[/caption]
USA, with the Federal Reserve again holding the benchmark rates at record lows (as expected) to allow the US economy to recover further. In spite of all this, unemployment rates remained high and the housing market stayed sluggish; signs pointing to a very slow (but probably more sustainable) recovery.
The same few issues saw frequent rotation in the news – that of Greece’s debt as well as China’s growth (or over-heating if you want to call it that). Many US blue-chip companies also released results and gave forward guidances which were positive, as the economic recovery meant spending would increase and demand for goods and services recovering to pre-crisis levels. This had the effect of pushing the US Stock Market gradually higher, and it broke 17-month highs recently on renewed optimism; but it was still significantly below the all-time high of 14,000 reached during the heights of the bull market in October 2007. It has been about 2.5 years since the peak was breached, and throughout history the average time period for a bear market recovery has been about 4-5 years.
With low interest rates, Singapore’s property market went into (another) frenzy, with many mass market projects hitting new highs (The Vision at west coast area sold for >S$1,000 psf despite leasehold, a record for that area), while The Estuary in Yishun also saw healthy demand despite exorbitant pricing (this is the author’s own personal opinion). The reasons given were the usual – record low interest rates, massive liquidity sloshing around as a result of the unprecedented stimulus packages, and also people’s risk appetite increasing as they sought to park their funds in investments which yielded returns above inflation (and pathetic bank interest rates). In this kind of environment, what could go wrong? The newspapers have been trumpeting bullish news for months and new records are being set even as I type this.
Even with the recent measures announced by the Government to dampen speculation in both private property and HDB, prices still seem to rise unabated. I myself have visited some showflats to get a sense of what is out there, and came back amazed and flabbergasted by the strong take-up response of seemingly pricey units. Some were as tiny as 500 square feet but going for $1,600 psf (Mickey Mouse units, no doubt). Others boasted of potential new MRT developments, never mind that these plans will not materialize for the next 10 years! Everyone is riding along on a wave of euphoria, and even the sales agents at each launch seem overly exuberant and look like sharks eager for their (almost guaranteed) fat commissions. HDB resale prices have soared to new highs with an apartment in Bras Basah “smashing” records and commanding a COV of S$70,000! Read more...March 2010 turned out to be a seriously boring month, in terms of both corporate news and developments as well as economic issues. The same usual issues were “recycled” back and forth while the experts at the top debated over economic policies for the
[caption id="attachment_2682" align="alignright" width="150" caption="Photo by circo de invierno"][/caption]
USA, with the Federal Reserve again holding the benchmark rates at record lows (as expected) to allow the US economy to recover further. In spite of all this, unemployment rates remained high and the housing market stayed sluggish; signs pointing to a very slow (but probably more sustainable) recovery.
The same few issues saw frequent rotation in the news – that of Greece’s debt as well as China’s growth (or over-heating if you want to call it that). Many US blue-chip companies also released results and gave forward guidances which were positive, as the economic recovery meant spending would increase and demand for goods and services recovering to pre-crisis levels. This had the effect of pushing the US Stock Market gradually higher, and it broke 17-month highs recently on renewed optimism; but it was still significantly below the all-time high of 14,000 reached during the heights of the bull market in October 2007. It has been about 2.5 years since the peak was breached, and throughout history the average time period for a bear market recovery has been about 4-5 years.
With low interest rates, Singapore’s property market went into (another) frenzy, with many mass market projects hitting new highs (The Vision at west coast area sold for >S$1,000 psf despite leasehold, a record for that area), while The Estuary in Yishun also saw healthy demand despite exorbitant pricing (this is the author’s own personal opinion). The reasons given were the usual – record low interest rates, massive liquidity sloshing around as a result of the unprecedented stimulus packages, and also people’s risk appetite increasing as they sought to park their funds in investments which yielded returns above inflation (and pathetic bank interest rates). In this kind of environment, what could go wrong? The newspapers have been trumpeting bullish news for months and new records are being set even as I type this.
Even with the recent measures announced by the Government to dampen speculation in both private property and HDB, prices still seem to rise unabated. I myself have visited some showflats to get a sense of what is out there, and came back amazed and flabbergasted by the strong take-up response of seemingly pricey units. Some were as tiny as 500 square feet but going for $1,600 psf (Mickey Mouse units, no doubt). Others boasted of potential new MRT developments, never mind that these plans will not materialize for the next 10 years! Everyone is riding along on a wave of euphoria, and even the sales agents at each launch seem overly exuberant and look like sharks eager for their (almost guaranteed) fat commissions. HDB resale prices have soared to new highs with an apartment in Bras Basah “smashing” records and commanding a COV of S$70,000! Read more...
[/caption]
USA, with the Federal Reserve again holding the benchmark rates at record lows (as expected) to allow the US economy to recover further. In spite of all this, unemployment rates remained high and the housing market stayed sluggish; signs pointing to a very slow (but probably more sustainable) recovery.
The same few issues saw frequent rotation in the news – that of Greece’s debt as well as China’s growth (or over-heating if you want to call it that). Many US blue-chip companies also released results and gave forward guidances which were positive, as the economic recovery meant spending would increase and demand for goods and services recovering to pre-crisis levels. This had the effect of pushing the US Stock Market gradually higher, and it broke 17-month highs recently on renewed optimism; but it was still significantly below the all-time high of 14,000 reached during the heights of the bull market in October 2007. It has been about 2.5 years since the peak was breached, and throughout history the average time period for a bear market recovery has been about 4-5 years.
With low interest rates, Singapore’s property market went into (another) frenzy, with many mass market projects hitting new highs (The Vision at west coast area sold for >S$1,000 psf despite leasehold, a record for that area), while The Estuary in Yishun also saw healthy demand despite exorbitant pricing (this is the author’s own personal opinion). The reasons given were the usual – record low interest rates, massive liquidity sloshing around as a result of the unprecedented stimulus packages, and also people’s risk appetite increasing as they sought to park their funds in investments which yielded returns above inflation (and pathetic bank interest rates). In this kind of environment, what could go wrong? The newspapers have been trumpeting bullish news for months and new records are being set even as I type this.
Even with the recent measures announced by the Government to dampen speculation in both private property and HDB, prices still seem to rise unabated. I myself have visited some showflats to get a sense of what is out there, and came back amazed and flabbergasted by the strong take-up response of seemingly pricey units. Some were as tiny as 500 square feet but going for $1,600 psf (Mickey Mouse units, no doubt). Others boasted of potential new MRT developments, never mind that these plans will not materialize for the next 10 years! Everyone is riding along on a wave of euphoria, and even the sales agents at each launch seem overly exuberant and look like sharks eager for their (almost guaranteed) fat commissions. HDB resale prices have soared to new highs with an apartment in Bras Basah “smashing” records and commanding a COV of S$70,000! Read more...
