web analytics

Does this graph confirm that the low in commodity prices is in place?

Posted by on Apr 2, 2016 in 18 year real estate cycle, Forecasts, Kondratieff (Long) wave cycle, Reports |

In February, National Australia Bank suggested that house prices in Perth would continue to fall in 2016 because of weakness in commodity prices, as mining companies shed staff and the domestic economy continued to experience weak growth and high unemployment. Here is the story. The article notes the link between the commodity and housing markets – which is strong in regions and countries that are strong commodity producers (Australia, parts of the US and Canada, Latin America and much of Africa, for example). I’ve set out my forecast for commodity prices in my recent report The Fifth Wave: Long-Term Commodity Prices and How to Profit from Them. With that in mind, I am a keen follower of the property markets in commodity-rich regions. In Australia, the Western Australian property market, particularly Perth, is something to look at given the importance of mining and other resource extraction to the local economy. Real estate prices recovered across Australia around 2012. But in 2012, commodity prices were still high and so Perth led the way. See the graphic below. Data source: Australian Bureau of Statistics   But from 2014 onwards (in particular) commodity prices fell sharply. It’s no surprise then that 2014 was a bad year for the Perth real estate market. As real estate prices in Australia continued to grow, they stalled in Perth. And then they started to fall. This continued into 2015. You can see from the graph above that during 2015 there was a major divergence between the general Australian market and Perth. Note, however, that in the last quarter of 2015 house prices in Perth ticked up slightly. So this begs the question: is the market turning around? From the evidence of the graph it’s possibly a little early to say. However, this is where our cycles work on commodities helps. A turn around in property prices would be consistent with our commodity price forecast – we are on the look out for a low in 2016. And expect also that rises from here will be seen in the housing market as companies once again expand and there is a return in demand for real estate. Since the lows in January, commodity prices have had a good run. See the chart below.   The next test of these lows will be interesting. Should they be higher lows, we are looking upwards for commodities and real estate....

Read More

Four Cycles to help Investors and Traders

Posted by on Aug 13, 2014 in 18 year real estate cycle, Kondratieff (Long) wave cycle, Reports |

We have just launched our latest report: Four Cycles to help Investors and Traders. In this 27 page report, we provide you with a detailed look at four key investor cycles that shape the long-term direction of global markets. You can apply this ‘big picture’ knowledge to your own investment decisions. We are firmly of the view that the best long-term investments follow the major secular market trends. This report will take you through those. In the report, we tell you: why in 2012, when there were still significant eurozone worries and US deficit issues, we knew that stock markets would have a bull year and why we are looking for a market low in the next six months why we don’t think that Western governments’ money printing will lead to major inflationary issues why we we live in an era of low interest rates why the coming boom will be the biggest of all time The four cycles we cover in the report are: Investor Cycle #1: The US Presidential Cycle Investor Cycle #2: The 18.6 year Real Estate Cycle Investor Cycle #3: The Kondratieff Wave (50-60 year commodity cycle) Investor Cycle #4: The Great Wave (the 100 year inflationary revolution and equilibrium) Any investors with a long-term investment horizon will benefit from the insights contained in this report.  For details on how to obtain this report, please visit our Reports...

Read More