What is DOGE - Musks baby. A very intelligent leader
Department of Government Efficiency
Aims to cut large portions of the useless state to nothing
Like he showed with Twitter so successfully.
So I'm a big fan of DOGE. Really really like the idea.
Why do I like it so much though?
It makes the state more efficient. As if a new labour saving device had been discovered
Productivity will boom as per the desired intent
Creating a new demand for the best locations
The best are where the biggest productivity gains can be made
Demand for land there will boom, even more than the gains, speculatively, due to expectation of future growth priced in
What is the net effect, the ultimate result of DOGE ?
Real Estate will boom, even more than now. Land values, rents, house selling price. Commercial property too.
Though stocks and other financial assets will boom too, they will not do so anything like as much as land value.
The banks, with renewed confidence will start wildcat lending again for mortgages not capital formation.
The state will ask the Treasury to print new money secured against nothing, not even Treasuries and Guilts for public capital works which is effectively buying land at new speculatively high prices.
How long will this sustain itself? As long as the people keep believing it's real value rather than speculative. Look to Bitcoin which has already started the trend on a much teenier scale.
There may be other assets that get caught up in the mania who can say right now what they will be. Who cares, the effect will be identical.
It will come suddenly. We're forecasting late 2026 and led by the US mortgage market. If there is no boom by then we were wrong mea culpa.
This is not financial advice we're merely looking to history for her testimony of what might happen. No guarantees.
When it happens within 24 hours the panic will set in. And spread like a virus across the globe. Which will respond identucally as was tested during the pandemic.
We think the rescue plan will be to bailout not the banks this time. But the hundreds of millions of mortgagors. Homeowners will be bailed out by states creating yet more new money to raise each homeowner back above water, or, just enough to create the confidence to stop the panic. Probably a bit both.
Once stabilised, after maybe several weeks of pandemonium, a new business cycle we be ready to start. It will have to pick up the new depths of land value debt though. So there's no guarantees it will remain stable.
The people will be looking for scale goats, especiaily the homeowner constituency who have been bailed out the most and gained the most from the boom - the primary perpetrators. Hundreds of millions of homeowners is the biggest constituency in total asset size and total number across the globe. This is the ultimate power now. Whomsoever is the scaie goat us screwed certainly.
Politicians will lead on this strongly to make sure root cause - the homeowner - is never revealed. Look what happened to Bernie Madoff when he threatened to blow the whistle. His family slowly started dying.
There will also be a big call for a new financial system model. This is the only and ideal opportunity for Bitcoin, as per the original protocol, to step up and significantly improve old world payments and credit systems.
Who really knows, all we can say without to much risk is that there will be a boom and a busy in roughly this time frame give or take 6 months.
If you have real estate, free from debt, you are in the safest place. It always comes back during the recovery faster and higher than all other assets.
And the brilliant Mr. Musk will have been it's progenitor. A great and smart man.