The Australian and US economies are not chalk and cheese. They are both suffering the same inflation spike, the same fallout from the credit crunch, the same low levels of unemployment, and while the preliminary figure for US first quarter GDP growth is 0.6%, Australia’s is 0.8%. (The 2nd graph …
HOMEOWNERS in Sydney’s outer suburbs have been losing as much as $450 a week every week since early 2004 on the value of their properties as the real story of mortgage belt misery begins to emerge. Since the peak of the boom in early 2004, Sydney’s southern suburbs has dipped …
This means the Australian economy is heading for a very sharp slowdown next year, which might seem a big call with unemployment at a 33 year low of 4.1 per cent . . . . » Something’s about to snap (Alan Kohler) – Business Spectator, 14th February 2008.
The Age asks Steve Keen about house prices : It has to fall at least as far as the US market will, and probably a lot more. Some conservative pundits think US prices need to fall another 25 per cent to restore pre-bubble valuations, and they’ve already fallen 8%. That …
Long time readers of whocrashedtheeconomy.com will remember a post back on the 28th of April last year about the Herengracht Real Location Value Index created by Piet Eichholtz dating back 350 years. It tracked house prices on Amsterdam’s Herengracht canal and shows over the 350 years when corrected for inflation …
From U.S. recession to Global recession. . . The U.S. economy may already be in recession; other countries might not be far behind. Japan, Britain, Spain and Singapore, which together represent about 12 percent of the world economy, are vulnerable as fallout from the U.S. worsens their economic weakness. Even …
The median house price in Australia is now 50 per cent higher than the median price in the United States. This is a huge disparity between the cost of housing in Australia and the US, and is not matched by a difference in incomes. » The price of fish – …
First it was subprime, then it was the home equity crisis. Today it is margin loans. In a day when the Australian Stock Market slumped 7.3%, making it the biggest fall in 28 years, debt was again playing its role. With double digit returns as long as you could remember, …
The Long Johns help you understand Subprime.
THE first real hint that something was wrong came in February last year. People started using the word “subprime” and talking about defaults in the US mortgage market. …. The long-proposed theory of ‘decoupling’ is also breaking down, and market watchers are less convinced the Australian economy can withstand a …
US and British house prices are falling. Australian house prices are still rising. Housing here is protected in the short term by strong Australian growth, but that will not last forever. …. Even so, the OECD suggested in 2005 that Australian house prices were the most overvalued of any developed …
As subprime takes center stage, there appears to be more trouble in the woods. As house prices spiraled to dizzy heights, home owners used the equity in their homes, or their homes as ATMs to buy other goods and services. This was achieved with a home-equity loan. Now as house …
A leading economic analyst says Australia’s strong resources sector could suffer if the United States economy slides into recession. Craig James from Commonwealth Securities says the slowdown in the United States will have a follow-on effect for Australian shares, particularly the resources sector. “If the US economy slows and there’s …
The New South Wales Valuer General says a glut of properties in parts of western Sydney has led to a fall in land values in the past year. » Land prices plummet in western Sydney – The ABC, 13th January 2008.
Dad believed when Maggie said: Get a mortgage, buy a home, so dad took out a great big loan. For a while there we were chuffed. Now the market has collapsed and we are absolutely stuffed. Our house, in the middle of the slump . . . .
“There is a clear and present danger of the world economy coming to a near standstill,” the UN’s Department of Economic and Social Affairs said in an analysis released today in New York. “The domino effect of a U.S. recession would be to knock down export growth from China, Europe …
A top bank says the feared recession in the United States economy has arrived. A report from Merrill Lynch, one of the world’s leading financial management and advisory companies, says Friday’s employment report confirmed that the US is in the first month of a recession. » US now in recession, …
There has been this misconception that as our population gets older, most will own their house outright and hence more will be immune from the credit crunch gripping the world. In today’s AFR they published this interesting graph : It would seem while more and more of Australia’s population, aka …
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