The Lap around Australia

With the boat and holiday home sold and us now the owners of a Ute and Caravan, it is time to set off for a lap, or two, around Australia as part of the Grey Nomads fraternity. Buying the Ute and Caravan proved to be an interesting exercise. I am convinced that the world is now (in early 2022) at the tail end of a massive bubble for stock markets and asset prices. There is just too much money chasing too few goods and services. The powers that be in practically every country have simply printed and borrowed money and thrown this around with a total disregard for who is actually going to repay all this money. With so much cheap money flooding the market, investors are chasing returns with a total disregard for the risk and consumers are accumulating assets. At some point reality will set in.

The behaviour of the majority of investors (many of whom are first time investors and have never witnessed a bubble burst) and consumers is simply ridiculous and, in my opinion, classic late stage investor and consumer behaviour in a bubble market. Investopedia notes that there are 5 stages in a bubble, with stage 3 being the ‘Euphoria’ phase where, “...caution is thrown to the wind, as asset prices skyrocket. Valuations reach extreme levels during this phase as new valuations and metrics are touted to justify the relentless rise, and the ‘greater fool theory’ – the idea that no matter how high prices go, there will always be a market of buyers willing to pay more – plays out everywhere.”

 

Whilst the rise in asset prices has been good for us when selling the boat and our holiday home, it has been the opposite when buying the Ute and Caravan. We are not prepared to buy into this ‘Euphoria’ phase of the market and it took some time to find a Ute and Caravan that were reasonably priced. You can see our setup costs here.

 

As much as we would have liked to head off north to Queenssland, we could not. We have a family wedding in May 2022 and Covid-19 is playing havoc with the State borders. The State Premiers are in the habit of closing the State borders at the drop of a hat and we cannot risk the Queensland Premier again closing the border and us being stuck on the wrong side.