Why is Akhil confident the property cycle will repeat?
August 9, 2017 9:19 am
Akhil Patel, Editor: The fundamental causes of the cycle have not changed. The cycle is based upon the Law of Economic Rent – which supports speculation in real estate (land) and creation of credit (money) by the banking system, based on land values. These two processes go over the top through the cycle and history shows that it does so in roughly 18 year segments. If the cause hasn’t changed then the effect (the cycle) has to repeat.
Note also that the cycle has repeated in times of great technological change (such as at the start of the 20th century or after WW2), in periods of high inflation (in the 1970s) and low inflation (the 1890s); when interest rates were at record highs (early 1980s) or record lows (currently).