money brought into the country by chinese citizens to invest in australian residential real estate has has pushed the market value of real estate up disproportionately in relation to wages and all other assetts in the country.
because of this average australians are wealthier asset wise, and therefore by leveraging their home they are able to afford other goods and services. ..in other words the additional money brought into the country to purchase real estate is recirculated into the economy creating employment and economic growth.
so our economic growth is based on the compounding growth of our real estate values... while this continues our residential construction industry and retail and consumer industries and other service industries will continue to flourish.
but we haven't made anything or sold anything to other countries to pay for all of the goods which have been imported such as cars and electrical goods, household goods, clothing, hardware, oil etc..... we are producing iron ore, coal, coal, gold, and some agricultural products and that's about it.
how long will this ponzi scheme continue ?...history tells us it will go on for a lot longer than anyone expects.
what will break the circuit - i think a crack in china's residential boom will be the circuit breaker, but again that might be a few years yet also. .. or perhaps it might be when some of the forcast industry close downs begin to occur - which still might be a year or two yet.
a couple of australian cities seem to be becoming much over supplied with multi -storied appartments, which could cause a few developer bankruptcies, but that's only part of the residential industry. ..i have also read of an over supply of office buldings in some of our major cities.
and yet the jobs situation do not be seem to currently be of any major concern.
what i am personally interested in here is some good reasoning as to when the crunch is likely to come so that i might be able to profit from it.
