The David McWilliams Podcast Sold Down the River
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Jun 27, 2024 Delve into the vulnerabilities of the commercial property market post-pandemic. Explore historical parallels with economic cycles and the impact of displacement moments. Unravel the dynamics of the real estate market through the lens of the flatboat era in American history. Discuss the interconnectedness of tech stocks, real estate, and pension funds in the financial system.
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Commercial Property Values Have Collapsed
- Dublin's commercial property values have plunged about 27% since the end of COVID, exposing many empty buildings.
- The Central Bank itself wrote down its new office by €157m a year after purchase, signalling deep market stress.
Read Central Banks Strategically
- Treat central bank proclamations as counter-indicators if they lack monetary firepower.
- Never 'bet against the ECB' because it can act with scale; treat smaller central bank statements skeptically.
Displacement Starts Economic Booms
- Economic cycles begin with a 'displacement' — a real, fundamental change that spurs speculation.
- That initial shift creates expectations which can magnify into long credit and asset booms.