Andy Xie – Australia Could Become the Next Spain

Andy Xie says Australia could be the next Spain if its property bubble bursts. He thinks high foreign net debt and Australia’s dependence on China could tilt the country into recession.

Dr Andy Xie is Shanghai-based independent economist specialising in China and Asia. He is currently director of Rosetta Stone Advisors and of China Boqi Environmental Science and Technology. Dr Xie is one of the few economists who has accurately predicted economic bubbles including the 1997 Asian Financial Crisis and the more recent subprime meltdown in the United States. He joined Morgan Stanley in 1997 and was Managing Director and Head of the firm’s Asia/Pacific economics team until 2006. Prior to that he spent two years with Macquarie Bank in Singapore, where he was an associate director in corporate finance. He also spent five years as an economist with the World Bank. Dr Xie earned a PhD in economics in 1990 and an MS in civil engineering in 1987 from the Massachusetts Institute of Technology.

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25 thoughts on “Andy Xie – Australia Could Become the Next Spain

  1. She’s just spruiking the “We’re different argument” BS again. All the
    dickheads in our country are going to spruik until it crashes. This is
    because everyone is soooo heavily invested in property that they don’t want
    to think ahead. Not just money but ego and self-worth are heavily invested
    in property. The shame is it is all destined to repeat itself regardless.

  2. Andy’s one of the best economist in the region. He predicted that the US
    property will crash from early as 2005. He did forecase hardlanding in
    China at the same time which stands to be a bit premature, but that just
    adds to his argument that the Chinese government is trying to cushion the
    fall and can easily massage their top line. The lady looks like a ten year
    old who’s been offended about her pink shoes and she’s trying to defend it.

  3. He is right on Australia, Here we have government grants for first home
    buyers a subsidy (QLD is at $15K in total for build on vacant. GO FIGURE
    WHY THEY ARE DOING THAT. to buy extra time. As for CHINA. So many families
    are holding onto RAW cash under their mattress which the financial sector
    has no control over. When you stop a % of cash in cycle you get
    unpredictable movements in panics. Ans as for AUS, the mining has bought
    time and the foreign profits only producing outside investments

  4. Tradesman in my house today said “Bought a house for my daughter, didn’t
    have to lay down a cent, used the equity in my home. In ten years it will
    be worth twice that much and I retire with a great profit”. People still
    think that this is the path to wealth creation.

  5. That illiterate news reader symbolises the idiocy many Australians live by
    – “we’re different”

  6. thank you @supperdon its thanks to people like you that have let me retire
    at 28, blind unwavering ignorance is a beautiful thing

  7. I’m getting really tired of hearing the ‘but Australia is DIFFERENT’
    chorus. Wake up for fuck sake!! If it wasn’t for the shameful state of the
    Australian mainstream media (our beloved nanny) I would say that someone
    was spiking the drinking water.

    People talk about demand for housing but with the current affordability the
    only demand is coming from speculators and offshore investors. The rise in
    housing prices have far outweigh that of the median salary, and that’s with
    all the cashed up miners earning 6 figures. Increase in population has
    nothing to do with housing demand when those looking for a place to live
    are forced to take out a mortgage that equates to 10 times what they’d earn
    in a year.

    Rather than increased demand, we’re more likely to see a generation of life
    long renters that refuse to take part in the Ponzi scheme. That being said,
    there’s no denying Australia on the verge of a collapse. Now would be a
    good time to sell that 100″ flat screen TV for some gold bullion and a
    large bag of rice.

  8. It doesn’t take a genius to know that, we Aussies is at the mercy of China
    keep buying our mining resources and properties. The moment China stop
    buying, we’re fucked!

  9. Maybe Australia can lease Tasmania to China for tons of money and make a
    treaty that all non-Europe immigrants could only settle down there. Two
    problems solved!

  10. Australia’s going down down down..

    that presenter just doesn’t want to accept it, clearly another sheepy

  11. what are we worried about? China now owns over 60% of all property in
    Australia. So if the bubble bursts, which I hope it does, it is the
    Chinese that will get cleaned out…BTW, I have NOTHING against Chinese,
    just our government that sells off all our land to foreign buyers while
    Aussie go without 

  12. poor Andy, I think he made an accurate call around the GFC time.He has been
    riding its coat tails ever since.
    Sadly for anyone who listens to him he has not got a thing right
    since.Surprised he still has a job really.

  13. China going down next..a true fact…and after WW3 that is coming
    next..when is over…Australia may get a few immigrants more from the whole
    of Europe, because right now, Australia is way too “rickety”, if I can say
    it like that…Wow, a mighty land with so few guys there, but after a
    massive flow of Europeans to your land, wow, you guys will turn like us in
    this mighty USA and can compete with us, but make sure, Australians , that
    you get the right immigration. This is only a possibility and who
    knows…could happens, why not?…Australia is for sure a rich land with so
    much resources, but you guys need the right people there…what you already
    have , but greater volume…who knows…Australia and the USA can compete
    later in the 21st century and I guess Europe will be jealous…Ha….

  14. Thing about the housing bubble is everyone wants it to burst, so they could
    all start buying! That’s not really how a bubble works tho

  15. stupid blond bimbo doesnt understand that our property is unaffordable for
    locals here and that there are an excess amount of baby boomers retiring
    and downsizing their homes which means more supply. Along with that
    australia is now the second highest in regards to income to house price
    ratio. I work in real estate and all our buyers and developers are chinese.
    I would like to see the interest rates rise a little as we can afford it as
    our debt is small compared to other countries. This would allow prices to
    gradually come down a bit without a huge crash

  16. reduced chinese demand. check
    lower commodity prices. check
    devalued currency. check
    it’s a commin’…

  17. Bubble… Well Im still waiting but bubble only gets bigger. Remind you
    this video is about 2 years old. Now in 2014 and 2015 1 in 8 buyer is
    Chinese… Money coming straight from o/seas… Sorry but this is not going
    to burst but bubble will only get a bit bigger

  18. Surely there’s something up when you can’t get rent money to cover loan
    repayments. And now here in South Australia the state govt is thinking
    about introducing a yearly land tax for home owners and saying they will
    lower stamp duty for purchasers. Around $1300 for a property valued at
    $420,000, will we suddenly start seeing a rise in property valuations only
    to add to the revenue for the govt? Once the land tax is introduced what’s
    to stop it been increased when the govt feel like it and what benefit is it
    to a couple who spend 20 years paying $2600 on a house valued at $8-900,000
    for a total of $52,000 only to down size and pay possibly that again for
    stamp duty on a smaller place. This state is fucked, Oh and by the way
    people from S.A the footbridge built across the Torrens was given to an
    interstate company for just over $40mill when an S.A company tendered for
    just on $30mill, questions need to be asked and answered for that because
    thats our money.
    Sorry but I’m pissed off.

  19. House price will never drop. keep going up like rocket is good. Andy Xie u
    r wrong. Not high enough. House price will go up to even 5 millions after
    10 years. No bubbles at all. Wasting your time to say so, Xie. We have
    EUrozone and G20 they all help to keep the bubbles around the world and
    avoiding any country Collapse so we will never have bubbles. EUROzone and
    G20 workers work hard to keep the world in peace and harmony. Maybe you
    have to wait till all your hair gone

  20. I think everything Andy said back then has come to pass. Giddy up.
    Something has to give to normalize the housing market.
    You know when your in a bubble when the locals can’t enter the market
    because the investors are falling over each other to snap up the houses.
    Bring it on. And review the insane tax lurks for the investment property
    moguls. What a F#$kin con.

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