how u know u are not inside a bubble ??

before the housing boom our household debt was at 45%, now it's at 83%.

ya maybe bank negara should let it increase until 2000%.

let us have trillion dollar GDP. strongest economy in the ASIA

people are either greedy or fearful.
it's in the DNA one.

people switch sides whenever necessary.
they dont die die must buy to prove that they are right.

if the house price increase 5% per year, no ppl wanna buy to goreng d.

they are in a buying frenzy mode because of the 25% increment, and not because of the stable increment.
when the price stops moving up that fast, all will be farking boring d....

some of them already thinking in their head....why my big boss Li Ka Shing already abandon ship.......

whatever bubble and crash also related to credit expansion, means banks release a lot of money.

for japan is their banks released a lot of money and the money flow into stocks


so their stocks market rushed to 40,000 points, exploded and now deflated at 1/5 price, about 8,000 points there.

over the same period of time, property prices skyrocketted also.
a lot of companies expanded and some maybe earning RM 20k per month somehow can swallowed RM 10mil loan.

so when everything exploded, the father tells the son :
Son dont buy house, just rent enough d.
True enough, renting house ROI is about 2% to 3% ROI only.
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as for US's case, after September 11, 2001 attacks, US president released a lot of money for create housing boom, during that time was about USD 1Trillion.
So it caused a massive crazy property bubble until finally exploded at 2008.
same schemes were used to encourage buying la, zero DP, zero interest during construction until completion, then the loans were packaged and sold worldwide.

although they said it was due to subprime loans, but actually it was the subprime loans that exploded first.
the economy simply crashed and a lot of prime loans turned into subprime because of the people losing jobs.
all their jobs got outsourced to China and whatever industries that came with the housing boom collapse with it as well.

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before 2008, it was US who was the biggest spender,
and after 2008, China cannot ask their people to slow down,
so their government released a massive USD 12Trillion loans out within 4 years.
it's the biggest money tsunami ever created by mankind.

so their corporations started buying like mad, people getting freaking rich fast

but now their government is trying to reduce the problem created by it because a lot of chinese misused the money and fled with it.
borrowed a millions and cabut from China. Some factory owners fled with company money.
when this boom gonna burst nobody knows, but it is definitely slowing down as all the export number and global countries growth numbers are showing decline d.

This post has been edited by AllnGap: Apr 22 2014, 04:48 PM

najib is pumping the economy via loans.
our country's debt is increasing by RM 100bil every year.

so i'm asking you back, how long can he do like that, but u dint answer me, u just say it will go UUU.

money is liquid one. so it can flow to any sectors, any countries, depending on where the government want it to flow to.
example, if bank negara wanna help car sales, they can introduce low interest for car loans only.

And if those sectors is recognized as assets so the banks can lend more.
Asset class : properties, blue chip stocks, bonds, commodities contracts, gold deposit as assets.
so any of those above if can inflate in price, the bank can borrow you more, cuz u are worth more now on paper.

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for Japan crash i explain like this la.
for BOOM to happen, you need money, lots of money, tsunami of money.

during that time, share market increased 5 times. property maybe 5 times also.
share market exploded first, properties later, but i wasnt sure the real reason was the central bank stopped lending so much money or due to interest.

so for domino effect is simple.
During malaysia 1998 times, property prices hardly move up that much, so there wasnt any bubble on properties.
Malaysia government spent a lot of money on mega projects for the 1998 Commonwealth games (bukit jalil stadium, hockey, KLIA all those big big ones)

most of the people dumped their savings into share markets, some played contra (leverage)
my friend uncle told me the stocks remisier was driving ferrari and he (uncle) was making RM 100k daily on share market.
most of the people quit their jobs and everyday just stand outside of the exchange centres.

LMAO compare properties flipping is damn slow man.

RM 100k daily in 1998 vs RM 100k for 3years in 2013.

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prime = people with savings, proper jobs (grade A n B)
subprime = people who cant get jobs, no savings (grade D)

As for US case, they blame it on subprime, but actually a lot of cities in the US price level now is still stuck at 2004 levels until today, never recover.

Buying house in US cities is cheaper than buying in Malaysia. but they earn in USD, we earn in MYR.
they pay finish in 15years, we pay finish in 35years.



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China's case is like this, they wanted to become world number 1 in shortest period of time, and after they open up in 1970s, they ran like mad one, never experience boom and bust.

after US economy collapsed in 2008, someone has to "spend big" so that their factories got order, their people got jobs, they can upgrade themselves, companies can go listing, more capital ventures like WeChat, Weibo.

so Chinese government released a massive 13,000 Billions USD in loans after 2008
These loans flows into corporate loan, personal loan, housing loan, car loan....
so money easily available and interest was low.
so a lot of songlap cases, China has the biggest illicit capital outflow in the world.

it is faster to pakat with bank officer to lend money and run away from China.
but that was a different premiere, now already changed leadership.

this leader comes up wanna clear up this whole mess.
to date, their corporate loan interest rate has already doubled, and banks cannot simply lend money d.

so the biggest spender in the whole world decide to slow down the music


summary of economy boom.
happy party time = low interest x easy loans (banks have billions to lend you)

no party time = high interest x hard loan (bank dont wanna lend u money even u have jobs)

before najib was 55%, now it's 84% of GDP d.

i dunt freaking care about najib.
when china decides not to buy so much of palm oil and other commodities from us then u see la....

government sure increase tax to collect back loss of income.

This post has been edited by AllnGap: Apr 22 2014, 08:27 PM

household debt growing larger by 100Bil year. now at 83%
sovereign debt owe outsider countries dint move that fast cuz most of the money comes locally from EPF.
means like 1MDB bonds is not sold to outsiders but sold to EPF.

household debt is like for you and me,

sovereign debt is government debt

comes back to the samething,

government spend more u think government pay ?

you are government income.

you owe more you pay to bank

government owe more they increase taxes to collect back

either way also the people pays more

those country experience crisis is sovereign debt crisis.

like i said.
1. sovereign debt
2. household debt

right pocket, left pocket still is your pocket
both is people pay.

u dint mention sovereign debt and household debt, i tot u were talking about household debt.

haha....what is this kind of theory ??

1 wrong = all wrong ??

champion la.....

lazy to explain d.

please buy more, sapu more.....leverage all u can.....i wanna see the price explode

nothing to contribute. just wanna gain posts count only.

taken from wikipedia

Since the end of Cold War[edit]
1989 Economic Bubble[edit]
Further information: Japanese asset price bubble
In the decades following World War II, Japan implemented stringent tariffs and policies to encourage the people to save their income. With more money in banks, loans and credit became easier to obtain, and with Japan running large trade surpluses, the yen appreciated against foreign currencies. This allowed local companies to invest in capital resources much more easily than their competitors overseas, which reduced the price of Japanese-made goods and widened the trade surplus further. And, with the yen appreciating, financial assets became very lucrative.

With so much money readily available for investment, speculation was inevitable, particularly in the Tokyo Stock Exchange and the real estate market. The Nikkei stock index hit its all-time high on 29 December 1989 when it reached an intra-day high of 38,957.44 before closing at 38,915.87. The rates for housing, stocks, and bonds rose so much that at one point the government issued 100-year bonds. Additionally, banks granted increasingly risky loans.

At the height of the bubble, real estate values were extremely over-valued. Prices were highest in Tokyo's Ginza district in 1989, with choice properties fetching over US$1.5 million per square meter ($139,000 per square foot). Prices were only slightly less in other areas of Tokyo. By 2004, prime "A" property in Tokyo's financial districts had slumped and Tokyo's residential homes were a fraction of their peak, but still managed to be listed as the most expensive real estate in the world. Trillions were wiped out with the combined collapse of the Tokyo stock and real estate markets.

With Japan's economy driven by its high rates of reinvestment, this crash hit particularly hard. Investments were increasingly directed out of the country, and Japanese manufacturing firms lost some degree of their technological edge. As Japanese products became less competitive overseas, some people argue that the low consumption rate began to bear on the economy, causing a deflationary spiral.

The easily obtainable credit that had helped create and engorge the real-estate bubble continued to be a problem for several years to come, and as late as 1997, banks were still making loans that had a low guarantee of being repaid. Loan Officers and Investment staff had a hard time finding anything to invest in that would return a profit. Meanwhile, the extremely low interest rate offered for deposits, such as 0.1%, meant that ordinary Japanese savers were just as inclined to put their money under their beds as they were to put it in savings accounts. Correcting the credit problem became even more difficult as the government began to subsidize failing banks and businesses, creating many so-called "zombie businesses". Eventually a carry trade developed in which money was borrowed from Japan, invested for returns elsewhere and then the Japanese were paid back, with a nice profit for the trader.

The time after the bubble's collapse (崩壊 hōkai?), which occurred gradually rather than catastrophically, is known as the "lost decade or end of the 20th century" (失われた10年 ushinawareta jūnen?) in Japan. The Nikkei 225 stock index eventually bottomed out at 7603.76 in April 2003, moved upward to a new peak of 18,138 in June 2007, before resuming a downward trend. The downward movement in the Nikkei is likely due to global as well as national economic problems.

friend, then i reply u why either one is not so important, i ask you how much more can the debt level go up, and who ended up paying for it.

i recognized that the price might still go up depending the level of debt that we have.

if our country debt is capped at 55%, then we are at 53% d
our household debt is at 83% of income d. we pay 83cents back to banks for RM 1 we earn.

how much more money can they release.

lmao......

1 wrong = all wrong......