Real Property

Another week of politics, and now it is the ALP’s turn to confess about the nationality complexities of some of their members.

What makes this even a little more interesting, than what has happened to the other parties, is that Bill Shorten had said several times, rather emphatically, that the ALP was beyond reproach on this matter. Not true. But that’s politics.

The saga of dual nationality continues. We are such a peculiar country. Firing members who did, or in most cases certainly did not know, that they had citizenship in another country due to their heredity background. When we are a country of immigrants?

The modern history is purely one of people moving here from all over the world, over-running the indigenous population. Right now in Australia, a full 24% of residents were themselves born overseas. This is extraordinary. Yet, if a member of parliament has citizenship in another country, through the fact that their parents or grandparents moved here from that country, it’s simply not allowed.

Now, we must respect the constitution to be sure. It is the foundation of our legal system. We also need to apply common sense and live in the times we find ourselves, however. Yes, the situation should be rectified immediately by cancelling that citizenship upon discovery. As long as it is clear that foreign citizenship has not lead to favourable treatment of that nation from the individual involved in their official capacity, then the harm that this aspect of the constitution sought to prevent has clearly not occurred nor been the intention.

As we all know though, the legal system is rarely about common sense. The upside is that our politicians, of all parties, at least have something to talk about. It is, as if, they are actors who go on stage every day but they were running out of anything sensational to talk about. Now our airwaves and screens are full with over-analysis of really not much at all in substance. Yet having yet another paralysing effect on government.

The thing about the current parliament however, is that it was already paralysed anyway.

Speaking of a lot of press time, there is yet another lead story on Bitcoin doing the rounds today. About an Australian who just became a billionaire out of Bitcoin. Sounds good, doesn’t it!

Like many headlines, they are not quite true. This chap has been living in California and is CEO of a Crypto currency firm of sorts. They do research and write code. A silicon valley style startup. They do however have the word “crypto” in the name of their company. So their stock is soaring.

This story actually says everything that is wrong about Bitcoin and other similar currencies.

You see, this Australian chap was only worth a billion dollars for a few hours. He immediately slipped back to around $900 million. Still not bad. But, it had nothing to do with him actually buying Bitcoin. It was all about his company’s volatile stock ride. The company rose sharply in value recently. The recent strong run though, only saw a handful of five thousands of shares exchanged. Basically, people want to buy the stock because it has “Crypto” in the name?

This is the hallmark of a bubble market. Just plain stupidity. The company in question currently has net assets of 3.6 million dollars. That’s all. And, they lost 1.5 million dollars in the latest calendar quarter. Yet the stock went so high as to value the company at THREE BILLION DOLLARS. Wow, what a business, being a small company, very small, be losing money, but call yourself “Crypto Co” … and your company is a 3 billion dollar operation all of a sudden.

This is total market madness. This is the whole story of Bitcoin. Prices going up, because people are buying, because prices are going up… It reminds me a little bit of Uber. Everyone thinks Uber is some super successful company? They lost US$ 5 billion in just the past two years. Their CEO and 20 other senior staff were all fired! Yet the CEO still walked away a billionaire. He basically wrote money-losing software that has become incredibly popular. That has a value to be sure. It just hasn’t turned into anything other than among the biggest losses in the history of the world.

Now doesn’t that all make you feel better about investing in real property?

Clifford Bennett