kiwi's, across the political spectrum, believe is theirs by right.

That's the bomb ticking away at the heart of America's the World's political system."

Just think what that does to house prices....pensions...healthcare....

and ppl laugh at the Green's.....

http://www.energybulletin.net/51089

regards

The issue with supply is one of quality not quantity; (from an Auckland Nth Shore perspective) there is plenty of housing stock, but the quality is low, leaky homes, old, cold wooden boxes, horrible cross leased crap on a miniscule site with no sun, houses that have been butchered and changed without permits, sites where the neighbour can look straight into your living zone, just general overpriced rubbish. What then happens is people pay over the top prices for a bit of quality in a good school zone and with a slightly bigger site and this skews the numbers.
Hopefully John and Bill have steel balls and make the hard decisions and we will see a better 2010.

Interesting Chart alright... What it demonstrates to me is how correlated Credit Growth and Value of House Sales are, or have been until 2007...

So to me, the Divergence is tellling us a Story of De-Leveraging. - With the Gap being the overleveraged being forced to the less leveraged...

Not sure how Hugh Pav. sees this as a portraying housing supply issue?... Hugh? anyone?

Nev : I think it is terribly sad that you imply the purpose of an MBA is to exploit undeveloped countries in order to make a fortune . Are you not damning the many , for the unscrupulousness of the few ?

Roger

Possibly yes, I've often seen MBAs doing charity work, collecting for poor, providing succor and suchlike, so yes I am uncharitable, it is Christmas after all.

But on the basis that wealth cannot be concentrated excessively without a balanced equation (the many must forgo a little to benefit the few) then I find the proposition that you can study the administration of business and somehow not exploit others a little disingenuous.

Was it just a bad choice of degrees on your part, No Doctors or Engineers mentioned?

Neven

@RT: "Don't you feel that fresh faced youngsters , full of ideas and vitallity , are better to focus on careers and businesses , rather than bricks and mortar ?"

Are these mutually exclusive? I dont see why.

Youngsters usually are focused on careers, I think if you look at the average age of first time mothers its getting higher and higher every year, suggesting careers are very important.

I dont see why ppl have to rent rather than buy myself, indeed wouldnt/couldnt a house act as collateral for a business? Also run a business from your own home? I know a few ppl that do, no landlord to get upset about that, you can convert a room(s) for business use...in fact my wife does this.

Also "suggesting careers are very important." this is one reason I roll my eyes when Bernard gets on his grandchildren via Facebook high horse, its more likely a "get ahead" career type is going to go abroad, NZ will always be too small no matter what we do with tax reform, its the career stupid (sorry Bernard)....but what I do se is NZers go abroad, have a career/OE and come back to have children...so personally I think Brenard is wrong to worry. In my case my parents (who loved NZ anyway) followed me to NZ permanently so grandchildren are within an hour. The funny thing is my wife's side of the family see less of our childen than my side at most once a year as they are on south island...so they just got an sdcard and a photoframe thingy for Xmas...

In terms of going abroad, well I want my children to be the best they can if that means they leave NZ so be it...its not that hard for us to follow...

regards

Stuff on property this morning,

http://www.stuff.co.nz/business/3195164/Is-property-back-from-the-dead

Be interested to see what the Pros in here think of Stuff's assessment(s)

regards

steven : I saw that " property back from the dead (" we printed it in the SST ) . They gave some helpful scenarios of cost / return of units . The issue seems to be that capital prices of these " shoe-boxes in the sky " have fallen so much . But I am reminded of a Bob Jones book where he states that the land is all important . Which is why he focuses on CBD investments . Condos have no land component , do they ?

Yep, personally I think condos are an open check book to the building managers...

If its not freehold, dont touch it IMHO.

I think shoeboxes are a dog of a buy myself...quality always wins.

I dont see prices have really dropped that much? are sales down because owners are waiting for the market to improve? kind of wierd to me.

regards

Oil price to start rising?

http://oil-price.net/en/articles/the-case-for-floating-oil-storage.php

bit of doom+gloom news in our brissie paper today
australia.s domestic debt--credit cards--mortgage,s + personal loan,s now stands at1.2 trillion--up 71 % in 5 years--this equate,s to 74 grand for every adult aussie.this figure is from the end of october so it,ll be worse now.reserve bank figure.s show personal debt now equate,s to 100.4 % of annual gross domestic product.
it,s never been over 100%.this seem,s to have been mainly fuelled by the first homeowner,s grant--this drops to 7 grand after 31/12/09.this may help to encourage the mexican.s[nsw+victoria] to pull their heads in.

Surely, there has to be an end to this; sometime soon ?!

"(Australia's) spending binge, fuelled most recently by the federal government's First Home Owner Grant, means personal debt now totals 100.4 per cent of Australia's annual GDP...up 71 per cent from just five years ago ..."

http://www.businessspectator.com.au/bs.nsf/Article/Aussies-12-trillion-i...

Agreed, re Oz Super, RT, but that is a 'frozen' asset. OZ Super is an ongoing weekly expense ( soon increasing from 9% pa to 12% pa, I believe) for households, against a future income stream, that can't be used for present day debt servicing. Current household debt has to be serviced with current household income, not future assets or capital gain. Let's hope Oz doesn't have a dowturn in employment or a wages rise pause or 'future assets' may have to turn into present day money..

12 degree cool Summer chart:
Because humankind is now so much better educated, well read, cultured, cultivated and civilised - we should not allow "The climate" to change. It should be categorically disapproved by the public. So called "Weather- Bombs", cyclones, droughts, rising sea- levels, wondering ice-bergs etc. must be declared as acts of terror against civilisation. Such events, the cognition and narration by the public must be internationally pursued and eliminated. Governments need to work together and make sure the public and companies do not change, safe, care and implement sustainable policies. For officials dealing with this matter we also recommend existing "Working Papers".
Please ask under: secret@CH.IS.RU-US.co.nz

Walter

Right now and in 2010 Crude is rude again.

Its all about chasing shadows.
By that I mean latching on to this or that latest, most innovative idea that some self styled money making guru has put out in the hope it'll go viral and make them a lot of money off the backs of all the headless chickens who will follow them blindly down a blind

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