By the time you read this, the latest edition of the Boom Bust Bulletin would have hit members’ inboxes. We have made it clear to our members that property prices are now on the rise. And they are unlikely to stop rising for the next few years at least. It’s never been more important to understand the 18.6-year Real Estate Cycle and how best to take advantage yourself.

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“Americans are re-programmed every four years for the most important desperately crucial national emergency election since the last one.” – Anonymous

This is to remind you that since 1776 in the US, elections held there have not made one iota of difference to the 18.6-year Real Estate Cycle.

The Property Sharemarket Economics (PSE) team study the 18.6-year Real Estate Cycle, 14 years up and 4 down with a mid-cycle recession interrupting the 14 years’ expansion.

We have shown our members that we are right in the middle of the mid-cycle recession of the current real estate cycle.

And in the US currently, the cycle continues to turn regardless of who is in the White House.

This will continue unless one of the parties decides to change how speculators borrow money to bid up land prices to extreme levels and sell them to each other.

And let’s face it, this will never happen. There are too many well-connected interests that want the present system to continue.

The boom-bust violence of the cycle is determined by the extent of the banking system’s lending.

And I can’t see that slowing down anytime soon either. Why would banks stop? They make huge profits out of it.

You can judge the credit creation simply by counting cranes in cities and looking at the height of the tall buildings going up.

I remain of the view that President-elect Joe Biden will do everything possible to pump the US economy full of money, increase lending, keep interest rates VERY low and spend government money that isn’t theirs.

To fully complete the picture, all we really need now is a major programme of infrastructure spending. The bigger the better, please.

Around the world and especially in the US, infrastructure is funded through borrowing from banks and the raising of (infrastructure) bonds.

This puts the relevant government (usually state-level) authorities into debt. Taxes are levied to pay the loan(s) back leaving the price of land to escalate.

And that money is about to unleash like a torrent across the mainland United States.

According to the “A budget for America’s future” released by the White House in February this year, the following were highlighted for fast-tracked spending approval beginning in 2021.
• $1 Trillion in Direct Federal Investment
• $60 Billion for a new Building Infrastructure Great grants program
• $50 billion for a new Moving America’s Freight Safely and Efficiently program.
• $35 billion for a new Bridge Rebuilding program.
• $25 billion for a new Revitalizing Rural America program.
• $20 billion for a Transit State of Good Repair Sprint program
Such infrastructure spending is the best way to start a real estate speculative frenzy.

I am expecting this to repeat. And so, the cycle continues to turn.

Again, the person in the White House has never (yet) altered this process.

Further to this, both PSE Directors Phillip J Anderson and Akhil Patel once wrote for the US publishing house Agora Financial.

Phil first wrote for them in 2014, Akhil joined later from around 2016- up until 2019.

We’ve been wanting to post some of this past writing to the Property Sharemarket Economics (PSE) website for some time now, where it’s helpful to you to do so.

It’s timely that we (re)post Akhil’s first piece for you. This detailed Mr Trump’s win back in 2016 and proved rather prescient.

You can read Akhil’s piece in the Archives page HERE.

We’ll post more such writing in due course so you can see about how the cycle can be forecast.

And don’t forget, your best companion piece to guide you through the 18.6 Real Estate Cycle is the Boom Bust Bulletin, click HERE now to sign up.

Best wishes

Darren J Wilson
and your Property Sharemarket Economics Team

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