Gold and Silver or Property?

one thing for sure is... his parents got a really big factory... and that is really big atm machine that spitting out money every month.. he just doesnt know what to do with his money anymore.. leaving it on the bank.. too low interest rate... i also known that he bought a lot of shell and bhp bonds... called that diversification..


bordsilver said:
^ Exactly. He made his money by building and operating a string of productive factories.
Click to expand...
 
browski said:
In the increasingly likely event that world currencies are becoming worthless, I'm wondering if members might give some thought to better stores of wealth.

Although PMs are the obvious wealth preserver of last resort, in the event of a currency crisis, does anybody believe that Property would be equally resilient?

Is property owned outright a good store of wealth and are properties with significant mortgages (and exposure to high interest rates) hazardous? Or are they both suspect?

Any thoughts out there?
Apologies if I've post in the wrong section.
Click to expand...

In Australia no property can be owned outright. Gubmint can legislate exactly what it wants to ito taxation of property as well as restrictions on property, eg having to get permission (= paying Council) to paint you own house, or lay paving or a deck or put up a shade cloth...

Property rights in australia are an absolute joke!

For all practical intents and purposes property owners are simply tenants to the state.
 
mmm....shiney! said:
I think along the lines of ounces of Au (as that is my main exposure) to house prices. It's ratio browski, like the Dow/gold, gold/silver etc. You buy and hold until the ratio swings in favour of the next asset you wish to purchase. I'm not sure what thye house price/gold or silver ratio is but you could figure it out for youreself and no doubt it would be possible to do a historical search to determine whic asset is valued or undervalued when compared to the other. I'm working on slightly outdated figures of 240oz of gold buys an average house. Am looking at swapping when it gets to the 100oz mark.
Click to expand...

See! you CAN write sense if you really put your mind to it ... :lol:
 
I got a friend that just inherited about AUD $12M, I would say at least 70% Real Estate + a $2M catamaran.

He has trouble keeping up with the paper work, let alone figuring out how to compound that 20% + / year, which is what I do.

One night, after a few beers I started telling him about Kondratieff winter, then I changed my mind. Most people are just beyond help.


Creating wealth is one thing, keeping it is a totally different ballgame.


I wouldn't even consider thinking about real estate for the next ten years. Here in Australia it's losing value 10%/year in real terms, and that's before the Gman sink its fangs into you.

Buying Real estate in 15 years time will be like when I was buying silver at $4 (after selling my house). don't be a mark.
 
mmm....shiney! said:
Am looking at swapping when it gets to the 100oz mark.
Click to expand...


It will touch 50.

By then, if you can pay cash, you gonna be on the gravy train. Credit will be inexistant so you'll have such an edge it's not even funny.

Gold will then be in a nice trading range for 20 years plus.

I'm already teaching my kids how to own the gold grid and compounds real estate... just have to go through a bit of weather first.
 
valuecreator said:
I got a friend that just inherited about AUD $12M, I would say at least 70% Real Estate + a $2M catamaran.

He has trouble keeping up with the paper work, let alone figuring out how to compound that 20% + / year, which is what I do.

One night, after a few beers I started telling him about Kondratieff winter, then I changed my mind. Most people are just beyond help.


Creating wealth is one thing, keeping it is a totally different ballgame.


I wouldn't even consider thinking about real estate for the next ten years. Here in Australia it's losing value 10%/year in real terms, and that's before the Gman sink its fangs into you.

Buying Real estate in 15 years time will be like when I was buying silver at $4 (after selling my house). don't be a mark.
Click to expand...

How is it losing 10% a year?
 
Byron said:
valuecreator said:
I got a friend that just inherited about AUD $12M, I would say at least 70% Real Estate + a $2M catamaran.

He has trouble keeping up with the paper work, let alone figuring out how to compound that 20% + / year, which is what I do.

One night, after a few beers I started telling him about Kondratieff winter, then I changed my mind. Most people are just beyond help.


Creating wealth is one thing, keeping it is a totally different ballgame.


I wouldn't even consider thinking about real estate for the next ten years. Here in Australia it's losing value 10%/year in real terms, and that's before the Gman sink its fangs into you.

Buying Real estate in 15 years time will be like when I was buying silver at $4 (after selling my house). don't be a mark.
Click to expand...

How is it losing 10% a year?
Click to expand...

easy - cos the actual inflation rate is between 10 and 15%
 
Where do you get these numbers from? What is the basis of your analysis?
Keen to see how you come to that conclusion.
 
Yes I do also believe that the house prices in Australia is abit 'how ya going' but when the big boys play with property, I do believe they acquire it at near land value no matter how big the mansion is, which reminds me of central banks buying bricks of cast bars, near spot, low premiums.

While the other people on the scale are purchasing property with a premium (bloody developers) which is like buying minted coins.

For example you could goto an housing estate here in Sydney and purchase a quarter acre block of land for between $280-$320k which I do believe is a fair worth in today's market. However once you build your dream house I am pretty sure it be close to $800-$1M now. Of course if your thoughts of your property is worth to you what you paid for it with the house, my car shouldnt of devalued as soon as I drive out from the dealer.

Of course you can purchase a house and land in a less reputable area (oh a couple spring to mind already) and have a 3 bedder house and 600-800sqm block of land for like $320k as well.

I am sure of the fact that we're on this forum because we believe that alot of things are over speculated and we are turning to precious metals.

What I believe the next booming era (providing we continue to consummate and consume) is either space logistics like mining on Mars for iron ore (which I highly doubt in my lifetime) or Agriculture as Jim Rogers is doing in Russia because the population continues to rise and arable land deminishes there will be shortages in food stocks.

Oh yeah theres also renewable energy and the English have manage to produce a fusion reactor that produces 20 or so mega watts but it also consumes nearly that same amount so the net output of that reactor is a big fat ZERO so research and development has slowed down. Maybe with the discovery of the Higgs thanks to CERN, investors can look into fusion reactors again.

Until then, we will continue to see booms and busts especially from the new emerging economies like the BRIC nations and I think Australia is a good place to be as we will continue to provide the resources all economies need like minerals and food.

Thats my 2oz worth, keep stacking.
 
GiLa said:
For example you could goto an housing estate here in Sydney and purchase a quarter acre block of land for between $280-$320k which I do believe is a fair worth in today's market. However once you build your dream house I am pretty sure it be close to $800-$1M now. Of course if your thoughts of your property is worth to you what you paid for it with the house, my car shouldnt of devalued as soon as I drive out from the dealer.
Click to expand...

You won't buy a 1/4 acre block for that anywhere near where houses are selling for a million or so. Not anywhere in Sydney that I'm familiar with.
 
Of the statement I said, what I was meant to portray is that people are paying premiums and expecting that value to maintain when sold. If you goto the eastern suburbs for example like High St Maroubra, or even Pymble area, you'd be expecting to pay well over $m's for a house there but if you find an empty block (wishful thinking) im sure the discount on the block will not be that much from the average price of a home.
 
GiLa said:
sorry your right $362k now http://www.realestate.com.au/property-residential+land-nsw-harrington+park-200411195 for 926sqm a little off
and $899k http://www.realestate.com.au/property-house-nsw-harrington+park-110453241 5 bedder house same suburb with 980sqm and a little under
Click to expand...

Hmmm, most of the places for sale in that suburb seem to be in the 500-700k range which I would expect for that kind of land price but you're right, there are a couple like that one which are more expensive. I think they're overcapitalising myself, but I guess if that's the kind of house they want that's fair enough as well.
 
Phiber said:
Where do you get these numbers from? What is the basis of your analysis?
Keen to see how you come to that conclusion.
Click to expand...

Right of the bat you can't rely on the Gman inflation numbers. If they calculated the same way they did in the 80's, inflation would be between 6-10% right now. Which make sense for anybody that eat - drive - pay bills. It sure doesn't feel like 2% inflation out there.

10%, That's about what your council raise your rates every year, they know what the real inflation is.

I think John Williams is spot on.

http://www.shadowstats.com/

check it out, it's a real eye-opener.

So say your house goes up 2% this year and inflation is 10%. In real terms your house went down in value 8% this year.

COMPOUND THAT over five years.

nominal = house went up +12% (yeah)
real term = house went down - 45% (oops)

people are getting poorer and they actually think they're getting richer, I'm in awe of this.

I know plenty of people that are aware of this and just leverage up on 30 years mortgages. They think inflation will eat away the value of the mortgage and end up paying 20 cents on the dollar at the end, like in the 70s.

But we are in the Kondratieff winter, not summer, me think debt is a one way ticket to the poor house on this one.

we'll see, said the blind man.


"There are people who have money and people who are rich." - coco chanel

"The way to crush the bourgeoisie is to grind them between the millstones of taxation and inflation." ~ Vladimir Lenin
 
how about 30 year loan... but the loan is paid off/helped paid by your tenant?

probably start off having to tip some money into the loan, in 1 to 2 years.. the loan become positive, and with the help of inflation.. price of rent goes up.. the process makes money for the landlord and banks... nothing wrong with that? or is this one way to grow poorer? as the landlord will be in debt forever?

remember the wording good debt and bad debt

valuecreator said:
Phiber said:
Where do you get these numbers from? What is the basis of your analysis?
Keen to see how you come to that conclusion.
Click to expand...

Right of the bat you can't rely on the Gman inflation numbers. If they calculated the same way they did in the 80's, inflation would be between 6-10% right now. Which make sense for anybody that eat - drive - pay bills. It sure doesn't feel like 2% inflation out there.

10%, That's about what your council raise your rates every year, they know what the real inflation is.

I think John Williams is spot on.

http://www.shadowstats.com/

check it out, it's a real eye-opener.

So say your house goes up 2% this year and inflation is 10%. In real terms your house went down in value 8% this year.

COMPOUND THAT over five years.

nominal = house went up +12% (yeah)
real term = house went down - 45% (oops)

people are getting poorer and they actually think they're getting richer, I'm in awe of this.

I know plenty of people that are aware of this and just leverage up on 30 years mortgages. They think inflation will eat away the value of the mortgage and end up paying 20 cents on the dollar at the end, like in the 70s.

But we are in the Kondratieff winter, not summer, me think debt is a one way ticket to the poor house on this one.

we'll see, said the blind man.


"There are people who have money and people who are rich." - coco chanel

"The way to crush the bourgeoisie is to grind them between the millstones of taxation and inflation." ~ Vladimir Lenin
Click to expand...
 
valuecreator said:
Phiber said:
Where do you get these numbers from? What is the basis of your analysis?
Keen to see how you come to that conclusion.
Click to expand...

Right of the bat you can't rely on the Gman inflation numbers. If they calculated the same way they did in the 80's, inflation would be between 6-10% right now. Which make sense for anybody that eat - drive - pay bills. It sure doesn't feel like 2% inflation out there.

10%, That's about what your council raise your rates every year, they know what the real inflation is.

I think John Williams is spot on.

http://www.shadowstats.com/

check it out, it's a real eye-opener.

So say your house goes up 2% this year and inflation is 10%. In real terms your house went down in value 8% this year.

COMPOUND THAT over five years.

nominal = house went up +12% (yeah)
real term = house went down - 45% (oops)

people are getting poorer and they actually think they're getting richer, I'm in awe of this.

I know plenty of people that are aware of this and just leverage up on 30 years mortgages. They think inflation will eat away the value of the mortgage and end up paying 20 cents on the dollar at the end, like in the 70s.

But we are in the Kondratieff winter, not summer, me think debt is a one way ticket to the poor house on this one.

we'll see, said the blind man.


"There are people who have money and people who are rich." - coco chanel

"The way to crush the bourgeoisie is to grind them between the millstones of taxation and inflation." ~ Vladimir Lenin
Click to expand...

Hey valuecreator, how far in are we in Kondratieff winter? Midway? I was having another look at the four seasons diagram the other day
 
valuecreator said:
mmm....shiney! said:
Am looking at swapping when it gets to the 100oz mark.
Click to expand...


It will touch 50.

By then, if you can pay cash, you gonna be on the gravy train. Credit will be inexistant so you'll have such an edge it's not even funny.
Click to expand...

I'll be dead before then or selling my stash for fiat.
 
long88 said:
how about 30 year loan... but the loan is paid off/helped paid by your tenant?

probably start off having to tip some money into the loan, in 1 to 2 years.. the loan become positive, and with the help of inflation.. price of rent goes up.. the process makes money for the landlord and banks... nothing wrong with that? or is this one way to grow poorer? as the landlord will be in debt forever?

remember the wording good debt and bad debt
Click to expand...

I hear ya.

But I'm of the opinion that in the winter cycle all debt is bad debt.

read Kondratieff.

What they're doing right now is trying to make the 30's look like the 70's. won't work.


just my opinion.

sure it's nice to have somebody else to pay for your assets, but what's the point if the assets lose half of its value in a few years?

We're wired to think in nominal terms and value assets in funny money.

In the States, after it crashed 50%, investment now properties yield north of 17%.

in nominal terms.
 
You must log in or register to reply here.
Back
Top