In just the past few years, global asset values have risen to the biggest bubbles in history. Unfortunately, this doesn’t seem to be a concern to the market because most people believe they are getting richer. However, rapidly rising digital riches can easily turn into digital losses, just as quickly. But, this will likely remain a secret until the major fireworks begin in the markets within the next few years.
According to a recent update by Savills, a global real estate services provider listed on the London Stock Exchange, global real estate values reached a new record of $281 trillion at the end of 2017. That is a BIG number because their last update in April 2017, stated that world real estate values were $228 million for 2016 year end. How could global real estate values jump that much in a year??
First, let’s look at my newest updated chart on the “Global Mainstream Asset Universeâ€:
Again, according to Savills for yearend 2017, global real estate values were $281 trillion, Securitized debt (treasuries-bonds) was $105 trillion, and total world equities were worth $83 trillion. Now, if you notice that GOLD SMUDGE on the right-hand side of the chart, that represents the total value of global gold and silver investments… a measly $3.1 trillion. And that figure really hasn’t changed in the past few years.
Second, when I went to the Savills website to find out the percentage increase in these bubble asset values, I noticed that they stated global real estate values increased 6.2% over the past year. You can check for yourself here:Â 8 things you need to know about the value of global real estate.
Well, something just didn’t make sense if Savills showed that global real estate values increased from $228 trillion at the end of 2016 to $281 trillion by the end of last year. Gosh, that can’t be a 6.2% increase… rather it was a stunning 23% increase. So, I decided to email the author of the article and find out why these numbers didn’t jive.
