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Beyond the expected

Car sales down as part of economic cooling?

By johnboy 22 October 2008 27

The ABC has a piece on car sales in Canberra being down over 10% in September.

I know I’m trying to reduce my debt with troubled times ahead, how about you guys?

What’s Your opinion?


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Car sales down as part of economic cooling?
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peterh 4:40 pm 23 Oct 08

tylersmayhem said :

What most people don’t realise is that the best way to stop the current downturn is to spend more money. By holding off on everything people are just causing the economy to get worse. You spend more money and the econoy will start to recover.

Can’t say I agree. One of the reasons the interest rates were teetering on 10% is because everyone was spending like there’s no tomorrow. High inflation = higher interest rates. Keep spending loads of cash, we will continue to drive prices up, as well as the interest rates.

Am I wrong in my thoughts?

probably not, but the first knee jerk reaction is to throw bags of money at the problem, to make it go away. Look at the US – they put together a recovery package – a hell of a lot of money, and this didn’t make the market steady. in fact, the reverse happened. people get more worried when a government says it is stepping in to shore up the market. it appears worse than it might be.

in my industry, we are seeing a massive shift in the diversification of smaller players into niche markets. they have to stay afloat. they will move away from traditional markets and rely on the services revenue that they can provide.

tylersmayhem 8:52 am 23 Oct 08

What most people don’t realise is that the best way to stop the current downturn is to spend more money. By holding off on everything people are just causing the economy to get worse. You spend more money and the econoy will start to recover.

Can’t say I agree. One of the reasons the interest rates were teetering on 10% is because everyone was spending like there’s no tomorrow. High inflation = higher interest rates. Keep spending loads of cash, we will continue to drive prices up, as well as the interest rates.

Am I wrong in my thoughts?

I don’t we’re likely to see property prices taking off in Canberra in the next few years, but rent is still increasing, and it’s possible to buy a property that nearly pays for itself with rent. My thought has always been to buy this type of property, put it on principal and interest loan, and let time do the work for me. This method also is also easier to replicate than the traditional negative gearing model, which hits a wall when you’ve consumed your income making up the shortfall.

At the moment there are a number of properties for sale that generate good yield (ie 5.5%+) at reasonable prices. And this return doesn’t include your future capital growth.

tylersmayhem 8:49 am 23 Oct 08

And as protection in case it all goes to shit and I get laid off lol and have to fund my holidays for 18 months until it gets better.

Yes, because depressions last for 18 months…

skaboy12 8:29 am 23 Oct 08

What most people don’t realise is that the best way to stop the current downturn is to spend more money. By holding off on everything people are just causing the economy to get worse. You spend more money and the econoy will start to recover. The financial planners and experts have been saying this for a whle. We are contributing to our own downfall.

Growling Ferret 8:18 am 23 Oct 08

Unemployment at 9 or 10% as predicted yesterday will see house prices collapse, but not necessarily that badly in Canberra unless Labour sacks 5000 or so public servants.

I think there is a still a long way to go, and house prices will drop by 25% in Western Sydney, outer Melbourne etc, but doubtful it will be that bad in Canberra. However, saying that, I have noticed that prices in my street have dropped by around 5% from the peaks of two or so years ago.

tabascoted 5:35 am 23 Oct 08

so anyone think that house prices are coming down anytime soon? as it looks like unemployment will be at 9% by 2010^(JPMorgan Australia’s chief economist Stephen Walters)

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