Inflation Rate Is Going Down. What Are The Effects In The Property Market?

Brett Alegre-Wood
September 19, 2020

Is Inflation happening after all government incentives are gone?

The government incentives put in place at this time is working really well. Once all these incentives are taken away we will see the real impact on the economy. Can the government keep these incentives flowing? 

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Inflation is the next thing so we've talked about you know the zombie companies which potentially all fall over when you know the furlough and government incentives are gone we've talked about unemployment.

Inflation rate so the inflation rate has come down you can see by the graph there you know it was heading up and now it's come down. And the interesting thing is you know with this is what we'd expect okay that the prices aren't going up right now the issue is with all the government spending the sting in the tail is that we could get inflation next year or the year after.

But this is one of my bigger plays right now in terms of my gut feel on where things are going. And that is I think the US government and you know the US has led in that they just print money aimlessly and senselessly and at the end of the day they don't really care frivolously almost.

What's happening now is a lot of other countries are going you know what US got away with it and are getting away with it and got away with it since the last recession they just you know inflated their way out of it or spent there you know produced money was it made money printed money. I can't think of a bloody name but anyway. 

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I think what's happening is a lot of countries are going well if it works for them, okay we're not the reserve country so we can't get away with it as they can but perhaps we can. And I think that's what's starting to happen and if everyone does it then we all sort of you know have the same problem. It's where countries a lot of countries you'll be used to if you're in a recession you know you were the only country going to recession so you know that's not necessarily happening this is a worldwide thing.

So you know some countries have performed better some will do worse but I think the bigger picture is countries are starting to get away with stuff that they wouldn't have normally done. And we'll talk about Brexit later on and we'll just talk about how arrogant you know the the the UK government is around the Brexit the exit bill you know and it's the same concept that I think is coming out with politicians now where they realise they can do whatever the hell they want and they don't there's no one checking them. And I think Trump really has taken us down that rabbit hole to a degree.

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With inflation I mean the interesting thing is they're saying you know the eating out scheme pushes down in August inflation. That's been a huge success. You know people I know who are in that sort of industry. It's fantastic. It's worked really really well for them. You know wonderful good on them. So yes I think that's really good.

Look I think really with this whole recession thing, it all depends on the government incentives and it all depends on how the businesses go from here and how we go about spending. The good thing is you know because they're building more properties and they're going they're investing in that that money's getting down and that can be spent so to build new properties.

So there's a bit of a mini boom I might say it's not a boom by any boom perspective but it certainly has stimulated the market to get moving in the building sector and then the building sector goes into the effect or the planning development that goes in the building and then the building. I mean for instance building right now you can't get red bricks you know because there's just not enough supply of them.

You know so that's what a precursor to prices going up which obviously inflation and all those things. But actually in the sense of where we are that's not such a bad thing yeah so yeah it's you know for me it's not it's more positive than negative but it's not over the top positive.

Video Transcription

Inflation is the next thing so we've talked about you know the zombie companies which potentially all fall over when you know the furlough and government incentives are gone we've talked about unemployment. Inflation rate so the inflation rate has come down you can see by the graph there you know it was heading up and now it's come down. And the interesting thing is you know with this is what we'd expect okay that the prices aren't going up right now the issue is with all the government spending the sting in the tail is that we could get inflation next year or the year after. But this is one of my bigger plays right now in terms of my gut feel on where things are going. And that is I think the US government and you know the US has led in that they just print money aimlessly and senselessly and at the end of the day they don't really care frivolously almost. What's happening now is a lot of other countries are going you know what US got away with it and are getting away with it and got away with it since the last recession they just you know inflated their way out of it or spent there you know produced money was it made money printed money. I can't think of a bloody name but anyway. I think what's happening is a lot of countries are going well if it works for them, okay we're not the reserve country so we can't get away with it as they can but perhaps we can. And I think that's what's starting to happen and if everyone does it then we all sort of you know have the same problem. It's where countries a lot of countries you'll be used to if you're in a recession you know you were the only country going to recession so you know that's not necessarily happening this is a worldwide thing. So you know some countries have performed better some will do worse but I think the bigger picture is countries are starting to get away with stuff that they wouldn't have normally done. And we'll talk about brexit later on and we'll just talk about how arrogant you know the the the UK government is around the Brexit the exit bill you know and it's the same concept that I think is coming out with politicians now where they realise they can do whatever the hell they want and they don't there's no one checking them. And I think Trump really has taken us down that rabbit hole to a degree. With inflation I mean the interesting thing is they're saying you know the eating out scheme pushes down in August inflation. That's been a huge success. You know people I know who are in that sort of industry. It's fantastic. It's worked really really well for them. You know wonderful good on them. So yes I think that's really good. Look I think really with this whole recession thing, it all depends on the government incentives and it all depends on how the businesses go from here and how we go about spending. The good thing is you know because they're building more properties and they're going they're investing in that that money's getting down and that can be spent so to build new properties. So there's a bit of a mini boom I might say it's not a boom by any boom perspective but it certainly has stimulated the market to get moving in the building sector and then the building sector goes into the effect or the planning development that goes in the building and then the building. I mean for instance building right now you can't get red bricks you know because there's just not enough supply of them. You know so that's what a precursor to prices going up which obviously inflation and all those things. But actually in the sense of where we are that's not such a bad thing yeah so yeah it's you know for me it's not it's more positive than negative but it's not over the top positive.


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