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The paradox of plenty
#11
Allow me to post this as an image - it's quite important:

[Image: 83308424_10157948177859872_3276175987959...e=5ECBA52A]
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#12
(01-25-2020, 02:27 AM)DaveGillie Wrote:
(01-25-2020, 12:39 AM)cbeatty Wrote: What? Nothing to say?


sounded like a pure sales pitch,
(really, imo that whole long article did not say anything valid, pure hype)

targeting sad doomer NUTZ.


I've never liked Stockman much,
and he came across much worse than normal here



wasn't really gonna comment on the garbage and offend you, but, if you're really interested, THIS is my 2 cents worth!

That's what I like about you, Dave. You are so sensitive of my feelings. Seriously though, thanks for the comment.

(12-07-2019, 07:55 PM)andrew_o Wrote:
(12-06-2019, 10:51 PM)cbeatty Wrote: OK Andrew, Here's another one for you ............
the one in the center, the Max Keiser Report


https://www.realecontv.com/page/34198.html

Thanks CB. I have just watched it.

A few thoughts on this:

It's a bit silly to blame the boomers on the US debt prior to the 1970's when they were either still in short pants or too junior to have any real influence.

The 'interest apartheid' thing is a laugh. Who here doesn't remember mortgage rates around 20% during the 70's and 80s? I never paid those rates because I took an alternative route but I know many struggled. The current price of housing is mostly a reflection of low interest rates: The debt servicing cost is similar either way. Same with share prices: Their returns are compared to what can be gotten elsewhere so the prices make sense.

Regarding the boomers selling houses - that's well under way and has been for years.  Many are now out of their family home and into a condo, a retirement home or a coffin. This will continue for years yet. As a late boomer I intend to hang on in my house for maybe another 20 years yet, so it's a slow process. 

Where I live the boomers bought rental property rather than shares because many got their fingers burnt in the '87 crash. So now they're selling down their rental stock and it's being bought by young first time home buyers. The net effect is to remove stock from the rental market and as a result we're seeing a spike in rents.

One detail they alluded to needs underlining: The boomers who built a mansion will lose out. Particularly a mansion in the woods. The cost of transport is due to go up due to the influence of these crazy greens (watch this space!) and there will be few buyers outside of the elite suburbs who can afford to buy a massive house. I have fought my family for years over extending our house because I knew we'd never get the money back. Mine is a boring 3 bedroom house in a great street near a good school 15 minutes drive from the central business district - highly marketable to a young professional couple. No pool. No BS. The folk who built a mansion 50 miles out in the woods will lose out.

I think current rates aren't that unusual. Here is a chart of the bank of england base rate:

[Image: historical-interest-rates-1800-2010-500x334.png]

The spike in the 70's and 80's was a unique event that was driven by unusual circumstances

1. The cost to rebuild post WW2
2. Militant unionism creating a wage inflation spiral


Those circumstances are gone and won't come back. Union power in the west has gone and we are (so far) in the long peace with no appetite for a major war. The potential combatants can't afford a war, hell they can't even afford some trade tariffs, let alone a shooting war! Fertility rates are tumbling around the world with Japan, China and Europe having fallen way below replacement level. For the first time in 60 years, the US has less than 200,000 troops based overseas. Call it the Trump bonus ;-)

So while rates are currently below the long term average and will likely pop up a little, you can see that the reference Keyser uses is the odd one out, not now. Expect low rates to stay.

If there's one good reason for falling house prices in some countries - it's lack of replacement buyers. In Europe and Japan there are so few buyers that entire towns have been abandoned. In both Japan and Italy you can buy a house for zero if you're prepared to pay the ongoing local taxes.

Thanks for the full response.
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#13
All me to post the image Dave:

[Image: 83308424_10157948177859872_3276175987959...e=5ECBA52A]

Yeah but according to CB the world is going to hell

Basically he's been suckered by mainstream media who HATE good news!
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