http://www.youtube.com/watch?v=fE_ovKAzL18&feature=player_embedded
A good video on those who like to educate themselves, it’s by Prof. Steve Keen who is pretty much the “Bear” on Property Prices, but he is an economist first.
Basically the video shows how the supply and demand curve don’t stand in our complex economy today.
Old Research has shown that if prices drop this can lead to a reduced demand due to a reduction in income – oposite of the S&D curves. This has been acknowledged by mainstream economist but regarded as too complex to modle/gauge (True at the time of the research, probably not so true with today’s technology).Effectively it simply states that income determines supply and demand and therefore price. Prof. Keen goes on to state that income is driven by debt – money makes money.
Nothing none of us probably didn’t already know, but may help us when speculating. Speculate on immigration or banks willingness/ability to increase lending?
Site’s I frequent in addition to this one:
Fool.com.au
Debtdeflation.com/blogsNot to be a negative nancy – I recently put money in an S&P 500 index fund and am now researching some US companies while our dollar is still high. There is no way I would put any money in gold or any commodity in the foreseeable future – however if the opportunity arises I would of course buy good shares in a gold miner.
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