Latest / Money Grows on Trees / #239 - Why Is The Australian Property Market Collapsing?!

Transcript

#239 - Why Is The Australian Property Market Collapsing?! · Money Grows on Trees

0:00
Australian home values have grown by, look at
0:05
this, 193%, which is wild. Inflation is at 2.4% in
0:10
2025. Here's the problem I've got with that. One in five people in Australia are
0:14
now on the NDIS. We're now becoming even more unproductive because we're incentivising
0:18
poor behaviour. So if you want to make money for free, go get disabled. Since
0:22
August 2022, 72% of all
0:25
jobs have been in the public sector. So 130 of every
0:28
thousand people now work for the government. In Australia, it's the highest
0:32
in almost any country in the world. In fact, Australia's at the top. Just when you
0:35
think Australian government can do nothing stupider, they do something stupider. This is
0:38
because I'm Lloyd James Ross, seven-figure investor and entrepreneur, and
0:42
I've helped thousands of business owners and professionals turn financial stress
0:46
into success. If you're stuck in old money habits, overwhelmed by
0:49
investing, or unsure where to start, this is for you. I'll
0:52
give you the mindset and strategies to take control, grow
0:56
your wealth, and achieve financial freedom. It's time to make
0:59
your money work for you. The Australian economic
1:02
crisis explained. That's what this episode is all about. I want to
1:06
dive deep with you into seven reasons why
1:10
it's very obvious that the Australian economy is
1:14
entering a very rough patch, a challenging period. But I want
1:17
to explain this to you as best I can in simplest terms, so you really try and
1:20
understand or can at least grasp what is actually happening in
1:24
this particular country at this time. Now, the things I'm going to explain are happening in
1:27
other countries as well, but specifically in our country in Australia, where
1:31
I'm recording this episode, there are some things happening where on
1:34
the surface, all looks robust. But underneath,
1:38
when we pull back the curtain, some of these metrics will, and
1:41
should, frighten you a little bit. Because the way
1:45
we're headed is not going to be a prosperous time
1:48
for a lot of us, and we're going to hit some challenges. But more
1:52
than anything, I want you to understand what's happening in the economy.
1:56
so you can be educated about well that's actually what's happening whereas what
1:59
you might be thinking or you
2:02
may be following something else or listening to your neighbor
2:06
and it might be that you just don't really understand what's going on at all. So I'm
2:09
going to use some data, some very current data to
2:12
go through these different steps with you and just explain to you each part
2:16
of it and how it's having an impact on the economy and specifically on you and how it
2:19
can impact you, all right? So we're going to go with step number one
2:22
first which is actually the complete illusion of
2:26
prosperity, all right? So it's really about
2:29
understanding GDP and GDP per capita.
2:33
So what GDP stands for is gross domestic product. And in simplest
2:37
terms, what that means is how much income the country produces.
2:41
So how productive is the country, all right? So
2:45
measuring gross domestic product is how the country's performing. But
2:49
measuring real gross domestic product per capita, per
2:53
capita just means per person, has declined in this country
2:56
for six consecutive quarters, making it, buckle up,
3:00
the longest per capita recession on record. So
3:04
when people say, oh, we're not in a recession, because a recession is just two quarters
3:08
of negative GDP growth. But what's happening is we've had
3:12
declines in GDP per capita. So every single
3:15
quarter for the last six consecutive quarters, we've actually
3:19
seen your income drop. pound
3:23
for pound relative to what's happening in the world. And it's actually the
3:26
largest drop in real terms in the
3:31
Western countries across all the Western democracies
3:35
and economies, which is crazy because we were right up there and
3:39
now it's falling consecutively and it's still falling. And
3:42
I'm looking at a chart here at Pete in 2022. So right when COVID happened,
3:48
And since then, well, like right in the guts of COVID. And when, from
3:52
that point on, it's dropped drastically from,
3:56
God, it's like, the index has been measured since
4:00
2007, and it was on an upwards trajectory, but now
4:03
it's just been dropping drastically. So, real income
4:07
per capita is falling by a lot, and has
4:10
fallen over the last, yeah, six quarters. And
4:14
it's actually worse than the
4:18
1980s recession, the 1970s recession from inflation, and
4:21
the 1990s recession from the Asian currency crisis
4:25
or the Japanese currency crisis. So it's now worse probably
4:28
about by threefold than all of those. So
4:33
whilst we're not in an actual recession
4:36
because they're not recording negative GDP growth for the country, we
4:39
are definitely in that for each person. So what
4:43
that means is if it feels like you're poorer and
4:47
you're working the same or harder for less real dispensable
4:51
or disposable income, it's because you are. And
4:55
what's caused that is is the next step.
4:59
So what's the cause of this? Why has this happened? You've got to think about Australia
5:02
being a productive country. And what happens in Australia
5:06
is this. Generally, we take resources and
5:09
we export them. That's really how we make a lot of our money. We're actually the
5:12
richest country in the world from a resource perspective. So we should
5:16
also be the richest per capita. But we're not because the policy isn't effective.
5:19
The policy is the government. And the way the economy is working currently, it's
5:22
not all the government's fault, it's not producing
5:27
for the citizens. We can't just conjure up legislation
5:30
to do that. So we're going to stuck in this Westminster democracy
5:34
system, plus we're stuck in the private sector and the public sector
5:38
and policy. It's a bit of a nightmare. So whilst we're the richest, we're
5:41
also the poorest. We're poorest in sense of the
5:45
growth in our personal income is falling. So
5:49
this one thing has caused a lot of it, especially
5:53
at a personal level. Here's what it is. Over the past
5:57
two decades, the last 20 years, Australian
6:02
home values have grown by, look at
6:06
this, in the last week, 193%, which
6:10
by and large, it's not a bad thing, but here's
6:13
where it sucks for anyone who lives here, who's lived
6:16
here for the last two decades. So back then, I was 21. So I
6:20
was just entering my career. And so
6:23
what's happened is prices in property have 2x, which is
6:28
wild. In fact, they're probably 3x. A 200% return means
6:31
they've doubled and doubled again. So if a property is worth $500,000 back
6:35
then, it's doubled to a million, doubled again, so it's $2 million. But
6:39
while that's been happening, this is where it gets wild. While that's been happening,
6:43
wages have only grown by 81%. in
6:47
the last 20 years. For example, if you were on
6:51
$100,000 a year 20 years ago, which is considered a six-figure salary
6:55
back then was considered amazing. You're on six figures. You're a
6:59
high-end middle class. You're going on family holidays. You got
7:02
a house. You're doing well, really well. Over
7:09
that time, the wages didn't do what property did. So property basically,
7:12
let's call it 200%. Wages didn't go to 200,000 to 400,000. They didn't. They grew by 81%. So your 100K went to
7:16
180K. Got it? but
7:24
property went from 500,000 to 2 million. So
7:28
your wages and wage growth at call it, you know, three, three
7:32
and a half percent per year, that's happened. But
7:36
properties have gone at like seven to 8% a year. It's just not catching
7:39
it. And so what has happened too is rents have gone up at
7:43
the same, not quite the same rate, thankfully, but they've gone up as well
7:46
with the price of properties. And so you're seeing this massive disparity.
7:50
Now let's think about that for a second. What if we scale out another
7:53
20 years and do another 200%, another 80%? We're
7:58
gonna get more of a disparity. And so less people being able to
8:01
actually afford shelter. Not own a home, listen up very closely. Actually
8:06
afford shelter. And last,
8:09
I was listening to a survival expert recently. I forget what show
8:13
it was on on YouTube. And they actually had this question. They said, what are the three most
8:17
important human needs in nature? Like, what are the three things
8:20
that if you don't get, you die? I'm like, oh, that's easy to answer that
8:23
question. They're like, what is it? I'm like, water. If you don't go for
8:26
water for three days, you die. You learn this when you're in school at like grade
8:30
four flipping geography. You learn whatever it is you're in,
8:33
what class. You learn pretty fast, outdoor education. that
8:37
if you don't have water in three days, you die, right? We all know this. And
8:41
second is food. If you don't get food for three weeks, you die. Now,
8:45
that's how I grew up and that's what I learned, but it's wrong. The
8:49
one basic human need if you're in nature and you need to survive and
8:52
you don't get it first, you die. And
8:56
it is shelter. Shock, I
8:59
was like, what, how? Because of things like exposure. Hypothermia,
9:05
right, can cook you, well, it doesn't cook you, hypothermia does the opposite. Hypothermia
9:09
can freeze you to death, right? And if you don't get shelter, you're exposed
9:12
to the elements. It's very, if you go without shelter for
9:15
three days, the impact to your body is irreparable.
9:19
It can really kill you. So think about that. We're
9:23
actually making shelter the number one human need. We're making it
9:26
unaffordable for our citizens. I've never said this
9:30
before, but it's a flippant disgrace. It's a disgrace.
9:34
It's a disgrace. We should be, I mean, the fact that there's
9:37
not many... We just take it on
9:40
the chin, right? It's not, and
9:44
if you're one of these people who's bought, have taken this, have
9:47
risen or have floated up on this high tide of
9:50
property prices and you're all high and mighty, well, that's great for
9:54
you. But what about your children and grandchildren? Like, I
9:57
think about my niece and nephew, like, what are they gonna do? It's
10:00
like, oh, bugger them. We've got wealth in our family. Well, that's
10:04
a very narcissistic, arrogant approach to take. Our
10:07
senior generation or the policies being made in this country are not
10:11
supportive of young people next generation. It's a God, it's a disgrace. It's
10:14
disgusting. Politicians should be limited to
10:18
one house. They shouldn't be incentivized to buy multiple houses because
10:21
they can make policy that pumps property prices. They can immigrate this
10:25
country where they're doing it right now. Okay, we'll come to that in a second. So
10:28
the reason why that's happening, the reason why this happened is two reasons. Why property prices are
10:32
way outperforming wages. It's because of this. Firstly,
10:38
interest rates in the 70s were at about 17%, because they had
10:41
to break inflation, right? Paul Volcker came out, he
10:44
was the chair of the Federal Reserve in America, and the world was
10:47
kind of sitting at high interest rates of 17%. And what he had to do was he
10:50
had to lift rates up to get inflation back down, and he
10:54
lifted rates to 17%. And when he did that, What
10:57
happened was when you raise interest, this is an absolute economic policy.
11:01
If you've ever studied any level of macroeconomics, this is an
11:05
absolute fact. It's physics. It's not, it's mathematical, which
11:08
means it's not up for dispute. But when you have, when rates
11:12
go up, and by rates, I mean the interest rate at
11:15
the reserve bank, when it goes up, the
11:18
value of assets falls. Because the
11:22
value of the future cash flows discounted back at a discount rate,
11:25
it's called the time value of money. When you discount those future cash flows back to
11:28
a net present value today, the net present value formula, which is
11:31
a mathematical formula you learn in any finance education, right?
11:36
When you discount them back at a high interest rate, the current value of
11:40
the property or the asset, whatever it is, shares, property,
11:43
bonds, is less today. Let me
11:46
just rephrase that for you so you understand. When you have a high interest
11:50
rate and you discount the future cash flows back from
11:53
the future to today's value using a high interest rate,
11:57
it means the asset is a lower value. So that's
12:00
why in 1990, when rates were at 17%, property
12:04
prices were very low compared to your wage. In fact, two to three
12:07
times annual wages. So if you were making 50 grand back then, a property
12:11
was about 100,000 to 150,000. very affordable, everyone
12:14
was buying, it was easy to pay it off, no dramas, okay? That's
12:18
fine. That's actually very, three to four times earnings is a nice fair
12:22
value. And in America right now, it's about 4.5, which is very
12:25
reasonable, okay? In Australia, it's 13 times
12:30
earnings. And in Japan in the 90s, before the
12:34
great kind of sort of big property bubble back
12:38
then for Japan, It was at 18 times earnings. So
12:41
we're not too far off. Anyway, so back in 1990, when
12:44
rates were all time highs, property prices were all time lows. But
12:48
guess what happened in the last 30 years? Yes, you guessed it.
12:51
Rates went from 17% to 1%, 1.25%, from 17 to one. So what happens when you
12:55
drop rates? It does this, it does this. So
13:04
when you drop rates, you lift asset prices. That's
13:10
because the future cash flows are discounted back at a lower rate, which means the asset value
13:13
is worth more. So you haven't been in a property boom,
13:17
you've been in a rate reduction cycle of 30 years. And
13:20
you didn't create that. You're not a genius. You're not that smart.
13:25
You just bought, it's timing. Arguably, honestly,
13:29
it's luck. You happen to be born in 19... in
13:36
the 1960s. That is the ovarian lottery. You
13:40
didn't plan that. You flipped it.
13:45
And now you're like, I'm flipping property investment. Well, let's see what
13:48
happens when interest rates go
13:51
back up. They used to be at seven and
13:54
a half percent, which is about roughly on average in the last thousand
13:58
years what they've been at. It's only recently because
14:02
of COVID that they really, and the GFC, that they really dropped them
14:05
so drastically. It's truthfully, like it's only recent. In fact,
14:08
interest rates got as low as pot, as low as they've ever been for
14:12
5,000 years in your lifetime. So think about it.
14:16
What happens when rates go back up? Yes, the value of your real estate falls. Welcome
14:19
to the party. You get it. What's holding it up and propping up
14:23
unnaturally is we're immigrating 600,000 people
14:26
to this country every single year. The average over the last 10 years was about 200,000, so
14:29
it's tripled. Of course, you're going to have stress
14:34
on the infrastructure and the housing of the country because you're not building enough houses to
14:37
house them. And it
14:41
just doesn't need to happen. It's a policy that can be stopped immediately by
14:44
government. But the reason why they're doing it is because they don't want to face a recession because they don't want
14:47
to get out of power. And they also, guess what? They own half
14:50
a dozen houses themselves. It should be
14:54
bloody banned, I tell you, for them to have houses because they're making policy to
14:57
pump their own bloody equity up. I'm disgusted You
15:03
can't tell. Disgusting. So that's what's happened. Now,
15:07
when rates go back up and your value falls, yes, a
15:11
rising tide lifts all boats. So when we have a rising tide that's
15:14
happened, you don't know who's swimming naked until the tide goes out. But when
15:18
rates go back up, The tide, my friends, will go back out and you'll see
15:21
who's swimming naked. Swimming naked means this. You will see who's
15:24
got leverage out to their eyeballs. You will see very quickly who's
15:28
got 10 properties fully geared to their eyeballs. Because when rates go back
15:31
up, and they will, because the bond yields are going up, which we'll talk about in a second, they
15:36
won't be able to escape. Because whenever it runs for the exit, They ain't
15:39
getting out. Cause when everyone tries to sell their property at the same time, it
15:44
doesn't end well. Okay. All right. So dwellings have risen faster
15:47
than wages long-term. Third part, mortgage stress
15:51
and household budgets. So interestingly at the moment, by
15:55
the numbers, these are crazy numbers.
15:59
Okay. So the data points of this, the now, the
16:03
app previous to the recent bubble in real estate and
16:07
the policy and immigration, the
16:11
average percentage of your household income that went to paying
16:14
your mortgage was about 30%, okay? About 30%, and
16:18
that's fairly reasonable, right? But now, it's 49%, which
16:23
means if you've got a household that's earning 200,000, let's say both
16:29
the woman and the man are making 100 grand each, okay? Six figures. And
16:33
they're sending their kids to daycare, because they're both working, they can't afford to stay
16:37
home and look after the kids. So let's say net into
16:40
their, if they've got one child, it's 25,000 a year. So if you've
16:44
got two kids, it's 50. Now they do get some rebates from the government. So let's call
16:47
it 20 grand. So they'd really make it 180,000 combined. That's
16:51
before tax. After tax, probably about 120, let's
16:55
say. So you've got 120 coming in. That's around about
16:59
$2,500 a week, right? Think about that. Listen to this very closely, because
17:03
you've got to pay your mortgage with after tax dollars, not before tax dollars. So
17:07
out of the 2,500 a week, $1,250 is
17:12
going to the mortgage. Like, and
17:15
then the family's supposed to live off $1,250. Are you kidding me? Like, and
17:18
then groceries of like $300. So. No
17:22
wonder people are struggling, like no wonder they're telling the government, please reduce interest
17:26
rates, because you can't, they can't afford their mortgage, right? Because they come into
17:29
the market and they're buying at all time highs with borrowings and they're both
17:32
strapped because they're both already working kids in childcare. There's nowhere
17:36
else to go. Like we're cooking our citizens. It's
17:39
a flippant disaster. It's a joke, right? So now take,
17:43
check this out. You'll now take 21 to 46 years, to
17:48
save up, not for the whole property, for the deposit, for
17:51
an entry-level home. And the mortgage will take 63% of
17:55
the median income yearly. That's where we're headed. Right?
18:00
So the income debt to income ratio and the mortgage rate is
18:03
getting out of control. Okay? Just quickly, if you're ready to take control
18:07
of your finances but feel stuck on where to start, I have a
18:10
solution. My book, Money Buys Happiness, simplifies investing
18:14
and wealth building with practical steps to help you achieve financial peace.
18:18
Get your copy via the link in the show notes and let's get your money working for
18:21
you. Now back to the episode. Number
18:27
four, this is also what's happening at the same time. Do you see why
18:30
the economy is in crisis? It's going to come home to roost. It
18:34
ain't good. I personally think we should take the recession on the chin,
18:37
stop immigrating people, shift our energy policy to nuclear
18:40
so we can reduce energy costs because that inflates everything. And
18:44
we need to stop bringing people in so we can just let the housing supply catch up a
18:47
little bit. And of course, we need to increase interest rates, not bring them
18:51
down, because we need to have the recession we need to have. We all need to take it on the
18:54
chin and realize that this country cannot go through decades and decades of
18:57
no recession. We need to have one. It's like when you have a bushfire,
19:01
it's like, oh, it's beautiful and green and everything's going well. Well, sometimes you need a
19:04
bushfire to come through and get rid of the foliage, okay? That's what we need.
19:07
We haven't had one in this country for so long and they're preventing it and preventing it. They're kicking the
19:11
can down the road and it's getting worse and worse and worse and worse. So
19:14
when it really happens, it's going to be even worse. So occasionally you need a
19:17
bushfire because you need these new roots to come through, right? Capitalism
19:21
needs to have resets and we haven't had it because we're turning into a socialist economy, which we'll
19:24
come to. Now, number four, inflation reality versus official
19:28
figures. Now inflation is where the price
19:32
of goods and services goes up. Rent, petrol, groceries, et cetera, right?
19:36
So there's a, they're saying that
19:41
inflation is at 2.4% 2025. Here's
19:46
the problem I've got with that. If
19:49
you go back, I would say, look, let's
19:53
even go back five years. Yeah,
19:56
five or six years, okay? A maxi bond, from,
20:01
I'm calling it the Maxibon, the Maxibon Index,
20:06
where I'm gonna, I measure, because I love Maxibons. Like I'll go to the BP,
20:09
and if I want to like spoil myself with a dessert, my wife Alicia knows it's
20:13
a Maxibon, okay? Because here's why, you get the best of both worlds. You
20:16
get the nice creamy chocolate with the outside exterior, and you get the nice soft sandwich on
20:19
the other side. It's a win-win, okay? You get a double hit, right? Inside
20:22
tip. So I've got this Maxibon Index. I used to go in, get a Maxibon, it
20:26
was $3.30 for a Maxibon. Fair, kind of annoying, but
20:29
fair. Now, if inflation was at 2.3%, it would take, the
20:33
rule of 72 suggests, if I take 72, divide by three. it'll
20:42
tell me how long it takes for that maxi bond to double in price, okay, on
20:46
inflation. So 72 divided by three would be around about 25, is
20:51
that right? No, yeah, 24. Let's just go with
20:55
24, okay? So you see 366, yeah, exactly 24, around the number. So 24, so 72 divided by 3% inflation rate equals 24 years.
21:08
So, if inflation was really 3%, using
21:12
the exact rule of 72, that is not even disputable, go
21:16
and research it. I did an episode on it, go watch my episode, okay? It
21:20
takes 24 years for the maxi bond to double in price. You
21:23
with me? So, here are the facts. I went into
21:26
the BP recently, and to my shock horror, I
21:29
was disgusted to find out that my maxi bond at
21:33
a BP service station was $6.60. It
21:38
has doubled, not in 24 years as it should if inflation 3%, it
21:41
has doubled in about five years. So
21:46
we take the rule 72 divided by five years equals
21:51
14%. Thanks Soph, 14%. So
21:57
inflation, you're telling me it's 3%? I've got proof from my
22:00
Maxibon index from the BP service station, that's full
22:03
of BS. The inflation rate in the last five years has
22:06
been about 14%. So if
22:10
it feels like you are poorer, it's because you are. Because what's
22:13
happening in this country is instead of increasing interest rates and having the recession we
22:16
have to have, what they're doing is printing money
22:21
Yes, to supply the money, because if
22:25
bond yields are high, without going into much detail, and
22:28
you want to re and you've got country debt, you want to refinance the debt, you
22:32
don't want interest rates to be high, because then the country's got to pay more interest. So they
22:35
like to artificially keep interest rates in the country low, they like to do it
22:38
because it keeps the country's debt financing low. Okay. But
22:43
The problem with that is that they print more money. They supply the country
22:47
with more money. And people, they make money through banks, okay? And
22:50
if people are borrowing more money to buy property, they're making more money. So they're printing
22:54
more money. They're putting it out in circulation. In which case, we're
22:57
inflating away our dollar. They're calling it the Pacific peso, the Australian dollar.
23:01
And most countries are doing this with the fiat currency. That's why things like
23:05
shitcoin and crypto are becoming more popular because people
23:08
are trying to hedge themselves against this. If I was going to choose any
23:11
hedge outside stocks, which I prefer, and outside even property,
23:15
which is still better than the other two I'm going to
23:18
mention, gold and crypto, that's why gold is becoming so popular. It's
23:21
shot up because people are trying to hedge the inflation inflating
23:25
away the currency. So the reality
23:29
of inflation versus the official figures is absolutely completely different.
23:32
So your $100,000 income used to be worth 100,005 years ago. Now fact, I think it's worth 50. So
23:38
you've lost purchasing power of your dollar by
23:42
up to, like it's fallen by 50%. How about
23:45
that? In fact, it's 100% worse because 50,000 into 100,000 is
23:51
100%. So if it feels like you're doubly poor, it's because you literally are.
23:56
I'm bringing you this data from the field. This is not like something I'm making up.
24:00
So five, superannuation tax changes. Now, what's happening is
24:04
lately they've announced this superannuation change, the government, whereas if you've got a
24:07
balance over $3 million, any capital gains associated with that particular
24:10
portfolio of assets, you have to pay taxes for the year
24:14
on unrealized capital gains. That means it's the capital gains
24:18
you haven't realized yet, meaning you haven't sold the asset and realized the capital gain. So
24:22
they're going to tax you on the unrealized gains, which is the most dumb, it's the most
24:25
idiotic, stupid, dumbest thing that
24:28
the government's ever done because you can't even have, we're going to force
24:32
people who've got balances over 3 million to sell their commercial
24:35
property just to pay you one year of tax. It's the dumbest thing ever. They're not
24:38
going to be able to manage it. It's just going to be a nightmare. But because it's not indexed,
24:42
it's not indexed, which means 3 million in 20 years is
24:45
going to stay as is. So 3 million, because of inflation,
24:49
everyone's going to have a superannuation balance of 3 million, which means the government's going
24:53
to actually tax everyone's super eventually.
24:59
They're coming after your money. We've got a Westminster system
25:03
in this country, and it's not like America. People are like, oh yeah, free
25:06
speech and home of the brave. It's not us. We're a convict nation.
25:11
We are a nation of rule followers. And
25:14
so we're like the proverbial frog in the pot that's getting boiled over time.
25:18
And we're just taking it on the chin. There's no uprising here. But
25:22
what's happening is, The liberal government in this country, meaning
25:26
the LNP, the Labour, sorry, liberal, we got a different round in
25:29
Australia. The Labour government, which is very liberal in its
25:32
policy, it's got socialist style policy. And
25:36
in fact, if you go back and you do enough digging, you find that
25:40
the Prime Minister has even got some ties to communism. Without getting
25:43
into detail. I feel like I'm on a Joe Rogan podcast here. But, What
25:47
that means is he's more towards socialism, meaning take from
25:50
the rich, give to the poor. But the problem with it is you're actually now
25:54
making the poor depend on you. So what's happening is people are
25:57
now becoming dependent on the government to save them, which is very bad for
26:00
them long term. Because if you're in that place and you're depending on the government to save
26:03
you, what's going to happen is they're going to tax, tax, tax and
26:06
give, give. So they're taxing the productive people in the country and
26:10
they're giving to the unproductive. Okay, and what's
26:13
happened lately is things like NDIS, which I believe in,
26:16
I like, I think we need, for people in this country who
26:20
are really struggling, who have a disability that is absolutely life-altering, they
26:24
should, we should have some sort of national support if we can afford it for
26:27
them. But what's happened is, as soon as you show someone they can get
26:31
money for nothing, people start to also accidentally be disabled. Now
26:34
what, this is the facts. One in five people in Australia are
26:38
now on the NDIS, which means one in five people
26:41
are disabled. If you wind the clock back 10, 20 years,
26:45
I bet it wasn't even close to that figure, but because they know there's free money on the table,
26:49
show me the incentive and I'll show you the outcome. And now
26:52
what's happening is we're now becoming even more unproductive because we're incentivizing
26:57
poor behavior. We're incentivizing disablement. So
27:02
if you wanna make money for free, go get disabled. Do anything in your power, mental health,
27:05
whatever it is you can conjure up, go get some money from the government. Free money, that's
27:08
what we're doing. This is shocking, right? So superannuation taxes
27:12
have changed, NDIS, where they're taking the
27:15
taxes they're raising is changing things, and it's getting worse and worse and
27:18
worse. Number six, employment trends and productivity, right?
27:22
Now check this out. Since
27:27
August 2022, 72% of
27:30
all jobs have been into the public sector. So
27:35
130 of every thousand people now work for the government. And
27:39
if this is a chart here, working in on state, okay, the chart here,
27:43
it puts, check this out, it puts Australia at
27:48
the amount of public sector workers per thousand people. And
27:51
again, as I said, it's 130 and every thousand now works for the government. In
27:55
Australia, it's the highest in
27:58
almost any country in the world. In fact, Australia is at the top. More
28:02
than Israel, Britain, France, Spain, United States, Brazil, Turkey, Argentina,
28:05
Mexico, Thailand, et cetera. We are at the very top
28:09
for how many people work for government. We are slowly becoming a
28:13
government working country entirely. So
28:16
we are moving towards a level of what would be considered
28:21
communism. where you actually only
28:24
work for the state. Last time I checked, didn't work out so good
28:27
for North Korea. Now, what's interesting with China, it
28:30
is communist driven, so it's state owned, but it's a capitalist society.
28:35
I think personally, it's more capitalistic than us at this present time.
28:39
Scary to think that. People are like, what happens if the Chinese invade? I'm
28:42
like, well, they're doing a pretty good job running their country. It
28:45
wouldn't be a bad thing. because they'd run this country better than what we
28:48
do. Fact. Anyway, I love Australia. I'm not suggesting that, but
28:51
you know, like I'm just annoyed, right? As you can tell. But the tonality of
28:55
this episode, because I grew up in this country and it was, it's been a
28:58
country of free, it's been a wonderful country, but now they're
29:01
turning it into a dog's breakfast and I'm annoyed. That's why I'm
29:04
doing this episode, to educate you on what's actually happening. This is crazy. Number seven. Energy
29:08
and exports, this is mental. We actually are the
29:12
richest country in the world, right? Check this out. Australia
29:16
exports 35 times more gas than the
29:20
shortage of gas projected in the 2030s.
29:25
We've got projected average annual shortage of
29:28
gas in this country. The
29:32
projected shortfall is 2.3 megatons, is it? And
29:37
we export 82 megatons. Like we're exporting
29:42
35 times what our current national shortage is.
29:51
What does someone say the other day? Just when you think Australian government can do nothing stupider,
29:54
they do something stupider. And now this is because there's this
29:59
narrative being pushed and it's been pushed from this
30:02
thing called global warming. And they changed it
30:05
to climate change. And it's a national, it's
30:09
a global narrative. And what's happening now is they're discovering, recently
30:13
they discovered there was new ice at the polar caps. And
30:16
they're discovering that they said the water is gonna rise and
30:19
there's now absolute, like if you go down to the water of all
30:23
those places they said were gonna be underwater, they're not. So
30:26
it's actually not real. This
30:30
is made up. At some point, it might have been thought that
30:33
that was happening, but now it's actually shown that it's
30:37
probably happening. If it is happening, it's probably happening so slow that
30:41
we can't even really see it, and it's not such a national or global
30:44
tragedy. Now, the reason why that's a problem is because clean
30:48
energy policies are now turning into a problem, because if it's wind
30:51
energy, And it's certain energy
30:55
that is not coal or nuclear. They call it
30:58
clean energy. But the problem is it's actually making energy
31:01
more expensive in this country, which means lately energy prices
31:05
have gone up by 10%. So it's like, oh, I got hit with more energy costs. What the
31:08
hell's going on? It's because the government is hell-bent on going to
31:12
net zero, which is just a stupid policy. Look
31:15
go and explore solar wind gag do it,
31:19
but don't just go shit We're just gonna jump ship and stop supplying, you
31:23
know Hydrocarbons as well. I mean you transition over
31:26
time But this ridiculous time frame is it's now becoming
31:30
not even really that important because we're not We're realizing we're
31:33
not really cooking the planet as much as what we thought now how that
31:36
impacts you is For a country that's
31:40
got all this incredible abundance of
31:43
resources, why are we paying $1,000 a quarter for energy?
31:48
It was making our citizens poorer, okay? So that's the seven. I hope
31:51
that makes sense. We're at a crossroads here, okay? We've
31:54
got the Australian bond yield rising. They're trying to drop in. They just dropped interest rates
31:57
the other day, again. But they need to put them up, not down.
32:01
And I'm fairly certain we're gonna come to a cross road where we're
32:05
gonna be forced to make these changes. And it's gonna be gnarly, right?
32:08
Because we cannot continue with 13 times earnings for
32:12
houses. Our kids are gonna suffer. The next generation, we're gonna leave.
32:15
We're living in just a terrible place. We
32:18
need to take some responsibility for it. Now, hopefully that happens. Well, last time I checked, I
32:22
couldn't change government, nor am I trying to. Elon Musk just tried
32:25
to change the government in the United States. He's finding that very hard. I'm not suggesting I
32:29
can change government here, but what I'm wanting to do is just educate
32:32
you a bit, because if you're feeling like things are getting a little bit worse for you, statistically
32:37
they are, but that's not to get our free card. I
32:40
don't want you to use that as an excuse. What I want you to do is
32:44
understand, based on the facts that I've shared with you here today on this episode, is
32:48
I want you to understand where you're at and I want you to understand what's coming and
32:51
I want you to now take ownership of what you're going to do to
32:54
increase your income, reduce your debt, take ownership
32:58
of your family's future because if you depend on the government, I'm here to tell you
33:01
it's just going to get worse and worse and worse until we
33:04
get some sort of reasonable leadership, especially when there's more people coming and
33:08
it's more competitive. So there's never been a more important time
33:12
to get financially educated, start actually learning to increase
33:15
your income, drop your debt, learn to invest. Because if you don't learn
33:18
to invest in assets that hedge inflation, if you don't learn to do these things now,
33:22
you're going to get inflated away. You're going to be off the
33:26
list of people that can even afford to live in this country. And you may need
33:30
to consider living in a place you don't even like. And I mean,
33:33
you may even consider having to board with other families. I mean, this is going to get
33:36
dire. So there's never been a more important time to
33:40
educate yourself financially. So go check out our links in our YouTube.
33:45
Go check out me on Instagram. Go and start beginning your education journey. Go and
33:48
check out some other episodes, the next episode even, on the Money Goes on
33:51
Trees video podcast on YouTube. Subscribe to the channel, share this with a friend,
33:55
and start educating yourself and your kids on what's going to happen and what you should be doing to
33:58
still, as best you can, dominate your own personal household
34:02
finances. so that you're at least ahead of the game here when
34:05
this country starts going down and down and down further and further. I hope it doesn't happen. You
34:09
know what? I hope I'm wrong, right? I hope I'm
34:12
wrong, but I'm not giving you personal opinion. All
34:16
I'm sharing with you on this episode is data, okay? It's just data.
34:20
And so you can take with it and do with it what you want, but I want to make sure this
34:23
podcast gives you no BS approach to financial
34:26
education and what's happening with your own finances. So I hope that
34:29
makes sense. And if you've enjoyed the episode, if you have, share it with a friend and I'll see you
34:33
in the next episode of the Money Grows on Trees podcast. Thanks for listening to
34:36
Money Grows on Trees. If you enjoyed the episode, leave a five-star review
34:39
on Apple Podcasts and Spotify and subscribe to
34:42
us on YouTube so you never miss an episode. And if you're serious about building
34:46
wealth, make sure to check out the links in the show notes and follow me on
34:49
all social media platforms, at LloydJamesRoss for