One of the challenges a disciplined investor faces is a dearth of opportunities as the market cycle grinds higher. If a deeper level of scrutiny is applied in decision-making, the more apparent phoney values and overhyped growth fall apart. This makes it even easier to fall victim to sub-par underwriting.

One possible antidote to such a stage is to keep looking at various areas where stress may be building up; and where imbalances are being accumulated to staggering heights. Being nimble or opportunistic, a short seller can take advantage, as this build-up progresses towards distress stage. On the other hand, later, if and when the deflation occurs you may also be ready with a sense of epicentre and ripple effects – Plus some better sense of value.

So today, to my mind, the following two areas are worth keeping a watch on:

1. Canadian housing sector
2. Australian housing sector

Without inflicting torture with too much detail, I would like to leave the reader with these intriguing charts given below:

Canadian Housing Sector


Australian Housing Sector