Monday, January 3, 2011
The party is not over in Australia
He is dead right that the Australian economy is a party and that it will end.
He is wrong that it is over now. The property market is more illiquid than usual. It has got illiquid a few times (and essentially flat) and every time it has I have thought that we were in Wile-E-Coyote country. (You know the type - the Coyote has run off the cliff - but he has not looked down - and only when he looks he starts to fall.) It just never fell.
The beaches are crowded and people are still buying lots of $6 ice-cream cones. You still meet plenty of people who are purchasing houses for more than can afford whilst driving his-and-hers BMWs.
I have thought the party was going to end for a while. (Like Mike Shedlock I am wanting to run fast from this bubble.) But early is wrong.
I have done very nicely with my offshore money. I have managed to keep up with the Australian dollar and then some. For that I am thankful. It would have course been easier to just buy Aussie bonds.
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