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Both Stock Market and Aussie Dollar performed strongly, likely due to US Fed talking interest rate cuts.
Less volatile Money Market action this week, still strong indication of rate cuts next year.
Respectable clearance rates andmedian prices for Sydney, a littleless positive for Melbourne andBrisbane, however; nationally it’s adecent winter auction volume.Brisbane is a smaller data set sothe median moves around morethan the other capitals
My first trip overseas was in 1977 to various countries in Europe. One travelled in those days with traveller’scheques, and I remember my parents buying Swiss Francs as the most convenient currency for ourdestinations. And the denominations were large because there were 5 francs to the South African Rand, soeverything seemed so much more expensive. Today there are 21 Rands to the Swiss Franc, meaning the Randhas lost more than 99% of its relative value. Over a similar timeframe the US dollar has declined from about 4Franc per dollar to $1.30 per Franc – about 80% of its value. The reason is largely because the Swiss CentralBank has not inflated its money supply to nearly the same extent as America, South Africa and indeed mostother countries.
This got me thinking about that calculation I made a few weeks ago that in 1975 it cost about 91 ounces of gold tobuy an average family home in Australia, compared to the current cost of around 300 ounces, and that despitethe gold price having risen from A$287per ounce then to over A$3,500 per ounce at the time of the report.What this means is that the currency with which we store wealth makes a very big difference to the WealthCreation journey. Those of my former countrymen who remain in South Africa and keep their wealth in Randshave to do a lot better than my Swiss contemporaries who save in Francs. Those who have stored their savingsin gold coins are doing a lot better than similar earners with savings accounts at the Commonwealth Bank. Butthose who have stored their wealth in property - they are doing the best by far of all of us.
Consider this table showing how property has created wealth, well in excess of inflation over the long term.
