Trass short of money again?

[kieran]

Update,

I note the Herald has run Tony's story and already I have received numerous contacts about me being referred to in Tonys comments as one of the "wayward pundits" (an interesting comment from a bank economist who has the largest vested interest of all for his employer anyway and has a very sketchy record of calling the market himself) ...

ANOTHER great PR job BNZ! (How to lose clients in one easy step... attack them publicly with mis-information - LOL,LOL,LOL).

It's also laughable that Tony thinks I have actually have made much money selling books. Penguin pay me a small royalty per book of just a few bucks... My hourly rate for book sales would be in the cents if I'm lucky... that's not why I write but guess a bank economist wouldn't understand that either, they probably get paid heaps for writing every word...

I must thank Tony one day because he has inadvertently just helped me to sell even more books so hey maybe I will make some good money from book sales now!

In response to his actions my equal and opposite re-action is that I have decided to take a line of "non-violence"... and close all of my 5 credit accounts with BNZ and tell the truth to the media as well (they may or may not be interested but that's entirely up to them). There is no violence in the truth.

I'm sure BNZ wont miss the @$400,000 of funds put through my BNZ accounts in the last year. I have other bankers who actually respect my business so now they can have more of it, now that's what I call Karma.

That's my last laugh for today!

[McDuck]

Tony has a vested interest in housing.
For some reason bank people (like Tony) think they will be able to go back to their old tricks.
The thing is, they stuffed everything up.
No one is going to let them do it again.

[PeterEmpowerEd]

Hissy fit ...

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10587627

In response to his actions my equal and opposite re-action is that I have decided to take a line of "non-violence"... and close all of my 5 credit accounts with BNZ ...

I'm sure BNZ wont miss the @$400,000 of funds put through my BNZ accounts in the last year. I have other bankers who actually respect my business so now they can have more of it, now that's what I call Karma.

"Karma"? Hmm, not really. How about this?:

reprisal n. an act of retaliation

This is a so much better use of five minutes ...


From: http://www.youtube.com/watch?v=4-94JhLEiN0

[whitt]

I never said 30%... actually my quote (which has been twisted and incorrectly thrown around like a tired rag doll) was...

"up to 25% in some suburbs"

This slump is far from over although Tony is trying to convince everyone otherwise.

Just as I posted earlier. It appears to be wrong info twisted by Tony.

I am tending every day to believe the "Dead cat bounce theory" myself. The economy is fatally wounded all over, there is no way we can pull out of the recession soon before more bleeding.

[kieran]

Thanks Peter!

That looked like one fun wedding!

[Gatekeeper]

Just as I posted earlier. It appears to be wrong info twisted by Tony.

I am tending every day to believe the "Dead cat bounce theory" myself. The economy is fatally wounded all over, there is no way we can pull out of the recession soon before more bleeding.

I'm with you Whitt, this is a long way from over. The way we run our Intl banking system means for it to continue to function we need more and more debt (it's exponential and the last doubling killed it). They are pumping funny money like mad at the moment and it will work for a while, things might look better but don't be fooled. Ultimately it will have to fall over again because the flaws haven't been fixed, and I doubt it'll be too much further down the road. Timing, by 2012 is my guess. It gives people times to pull their heads in before what I reckon will be a massive reustructuring of our international systems. New reserve currency anyone, and a lot less unproductive debt. China, amongst others are already pushing this one.
The 2000-2007 boom will be an anomaly written about in text books!

Very cool watching this all play out.

[Wayne]

Please don't let this discussion degenerate into a slanging match.

Kieran - I have been told before that there is little money in writing books (unless it's a Harry Potter). I suspect many write them because they enjoy it and the money is a bonus. It is great to see you pop up in this 'discussion' - much appreciated.

Regarding Tony and his weekly - it is interesting that he says all views are his own but it has BNZ all over it. Very hard for the views to be seen seperate.

Is it over - I don't think so. We are heading into a housing shortage (given immigration at what it is) but the jobless is still rising. People will share houses and stay with Mum and Dad for a while yet. Plateau maybe but sustained rise I don't think so. I wonder how many are going to get burnt extending themselves now wit historically low interest rates only to have to sell in a year or two when rates go higher.

[Wayne]

about time for a decent(?) World War to sort things out.

[OllyN]

The end is nigh

Kieran is all over the "Listener" today predicting more massive gloom and doom for the NZ property market. To further promote his philosophy he intends shortly to travel to Canada ( one way?) in order to further spread the message.

[whitt]

Looks like PT is divided.

Those who believe recession is near the end and prices wont fall more and the others who think some parts of the market will crash even further.

I am firmly in the latter now there is much to flow through yet. The governments have only patched the issue and it has not been fixed so will fail some more. There is much more to flow through in the coming 12 months how is it at all possible for this to be over? I think it was mentioned in a post on PT a few days ago the farmers are probably next too.

Olly where do you see it? You must have been through this all before?

[PeterEmpowerEd]

Alexander has criticized property commentators previously and I applaud him having the balls to do so.

I think there were many of us who looked at some Trass and Hickey predictions in the last 18 months and could see they were skewed by hubris. But most of us shook our heads, mentioned it to our nearest and dearest - and didn't speak out.

....I believe property commentators have a duty of care to be less emotional and more rational, as I know of people acting specifically on their incorrect advice to their own detriment. But I suppose the gullible will always be out there.

Though I have a soft spot for Olly. I think there['s] some genuine desire there to help the public evident in his words and actions.

I agree.
Also, as for Tony Alexander (or anyone else) 'changing their tune', I think foolish 'consistency' of message in the face of changing facts is not helpful.

I gave my own view of this (quoting no less than John Maynard Keynes as well as Olly) in the introduction to How to Survive and Prosper in a Falling Property Market...

Beware pseudo-science
Be wary of pseudo-academic discussion and analysis around
‘drivers’ and ‘influencers’ of the property cycle. Some amateur
economists and self-proclaimed property investment experts
are, sadly, ‘gums for hire’ — and their services are used as
bait by property promoters.

On the other hand, many genuinely qualified, professional
economists are fine people, but, with respect, they sometimes
appear to forget economics is a social science (not one of the
‘hard’ sciences like physics).

.... Some of the brains looking at the market are the best in the
business and can identify what’s been going on (hindsight)
in terms of investment fundamentals, taking into account
inflation, mortgage interest rates, rents received and tax rates.

From experience, however, many of their ‘predictions’ can
turn on a dime — the analysts change their forecasts with
great alacrity. And you can’t blame them for this. “When
the facts change, I change my mind. What do you do, sir?”
economist John Maynard Keynes once famously responded
to a charge of inconsistency.

In many cases, such commentary is little more than
hindsight — some of it practised by self-appointed experts. A
wise investor sees this as ‘noise’ and looks for real-world, specific
data for their specific market — ‘hard’ factors such as up-to-date
comparative sales prices and rents/leases being received.

.... There’s value in considering these ['soft'] factors, their trends, and
being aware of market commentary, but it’s not just arithmetic.
Market sentiment and confidence — optimism and pessimism
— are the indicators we observe most closely.

It is difficult to improve on Olly Newland’s evaluation
from The Day the Bubble Bursts:

It would be easy to spend several lifetimes ‘analysing’, in
a rigorous statistical fashion, the factors that drive the
Economic or Property Clock. Pointy-heads can and do bury
themselves in statistics, rows of data, multicoloured charts
and graphs, finally emerging triumphant at having weighed
all the macro-economic factors (interest rates, money
supply, immigration, etc) and coming up with a theory
to ‘explain’ what happens as the cycle moves around the
clock. (But always after the fact. With very few exceptions,
their self-serving ‘predictions’ aren’t worth a tinker’s cuss.)

But the real driver is emotion or ‘market sentiment’.
What emerges in markets is a scaled-up version of ‘group
think’, where the pervasive mood switches (and I mean
switches) from negative to positive, then gradually becomes
super-positive and hyped-up. In other words, hysterical.

Unfortunately, the reversal of sentiment happens a lot
more suddenly. There’s an old saying from the sharemarket:
‘The bull climbs up the stairs, but the bear jumps out the
window.’ (And I’ve lived it.) The climb towards high market
mania happens regularly.

Download/read the whole introduction here, (if you want): http://www.empowereducation.com/gene...true&key=HTSAP

[WBuffett]

I'm a dead cat bouncer, I was of the opinion that the cat had already bounced, but now believe it may last up to two years before it all comes down in flames. The polices of worldwide govts and reserve banks to ignore the fundemental issues by increasing expodentially the very polices that led to this problem will make it so much worse than if it had been allowed to run its natural course ...in which case we would have been looking at a genuine recovery in a few years rather than twenty to thirty years.

But there is money to be made in a bounce ,a mini bubble if you will, when this current two week long mini-mini bubble (which is about the 4th so far within the two to three year bubble )crashs within a few weeks I will go back into the stock market for a few months and hope I time very well once more.

[Dean@Massiveaction]

Based on levels offers I can get for property in the Auckland market and talking to business owners, especially retail, I think we have a lot of pain to go. Lots of property opportunities but the general economy green shoots theory looks dodgy to me.

In fact if we do see a recovery without enough pain I would say we are setting ourselves up for another longer downturn. OZ is headed that way

[whitt]

From experience, however, many of their ‘predictions’ can
turn on a dime — the analysts change their forecasts with
great alacrity. And you can’t blame them for this. “When
the facts change, I change my mind. What do you do, sir?”
economist John Maynard Keynes once famously responded
to a charge of inconsistency.

That is clearly evident here on PT also reading posts in past month.
Any sign of a upturn in market and readers jump the fence.

[dandan]

I have never predicted a "housing collapse" since 1988 nor did I give any such talks on the subject. My first warnings were 16 years later in my book "The Day the Bubble Bursts" ( 2004) and I got that mostly right.

I don't know who Tony Alexander is talking about, but it isn't me.

Tony is refering to the following three pundits.

Tony Alexander, NZ Herald.
House prices 30 per cent over-valued, risk large fall - BNZ
http://www.nzherald.co.nz/nz/news/ar...ectid=10501887

Bernard hickey, NZ Herald
http://www.nzherald.co.nz/personal-finance/news/article.cfm?c_id=12&objectid=10533289

Gareth morgan, Campbell Live.
http://www.3news.co.nz/Video/Campbel...ult.aspx#video