Copyright, Li Read, 2008
It's very interesting that we have a meltdown in the financial/banking centres, plus in the housing market, plus in the stock markets, and all at the same time. This is something very "new", indeed.
I'm of the opinion that it's "societal". In the early days of the 20th Century, life was much as it was at the end of the 19th. World War I was the dividing line, and the beginning of the 20th Century model.
Perhaps this financial cataclysm, with its global dimensions, is the equivalent. It's definitely a dividing line of some sort, along the same lines as "9/11".
With all the monies being printed, globally, to "bail out" the financial sectors (in an effort to maintain economic health, in these countries), it brings to mind the historical information that we have in various countries/time lines, where printing money was a government's idea of saving a situation.
If all that paper money is being printed, in whatever currency, what's backing it? A government? A savings institution? Forget that!
When will people realize that the old adage of "cash is king" no longer works?
Cash is becoming worthless. Perhaps, and we don't have a time line for same, we will find currencies folding into "one" currency, and trading blocks will be the outcome. Will we find a North American currency, including Canada, the U.S., and Mexico? Will there be one currency for Europe (including Russia)? Will there be one currency for Asia (including both China and India)?
Big questions, and I'm not a currency trader or an economist.
It's definitely not business as usual, however.
I've always been a believer in hard asset investments, even before I became a real estate agent. I've been encouraging clients to "hold" their Salt Spring Island and Southern Gulf Islands properties, unless they "have to" sell. The Islands Trust, a government mandated body, which came into being in 1974, has effectively prohibited growth on the Gulf Islands, and this makes them "protected investment" areas.
We don't have a crystal ball, and the immediate future may have dire events. What about the hedge funds, and their exposure to the subprime mess? We might see another 50% drop in the stock market! A lot of net worths have already been erased.
If one has to sell real estate, right now, then it's entirely possible that the sale will be 30% less than it might have been a year ago.
If one doesn't "have to" sell, though, and can keep all the balls in the air, pay the mortgage, and soldier on, then it may be that an appreciation will be seen, with patience. If hyper inflation occurs (& that's one scenario), then a real estate investment is a good option to "hold".
More into? Call me! (cell: 250-537-7647).
These are very interesting times, indeed (wasn't that an ancient Chinese curse?).
It's very important, though, to keep to an even keel, especially when bombarded by the cable news onslaught of repetitive reporting. We are creative beings. If we don't get bogged down in fear, and thus allow our creative selves to come to the forefront, we may be able to work our way out of this seeming morass.
The good news is that we're all in the same boat, globally. This means that we all, wherever we are, can come up with the new directions demanded by the 21st Century. Have we thought what those issues might be? In pondering the "now", and it's wavy directions, we might just hit on the path to the future. If you see the signpost, give me a call. I'll do the same for you.
The 21st century might also be about sharing and aiding. Now, there's a thought!
For excellent real estate advice and knowledge, for Salt Spring Island and the Southern Gulf Islands, please call anytime.
Sea to Sky Premier Properties
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