I suppose if I were to disclose anything it would be that I ascribe to a theory of asset pricing propogated by the likes of Marc Faber, Bonner and Keen.
They all push the idea that lending produces excess liquidity in the system and that ultimately leads to people paying too much for assets and bubbles forming in ecomomy for certain asset classes.
It's the old tulip story again and again.Last month it was Uranium. It went from $140 to $60. Now its property's turn.
And each time it happens you always have the same ingredients. High prices - in the case of property...almost 100% more than what people can afford and lending gone mad- refugees and people on the dole getting $200,000 loans.
And interesting you have the same bunch of deniers who are living in a fools paradise ie is why prices continue to rise of course. They vigorously defend their positions.
Anyway we all know the bubble is going to be popped. It is just hard to know exactly when. I was wrong 12 months ago but it seems like the bubbles in Britian and US have been popped and property is crashing all around the world.
For some reason it hasnt happened here, which is a bit puzzling. Keen has bet his house on it happening in the next two years though. I with him. we may be seeing the bubble about to pop now as the 60 minutes program is saying. 4 Corners has done a great program on it as well check it out if you like
