Looking Under the Hood – Australia

Featuring Shane Oliver

Shane Oliver of AMP Capital is one of Australia’s most highly rated economists. In this Think Piece, Shane provides an insightful assessment of the domestic economy and property market, as well as the influence of commodity prices, alongside global drivers, including an upbeat view on China. Filmed on March 21, 2017 in Sydney.

Published on
27 March, 2017
Topic
Australia/New-Zealand, Macro, Housing Market
Duration
25 minutes
Asset class
Currencies, Real Estate, Equities
Rating
169

Comments

  • HK

    Hurshy K.

    9 4 2017 14:36

    1       0

    I'm somewhat torn by the Australian property market and I personally do think the eventual rise in interest rates will have the contagion effect on the private debt rather than household. Household debt while at an all time high still has leeway for households to steer towards debt management but that will ultimately impact businesses. A combination of private debt refinancing and lower sales will lead to eventual rise in unemployment and that's where I believe the issue will occur - Forced sales. The extent however I have no idea. Really great to read some of the comments (much more educational than some of the videos!) I think John M hit it on the head around the government losing it's eventual AAA rating it was very close in October last year and they've done all they can on clawback attempts with social security but to very little avail.

  • TE

    Tim E.

    5 4 2017 09:30

    1       0

    Despite all the negative comments, there were some interesting insights in here. For instance, his point that while here is a lot of debt in China, that is simply the corollary of a high savings rate, makes some sense. It's the same comment I often make when people cite the "there's too much debt in the world" argument --- namely that one person's debt is by definition another's asset. That's the system we live in. For each debit there's a credit. So, if there's too much debt in the world, are there also too many assets? Maybe. Much of it is just paper, after all. But, just because there is a lot of debt, doesn't mean that we're due for an imminent debt deflation. His point that China has grown richer so fast, that even housing built 20 years ago is of a quality that doesn't meet the market's current quality expectations, and needs to be rebuilt, is also an interesting view, and one I had not seen expressed elsewhere.

  • RZ

    RICK Z.

    4 4 2017 03:22

    2       0

    He reminds of a Shawb retail account manager - a little to simplistic

  • JM

    John M.

    2 4 2017 23:58

    0       0

    Nathan S, this real estate boom is not confined to Australia. Also Canada, west coast of North America, and even parts of New Zealand. These countries have the highest number of millionaire immigrants in recent times. What you are suggesting ('trillions printed by RBA') in my view would be a systemic problem – i.e. not just Aus, but other Western financial institutions too. It is possible, but less likely. More likely is to kick the can down the road. Regulator (APRA) has been getting Big 4 to wind back lending for 18 mths now (albeit limited success); and manage their capital buffers. This is not asleep at the wheel stuff. Confidence from foreign investors is needed, but you don't go from AAA/AA to Junk overnight, and not when you have 25 Million people with good education levels, property rights, multicultural attitude, and fortunate enough to have the resources of an island continent. Great value in the different views on this blog btw, just looking for a middle road between Polyanna and Chicken-little.

  • DP

    David P.

    2 4 2017 12:17

    7       0

    Being a local working in construction in Sydney, i can admit that many of the people in know have "faith" in real estate as an unsinkable asset that will always go up. Most of them seem to be emotionally "invested" in their investment. And high rise residential towers keep popping up like mushrooms. The biggest question is: are we going to have a big crash or a japanisation?

  • jg

    james g.

    2 4 2017 10:55

    4       0

    Very superficial commentary. Not required back.

  • SK

    Stephen K.

    1 4 2017 16:21

    0       5

    Being long Sydney residential apartments, I agree the market is overvalued but am not convinced by any of the reasons promulgated here that the next price reversal will be severe or is imminent. Some of the comments are amusing in their certainty that particular factors will cause the fall. Each of the sub-markets is influenced by so many variables that prediction is impossible. For example, one of the factors supporting high prices in Sydney appears to be increased equity contributions by the parents of first-home buyers. But how can anyone isolate whether this is actually having any measurable effect and then, how it interacts with all the other variables. Commentators also seem to discount the effect of randomness in their opinions.

  • NS

    Nathan S.

    1 4 2017 05:08

    4       0

    John M - how many trillions do you think the RBA will have to print to avoid the Big 4 "going to the wall"? How will they do that? And how will the Australian economy and lifestyle look then?

  • RW

    R W.

    1 4 2017 02:42

    5       1

    I believe a lot of the issues the Australian economy faces are already very well known. Whilst I don't particularly rate Shane Oliver (despite being a good bloke form the Nthn Beaches) what he does see, that many of us don't, is the extraordinary liquidity in the pension system that is a result of a defined contribution scheme and 30 years of property (hyper) inflation.

    I am in no way bullish on the fundamentals of the Australian economy, however, pool of savings is extremely liquid and that likely frives his views somewhat.

    As for the banks, as ridiculously geared and exposed to property as they are, there is (as yet) no uptick in credit spreads that put their wholesale funding model under pressure. I suggest that AUD/USD basis swap will be the first instrument to indicate stresses as will new issues pricing higher in the 144A market. At that point the equities will be a tremendous short , however, until then you are betting against not just the banks themselves but an entire system.

  • TJ

    Tay J.

    31 3 2017 07:41

    1       0

    Not seeing the traffic jams Shane claims exist:
    http://www.businessinsider.com/china-ghost-cities-satellite-images-2017-3/#ordos-another-notorious-ghost-city-in-inner-mongolia-is-reportedly-adding-people-but-still-has-lots-of-unsold-housing-and-unfinished-construction-this-beautiful-stadium-for-instance-has-been-sitting-unfinished-for-a-long-time-according-to-digitalglobe-9

  • SM

    Svetlana M.

    30 3 2017 08:09

    6       0

    I agree with Vanessa that we have demand issue (i.e. artificially stimulated demand which drives the price up), not a supply issue. Every day I can see a lot of building going on, mostly dog box apartments small as hell and townhouses. Most of them are of very poor quality, especially apartments where you have carton walls. How long would they last I wonder? And now in Victoria prices will up go even further after for first home buyers stamp duty was abolished (for purchases below 600K). Although duty was abolished for first home buyers, prices will go up for everyone. This is clearly a demand issue.

  • JJ

    JJ J.

    29 3 2017 14:03

    2       3

    Nice to see a view from Australia RV. Perhaps would have been better to have a proper interview like others rather than just soundbite responses... you could have challenged Shane on some of his bullish views... which re Aussie views he is correct.
    He said they've been talking of a property bubble since '03... that's 14yrs now... eventually one day they may be right but he nailed it with supply and demand. Hard to argue with mother driver of all economics. I know I had to move up the coast to over 1 north of Sydney and commute to work everyday on the train to be able to afford a house... this after growing up in Bondi! So clearly the supply shortage is real otherwise I would have stayed closer to Sydney. On super he is also right that there is a constant tap of funds going into the Aussie market and given I work in AM, I can tell you most people have a standard 70/30 balance portfolio and of the 25-30% of total funds are in Aussie Equities. However having said this market panic doesn't prevent the ASX from the selloff, but the price isn't being set by the Super industry as they are long term holders.

  • LJ

    Lindsay J.

    29 3 2017 08:04

    23       1

    I generally enjoy Real Vision but this piece really disappointed me. Shane Oliver is a media-friendly mouthpiece for one of the largest institutional fund managers in Australia. He is always bullish, upbeat, and a constant source of feel-good soundbites. He rarely cites any intriguing/specific facts to back up his stream of positivity. Hence I fail to see how he adds anything to the Real Vision audience. By all means feature people who are both bullish and bearish but preferably those with truly incisive and insightful perspectives. Australia is more nuanced that the international stereotypes suggest but this piece didn't illustrate this in any substantive way. Please find some non-mainstream interviewees next time (bulls or bears).

  • JM

    John M.

    29 3 2017 03:09

    5       0

    Canada is in the same basket with Australia. Bank of Canada also refuses to raise rates, despite record high household debt & a hot real estate market. Same strategy, same results.

  • VV

    Vanessa V.

    28 3 2017 23:58

    7       0

    I just wanted to say Thank You to everyone who took the time to comment on this thread. Some real gems of information! And funnily enough I would not have had insight into your thinking if it weren't for this video (which I gave a thumbs down to - my first thumbs down on RV).

  • MN

    Michael N.

    28 3 2017 22:59

    24       2

    Good set of comments. I am also Australian and was disappointed that Oliver seemed to be using the same tired old media sound bites that we hear so often here and providing little critical thought or local knowledge.

    The first sound bite was housing under-supply. As captured well by Vanessa V we have an under-supply because a speculative demand and low interest rates.

    The second sound bite was the 'transition of the economy to non-mining investment' (primarily in Sydney and Melbourne). Oliver didn't mention that this investment has primarily been building shoe box apartments for the speculative demand above! There has been little real investment in productive enterprise. The manufacturing base has been hollowed out (no cars being produced in Australia by end of 2017). There are currently major issues with energy security/prices both in gas and electricity markets. Australia frequently ranks near the bottom of the OECD in terms of innovation and converting ideas into marketable products. Business lending is at historic low proportions compared to home lending. The banks have around 65% of their loans for houses (world leading figure I believe, and by a margin).

    The only thing the economy has 'going for it' is that we are importing people hand over fist. Immigration is way higher than long-run averages. Not surprisingly the immigration is confined almost exclusively to Sydney and Melbourne (plus internal immigration from places like Adelaide to Syd/Mel is huge).

    There has been no 'transition'. There has simply been a delay in the correction that Australia is due. The fact that Oliver and other mainstream economists (usually from the big 4 banks) spout the success of this transition is infuriating to me and many others in the country.

  • JS

    John S.

    28 3 2017 21:33

    5       0

    I have sold my house in Melbourne, invested the cash and rent a much nicer place by the beach and restaurants on an effective 2.3% estimated gross yield. Rents have been mainly flat to slightly increasing for years. Speaking to senior bankers they have people borrowing more on the revaluation of their property portfolio to fund more property. Ability to repay is fudged because if one bank doesn't lend then they just go down the road to the next one. Who knows when it will stop but the risks are clearly there.

  • JM

    John M.

    28 3 2017 21:26

    2       1

    Nice work James M on Australia's Big 4 and potential Eurodollar funding issues. Though I think the Federal Government would seek to at least take the edge off the worst of the consequences, and with the AAA rating (for now) and the RBA they still have some tools at their disposal . Politically, we've had a change in PM in last 18 months (he is currently going down in the polls), as he is "wedged" by the Opposition on the Left, and more extreme views on the Right. So populism rules. And given the high debt levels and property ownership among Australians, they will likely lean to populist solutions.

  • TM

    The-First-James M.

    28 3 2017 18:53

    1       1

    No problemo David. Thanks. :)

  • DS

    David S.

    28 3 2017 18:24

    3       0

    Re: James M. – I gave you a thumbs up as you actually have personal history in Australia and an reasonable analysis. I live in Hawai’i where we are struggling with affordable housing for even a middle-class family. Friends leave, but few can return as it is always more expensive. DLS

  • TM

    The-First-James M.

    28 3 2017 14:32

    21       0

    Just want to respond to a few people in the comments.

    DOROTHEE R.
    From my own experience of renting in Melbourne, rents are typically locked in for only up to 12 months. I don't personally see this as a long time.

    DAVID S.
    Some of us commenting are Australian Mate (adopted in my case; British by birth). In my case I lived there four years and became a citizen. A housing bubble bust would see me seriously consider going back.

    Reading the comments, my own personal view on what will burst this bubble are Australia's Big 4 Bank's Wholesale Eurodollar funding liabilities. They are highly vulnerable to up-moves in LIBOR, and this has already become readily apparent with the two rounds of mortgage rates increases since last November - regardless of the RBA having not raised rates. Any further Fed funds rate increases are likely to see further mortgage rate increases in Australia IMO.

    Anecdotally, I could tell you stories of people on AUD $100k incomes leveraged up with 8+ houses all on variable rate interest only mortgage debt. According to APRA, at the end of 2016, there was more than AUD $550 billion outstanding in interest only mortgage debt. Current overall mortgage debt pile is AUD $1.6 trillion and rising - over 100% of annual GDP. No way is this sustainable, and I feel inter-bank funding dependency will be the Achilles Heel that breaks this. When this breaks, so does Australia's AAA credit rating.

    The above is some of the complexity that Shane alluded to but didn't mention.

  • DY

    Damian Y.

    28 3 2017 12:17

    8       2

    The last thing we need is a main stream economist who is employed by a crappy Australian insurance company to tell us what is happening in the world.

  • jS

    jurgen S.

    28 3 2017 10:13

    11       2

    Please RV no more Aussie economists who are employed by insurance companies or banks as they bring virtually nothing to the table as all they do is tell you what's happened in the past. Interviewing actual fund /hedge managers who have a view and are backing themselves with other people's money is far more interesting. Totally agree with Peter L's comments. We have many interesting investment managers that should be interviewed way before any employed economists from large institutions.

  • MV

    Mark V.

    28 3 2017 08:46

    3       0

    I think that a better reason than undersupply for Australian property to continue to catch a bid is , to poorly reference one of my RV favourites, Dr Ben Hunt, that the "common knowledge"narrative continues to support a view that the "best way" to make money in Australia is through direct property holdings.
    If and until this changes (requiring a major cultural and political mindshift ) I can't see much changing

  • VV

    Vanessa V.

    28 3 2017 07:35

    18       1

    Shane Oliver's, and the Australian Government's, assertion that Australia has a Supply issue doesn't hold water. Australia has an artificial Demand issue (aka speculation issue). People aren't buying investment properties at such high prices because they believe they can make money renting them out. They're buying for speculative reasons and the negative gearing policy makes it easy for them to do so. Consider that overall house prices in Australia have risen approx 130% and rents only 20% in the last 20 yrs (in Melbourne house prices are up 210% and rents only 12% - no bubble there!). Surely if there was a Supply issue rents would be sky high? And there would be no need for investors to be negatively geared due to high rental yields? But the reality is that rents are low. Therefore its a Demand issue, not a Supply one. ???

  • an

    adrian n.

    28 3 2017 06:03

    9       0

    Professional investors with an extensive public profile, carry the burden of reputation risk. Much like politicians in office, they mostly praise the status quo that they are part of. Imagine how boring it would be to interview Warren Buffett.

    Dear old Shane did feel a little uncomfortable with admitting, in a clipped manner, that US trade protectionism or Italian euro exits would screw it all up.

    I was half expecting him to start chanting Ozzy Ozzy Ozzy Oi Oi Oi

  • EK

    Emil K.

    28 3 2017 04:34

    9       0

    If Steve Keen was dead he'd be rolling over in his grave right now. Thankfully he's very much alive and a simple pirouette will suffice.

  • RU

    Razvan U.

    28 3 2017 04:05

    7       1

    Tepper needs to interview this guy.

  • JM

    John M.

    28 3 2017 03:57

    9       9

    I struggle to see the great Australian Housing Crash so many commentators refer to here (including the oft-quoted Lindsay David).Aus will experience a downturn no doubt, but a crash? It will be selective crash more likely.
    No secret that buying off-the-plan apartments is not the best idea. Regional mining towns awful last few years too. On the other hand, what chance of a crash on house-and-land 10-kms from a major CBD? This last category is tightly held, often by retirees or families who will do everything they can to hold onto it.
    A crash would need a major upturn in the unemployment rate. Consider, Aus is more-and-more a service economy, funded by an ageing population with $2 Trillion in retirement assets. Meanwhile, the Fed Govt is spending $50+ Bill in defence contracts in South Australia (where manufacturing has been winding down). And while we do export, it is closer to 20% GDP, nowhere near the 40+% of Germany and China. Education (foreign students) also a major earner, and Sydney is the 4th largest financial services hub in Asia.
    Meanwhile “Big 4” banks have been increasing capital buffers in recent times, and still paying out $8 Billion each in dividends each year. Deposits of up to $250,000 are guaranteed by the Fed Govt and this is why Big 4 have a AA rating. Do you think Fed Govt (AAA rated) will let the Big 4 go to the wall, when so many votes count on it?
    While Oz trade is more and more to East Asia, our capital investments have primarily come from US and UK among others. We have rule of law where property is protected, are multicultural, open to foreign investment and trade.
    So to put it simply, the picture is “complicated”, and while there will be a downturn, with investors hurt, I for one don’t buy into this wholesale crash narrative suggested in some of the comments here.

  • VV

    Vanessa V.

    28 3 2017 02:50

    23       0

    Oh dear. In my humble opinion Shane Oliver is an example of the flawed thinking currently dominating Australian economics. What about Negative Gearing, Capital Gains Tax concessions, the fact that Australia has the highest immigration levels out of all OECD countries, extremely high household debt, interest only loans, falsification of bank applications etc? The man seems so out of touch. Please consider Lindsay David as your next Australian guest.

  • LS

    Leigh S.

    28 3 2017 02:43

    6       0

    always the optimist is Shane. Agree that if all you have done is lived through the greatest credit bubble in history then why not be relaxed. Shane recognizes the extend of global debt but seems to says its not a problem.

    All a bit superficial to me.

  • SD

    Stephen D.

    28 3 2017 02:25

    6       0

    Paul N is spot on. HUGE COMPLACENCY. But that's what 25 years of economic expansion will do to you. Anyone who can comment on Australian housing without noting affordability problems is taking the happy pills.

  • DR

    Dorothee R.

    28 3 2017 02:04

    1       3

    I'm always surprised that interviews that aren't dollar bullish or paint a very grim picture on some part of the market receive pretty harsh ratings.
    For some reason, selling a positive story in asset management is so much harder than selling a sanguine one (I'm not referring to any particular view here). Maybe that's the inefficiency?

    JAMES M., I agree with your second comment, and regarding your first one, rents are indeed very sticky because leases are generally locked in for a long(er) period of time. Add to that the fact that you have many speculators that don't inhibit their homes, and you have negative pressures in rents. Same thing is happening in Tokyo boroughs ahead of the Olympics. An ironic backfiring of low rates that are supposed to bring up inflation...

  • PL

    Peter L.

    28 3 2017 01:30

    13       3

    As an Australian, that was embarrassing. Mainstream economists are treated as a bit of a joke in the advising community in Australia as they usually ‘sit-on-the-fence’ and if they do have a view it invariably turns out wrong. None of them saw the crisis of 2008, and I dare say they won't see the next crisis coming. Not sure if it’s like this in the rest of the world.
    If you really want to know what is going on in Australia I suggest to speak to an economist like Simon Kitson from Blue Sky Investment Management. Simon spent 2007 warning the advising community of the impending crisis (not many listened) and would provide Real Vision listeners with some thought provoking macro views. He is also an avid follower and member of Real Vision.

  • JM

    John M.

    27 3 2017 23:13

    2       0

    Great to see an Australian focus from RV. Oz is an interesting place as we have enjoyed the best of both worlds (East and West), however rising tensions may change this. We may be a bellweather in that respect.

    Shane Oliver is highly regarded, but agree with concerns that his is more an establishment status-quo view.

    In terms of Australians, I suggest RV interviews Craig Swanger, Chief Economist at Revolver Capital. Have followed his articles for a few months now. Seems to have a more balanced outlook, better focused in terms of where disruption is likely to occur (both positive and negative).

    Also keep Simon Hunt in the pipeline for later in the year. Great interviews with Grant, even if his calls might not necessarily happen. Its well-informed, outside-the-box stuff. Cheers.

  • PS

    Paul S.

    27 3 2017 22:53

    16       0

    Housing shortage? Only for kids wanting to buy a home to live in. Almost a half of buyers are 'investors', 40% of loans now are 'interest only'. Brisbane has 7 years of supply being delivered in 18 months. Oliver is a retail cheerleader.

  • DS

    David S.

    27 3 2017 22:37

    2       2

    Cheers! I enjoyed a practical viewpoint from Australia. From the comment section, it is surprising how much more knowledgeable non-Australians are than someone who lives and works in Australia. Good luck Australia. DLS

  • TA

    Tobias A.

    27 3 2017 22:09

    7       0

    How many times can he say its complicated. That amounts to saying I have no idea. Or in Aus we say "she'll be right mate!".

  • SR

    Steve R.

    27 3 2017 21:26

    14       0

    Sorry - but this is just total crap! You should follow Lindsay David on Twitter to find out just what is REALLY going on in Australia. Massive oversupply of property development, huge falls in rents, and banks upto their eyeballs in mortgage fraud!

  • PN

    Paul N.

    27 3 2017 21:21

    26       0

    The #1 term to describe Australia is complacency. People passively pay into superannuation and get rorted with insane fees by index hugging funds. People invest in one asset class (property) and then never think about investing again. The RBA cuts rates and doesn't do anything about the housing bubble they created. The government props it up with tax breaks so it doesnt burst on their watch. The banks lend to anyone with a pulse and write whatever they want on the loan application so it gets over the line. And the regulators are asleep at the wheel.

  • PD

    Philip D.

    27 3 2017 21:17

    10       1

    Ah...Shane Oliver. Nice guy but end of the day AMP has massive investments in property. Unless you want your boss calling you for sounding dovish; there is no reason not to be bullish on property.

    Then AMP has a long term vision of playing big in China's pension system through a joint venture with China Life...so again why be bearish on China.

    On the point of most superannuation money is long term passive and the market is some what supported (in case of a downturn) through employer super contributions...isn't that when the smart money is selling and suckers buying. Now tell this to someone who has worked all their life and is to retire in a few years --should markets correct along with rising interest rates and government cuts to pension. Oops...compounding is of no use to them!

    The bottom line is, in this business you got to distinguish between the asset accumulators (big players in markets) VS true asset growers (compounding). My 2 cents

  • PN

    Paul N.

    27 3 2017 21:13

    28       1

    Australia is a textbook example of gdp growth being a stupid measure of prosperity. It's being fuelled by over-immigration and ever increasing HH debt. Wages are flat, housing costs have skyrocketed, the workforce has been casualized, youth unemployment is at record highs, and housing auctions have become the #1 national sport. This record long period of no recessions hasnt even been that good for ordinary Australians, and the coming crash will put us in the Greatest Depression ever.

  • SS

    Steven S.

    27 3 2017 21:11

    0       1

    Thanks RV! I was wondering last night why the Premier of China was in New Zealand. I realized that the AUD/USD is closely watched. But if Pres. Donald Trump came in on a Democrat Party ticket, I would have voted for him. So onto the European Union.

  • HA

    Hamed A.

    27 3 2017 20:06

    10       0

    maybe a dingo ate the supply of housing

  • JM

    Justin M.

    27 3 2017 19:35

    7       0

    Something about this interview feels awfully toppy..........

  • VK

    Viresh K.

    27 3 2017 18:19

    9       0

    Final comment, after posting two comments largely, disagreeing, I welcome the alternative viewpoint which is the great thing about RV.

  • VK

    Viresh K.

    27 3 2017 18:19

    1       0

    Regarding Shane's opinion that China is also short in housing:

    http://video.vanityfair.com/watch/the-new-establishment-summit-disrupting-the-global-economy

    <<< This is an interview of Jim Chanos and Kyle Bass late last year, who mentioned that China still has huge overcapacity. They have built c. 5.6bn sq m of high rises. And if 1/2 is office space = it means there is a 5ft by 5ft office for every single person in China

  • VK

    Viresh K.

    27 3 2017 18:09

    15       0

    Speaking of history, I'd like to remind everyone of Kyle Bass' interview in June last year. In that he mentioned he asked people from every state about his thesis on the housing crisis, and they all replied saying 'we agree, but it won't happen in my backyard'. Shane's explanation sounds so similar, and echo's his message that 'we've seen it all before'.

    Secondly, let's go onto the fact that Australia hasn't had a recession and he believes that the stock market has an effective floor on it due to the pensions dynamic. Granted. While these things may be true, just because it hasn't happened so far, doesn't mean it won't. Also, we can't predict the actions of people in a bear market. Will that stop/ floor exist when the market is falling? I think the probabilities of that are unlikely, as emotions take over and people begin to panic quickening the pace of the downturn. Next, onto the recession, I've seen Australia used as this beacon of how to avoid recessions, and how to manage your economy. Yet to me it just seems like they are 10 years or so behind the West considering their infrastructure, and have been boosted by having China next door during an unprecedented credit boom. Can they rely on this to remain? I think not.

    And finally, onto my favourite topic - Europe. This is a classic case of extrapolating the present.

    Shane says that the elections in Germany and The Netherlands means that European countries have turned their back on leaving the EU or the Euro. I'm not so sure this is true. Firstly, it's important to recognise that Brexit doesn't mean that everyone in Europe will want to leave, and secondly, the Dutch election doesn't mean that everyone now wants to stay. It's absolutely important that as investors we try to understand the idiosyncrasies of each country to see who is more/less likely to leave given the dynamics in their country. I don't believe we know yet what will happen in France, or Italy, or even Greece (still) for that matter, and all three could upset the newly formed consensus that Europe is now together forever.

    All in all, I'm not criticising Shane's interview. I think it was a useful, but more so to understand the psychology of market participants at this moment, and some of the thought process of people in Australia (again without generalising for all Australians). It was a great exercise in recognising biases and dissonance in your thinking.

  • JK

    Jon K.

    27 3 2017 17:15

    22       2

    This is my first thumbs down ever on Real Vision...I would explain why, but it is "complicated".

  • DS

    Dan S.

    27 3 2017 16:35

    21       2

    Shameless chief cheerleader for the housing bubble and immigration Ponzi scheme in Australia.

  • IJ

    Ian J.

    27 3 2017 14:23

    13       0

    Similar things were said of Spain re positive immigration and demographics underpinning RE demand. Turns out that postivive demographic/ immigration were casued by the boom and promptly reversed after the bust.

  • HB

    Heini B.

    27 3 2017 13:09

    27       0

    Please schedule a Rewind with Jonathan Tepper as interviewer in 12 months time.

  • SD

    Salvatore D.

    27 3 2017 12:27

    7       5

    Love the tie.

  • SP

    Simon P.

    27 3 2017 12:16

    12       6

    AMP Employee = Paid to be long.
    Amazing that this employee can see no systemic risk.
    Are Grant.Raul and co taking pay to play here?
    Better balance from Alan Kohler.

  • TM

    The-First-James M.

    27 3 2017 10:47

    4       1

    The fact that most people don't look at their Superannuation on a regular basis is one I can attest to, and I'd argue that this is why fees are high on what are mostly effectively closet index trackers. I've personally seen 5%pa fees on a balanced superannuation scheme invested in as the default option for a company I worked for. Most people who don't take ownership of their own super tend to be invested in a balanced fund, and the ones I've dug into have all been closet ASX 200 trackers.

  • TM

    The-First-James M.

    27 3 2017 10:43

    5       1

    Definitely more complicated though as Shane says. By way of example, he didn't mention the negative gearing tax break nor the impact it has had on Australian real estate prices.

  • TM

    The-First-James M.

    27 3 2017 10:42

    38       1

    If there's such a heavy property shortage, why are rents static? The only shortage of Aussie property is enough to satisfy speculative demand, not residential (Anecdotally, many Gen Y's I know have given up on the idea of ever owning their own home).