"It's Too Late" - Australia Can't Avoid Economic Apocalypse

I found the article very interesting spatial.

I'm wondering though, what you think economic collapse would actually look like. I know less jobs etc, but I'm interested, particularly as it's something you have a particular interest in, what you think some of the impacts would be. If something did happen in, say, Nov 2017, what would it be? What impact would there be on house prices - are you expecting the price increases to stop or prices to actually drop? Would there be any impact on money sitting in the bank?

  Yeah, I am very negative on global and Australian economic outlook.   To put things simply just about every country in the world now relies on debt as expenditure exceeds income - too much welfare and too many wars being fought.  Global central banks are printing money like crazy total liability is more than $16,4 Trillion.  Chinese are borrowing $4 for every one dollar extra in GDP growth - the entire Chinese growth is based on borrowed money and housing bubbles etc.... Australia has the highest private debt in the world per capita.  US has vehicle house, student load private debt etc...  Stock prices are at all time high compared to company earnings referred to at P/E ration prise to earnings,  Currently at levels (25.65) only seen twice before 1929 great depression and the 2000 dot com bubble.  Global GDP and growth is slowing down.  Japan is a total basket case.  Mnay of the states in the US are broke and cant bay their bills and are stopping maintenance work on roads, pensions are being cut by 40% etc..
Now the US central bank is raising interest rates, and waning to sell all the bonds they purchased, Japan the the EU are also looking at cutting back bond purchases.  

Any one of the issues mentioned above has more money and potential to cause a major collapse than the 2008 GFC housing bubble in the US.  In 2008 the world was hours away from a global banking crises where all credit and bank withdrawals were to be stopped, the central banks of the US and EU just saved things in the final hour by pumping billions of dollars into the banks.  The ability of central banks to pump up the economy is coming to an end.   We have seen this in Greece and this month with two large Italian banks that had to be bailed out. 

There is an end game and it has to come sooner or later but come it will, like in the story of the boy who cried wolf eventually the wolf  does come.  

I am paraphrasing and rambling on at the same time the entire global financial system is a house of cards and if one things goes down it all goes down.  We could very easily see a 6 month banking holiday where all financial transactions are shut down and due to debt the value of money is watered down to nothing.  There will be a lot of civil strife and rioting and major destabilisation of civilisation as people will go mad with rage when they see their life saving like super funds wiped out.  Wars would also break out across the globe as the rogue countries would take advantage of the internal civil unrest.  

The left and right wing are very divided in the western world so the stage is set for major confrontation.....  By the end of 2017 it could be TEOTWAWKI -  I am sure it is coming just the timing is very difficult to determine as there is so much manipulation.  

I agree.

Think of all those poor saps that own investment properties with their Super (especially units)...they can't default on those properties, so they are forced to sell their primary homes to stay afloat.

While I know that no-one can predict the future, I also know that there are people here who watch for signs of trouble more closely than some people do, and certainly most people here don't live with the mindset that many have - that everything will be fine. Hence my interest in exploring these issues here.

If the housing market experienced a downturn, do you believe there would pretty quickly be an issue with investments and bank savings too, or does it start with real estate, then jobs, then govt payments, then super and bank savings, etc? What do you think? I can't see a sudden crash with everything going bad all at once, but perhaps I'm wrong.

I'm not really asking for detail and exact order, but I'm wondering if people with money will be able to take advantage of a real estate downturn, or if money will have less value anyway.

This is why my biggest prep for the year is getting my debts paid off. Hopefully this will all be completed by September, after which I won't owe anyone anything (apart from maybe the tax man).

Got this in my email this morning...

Housing market sentiment falls in every state:NAB survey

www.abc.net.au/news/2017-07-13/housing-market-sentiment-drops-in-all-states-says-nab/8705044?pfm=ms

No expert but I'll give my thoughts...

Housing prices are super local. Analysts often talk of a state or capital cities market dropping. Whilst the mean drops for sure this doesn't tell the whole story. You have to understand the factors that drive price in a cirtain area and try to understand why the property has value. Is the price because of fashion or fundamentals?

Another set of data that you can utilise to understand the stability of an area are the census stats. ABS will give you the percentage of houses that are owned outright, mortgaged, rented... It will also list the percentage of mortgages where payments are higher or below 30% of weekly income. Less established suburbs with higher levels of 'mortgage stress' are immature markets that will have a higher level of volatility and more people could be forced to sell during a downturn.

Should you buy now or wait? It depends on what and where you're buying...

Believe me, if I made as much as our pollies I'd have plenty of investment properties...

When it is the only investment in town you can have any faith in keeping up with inflation cannot you blame people from wanting to invest their super in negatively geared rental property. The average mum and dad punter cannot afford to gamble on uncertainties and in this country we have seen super funds go backwards, inflation as high as 18%, mining booms end, iron ore prices drop, share market crashes the only thing they can count on is rental property to keep up with inflation...and people want to take that way from them so they cannot write off their legitimate outgoings in operating a rental property.......

Australia is in trouble, where I work now, out of 155 staff 44 are teachers the rest admin and management.... the teachers are probably the lowest paid of them too! Something has to give as the balance is all wrong. To me it feels like less and less people are productive while the rest shuffle deck chairs or have restructures.