Was woken up this morning by unusual dawn - golden red, just like a dawn over Sodom.
Opened up news sites - here it is! How exciting - new clown rules in the circus, accusing the old clown in not following "liberal party economic policies".
Not sure why plural is used in this case - because Libs have only one policy - resolve all the problems of "big business" at the expense of ordinary people.
Not sure why it is better for the economy to try harder the thing that never works. Not sure why do we have a Government that does not understand elementary economic principles.
Here is the (oversimplified) example. To give "big business" a million dollars, you have to take $1000 from 1000 ordinary people. In this country for the last 15 years we have had income growth under the inflation? i.e real incomes were diminishing, i.e. "ordinary people" just making ends meet.
It means that if they had these $1000 each, they would spend the money buying things. That means that "big business" would be deprived of a $1M in revenue. Which is bad for business, which is bad for the economy.
What this post is doing in Real Estate section? Because change of clowns is directly and immediately reflected in Real Estate market.
First, new clown is going to sabotage the economy harder. Which means interest rates will go down even quicker.
Second, for some obscure reason "political uncertainty" weighs on any market. Now it has been removed, market will get back to normal.
Third, when trees start to bloom - markets follow. There is no rational explanation - but this is a fact of life. People can buy houses all year round - but for some reason they hibernate in winter. Whoever exits hibernation sooner - wins.
And here is the bedtime reading for you:
Just in case the reality evades you.
1. If you are envious that somebody's house earned $200K a year (more than a house owner in their day job) - you perhaps forget that capital growth in the house you live in is not taxed. In other words, to get even with their house owners need to earn close to $400K pa before tax.
2. It means that both tenants and buyers have a reason to worry. On the other hand - home owners can enjoy watching their money grow.