Do you hate Change?

G’day all

Happy Friday from my home office here in Melbourne!  The weather has even been mocking me the past few days, with some beautiful sunny autumn days, teasing me, that I cannot be out in and enjoying… Well, not completely, but certainly managed a few walks/runs to enjoy the sun – with social distance of course!

Hope you are all coping well at home?  It is a massive change for us all, as essentially social creatures to be now isolated.  I certainly know that we have it fortunate here, as our office is one level of our home anyway, and I have the family here with me, my wife is actually enjoying not having to do the 1.5 hr each way trip to her office at the moment.

I read a quote recently on the big almighty Facebook, that said something along the lines that “us introverts have been preparing for this moment all our lives!” and had to laugh.  As a self-confessed introvert, I certainly resonate with this and am not necessarily feeling isolated, and often enjoy my own space.

This change is all around us at the moment.  And while some are embracing the change, thriving in this uncertain environment, others are scared, unsure, panicking because they crave the ‘normal’, the routine.

I was on a webinar this week, with a colleague of mine that runs one of the most successful online digital marketing business on the west coast, and we were discussing what, as businesses we were doing to adapt, to pivot in these changing times.

We have seen restaurants now develop very successful takeaway and home delivery divisions where they didn’t have one before…

Retailers that may have been slow to develop online sales presence have now moved across and selling more goods online, than they did last month through their store front…

Even hairdressers and beauticians who were predominately face-to-face businesses are finding ways to sell products online, including vouchers for treatments down the track.

I just love seeing the innovation that people are using to change and pivot with the times.

As Charles Darwin said “It’s not the strongest of a species that survives, or the most intelligent, but the ones most adaptable to change.”

And I think now, more than ever, this is so pertinent.

How can you adapt to this change?  What have you been doing previously that is no longer working for you now, and you need to change?

A great little exercise is to take a piece of paper, draw a line down the middle and on the left column, write down all the things that are working well for you, your family or your business right now. 

Then on the right hand column write down the things that are NOT working right now and need to look to change.

This can be a very quick way to see what is going well for you in these crazy times, and want needs to be addressed, what isn’t working.

Then you can focus on looking at ways to change the left hand column, what can you do to adapt

Even if you hate change, you might find that there are more things in the right hand column than you thought there would be – things working well in these changed times.  It might impress you even how much you have adapted already, without conscious thought…

For those of you who have done all your Prosci methodology and other change management tools (the Change Managers will be smiling right now) this will be a time to shine. 

For those of us not so happy with change, you just might surprise yourself actually how good at it you are, and suddenly realise it is not so scary after all

You got this!

Happy Investing all and have a great weekend!!

Cheers

Lindsay

Tips to Surviving the Pandemic

G’day all

As I write this, Australia appears to be tip-toeing into total lock-down, changing the rules state by state, hour by hour…  Meanwhile, in the US, Trump appears to be dead set on reopening everything by Easter come hell or high water… interesting times I see.

While I certainly cannot predict what is going to happen in the next few weeks, or even few months for that matter, I can tell you that we will certainly get through this.

I can also say, that what we do now, in the next few weeks, will make a difference as to how well we come out the other end…

It’s what we do in the next few weeks that will define us as a nation and as people.  Are you going to be proud of what you achieved, what you were able to do over this period, or embarrassed by your choices?  It’s up to you…

We have all seen over the past 3-4 weeks that the J O B is no longer as secure as we thought it might be… hundreds of thousands are now immediately out of work in Oz with the number only to grow…

And a number of people will unfortunately not be able to go back to work once everything gets back to ‘normal’ either… Because there will be a NEW normal.

Impacts from a crisis to the magnitude of this, can be forever; things will change, the way business will be done in months/years to come, will change.  Our society will change.  We saw it after the Spanish Flu of 1918, the Great Depression of 1929, the stock market crash in 1987 (Black Monday), the dot com bust in the early 2000’s, GFC in 2007 – after each of these events, the world was not the same.

Just taking the GFC most recently, changes to the banking sector and how money lending occurs changed forever.

We will see our economies, business etc will change, and never be the same again.  And this is not necessarily bad…just different.

Business will be forced over this period to become more lean, more agile, trade will be different, countries will start to become more self-sufficient again (finally!) and less reliant on overseas trade…it will be – different.

So here are a couple of tips to make sure that we all come out of this better:

  1. Follow our Leaders’ Instructions – first and foremost, this is critical.  During the bushfires over Christmas, all of a sudden everyone is an environmental expert and now all these brilliant people are now Virologists… please…  We have leaders of the country who DO have the experts advising them, so the best thing we can do right now is do what the Coach is telling us… full stop…
  2. Keep Moving – although we cannot go to the gym and probably shortly not the ‘outdoor boot camp’ group either, but we can still keep exercising.  Find an online app, YouTube videos, DVD’s, whatever works for you.  There are even PT’s now offering online sessions.  Fitness is critical to not only to your immune system, but your mental state.
  3. Eat Healthy and get into good habits – Drink plenty of water & eat healthily while you can.  It can be easy to fall into bad habits during periods of isolation.  Thinking it ‘won’t matter if…’ will only make you feel worse about yourself and feel unhealthy. Nothing wrong with the odd glass of wine, but now is the best time to get into healthy eating habits, get lots of sleep, get up early, get yourself into good patterns.
  4. Be kind and patient with people – again, I cannot stress this enough.  People are genuinely scared and worried, as none of us have been through this before, or know how to react.  Now is the best time to be kind and patient, especially with loved ones.  People are stressed – it isn’t about you…
  5. Read and/or listen to podcasts/videos to improve yourself – personal development is a great option right now.  While I am not saying don’t watch Netflix, relaxation is also a good habit, but spending 30 minutes per day on personal development is putting deposits into your future wealth account!  With all the media and news out there so doom & gloom, we need some positivity to offset this and keep us moving forward – plant those positive seeds and watch goodness grow.
  6. Learn something – here’s a real bonus to having some time on our hands right now – Self Education!  Take this time to learn something that will benefit you moving forward.  Income creation techniques, study investing, learn a new skill.  Anything you have a passion for.  Spend time mastering this and you will be in a perfect position to launch at new opportunities when the shutters go back up!

You got this!

Happy Investing all and have a great weekend!!

The Feather, the Slap & the Brick

G’day all

While things are certainly crazy right now, and I feel we (Australians) are still in for some tighter controls over the next couple of weeks, and the US is also starting to groan under the strain of the outbreak, there is only so long that we will see impacts on global markets.

While we are probably also going to see zero, or negative growth for the first quarter of 2020 both in Australia and the US (most other countries as well mind you – but I haven’t been studying those markets as closely), we are also likely to see negative growth for the second quarter coming…recession…

There will certainly be more job losses both here and in the US and we are in for some tight times…

But that’s enough doom and gloom from me!  I certainly want to be that ‘metronome’ vs the media at the moment.

The hype and spin they are putting on this is incredible – front page headlines by the Herald Sun here in Melbourne TELLING people to buy 2 weeks’ worth of everything is insanity, even our Prime Minister agreed!

Sentiment and reaction will certainly be clouded by the media, and while it’s great to stay up to date with what is happening, I urge people to be cautious of the amount of media we absorb right now – do we really need the 5th one-hour special on the Coronavirus today??

What I am seeing is some changes, that while have been prompted by the pandemic, could actually be for the better, and hopefully become the ‘new norm’.

Firstly, people are starting to become more acutely aware if they are feeling unwell, to stay away from others and ‘self-isolate’.  While we had not really used that term until a few weeks ago, I remember back from my corporate days (yes a while ago thankfully, but I still remember!) coming into work and finding the person next to me in the cubicle coughing and spluttering all over the place, just didn’t want to ‘use up all their sick leave’ and wouldn’t go home!  Next thing, we were all sick and productivity plummets – not to mention if anyone one of us infected our grandparents with the flu, it is and was, critically dangerous for them!

If this means that from now on, if you are unwell, you stay home and recover, and we see a drop in influenza deaths throughout the world, that’s a great step forward.

Secondly, bars, restaurants and eateries are spreading out tables here in Australia, to give everyone the required distance from others to still be able to dine (in Australia, it is a maximum of 100 people inside right now, with 1.5 metres between, classified as safe distance).  Finally, not sitting on the lap of the next table when you dine, giving us some space, to enjoy our meals and conversation with loved ones and friends without feeling uncomfortable.  If it means that restaurants now realise that as many seats as physically possibly in a venue is no longer acceptable, that again, is a great step forward.

Now, while I am absolutely not trying to make light of this situation, I would like to point out that often it can take a great event or action, to promote positive change or reactions.

What about change in our lives, what changes do you need to make?

I feel that often the universe does things in threes, and in the case for change, we find there are generally 3 hints that we need to (change):

The first hint is what I call a feather.  The universe tickles us, to realise there is something that needs to be scratched.  Maybe it is our neighbour losing his business or our colleague getting retrenched.  Now while this does not directly impact us, it does make you think, “wow, that can happen”.  Mostly though, we feel “it won’t happen to me” and we carry on with life. Rarely here, does someone look to actually make changes to protect against it.

Now though, the universe realises that the feather didn’t work, we just scratched and moved on.  So next is the slap…

Now it’s your partner getting sick and needing an (albeit not life threatening) operation; or the car breaking down and needing significant repair, realising you don’t really have the funds; the landlord saying you need to move, and all new rentals are significantly more expensive…  This is where now, it hurts, right…  That sting which, while it goes away, really brings tears to the eyes for the moment, and starts you thinking “I really need to change something here so this isn’t a problem again”.

But, you fix the car and move on; get a credit card or loan for the operation – but then go back to the ‘rut’ and nothing really changes.

Hmm…Universe is thinking if that didn’t work, now what?

Lastly it’s the brick… that ‘brick to the head moment’

Now I have always said that I hope people would never get to this stage, but I feel as a society we may have just had our ‘brick’

This is where there may be a life changing event in your family which FORCES you to make changes and decisions.  A death, life threatening illness, permanent disability; loss of job or business – some event which is catastrophic enough to cause us to HAVE to make changes.  Again, hoping the feather or the slap is enough, but if we do not change, we get a brick.

I was lucky enough (aware enough maybe?) to react on the feather, but we don’t all do this.

So, what changes do you NEED to make?  Are you comfortable right now if your company has to close in the next 2-3 weeks due to the pandemic and you are off work?  Can you survive?  What if your loved one gets sick, can you afford the medical bills?  Do you need to change things NOW, so that we can learn from this brick and build a better, stronger life?

I pray that none of this will happen, but I urge you to think about what you see around you and at least ask yourself the question… Do I need to change?

Happy Investing all and have a great weekend!!

Markets slide as panic hits fever pitch

G’day all!

Well, this has been a great example of what can happen within a week…

Suddenly now, with the AUD/USD on a slide, Billions being wiped of share markets and Superfunds (unless you have a Self-managed and invest in Real Estate!), countries in lockdown, and even sporting events being cancelled or playing at empty stadiums, I guess we all are asking, what’s next?

I certainly am not trying to play down the Virus outbreak, and the effect this will have on thousands possibly tens of thousands of lives, but I also would like to play the role of common sense a little here…

Our biggest threat is actually our response to what is happening.  If panic sets in, then we can begin to see the fabric of our societies start to unravel, even a little (fights in supermarkets over toilet paper…seriously?!)

Just looking at a couple of issues that directly affect us as investors, particularly US investors, we are watching closely the response the economic leaders are making to try and help insure our global economies do not collapse – China and the US particularly as two of the world’s largest economies.

And this is a real fear – universities and schools are closing; tourism (equates for almost 10% of global GDP) is at a standstill; factories (particularly in China) are closed, therefore no products to sell; ships and planes are almost empty; and soon, business will need to begin laying off staff or closing as well, forcing unemployment up. 

There is no point trying to sugar coat this, the impact of this will be felt globally for some time.

The question really is, what can governments and central banks actually do to reduce the impact of this?  I don’t know the answers here, but I do believe, that rate cuts are useless (nobody cares if rates are 2.5%, 1% or 0%) and stimulus packages are not going to have the same effect as they did during the GFC.

In GFC times, borders were not being close, tourism was not stopping, and trade was still occurring around the world, albeit at a slower level…

The slide in the AUD this past week, I feel has been coming for some time, certainly not this quickly mind you.  I was predicting back last year that we would hit the 0.60c range again and feel to be honest, that is about where the Aussie dollar needs to be in the global economy.  We have had it too strong for too long.

What is the impact then, on investing in US property?

Great question…

If you are already invested, then there are certainly a couple of pieces of good news here. 

One, your profits are getting better, every drop of 1% in the AUD/USD rate is an equivalent increase in profits.

Two, with the slowdown in the economy, I have already been able to pick up some great deals I probably would not have been able to get 2 months ago, properties for tens of thousands less than list prices.

On the other hand, if you are still looking to get into the market, then you certainly haven’t ‘missed the boat’ as it were…

Although it is 4-5% more expensive to purchase properties, I personally have been able to negotiate more that this off the list prices at the moment, with sellers starting to worry they will not be able to sell.

Furthermore, it means that profits then made in the US, when brought back into Oz to buy you that new Merc, are equivalently higher based on the exchange rate.

I guess the moral of the story here, is certainly don’t panic, and as for when is the best time to invest in real estate, even in the US… I would always say – NOW!

Don’t forget, we have great FX partners if you wish to discuss the dollar level or looking to send funds, best to talk to the experts, again, it is in times of volatility that there can be great opportunity

You got this!

Happy Investing all and have a great weekend!!

Rate Cuts and Viruses

G’day all

What a week it has been!  From finding it impossible to buy hand sanitiser & toilet paper in Australia (toilet paper?…of all things!) to massive rate cuts by the Federal Reserve in the US & cuts in AU as well, it’s been a bit of a roller coaster ride.

We held our latest workshop last night in Melbourne and I was asked, and do get asked all the time at the moment, what impact we may see on the property market, particularly US property, will the Coronavirus outbreak have?

This is a difficult one to answer in isolation, but there are certainly impacts being felt throughout the global economy right now, manifested particularly by the Federal Reserve in the US particularly, and the Reserve Bank of Australia (RBA) as well this week.

With the RBA announcing at their monthly meeting that rates have been cut a further 0.25%, bringing our interest rates down to a record low in the country of 0.5%, my feeling is that they are trying to get out ahead and avoid a slump in economic growth that will inevitably be felt from symptoms such as reduced tourism, university numbers down and the slowdown Chinese manufacturing, given we are very depending on China for many of our needs – mobile phones for one!

Never to be outdone, the US Federal Reserve has then announced, out of session in an emergency meeting, that they have reduced interest rates in the US by half a percent, bringing their range to 1-1.25%.  The Fed chairman, Jerome Powell, said in a statement, that while fundamental economic indicators in the US were strong (jobs, wages & unemployment) they were experiencing a new threat from the Coronavirus.

So what does all this mean for us, particularly as US property investors?

Well firstly, market sentiment right now is at a significant low.  We can see this reflected in the share markets, with millions (even billions) being wiped off company stocks, and out of many people’s Super funds…

Further, in the past week or more we have seen a slide in the Aussie Dollar, as traders pull back for the safe haven currencies of the US dollar (although, now a significant correction again as traders start to back in further Federal rate cuts)

More importantly though, with share markets on roller coasters and currency markets volatile, this can bode well for property, as it has always been seen as one of the safer, stable investments.  Investors do, though, also understand that property is certainly not as liquid as shares or FX, and just how long is this Coronavirus outbreak going to affect markets?  I believe this is the key question…

With people and markets unsure, generally there is a period of quiet.  Investors may sell shares and or currency, but will then generally just wait, keeping their hands in the pockets for the time being to “see what happens”. 

I was reading an article by one of my property mentors today, Jon Giaan, and he lost a bet last week, saying that auction clearance rates in Australia would be down with buyers looking to hold off and see what happens over the next few weeks, but in Sydney last week, they hit 77%! Crazy!

I do agree though, that I think we will see a slowdown temporarily but I cannot see any long term effects directly, other than those caused by rate cuts etc, which will keep our markets bouncing along nicely.

There has never been a better time to get some equity out of your current investments and look for some high cashflow properties in the US with our interest rates at almost zero!  With some investors hesitant, it gives us a chance to swoop in and grab some incredible deals, like I have been able to this week in the US.

So, wash your hands, don’t horde toilet paper and keep your eyes peeled for those great deals…

You got this!

Happy Investing all and have a great weekend!!