GRA Blogs

Articles by Matthew Gilligan

Matthew Gilligan

Trump aftermath - what will it be?

2528

What does a man with $1 billion of property do when he becomes president and finds himself in control of the money supply, influencing credit conditions and the quantum of the government's fiscal spend as stimulus? The sceptic in me offers the following prediction.

We know that if you give Americans credit to spend, they dive in head-first. When you loosen lending rules on housing, it's no different. Therefore, if the person who owns $1 billion of property can influence the supply of money and loosen credit, thereby inflating their $1 billion to $2 billion, do you think he might be tempted? 

In my opinion, it's a no-brainer. Trump is going to try and inflate America through its woes, and he'll get popular doing it. Not only will he make billions through real estate inflation, the Americans who participate will all make money while the bubble builds, and they'll love it. 

Of course it will be a giant bubble which will explode at the end, and the inflationary period will cause high interest rates. He is already talking about public spending programmes and reducing tax rates to 15% for fiscal stimulus. Think of it this way. If your household decided to spend more, and your income decreased (from gathering less taxes), what would happen to your household cash flow? 


It will be interesting to see whether Trump shows restraint in spending, or whether he takes America donkey-deep further into debt while he inflates property values and the Trump empire. 


I can only see inflation and higher interest rates from a Trump presidency. It's lucky I still own some US properties! 


(I recently talked to Stuff about the Auckland property market and why investors need to exercise some caution – you can read the article here.)

Matthew Gilligan
signed
Matthew Gilligan
Director
© Gilligan Rowe & Associates LP

Did you like this article? Subscribe to our newsletter to receive tips, updates and useful information to help you protect your assets and grow your net worth. We're expert accountants providing expert advice to clients in NZ and around the world.

Disclaimer: This article is intended to provide only a summary of the issues associated with the topics covered. It does not purport to be comprehensive nor to provide specific advice. No person should act in reliance on any statement contained within this article without first obtaining specific professional advice. If you require any further information or advice on any matter covered within this article, please contact the author.
Comments

Add a Comment

Log in or sign up to post a comment

Testimonials
Hello Matthew, I am just wishing you the best of success with your excellent book Property 101. It is very rare that I come across a book on real estate that is in the league of other financial securties writer's. Thank you for taking the time and more importantly writing about real estate in a easy to read manner. I am still learning after 30 years in real estate. I am also a true contrarian like yourself and have learned this art from my favourite contrarian, Jim Rodgers (Former Quantum Fund). I have been preaching this to our Investor net work and corporate clients for some time, but most find it very hard to-do. Thanks again! Kind Regards, - Chris Kerr - The New Kids On The Block Pty Limited - October 2015
We can help
Here's how

Property 101by

Investing in residential property?

Put this at the top of your reading list.



If you're investing in residential property, seeking to maximise your ability to succeed and minimise risk, then this is a 'must read'.

Matthew Gilligan provides a fresh look at residential property investment from an experienced investor’s viewpoint. Written in easy to understand language and including many case studies, Matthew explains the ins and outs of successful property investment.

  • How to find the right property
  • How to negotiate successfully
  • Renovation do's & don'ts
  •  Property management 
  • Case studies and examples
  • and much, much more...
TOP