# How low can the All Ords go?



## LRG (18 March 2008)

I subscribe to Huntley's who's view was that the Jan 22 low of 5200ish was the low to rally off to new highs going forward.

This has now proven not to be the case.

I have heard some say that it is now heading to 4700 before it bottoms.

We have so many "expert" opinions - some say black, some say white.

Statistically, 50% will be right and 50% will be wrong.

I think maybe more downside over the next 6 months at least.

What do people think???


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## wayneL (18 March 2008)

*Re: How low can All Ords go?*



LRG said:


> I subscribe to Huntley's who's view was that the Jan 22 low of 5200ish was the low to rally off to new highs going forward.
> 
> This has now proven not to be the case.
> 
> ...




How long is a piece of string?

It is conceivable that the XJO could end up in the 3000s. I say this by drawing a line through the financials... the big banks etc.

If not for the resilience of the big miners, (and desperation measures from the Fed) we'd nearly be there already. IMO

If the miners come off 3000s are a dead cert.


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## wildmanchris (18 March 2008)

Agree with Wayne.

I wouldnt call 3000's but then again, I didnt think the hole was as deep as it's proven to be already.  All you have to do is to read finance headlines each day to realise that there is potentially so much more bad news to come.  

Look at the companies that have already struggled to refinance or been called on loans, and add RJT to that mess as well.  I know of a few more companies with high debt levels that _may _find themselves in trouble very soon - the charts all show the same direction over the last 12 months as well.  

It doesnt surprise me that the futures are up as much as they are in the US tonight, but this happened a few weeks ago at the last cut and it lasted a few days and then turned.  I have heard it referred to as a sucker rally in some cases, and I would guess we will see another one of those over the next few days.

My money is safe and sound in ING for the time being, and if it wasnt there it would be shorting financials - MQG and BNB's bottom is anyones guess based on fear, and fear alone.


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## Bill M (18 March 2008)

LRG said:


> What do people think???




Nobody knows, can go either way. The way I look at it is if you have money would you like to get income of 5% after tax in a cash account or 7% after tax in fully franked dividends? My choice is easy as I am a long term investor. If you aren't a long term investor then the sharemarket may not be for you.

A chart can tell you where a stock has been but can't tell you where it will go. You only need to read reviews of everybody's individual interpretations on other threads.

Good luck with your investments.


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## prawn_86 (18 March 2008)

*ZERO*


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## Julia (18 March 2008)

wildmanchris said:


> My money is safe and sound in ING for the time being, and if it wasnt there it would be shorting financials - MQG and BNB's bottom is anyones guess based on fear, and fear alone.



What makes you so sure your money is "safe and sound in ING"?


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## Dezza (18 March 2008)

Julia said:


> What makes you so sure your money is "safe and sound in ING"?




Because Billy Connolly said so in the ads. :

If people knew where the market was going, there wouldn't be any fun in trading. Wasn't it only in 2005 or so that they were saying it'll drop to 4800, then ended up at 6000. Now, it's the other way around.


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## wildmanchris (18 March 2008)

Julia said:


> What makes you so sure your money is "safe and sound in ING"?




Good old Billy, funny and smart.  

Fair call - nothings safe at the moment.  But i'd rather have it there than long in anything at the moment.  It'll be back in the markets soon enough, but not until we've seen an investment bank fall.


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## Julia (18 March 2008)

I asked because I have found myself hesitant about placing a term deposit with one of the Big Four!!!
Such is the contagion of fear.


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## Dezza (18 March 2008)

TDs currently offering around 7-8% depending on terms, which is pretty tempting in current conditions. GUARANTEED! 

You wouldn't believe the amount of TDs and annuities being recommended at the moment at the funds manager I work for.

So you're not the only one a lil' worried at the moment. But you'll just have to weigh up your investment objectives / timeframe and see which option is for you. Discuss with your adviser / accountant / family etc to see what's best for you.


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## Synergy (18 March 2008)

Bad news is a funny thing. A steady flow of it will cause an over reaction. Even after we are prepared to sit back and call it an over reaction, more bad news will send us back past our previous low. Didn't we learn the first time? The current events were predicted a few months ago and we are still being surprised by them and reacting to them as though we didn't have the faintest idea about them.

Also where on a 1 - 10 scale would this current crisis sit? Is it deserving of wiping 25% off our market value? If the US were to fall off the map what would our market be worth? Obviously it wouldn't be worthless. Maybe 50% of its current value? I doubt the current crisis is half as bad as that. For me we are in a major over reaction, but thats the market. Or maybe i'm talking dribble.


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## rederob (19 March 2008)

*Re: How low can All Ords go?*



wayneL said:


> It is conceivable that the XJO could end up in the 3000s. I say this by drawing a line through the financials... the big banks etc.
> 
> If not for the resilience of the big miners, (and desperation measures from the Fed) we'd nearly be there already. IMO



I think the low 4000s is a dead cert.
If the derivatives market starts to unwind, then halve it!

That said, I believe this is more about timeframes and fundamentals than mere numbers.
In timeframe terms I think buying in at the moment is silly unless you have got onto something moving against the trend for good reason (maybe oil or gold stocks).  The markets need time to digest all the bad news, and more time again to determine that it's ok to start heading up again: 2009 is looking like it's worthing waiting for.
Additionally, until the US has had its Fed interest rates sit at zero for a quarter or so, I for one will keep a lot of powder dry.

In fundamental terms its the difference between a US recession, and a US depression: The former may not impact global industrial production to the extent that our allords dips under 4K.  The latter locks in 3K and could see us lower still.

As an investor, I had thought 4300 was a good point to consider a strong market re-entry:  From a long term perspective it will probably prove profitable.  However, as a thinking investor, I regard it unwise to use numbers per se in the present climate.  

There are many market indicators that will give us signals a return to equity investing can be profitable and I intend to line up as many of these as practicable.


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## Birdster (19 March 2008)

Bill M said:


> ... If you aren't a long term investor then the sharemarket may not be for you.
> 
> A chart can tell you where a stock has been but can't tell you where it will go. You only need to read reviews of everybody's individual interpretations on other threads.....




Well said. Thought this was one of those "poll" threads till yor post Bill. If you are looking to go long, now "might" be the time if you get the right advice, IMO. 50% will say I'm wrong and 50% will wait till I'm wrong. 

If you are there in for a sweep, pick your codes well, or let it go for another day/week/month. 

Gambling vs. investing...make sure the definitions are kept as far apart as possible.


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## Wysiwyg (19 March 2008)

Must be due for some flattening out and sideways movement. A time for reflection and an easing of volatility.


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## wayneL (19 March 2008)

Oh murther!

A new crop of fundy *investors who have no idea about technical trading, yet feel qualified to criticize. LOL

I've done it too many times, would someone enlighten these chaps?


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## wildmanchris (19 March 2008)

wayneL said:


> Oh murther!
> 
> A new crop of fundy *investors who have no idea about technical trading, yet feel qualified to criticize. LOL
> 
> I've done it too many times, would someone enlighten these chaps?




Easing of volatility wasnt something I was expecting to see in the near future, but who knows.  I've seen stranger things..........


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## Smurf1976 (19 March 2008)

Dezza said:


> TDs currently offering around 7-8% depending on terms, which is pretty tempting in current conditions. GUARANTEED!



Trouble is, that guarantee is worthless the moment you need it...


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## tech/a (19 March 2008)

> A chart can tell you where a stock has been but can't tell you where it will go.




Not where it will go but where it is likely to go.
Radge is right.
All analysis regardless of what you choose is nothing more than Prove-Disprove-Prove-Disprove.

In other words its correct until proven wrong.
You/we all trade according to our analysis.

We are constantly anticipating the market through analysis.


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## wayneL (19 March 2008)

tech/a said:


> Not where it will go but where it is likely to go.
> Radge is right.
> All analysis regardless of what you choose is nothing more than Prove-Disprove-Prove-Disprove.
> 
> ...



'zactly

Not only that, a price chart delivers logical points of price (and some say time) whereby we can determine proof or disproof.


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## DB008 (19 March 2008)

any analysis (F/A, charts etc etc) is only looking at the PAST. 
you want to look at the future, do futures.
How long is that piece of string???


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## rederob (19 March 2008)

wayneL said:


> 'zactly
> 
> Not only that, a price chart delivers logical points of price (and some say time) whereby we can determine proof or disproof.



I have not seen a price chart for an equity or commodity that did not have logical points of price.
Would you like to explain the price points that are on charts which are not logical?
I won't go into the temporal issue: It's self evident that prices exist at points of time.
If something is on a chart, what are we proving?
Or is it your tenet that a chart portends eventualities?

I agree in part with tech/a.  Not wholly, because good analysis provides an edge.  And this edge is expressed in probability terms.
Thus the near term probability of the US economy rebounding into prosperity is exceptionally low.  So the probability of the US dollar increasing in value (on a sustainable basis) near term is also quite low.

We can extrapolate these probabilities to selected equities and commodities - such as gold - and draw some conclusions about price outcomes: I prefer the simplicity of "higher" or "lower" to exact price.

So, to suggest that forecasting the allords is prove, disprove, prove etc., is, in my view a cop out.  Moreover, as the allords is in decline, we can sequentially determine the probability of further declines.  Those probabilities are high: That is, the probability that sequential lows will be hit over coming months is high.

Toss into this mix the known unknowns, that is the unwinding of derivatives post subprime, and then unknown unknowns (that is, if its not a depression, what will it be), and the probability factors are advanced over time.  

That's why I'm reasonably confident of the allords hitting low 4Ks and, agreeing with Wayne that 3Ks are in play.  But as months pass, I would not rule out the high 2Ks as a chance.


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## wayneL (19 March 2008)

rederob said:


> I have not seen a price chart for an equity or commodity that did not have logical points of price.
> Would you like to explain the price points that are on charts which are not logical?
> I won't go into the temporal issue: It's self evident that prices exist at points of time.
> If something is on a chart, what are we proving?
> Or is it your tenet that a chart portends eventualities?



We are attempting to prove a hypothesis, whatever that hypothesis may be. That hypothesis could be something like; that a trend as defined by the trader will continue far enough to result in a reasonable R/R trade. Disproof would be that it didn't. Technically significant points on a price chart, allow us to define the hypothesis, and subsequently the proof, the disproof and the parameters by which the hypothesis will live or die.



rederob said:


> That's why I'm reasonably confident of the allords hitting low 4Ks and, agreeing with Wayne that 3Ks are in play.  But as months pass, I would not rule out the high 2Ks as a chance.




2k's? Lord, the number that dare not speak its name! OK Now that someone else has put it on the table, I'll go along with that. But my word, that's an uncomfortable thought for the vast majority.


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## rederob (19 March 2008)

Wayne.
We must be talking about different things.
The chart shows price history, and a myriad of technical indicators can be based on these prices.
Are you hypothesising on a forward view?
As distinct from determining the probability of an event? 
You have lost me, poor simple thing that I am.


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## wayneL (19 March 2008)

rederob said:


> Wayne.
> We must be talking about different things.
> The chart shows price history, and a myriad of technical indicators can be based on these prices.
> Are you hypothesising on a forward view?
> ...



Well I'm speaking generically as both are considered to a greater or lesser degree by most technicians. I'm too simple to do either to a masterful degree, so rely on a little bit of game theory and money management to eek out a crust.

However, I'm not so simple as to not realize that those indicators you mentioned pretty much suck. Price action, wave structure and purported support and resistance are my caper.


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## MRC & Co (20 March 2008)

DB008 said:


> any analysis (F/A, charts etc etc) is only looking at the PAST.
> you want to look at the future, do futures.
> How long is that piece of string???




Huh?  I dont get it 

Any analysis is trying to predict future price, no matter what your instrument, stocks, options (though not always the direction with options, but with some degree of direction involved), futures.


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## wayneL (20 March 2008)

DB008 said:


> any analysis (F/A, charts etc etc) is only looking at the PAST.
> you want to look at the future, do futures.
> How long is that piece of string???



Trading futures is no different to trading stock in the simple sense.

The term "futures" has got nothing to do with the future in the price speculation business. The term relates to commercial interests locking in a price on a future date.


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## Logique (20 March 2008)

Nobody knows how low for the XAO, and it's a question that will be answered in offshore markets - ask them how low they will go. 

I still haven't given up yet on the XAO holding above 5000. However if that level fails, some likelihood of it fallling to test 4000. But by that time what will the franked dividends be runing at - double digit % ? So it can't keep going down forever.


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## jonojpsg (20 March 2008)

I guess if we think that over longer periods of time, earnings are the key driver for stock prices, then we would need to see earnings reports around the middle of this year and then the end of the year to see where we might be heading.  Obviously if earnings hold up, then one would assume that prices will also hold up, otherwise as Logique says yields will reach double digit and everyone will want in which will push prices back up.

I can't see how the All Ords can reach 2ks???  THat would imply prices for BHP of sub $20, CBA at around $20s and so on.  Of course, if world economy implodes, people stop buying everything apart from essentials, commodoties collapse, then these prices may happen.  Does anyone know?  

Of course the known unknowns and unknown unknowns may well kick us in the butt until we get to the 2ks - I hope not


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## jonojpsg (20 March 2008)

Just had a look at the All Ords back to 1990 and drew a trendline through the lows from 1990 until now and it predicts a target of 3750.  Through the tops gives around 4300, so I guess this might well be a reasonable range to look at as it takes out the excesses of the debt boom era of the last 4 or 5 years.


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## dhukka (20 March 2008)

Logique said:


> Nobody knows how low for the XAO, and it's a question that will be answered in offshore markets - ask them how low they will go.
> 
> I still haven't given up yet on the XAO holding above 5000. However if that level fails, some likelihood of it fallling to test 4000. But by that time what will the franked dividends be runing at - double digit % ? So it can't keep going down forever.




The assumption here is that currently forecasted dividend levels will be realized. 4 months ago, the best (I use that term loosely) analysts on Wall Street said that Citibank would not need to cut its dividend since it generated $20 billion in free cashflow. What happened to that? Many other financial companies have slashed their dividends and in some cases eliminated them altogether. 

The US has hit a turning point in the economy and in terms of earnings. Earnings visibility is extremely impaired at cycle turning points. Analysts are notoriously late to the party. 12 months ago *4Q07* S&P500 earnings were forecast to show double digit growth. Even as late as mid November analysts were predicting 4Q07 earnings to rise *3%*. Now with *99%* of S&P500 firms having now reported, earnings show a *-31%* decline. 

We are not yet there in terms of earnings in Australia The Australian economy is still strong so you can expect strong earnings through the end of June 2008. However there are signs of weakness in Aussie bank earnings, you'll see more of that in May when the other 3 majors report but the real weakness wont show up until next year IMO. 

Reliance on current earnings and dividend forecasts should be taken with a grain of salt as they are next to useless at turning points in the earnings and economic cycles.


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## dhukka (20 March 2008)

jonojpsg said:


> I guess if we think that over longer periods of time, earnings are the key driver for stock prices, then we would need to see earnings reports around the middle of this year and then the end of the year to see where we might be heading.  Obviously if earnings hold up, then one would assume that prices will also hold up, otherwise as Logique says yields will reach double digit and everyone will want in which will push prices back up.
> 
> I can't see how the All Ords can reach 2ks???  THat would imply prices for BHP of sub $20, CBA at around $20s and so on.  Of course, if world economy implodes, people stop buying everything apart from essentials, commodoties collapse, then these prices may happen.  Does anyone know?
> 
> Of course the known unknowns and unknown unknowns may well kick us in the butt until we get to the 2ks - I hope not




I see the 2ks on the XAO, CBA trading in the 20's and BHP in the teens as very conceivable. Consider that P/E ratios become very depressed at the end of bear markets. At the end of the 1966 -1982 bear market the P/E of the market was around 6 - 7 times trailing earnings. So if you think CBA is cheap trading at 11 times earnings just remember that history suggests it can get a whole lot cheaper. 

The above is not a forecast, I don't expect the XAO will see the 2k's but I wouldn't be surprised. FWIW I'm looking for a bottoming somewhere between 3400 - 3800.


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## Junior (20 March 2008)

dhukka said:


> I see the 2ks on the XAO, CBA trading in the 20's and BHP in the teens as very conceivable. Consider that P/E ratios become very depressed at the end of bear markets. At the end of the 1966 -1982 bear market the P/E of the market was around 6 - 7 times trailing earnings. So if you think CBA is cheap trading at 11 times earnings just remember that history suggests it can get a whole lot cheaper.
> 
> The above is not a forecast, I don't expect the XAO will see the 2k's but I wouldn't be surprised. FWIW I'm looking for a bottoming somewhere between 3400 - 3800.




So you're looking for XAO to lose a total 50% of it's value from top to bottom?  That's a massive call, has that happened in the past 100 years?

I would've thought with our country's vast natural resources this is highly unlikely.


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## dhukka (20 March 2008)

Junior said:


> So you're looking for XAO to lose a total 50% of it's value from top to bottom?  That's a massive call, has that happened in the past 100 years?
> 
> I would've thought with our country's vast natural resources this is highly unlikely.




Yes, the low end of my range would imply a *-50%* decline in the XAO. However as stated above I could easily conceive of a bigger fall. From it's peak in the late 60's to the trough after the OPEC oil crisis in 1974 the XAO lost more than *-65%*.


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## gfresh (20 March 2008)

> So you're looking for XAO to lose a total 50% of it's value from top to bottom? That's a massive call, has that happened in the past 100 years?




Yes, a few times, or quite close to it.. How many times in the last 100 years have the world's largest financial institutions been in so much trouble? Maybe less than that.. This is what we are dealing with, at least a once in 30 year event, maybe the sort of thing that only happens twice in a century.

I know we're really talking about our local All Ordinaries, but seeing as it's difficult to get such a long timeframe chart for Aus, here's the US..


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## vishalt (21 March 2008)

Long term support for the Dow @ 500 points LOLLLL.


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## ta2693 (21 March 2008)

The market can be ridiculous on one way. why can it not be ridiculous on the other?


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## rederob (21 March 2008)

vishalt said:


> Long term support for the Dow @ 500 points LOLLLL.



Umm
That's 1000points.
So, will the gold and DOW hit the same level?
What if the answer is yes?
Not this year tho.....


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## Sean K (21 March 2008)

ta2693 said:


> The market can be ridiculous on one way. why can it not be ridiculous on the other?



Need to check the long term charts of the general indices. There have been some serious bumbs but only a few relatively sustained. Going through a serious down right now, but for how long is anyone's guess. However, long term up, not long term down...


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## wildmanchris (13 April 2008)

LRG said:


> I subscribe to Huntley's who's view was that the Jan 22 low of 5200ish was the low to rally off to new highs going forward.
> 
> This has now proven not to be the case.
> 
> ...




Got a free trial with Huntleys so I looked at back issues out of interest.  I wasnt really impressed with some of the calls they made - and from memory underperformed the market last year with their portfolio?  Someone correct me if im wrong.

One of their December newsletters was saying the correction was over, and buy back in - and in each article they seemed to forget what the had been talking about the week before.

Glass was always half full, and it clearly wasnt over the time period I was reading.

I also love their buy recommendation on AIO from 9 all the way down to $3.50.


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## Junior (14 April 2008)

ta2693 said:


> The market can be ridiculous on one way. why can it not be ridiculous on the other?




Calls for the all ords to reach 2-3k's seem too extreme a scenario for my money.  Look at our biggest financial insto's for example...despite major credit problems they're still expecting huge profits.  Then look at mining...commodity prices smashing through record highs as demand continues to grow, unaffected by a global financial crisis.


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## Temjin (14 April 2008)

wildmanchris said:


> Got a free trial with Huntleys so I looked at back issues out of interest.  I wasnt really impressed with some of the calls they made - and from memory underperformed the market last year with their portfolio?  Someone correct me if im wrong.
> 
> One of their December newsletters was saying the correction was over, and buy back in - and in each article they seemed to forget what the had been talking about the week before.
> 
> ...




I agree. My Father subscribed to the newsletter and I told him to ignore what the guy say. He doesn't know what he is talking about. Now the latest newsletter saying he "underestimated" the extent of this crisis and had to recalculate some of his "valuations". 

Not to mention he is still assuming a gold price of US $650 for his long term valuation in gold miners.


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## treefrog (14 April 2008)

Junior said:


> Calls for the all ords to reach 2-3k's seem too extreme a scenario for my money.  Look at our biggest financial insto's for example...despite major credit problems they're still expecting huge profits.  Then look at mining...commodity prices smashing through record highs as demand continues to grow, unaffected by a global financial crisis.




Hi junior,
have always thought when trying to look at the big picture to include the big factores in the equation. Yes record commodities but what is the consequence??
consumption = global warming and that causes a few problems on a large scale not least the availability of fresh water
high prices = high food prices and spreading food riots
here's a couple of grabs from a quick google of these two issues
The NZ Herald Monday April 14, 2008
"Food riots in developing countries will spread unless world leaders take major steps to reduce prices for the poor, according to the head of the United Nations Food and Agriculture Organisation.
Despite a forecast 2.6 per cent rise in global cereal output this year, record prices are unlikely to fall, forcing poorer countries' food import bills up 56 per cent and hungry people on to the streets, says FAO Director General Jacques Diouf.
The FAO says food riots had broken out in several African countries, Indonesia, the Philippines and Haiti. Thirty-seven countries face food crises, it said in its latest World Food Situation report"

The Earth's Most Precious Resource May Be the 21st Century's Most Lucrative Investment - Green stocks report
"per capita access to clean water is diminishing in all developed and developing countries. Beyond that, 20% of the clean water we do have is lost every year through aging pipes and other faulty infrastructure.
An investment of over $1 trillion will need to be made in the next 20 years to ensure an adequate supply of fresh water for the world's growing population. We'll see this money go to water utility companies and other specialized companies focusing on desalination, purification, pipes, pumps, and anything else that will help increase the amount of readily accessible water.
So it's no surprise that the water companies leading the charge in solving the water supply crisis stand to make legendary profits. A few water companies have already gained over 1000% in the past few months... And to be sure, there will be plenty more to come."

while it is obvious that there are investments possibilities there, I would contend that the current economy is not structured to respond quickly to this change and the question must be how far the drop until it does restructure and deal effectively


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## professor_frink (14 April 2008)

Bill M said:


> ........If you aren't a long term investor then the sharemarket may not be for you.
> 
> A chart can tell you where a stock has been but can't tell you where it will go. You only need to read reviews of everybody's individual interpretations on other threads.
> 
> Good luck with your investments.




exactly! the sharemarket is for investors only and charts don't serve any useful purpose.

When will people learn



:fish::kebab


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## Temjin (14 April 2008)

professor_frink said:


> exactly! the sharemarket is for investors only and charts don't serve any useful purpose.
> 
> When will people learn
> 
> ...




To think charts don't serve any useful purpose would mean every technical analysis traders in the world were either fraud or just extremely lucky to maintain a consistent profit. Good luck telling them that, plenty of them here.  (including myself)

Be open minded to all things.


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## Julia (14 April 2008)

Temjin said:


> To think charts don't serve any useful purpose would mean every technical analysis traders in the world were either fraud or just extremely lucky to maintain a consistent profit. Good luck telling them that, plenty of them here.  (including myself)
> 
> Be open minded to all things.



Temjin, I think Professor Frink may have had his tongue just slightly in his cheek with that remark.


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## professor_frink (14 April 2008)

Temjin said:


> To think charts don't serve any useful purpose would mean every technical analysis traders in the world were either fraud or just extremely lucky to maintain a consistent profit. Good luck telling them that, plenty of them here.  (including myself)
> 
> Be open minded to all things.




I'll try. But I can't guarantee anything


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## Bill M (14 April 2008)

professor_frink said:


> exactly! the sharemarket is for investors only and charts don't serve any useful purpose.
> 
> When will people learn
> 
> ...



I should have clarified that, my apologies. The guy was reading Huntley's and I was presuming he was thinking about entering the market. He was asking for opinions so I assumed he was not a trader.

As for traders I salute you guys (and girls), I haven't the knowledge, nerves, nous and time to do it or understand it. The "XAO Analysis" thread is very interesting reading, keep up the good work, cheers for now.


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## Junior (14 April 2008)

treefrog said:


> Hi junior,
> have always thought when trying to look at the big picture to include the big factores in the equation. Yes record commodities but what is the consequence??
> consumption = global warming and that causes a few problems on a large scale not least the availability of fresh water
> high prices = high food prices and spreading food riots
> ...





All very valid points, my posts have been in response to the impact on the All ords of the credit bubble....I haven't considered environmental impacts.


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## rederob (12 July 2008)

Junior said:


> Calls for the all ords to reach 2-3k's seem too extreme a scenario for my money.  Look at our biggest financial insto's for example...despite major credit problems they're still expecting huge profits.  Then look at mining...commodity prices smashing through record highs as demand continues to grow, unaffected by a global financial crisis.



It's been a while since this thread was opened.
Low 4ks are a shoe-in.
High 3ks are coming more and more into play.
Oddly enough the US has not yet sunk into a technical recession, let alone depression.
So *technical recession *will lock in a 3k scenario.
And depression thereafter looks like a good bet, with the allords possibly dipping into 2k range.


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## r34ztune (13 July 2008)

rederob said:


> It's been a while since this thread was opened.
> Low 4ks are a shoe-in.
> High 3ks are coming more and more into play.
> Oddly enough the US has not yet sunk into a technical recession, let alone depression.
> ...




what evidence/facts can you base your claims that the s/market will dip to 2k? Even Warren Buffet  admitted he can't tell what the market will do the next day let alone next year.


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## chrissyoscar (13 July 2008)

rederob said:


> It's been a while since this thread was opened.
> Low 4ks are a shoe-in.
> High 3ks are coming more and more into play.
> Oddly enough the US has not yet sunk into a technical recession, let alone depression.
> ...




Ok so the share market goes as low as 2500-2900, what would that mean.
Telstra at $2.20, NAB at $13, QBE $11, Tol around $3, BHP being resource should only drop to $30 lol, and so on.
Come on does that really sound like a scenario that could happen.
It will never get that low as most think the market is already cheap.
But hey If it does I'll be the first to say good call, just before I jump of the cliff.
I'll probably have to wait my tern as no doubt there's be a line of jumpers at the bridge.
The market will settle but I do agree it could go to low 4000,s out of fear and nothing else.

Experienced traders and investors know the markets and a lot have already fled and cashed up.
You can bet they are ready to jump back when they think the time is right.
When the mums and dads are fleeing the experts are buying.


----------



## M34N (13 July 2008)

rederob said:


> It's been a while since this thread was opened.
> Low 4ks are a shoe-in.
> High 3ks are coming more and more into play.
> Oddly enough the US has not yet sunk into a technical recession, let alone depression.
> ...



2000's? That's a serious depression, what sort of time frame would you be talking about here to reach that event, 5+ years? Impossible to predict that time frame, no way could you put a figure on it.

For all we know the US economy may rebound by the end of this year even, who knows, we could be back in record territory by then!


----------



## rederob (13 July 2008)

r34ztune said:


> what evidence/facts can you base your claims that the s/market will dip to 2k? Even Warren Buffet  admitted he can't tell what the market will do the next day let alone next year.



Let's see:
You bought a house and had mortgage.
The value of the house fell substantially below the mortgage so you sell the house at a loss and still owe the bank the balance on the mortgage.
While paying off the mortgage and rent your fuel bill doubles and the cost of everything you consume rises substantially due not only to pre-existing inflationary pressures, but also to passed-on costs principally energy/transport related.
You lose your job because GM shuts down yet another production facility and your employer loses his major supply contract.
You go to your bank for a loan to tide you over the tough times only to find that you have no collateral, and are now deemed a credit risk.  Moreover, you learn you couldn't have afforded the repayments anyway as interest rates are now through the roof.
You go home, turn on the news are greeted with the Fed stating that the US is not in recession, and the next rate movement could be "up".
Multiply this story several million-fold and you are scraping the surface of what is happening to real people in the world's largest economy.
At a corporate level the burden of debt is still gathering momentum.
The US is going down the gurgler and its stock market will follow.
Our stock market will follow it - perhaps not as steeply in the longer run.

In the world of probabilities, a US recession in the near to medium term is a certainty.
I'm not so sure about a "depression": Haven't been around long enough to experience one.  
I'm clearly not Warren Buffett, although like him I have no idea where the market will end up tomorrow, or next year.  I am very confident, however, that the market has a long way to fall from here.  It might take up to a year to bottom, or perhaps longer. I believe the allords will plumb the 3k range at some point, but at this stage would not bet on a 2k outcome.


----------



## dhukka (13 July 2008)

rederob said:


> Oddly enough the US has not yet sunk into a technical recession, let alone depression.





On the contrary I think the US economy probably tipped into recession back at the beginning of this year. It may have poked it's head out again with the help of rebate checks but that won't last long.  6 Consecutive months of job losses without a recession would be first and there is little doubt that the job losses reported so far have been understated. John Maudlin talked about it in his newsletter today. 

Martin Feldstein, the head of the NBER said that the US economy was probably sliding into a recession in December or January. It is often stated and falsely reported by media hacks that a recession is 2 consecutive quarters of negative GDP. That is not the case, if it were, there was no US recession in 2001.


----------



## Muschu (13 July 2008)

rederob said:


> ...I'm clearly not Warren Buffett, although like him I have no idea where the market will end up tomorrow, or next year.  I am very confident, however, that the market has a long way to fall from here.  It might take up to a year to bottom, or perhaps longer. I believe the allords will plumb the 3k range at some point, but at this stage would not bet on a 2k outcome.





Tried to ignore this but gave in..... because it is self-contradictory.  "I have no idea";  but "I am very confident";  and  then throw in the "I believe". 

Yes, these are challenging times and they're not being aided, in my view, by global statements and self-fulfilling prophecies.  Fear is ruling.  It has almost become a competition in its own right.

I'm quite OK with saying I don't know where the market is going and that most informed opinion suggests further losses.

Beyond that point very strong evidence is needed in my opinion.  I don't know that such tangible, relevant evidence is currently available.  Maybe it is or maybe there's a place for acknowledging uncertainty and waiting.


----------



## wayneL (13 July 2008)

chrissyoscar said:


> Ok so the share market goes as low as 2500-2900, what would that mean.
> Telstra at $2.20, NAB at $13, QBE $11, Tol around $3, BHP being resource should only drop to $30 lol, and so on.



You're right it doesn't seem low enough. 

< 2000 it is then.


----------



## noirua (14 July 2008)

:aus:I wonder, does the index mean more than the shares that are representative within it? 
Do we look at the index without being able to name all that many shares within it or their track record or indeed, the price record?
Good grief! The index has gone down 3 - 4%, probably what will happen in less than five hours time. Don't concern yourself about, only do so, if you think your stocks can't weather the storm or you think Australia is about to collapse.
An article recently spoke of Australia's two level economy, where many businesses will do better than in the last 100 years and few will do worse than anytime in the last 100 years. Overall the economy will survive better than Europe and the States. Maybe, yes, the financial storms and even hurricanes are all around us, but, but, but, there is fair weather in the GREAT country of AUSTRALIA, keep calm, relax, take a lofty point of view, the other side of the tunnel is great for this magnificant continent.:aus:


----------



## enigmatic (14 July 2008)

I have been hovering over the ASX and have notice an increasing amount of companies having a equal or lower Mkt cap to there actual Cash. In the resource sector.
And an increasing number of Companies with a low PE. I'm relatively new however i have been reading that an average PE is 13 normally. with some companies like BHP expecting to reach 9 by 2010 at much older prices i think $48 for it to drop to $30 and level at that would indicate a PE of 5.6 I seriously doubt BHP would get to that level or even a PE of 9.

The demand is strong in the rest of the world other then the US and even there it is still strong, Fear is the only thing that is driving the market down, A group of New investors riding the high gains bailing out when they start lossing money.
Just my thoughts.


----------



## rederob (14 July 2008)

Muschu said:


> Tried to ignore this but gave in..... because it is self-contradictory.  "I have no idea";  but "I am very confident";  and  then throw in the "I believe".
> 
> Yes, these are challenging times and they're not being aided, in my view, by global statements and self-fulfilling prophecies.  Fear is ruling.  It has almost become a competition in its own right.
> 
> ...



Nothing contradictory in what I wrote: I have no idea if the allords will be higher tomorrow than today, or higher next year than today.
I am confident that significant falls are ahead of us as the global malaise we are experiencing has not resolved itself.  Resolution could be less than a year, could be more?
I believe, from my research - and I spend typically around 20 hours a week reading on market related matters - that the allords is destined for a number in the 3000 range before global markets rally and we can again invest with some confidence.

People have good reason to be fearful of market direction: There is nothing on the horizon that suggests we a close to improvement.  In fact the signposts clearly point to massive financial debt burdens in the US rolling across the world and dragging us further down.  The 5 trillion debt carried by Fannie Mae and Freddie Mac alone suggest something more dire than than Northern Rock Building Society bailout is about to happen.

Unlike you, *I'm not OK * saying I don't know where the market is going.  I have a very high degree of confidence that significant falls are ahead.  By the same token, there will be some intermittent rallies as well, and I will sell several of my long term holdings into these, and retain only a few energy and metals (mostly gold/copper) plays.


----------



## Julia (14 July 2008)

Muschu said:


> T
> 
> Beyond that point very strong evidence is needed in my opinion.  I don't know that such tangible, relevant evidence is currently available.  Maybe it is or maybe there's a place for acknowledging uncertainty and waiting.



Rick, I guess most of us would agree that fear is dominant at present.
But there's sufficient reason for this fear.  It's not irrational.  And, of course, it's feeding on itself.

My concern for those who are "acknowledging uncertainty and waiting" is that they are risking capital in the process. I just can't see that it makes sense to have funds in e.g. falling bank stocks, right now, when you could be utilising a sector, e.g. coal, which is doing better.  Or, failing that, just staying in cash until confidence returns.  Or using options.

I'll be surprised if we don't see further profit downgrades come reporting season, with the resultant further falls in SP.


----------



## nioka (14 July 2008)

rederob said:


> I believe, from my research - and I spend typically around 20 hours a week reading on market related matters - that the allords is destined for a number in the 3000 range before global markets rally and we can again invest with some confidence.
> .



 That is the sort of information that could only come from the "Lemming Daily News". That will give us great buying oportunities on the way down if many lemmings follow that advice.


----------



## Aurum (14 July 2008)

Is that a bullish wedge I see in the All Ords?

Aurum.


----------



## r34ztune (14 July 2008)

rederob said:


> Nothing contradictory in what I wrote: I have no idea if the allords will be higher tomorrow than today, or higher next year than today.
> I am confident that significant falls are ahead of us as the global malaise we are experiencing has not resolved itself.  Resolution could be less than a year, could be more?
> I believe, from my research - and I spend typically around 20 hours a week reading on market related matters - that the allords is destined for a number in the 3000 range before global markets rally and we can again invest with some confidence.
> 
> ...




I think we can all agree that there is volatility around, however to suggest the all ords will drop to 4k is a big call let alone 3k. Correct me if I'm wrong however I haven't even heard economists talking these levels.You spend 20 hours reading on market matters, so you can further elaborate your findings,research and most importantly figures as how you come to the conclusion the market will reach these levels. I would caution anyone on this forum to others who make such big claims without evidence to support.
Other than reading about the market do you have any formal qualifications?


----------



## Sean K (14 July 2008)

Aurum said:


> Is that a bullish wedge I see in the All Ords?
> 
> Aurum.



It's wedgeish, but too early to call anything bullish I think. 

4800 ish support probably assisting and Uncle Ben self protective measures coming into effect.


----------



## Aurum (14 July 2008)

kennas said:


> It's wedgeish, but too early to call anything bullish I think.
> 
> 4800 ish support probably assisting and Uncle Ben self protective measures coming into effect.




Yes, I'm still bearish but it will be interesting to see if the support level continues the wedge(ish) pattern.

Aurum.


----------



## dhukka (14 July 2008)

r34ztune said:


> I think we can all agree that there is volatility around, however to suggest the all ords will drop to 4k is a big call let alone 3k. *Correct me if I'm wrong however I haven't even heard economists talking these levels.*You spend 20 hours reading on market matters, so you can further elaborate your findings,research and most importantly figures as how you come to the conclusion the market will reach these levels. I would caution anyone on this forum to others who make such big claims without evidence to support.
> Other than reading about the market do you have any formal qualifications?




Economists generally make very poor forecasters of stockmarket levels. Find me one Australian economist that had the ALL ORDS at 5000 through June of 2008, 9 -12 months ago. Dr Shane Oliver had the ALL ORDS bursting through 7000 in the first quarter, Craig James of Comsec wasn't far behind either. 

On the other hand, several members of ASF predicted a significant fall in the XAO in 2008. Wrong or right, rederob's opinion about the direction of the market is as vaild as any economists.


----------



## trend rider (14 July 2008)

does anyone else see a v large head and shoulder pattern, with a bearish sloping right shoulder.


----------



## Aurum (14 July 2008)

trend rider said:


> does anyone else see a v large head and shoulder pattern, with a bearish sloping right shoulder.




Yes, I can see the pattern and it adds to the importance of the 4800(ish) support level. If support fails then the H+S is confirmed and it's very bearish. If support is respected then the H+S fails which is very bullish. An interesting time ahead.

Aurum.


----------



## Trembling Hand (14 July 2008)

r34ztune said:


> Other than reading about the market do you have any formal qualifications?




LOL, Formal Qualifications now thats funny.


----------



## Sean K (14 July 2008)

trend rider said:


> does anyone else see a v large head and shoulder pattern, with a bearish sloping right shoulder.



A little while ago.

https://www.aussiestockforums.com/forums/showpost.php?p=311881&postcount=3708


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## Sean K (14 July 2008)

Trembling Hand said:


> LOL, Formal Qualifications now thats funny.



Yes, I'm much smarter and know more about the market than any economist with a Phd. 



And, I know more about computers than an IT graduate too. 

And, my local doctor knows crap about medicine!


----------



## Trembling Hand (14 July 2008)

kennas said:


> Yes, I'm much smarter and know more about the market than any economist with a Phd.




So you happily follow the Muppet's on the idiot box when they have a couple of letters after their names??????????????????


----------



## CanOz (14 July 2008)

Kennas your H&S target is taken from the centre of the neckline whereas in theory it should be taken from the right shoulder, giving a much lower target, more in line with some of the levels being discussed. I'll try and post something later.

Cheers,


CanOz
FWIW, there are a couple of these patterns in US stocks too atm.


----------



## orr (14 July 2008)

The following is a quote from J.K.Galbraith, A chapter titled _" Financial Genius is Before the Fall"_

"No feature of the Great Crash was more remarkable than the the way it passed from climax to anti-climax to destroy again and again the hope that the worst had passed. Even on the 30th, when the Crash was over, the worst was still to come. It was only that it came more slowly. Day after day over the next two weeks prices fell with monotonous regularity. At the close of trade on the 29 October the _Times industrials stood at 275. In the rally of the next two days they gained more than fifty points. By 13 November they were down to 224 for a further net loss of fifty points. By then stock of investment funds was largely unsalable. Their creators had, by now, ceased to be men of genius."
"The levels of late 1929 were wonderful compared with what was to follow. On 8 July 1932 the average of the closing levels of the Times industrials was 58.46. This was not much more than the amount by which they dropped on the single day of 28 October, and considerably less than a quarter of the closing values on 29 October. But by then of course, business conditions were no longer sound fundamentally or otherwise. The United States, indeed the industrial world, was in a terrible depression."

It's just a guess but I suspect that in late 1929 and in 1930 People were contemplating a similar question to the one raised in this thread._


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## Sean K (14 July 2008)

Trembling Hand said:


> So you happily follow the Muppet's on the idiot box when they have a couple of letters after their names??????????????????



Of course.


----------



## Sean K (14 July 2008)

CanOz said:


> Kennas your H&S target is taken from the centre of the neckline whereas in theory it should be taken from the right shoulder, giving a much lower target, more in line with some of the levels being discussed. I'll try and post something later.



Thanks, I've been doing it wrong for some time then.


----------



## CanOz (14 July 2008)

kennas said:


> Thanks, I've been doing it wrong for some time then.




Hey, targets are only theoretical anyway right!

Heres a link http://www.thepatternsite.com/hst.html

Cheers,


CanOz


----------



## Beej (14 July 2008)

orr said:


> The following is a quote from J.K.Galbraith, A chapter titled _" Financial Genius is Before the Fall"_
> 
> "No feature of the Great Crash was more remarkable than the the way it passed from climax to anti-climax to destroy again and again the hope that the worst had passed. Even on the 30th, when the Crash was over, the worst was still to come. It was only that it came more slowly. Day after day over the next two weeks prices fell with monotonous regularity. At the close of trade on the 29 October the _Times industrials stood at 275. In the rally of the next two days they gained more than fifty points. By 13 November they were down to 224 for a further net loss of fifty points. By then stock of investment funds was largely unsalable. Their creators had, by now, ceased to be men of genius."
> "The levels of late 1929 were wonderful compared with what was to follow. On 8 July 1932 the average of the closing levels of the Times industrials was 58.46. This was not much more than the amount by which they dropped on the single day of 28 October, and considerably less than a quarter of the closing values on 29 October. But by then of course, business conditions were no longer sound fundamentally or otherwise. The United States, indeed the industrial world, was in a terrible depression."
> ...



_

Well if things are ever to even approach the circumstances of the Great Depression in current times then everyone is completely screwed - even all those who sell out of all their shares and property and deposit their cash in the bank! Remember during the Depression, numerous major banks, pension funds etc etc all went completely bust - if you had cash on deposit you LOST IT, every cent. Even keeping the cash under your mattress didn't help much due to inflationary pressures. There was no protection against these events back then from governments/regulators etc, (such as is in place today for exactly that reason)

So I guess I raise this point just to contrast against the current situation, which although presenting some serious financial challenges for us all as individual investors and the global economy more generally, really is incredibly unlikely to lead to the equivalent circumstances as seen in the Great Depression. Unless you are one of those guys wandering around the city with an "The End is Nigh" placard hanging over your back and chest!

We have had recessions and other general economic slow downs before in more recent times, and whilst they were unpleasant, there were also recoveries from them. They didn't end up being any where near as bad as the 30s Depression, even though on each occasion there were (as there are now) people running around predicting the next Great Depression was upon us and trying to draw various parallels. I would think for those of us looking to the past to try and divine what the future *might* hold, looking at some of those other more recent downturns would be much more relevant than crying "the Great Depression" - seems a little "Chicken Little"-esq to me!

And besides, as I stated at the start of my post, if things did get that bad then we are all screwed no matter what anyhow, so may as well just go and jump off the cliff now and get it over with!  (PS - that's a metaphor and not meant to be taken seriously by anyone reading this who MAY in fact subscribe to the Chicken Little economic outlook!).

Cheers,

Beej_


----------



## Aurum (14 July 2008)

Beej said:


> Well if things are ever to even approach the circumstances of the Great Depression in current times then everyone is completely screwed - even all those who sell out of all their shares and property and deposit their cash in the bank! Remember during the Depression, numerous major banks, pension funds etc etc all went completely bust - if you had cash on deposit you LOST IT, every cent. Even keeping the cash under your mattress didn't help much due to inflationary pressures. There was no protection against these events back then from governments/regulators etc, (such as is in place today for exactly that reason)
> Beej




Time to buy gold me thinks.

Aurum.
P.S. couldn't resist with a name like mine.


----------



## brty (14 July 2008)

Good post Beej,

All the canniest investors seem to use simple stuff, like Buy in gloom and sell in boom.

It's pretty gloomy out there (and in here).

Question??. If the US is going to drag us down, and there are billions/trillions in losses, and everyone can see with the emerging figures what a basketcase it is, then why has the DJIA/SP500 only fallen 20-25%???

All this gloom has been around for a year now (subprime etc), communication is better and faster than the past, yet bear markets of the past did most of there damage in the first 6 months or so. hmmm...

This market may not get much lower at all.

brty


----------



## rederob (14 July 2008)

nioka said:


> That is the sort of information that could only come from the "Lemming Daily News". That will give us great buying oportunities on the way down if many lemmings follow that advice.



You can always offer your own view of direction and quantum rather than make disingenuous comment.
Please note I am not giving *advice*, as you infer.  I am offering my view of how I see things and why.
If I was giving advice it would be along the lines of *get out now, and stay out until the market has actually showed signs of sustained recovery*.  And then it would be to buy as the market was going up, not down as you have assumed.

*r34ztune*
I have posted at this site for several years, and have not been backward in making some "way out" forecasts in that time.  They remain available at this site for anyone to throw bricks back at me.  In fact, I specifically came onto this site to stir the pot in the "gold" thread over 2 years ago.  At the time I had moderators and posters insisting I tone down my posts.  
Last November in the "oil" thread I forecast an average price of $120 for 2008, and suggested it might be conservative.  There's another 6 months to run on that one, but so far, so good.
If you want to challenge my capacity for analysis, please do so directly on this forum so that I can reply to you in a considered way.


----------



## Crafty (15 July 2008)

enigmatic said:


> I seriously doubt BHP would get to that level or even a PE of 9.




BHP was on a PE of about 8 early last year...


----------



## Wysiwyg (15 July 2008)

Things are starting to get silly now.Petrified fear selling at large losses, dump buttons locked and loaded, domino effect accelerating.Not long to wait now in my opinion but no doubt the market will stay irrational  just because it can.




.


----------



## korrupt_1 (15 July 2008)

when there are no more sellers in the system... then the market can come back up....

as some here have mentioned before... the strength of sellers on the Australian Market is a force to be reckoned with.... absolutely no hesitation to dump the markets,... sell with extreme prejudice and don't care what how anyone feels about.


----------



## explod (15 July 2008)

rederob said:


> I have posted at this site for several years, and have not been backward in making some "way out" forecasts in that time.  They remain available at this site for anyone to throw bricks back at me.  In fact, I specifically came onto this site to stir the pot in the "gold" thread over 2 years ago.  At the time I had moderators and posters insisting I tone down my posts.
> Last November in the "oil" thread I forecast an average price of $120 for 2008, and suggested it might be conservative.  There's another 6 months to run on that one, but so far, so good.
> If you want to challenge my capacity for analysis, please do so directly on this forum so that I can reply to you in a considered way.




There are those who have a view and those who follow others.    As part of the former your word is very much valued Red.

Our market is tied to the fear and sentiment of Wall Street.  I pointed out with analysis some time back that I thought the Dow would go below 4,000 in the next year.   The All Ords will follow it all the way.


----------



## brty (15 July 2008)

Are we having capitulation right now??? All ords down over 100.

Fear in the air.

brty


----------



## Snakey (15 July 2008)

brty said:


> Are we having capitulation right now??? All ords down over 100.
> 
> Fear in the air.
> 
> brty




Still got a while to go yet
Check out these graphs 
I would say fear brty not capitulation yet!


----------



## Beej (15 July 2008)

Snakey said:


> Still got a while to go yet
> Check out these graphs
> I would say fear brty not capitulation yet!




Shouldn't you be using a logarithmic (not linear) value/price scale on the XAO chart?? Otherwise your mean projects ever diminishing future returns....

Beej

Oh and PS - If I look at an AllOrds chart from 94 to present, with a logarithmic price axis, the mean trend would appear to take us to fair value around 5000 (don't know how to post it here but easy to get the chart from yahoo finance and look).


----------



## Aurum (15 July 2008)

Beej said:


> Oh and PS - If I look at an AllOrds chart from 94 to present, with a logarithmic price axis, the mean trend would appear to take us to fair value around 5000 (don't know how to post it here but easy to get the chart from yahoo finance and look).




I just had a quick look and would put it a little lower by about 200 points.

Aurum.
P.S. doesn't that 87 crash look scary.


----------



## IFocus (15 July 2008)

brty said:


> Are we having capitulation right now??? All ords down over 100.
> 
> Fear in the air.
> 
> brty




No Brty not yet no volume, sellers still to get with the program and feel the fear so maybe a way to go yet.

Still, an amazing straight line move down maybe a bounce soon around 4800.......todays bar quite telling.


----------



## pepperoni (15 July 2008)

Snakey said:


> Still got a while to go yet
> Check out these graphs
> I would say fear brty not capitulation yet!




Ha ha ... I saw that similarity today too.

Seriously though, going back to apr 03 and projecting a sensible longer term growth rate I can see XJO getting to 4500.


----------



## Seneca60BC (15 July 2008)

Snakey said:


> Still got a while to go yet
> Check out these graphs
> I would say fear brty not capitulation yet!




WOW the similarities on those graphs are extraordinary!


----------



## Aurum (15 July 2008)

So, does no one agree that looking at a long term linear chart is just folly and only logarithmic charts give a true picture? Just curious.

Aurum.


----------



## brty (15 July 2008)

Interesting graph Snakey,

It looks a lot like what happened between '82 and after the crash in '87. During that market, the all ords shot up from 450'ish to 2312 over 5 years. The fear, capitulation, despair phase took 3 months. From the top, the correction was 50%, but after a run up of 500%.

Currently, we have had a runup of ~230% over 4.75 years, yet the selloff of 28% has taken 8 months. You can read anything you like into charts, and always find something that looks 'similar', however they rarely conclude the same way.

I am currently looking for opportunities amongst large "solid" companies to invest, because if the worst were to happen, my money is safer there than in bank deposits. 
Realistically and statistically, we are much closer to the bottom than many think. There is simply too much gloom and doom out there.

brty


----------



## Snakey (16 July 2008)

brty said:


> Interesting graph Snakey,
> 
> It looks a lot like what happened between '82 and after the crash in '87. During that market, the all ords shot up from 450'ish to 2312 over 5 years. The fear, capitulation, despair phase took 3 months. From the top, the correction was 50%, but after a run up of 500%.
> 
> ...




yeah i dont believe that it will follow the same track as the EXAMPLE but I will stick with my bottom pick of around 4200 remember you must allow for the despair factor. then a bounce back to 5000 before settling at 4800


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## Wysiwyg (6 August 2008)

After a quiet period this forum has had old nicks return and  new nicks joined.Maybe some confidence returning to the market.A 300 + on the dow might draw some attention though so we`ll see how much credibility there is to it all.


----------



## Muschu (7 August 2008)

Just thinking out loud.....
If the reporting season in the USA is pretty much over, and if the DOW is to continue its downward spiral, what will be the major causative factors behind further drops, particularly in the short term?
Historical patterns?
Fear / sentiment?
Other?


----------



## Sean K (7 August 2008)

Wysiwyg said:


> After a quiet period this forum has had old nicks return and  new nicks joined.Maybe some confidence returning to the market.A 300 + on the dow might draw some attention though so we`ll see how much credibility there is to it all.



Interesting perception Wys.

I'm looking to total dispair/capitulation on volume as sign that the worst is factored in. 

There will be a time soon with those who have keep some in reserve, or at least a pot of gold to margin off, will do very well in the years to come.  

I don't think we are there yet, but it's probably not too far off in the grand scheme of things.


----------



## wayneL (7 August 2008)

kennas said:


> Interesting perception Wys.
> 
> I'm looking to total dispair/capitulation on volume as sign that the worst is factored in.
> 
> ...




Well we haven't had a capitulation low, and this last low wasn't even a particularly volatile low, as lows go. I don't know whether that's bullish or bearish, but we've certainly had "a low".

Ergo, all doom mongering is suspended until a new low appears.


----------



## MRC & Co (7 August 2008)

Muschu said:


> Just thinking out loud.....
> If the reporting season in the USA is pretty much over, and if the DOW is to continue its downward spiral, what will be the major causative factors behind further drops, particularly in the short term?
> Historical patterns?
> Fear / sentiment?
> Other?




Hey Rick,

Sentiment.  Which includes fear/greed and is seen within historical patterns.

I don't think we need a capitulation low (and probably won't see one the way the market has been behaving lately), though these usually form pipe bottoms which are a highly probable reversal pattern.


----------



## Sean K (7 August 2008)

MRC & Co said:


> Hey Rick,
> 
> Sentiment.  Which includes fear/greed and is seen within historical patterns.
> 
> I don't think we need a capitulation low (and probably won't see one the way the market has been behaving lately), though these usually form pipe bottoms which are a highly probable reversal pattern.




Perhaps something to consider at this juncture is the diference between a 'low' and a 'capitulation low'. 

There is going to be a point soon (IMO) when the smartish investors will take the _plunge, for the long term_, for a long term gain. 

God knows where that is, but IMO, we are approaching an unprecidented opportunity for those who have some collatoral to invest at the right time and make an absolute motza!!!

A MOTZA!!!

There have been quite a few people ranting this mantra for at least 12 months and adjusting their portfolio accordingly to make the most of this opportunity.

On the other hand, we may all be fighting something....else....


----------



## MRC & Co (7 August 2008)

ha ha, yes, there could be a MOTZA to be made, but the timing is definately extremelly hard at the moment.  A captulation low would be the best opportunity to dump back in.

Just hope it's not like the late 1800s and the subsequent 30-40 years or so.......


----------



## Bushman (7 August 2008)

MRC & Co said:


> Just hope it's not like the late 1800s and the subsequent 30-40 years or so.......




Then we all die poor... 
:


----------



## Muschu (7 August 2008)

Now Kennas and MRC:  As you know from our previous exchanges I am kinda older [= more mature? ] than you guys.  So don't try to confuse me. 

Lows Vs Capitulations Lows? 

Is most of the bad news out I wonder?  Or does it matter? 

Sentiment / greed / fear can certainly conquer reason.

My scanning of ASF has suggested [if I read more experienced views correctly] that we would experience 4800 (We have), then a bounce [to what point -  not sure if there is a popular view here - 5200/5400?] and then a drop / plummet / whatever to maybe 4200.  [I know others are suggesting even lower but 4200 seems a more common analysis / view].

I know that we are talking opinions and not advice, but is that 4200 still the common view I wonder? 

Got an opinion on what the near future holds because on Saturday I'm heading overseas for 7 weeks?  Planning to drop in on George W and ask him, after dinner, to provide Australia with some advice....


----------



## Wysiwyg (7 August 2008)

Muschu said:


> Got an opinion on what the near future holds because on Saturday I'm heading overseas for 7 weeks?  Planning to drop in on George W and ask him, after dinner, to provide Australia with some advice....




Please don`t mention Australia to Georgey Porgey.

Anyway Rick matey I have Tharpy`s thoughts on the situation.He reckons we`re in a bear market for an indefinately long period.His perception is his perception but the simplicities ring true.



> I don’t know how many people on our database consider themselves to be average investors as opposed to professional traders, but it’s probably quite a few. The media is basically controlled by its advertising and they want you to think the following:
> 
> **You should buy and hold to make money*.
> 
> ...


----------



## MRC & Co (7 August 2008)

lol, ok, I will try make it simple for you Rick, don't want to confuse that old brain 

A low is simply supply petering out, you will normally see low volume and a sign of a lack of sellers, the path of least resistance is then up, it will form a base and continue to just move sideways for a while.  You may also see very tight spreads and high volume, a sign that any last remains of selling is being sucked up by demand.

A capitulation low, is a sudden large impulse lower on high volume, then a swing back up.  IFocus I think posts the chart of a capitulation low back on the last page.  

My view is that of the 'majority' you talk about.  Perhaps 5400 being hit over the next few weeks and then a run down to the 4000 mark over the next year or so.


----------



## Muschu (7 August 2008)

MRC & Co said:


> ......
> My view is that of the 'majority' you talk about.  Perhaps 5400 being hit over the next few weeks and then a run down to the 4000 mark over the next year or so.




Here I am, and now should be rick63, surrounded by all you young _optimists_... mind you even my late father-in-law used to say the only place to keep your money is under the bed.  Could he have been right?


----------



## Muschu (7 August 2008)

And, before I go to bed over here [it's almost 5pm], I suppose you guys will tell me the market won't recover from 3999.99 or thereabouts as a whole but sector by sector?
Where did I read that financials dictate market movements?  Or was it oil?  Or.....


----------



## JTLP (7 August 2008)

kennas said:


> On the other hand, we may all be fighting something....else....




LOL...i remembered you said you were in the army and couldn't help but think of the predator with this line...classic!


----------



## milken$ (16 August 2008)

4100 ish my targte


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## nizar (16 August 2008)

milken$ said:


> 4100 ish my targte




Timeframe?


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## cutz (16 August 2008)

My 2 cents worth,

I think we have already seen the lows of this bear market, i don't think we will see a sickening capitulation stage, ( depends how you look at it).
A slow grind has been happening for a while and i reckon the taxi drivers may be out of the market.
If this is not a time to accumulate i don't know what is, but i could be wrong, i haven't really experienced a deep bear market yet with a large stake (till this year).

Cheers,

Cutz.


----------



## rederob (19 September 2008)

rederob said:


> It's been a while since this thread was opened.
> Low 4ks are a shoe-in.
> High 3ks are coming more and more into play.
> Oddly enough the US has not yet sunk into a technical recession, let alone depression.
> ...



A month since the last post here and nothing really has altered my view on likelihoods.
The US Fed's actions, in concert with other Central Banks, will open the door of a bear trap to unwary investors who might think "confidence" has returned.
If there is any confidence, on my part it is that a "domino" event is now "paused" (or playing out in slo mo) and will pick up pace again when the spate of current bailouts and buyouts has ceased.
What is most apparent is that a myriad of debt instruments remain deeply embedded in the financial market and are taking their time to work through.  Rather than allow capitalism to run its course and rid itself more quickly of this insidious disease, the bastions of free markets are contorting themselves into radical socialists in a vain attempt to stave off the inevitable.
Unfortunately it is the least well off who will again suffer as governments effectively use their tax revenue bases to prop up failed and capitulating financial institutions.  

Back on topic, yesterday marked a new cyclical low, which could hold up for a month or longer.  It also showed how easily a few hundred points can disappear from the allords.  It is very doubtful the worst is over.


----------



## rederob (10 October 2008)

A few people dipped their toes into this thread.
More probably read it and reckoned it was a crock.
Low 3ks looks like it's a reasonable chance now.
I think 2ks will be in play on a depressionary scenario - which we are a long way from.
Whoever re-enters this market at the bottom will do handsomely as the next global growth phase will make the past look quite anaemic.
I intend waiting this out for a good while longer as the domino effect is now rolled into a snowball and gathering pace.


----------



## Dowdy (11 October 2008)

It's peak was 6000. I reckon it'll lose 60-70% of it's peak value


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## rederob (16 October 2008)

Recession now locked in: Low 3ks are a dead cert.
Depression in the wings with 2ks an ever increasing chance in 2009.


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## Smurf1976 (16 October 2008)

rederob said:


> Recession now locked in: Low 3ks are a dead cert.
> Depression in the wings with 2ks an ever increasing chance in 2009.



I'm not really into charts, I'm more of a fundamental long term (10+ years) investor, but I've been thinking the bottom will be in the 3000 - 3500 range for quite some time now. It just seems reasonable to me considering the overall situation and a casual look at the long term charts.

That said, I'm continuing to hold some stocks that I bought for long term investment where there is potential for an upside surprise - eg companies drilling for oil etc. I've no intention of selling for years and don't really care what happens in the meantime with the share price. 

With the fall in oil prices making many smaller fields unviable, the economy is going to have to fall in a hole big time to see sustained lower prices there. And by that I mean big % cuts in oil use rather than the few % we've seen in previous situations.

Likewise I'm keeping my gold as I do think we'll see high inflation at some point and I'm prepared to wait. Thus far it's doing better than I expected. 

Agreed that recession now seems certain. The only question is how bad - I'm thinking the bottom is probably 2 years away for the overall economy and we haven't seen the end of big companies failing yet. The share market should, in theory at least, bottom first since it's supposedly looking to the future. 

All in my opinon, I'm not a financial adviser and so on. Do your own research before investing in anything.


----------



## Indie (16 October 2008)

Based on where we are now, around 4000, I think we will head much lower. Unless you believe the market has already priced in likely housing market declines, consumer spending retreat, debt implosion, etc. I don't think these (future) realities have set in with the average investor. What happens when they do? When it all unfolds in 09? The last thing on their mind is going to be getting back into the market, or waiting for a new All Ords high. They'll be more concerned about their job, mortgage, putting food on the table. When those things are safe then some will consider re-entering the market. 

I think we will probably see sub 2500. Unfortunately.


----------



## YOUNG_TRADER (16 October 2008)

Indie said:


> Based on where we are now, around 4000, I think we will head much lower. Unless you believe the market has already priced in likely housing market declines, consumer spending retreat, debt implosion, etc. I don't think these (future) realities have set in with the average investor. What happens when they do? When it all unfolds in 09? The last thing on their mind is going to be getting back into the market, or waiting for a new All Ords high. They'll be more concerned about their job, mortgage, putting food on the table. When those things are safe then some will consider re-entering the market.
> 
> I think we will probably see sub 2500. Unfortunately.




Interesting, in response to this the RBA will no doubt cut interest rates and I can tell you what that does, it makes people like me with lots of cash in high interest savings accounts go hmmm yield is dropping was 8% guarnateed now 6.5% I think, if it gets to say 5% I will start looking for stable earning stocks with good dividend yield, may also start looking at getting back into property,

Food for thought

Also how/what will drag the All Ords below 2500? BHP $10? RIO $30? CBA $10? NAB $7?

I would say 3400 is what I would have thought as an all time low target

I am still a firm believer in the industrialization of over 2Billion People


----------



## Smurf1976 (16 October 2008)

Indie said:


> Unless you believe the market has already priced in likely housing market declines, consumer spending retreat, debt implosion, etc. I don't think these (future) realities have set in with the average investor. What happens when they do? When it all unfolds in 09?



I may not have this quite right, but one commentator (Jim Puplava) was saying that the US mortgage situation has further rounds to go over the next couple of years. 

Due to the way these mortgages work, they have a "reset" date when the required repayments will (in general) greatly increase. Apparently there's plenty more of this to come and in a significant portion of cases he expected the end result to be defaults on the mortgages. Overall, this sounded worse than what's already happened in terms of scale and duration.

I'm generally a bit sceptical about commentators, but Jim's been pretty right in the past. He was on about this whole situation with mortgages etc years ago so he seems to know what he's on about.

One point worth noting is that if you made an investment in the Dow or other broad US stock indices at this time in 1999 then you're still sitting on a loss in nominal terms. And it's a big loss once inflation is factored in. Sounds like we're half way through a 15 - 20 year secular bear market to me.


----------



## awg (16 October 2008)

i dont think anyone can accurately call a low yet.

even though many think the market is oversold due to fear/panic

the fundamentals of company profits have just not been seen yet.

I expect the big companies to be profit squeezed.

I have 90% cashed out gradually since January.

various brokers and financial planners are STILL telling me and others to hold or even buy.

I even had the indignity of my panelbeater ringing me to say yesterday is the big day to buy.

I muttered about recession in USA, Europe and Japan, and told him i would'nt.


----------



## MS+Tradesim (16 October 2008)

awg said:


> i dont think anyone can accurately call a low yet.
> 
> even though many think the market is oversold due to fear/panic
> 
> ...




LOL! My brother-in-law wouldn't know a FPO share from a latte but we had him sending us emails telling us "Now is the time to hold, don't panic, it'll be alraight."


----------



## white_goodman (16 October 2008)

MS+Tradesim said:


> LOL! My brother-in-law wouldn't know a FPO share from a latte but we had him sending us emails telling us "Now is the time to hold, don't panic, it'll be alraight."




yeh the amount of mates that want me to help them with share trading, that go two days ago yeh it hit the bottom im gonna buy in yada yada yada, then i tell them to buy when i buy. 2 day up move and they think they are messiahs of the market...

meanwhile they dont even have a broker...



oh and the answer to this thread is...

how longs a piece of string?
how deeps a bottomless pit?


----------



## awg (16 October 2008)

I recently cashed out the last of my Managed Investments via my Wrap fund.

Everything is now in my SMSF...I pay a flat $600pa for my considerable 6 figure balance...no more rip-off % fees for dud advice ever again.

I said to the FP,,bye the way, what have you done personally ( now I am finished he can answer that, and he said he had been buying for F sake!

On a slightly different note..a good friend who knows my interest in the market was asking me my opinions at a function several weeks ago..usually I prefer not to talk about it much, especially as I have been pessimistic for some time, but because he is a great guy, and was asking very specific questions, I said if you really want to know...the OTC derivative market has collapsed,(I explained), the bailout is like p!ssing in the ocean, the economy is in for a big recession ( if we are lucky)...I am cashing out completely, and credit may soon become very hard to get, many people will loose their jobs, house prices down 20-40%, and it will hit us like a tidal wave...and people just have no idea whatsoever about the coming sh!tstorm...meanwhile, quite a few people had started listening in...and the response was as I expected...hey mate, the sun is shining..what are u worried about...thats bullsh!t etc (not from him), but the gathered crowd.

I said "I have never so hoped to be wrong in all my life"


----------



## Indie (16 October 2008)

[QUOTE=YOUNG_TRADER;350230]Interesting, in response to this the RBA will no doubt cut interest rates and I can tell you what that does, it makes people like me with lots of cash in high interest savings accounts go hmmm yield is dropping was 8% guarnateed now 6.5% I think, if it gets to say 5% I will start looking for stable earning stocks with good dividend yield, may also start looking at getting back into property,

Food for thought

Also how/what will drag the All Ords below 2500? BHP $10? RIO $30? CBA $10? NAB $7?

I would say 3400 is what I would have thought as an all time low target

I am still a firm believer in the industrialization of over 2Billion People[/QUOTE]


All fair points.

I think China is starting to show that the pace of it's industrialization is entirely dependent on Western consumption at this point: the tail doesn't wag the dog. They (and India) will industrialize but in the meantime I don't have the stomach to ride the rollercoaster all the way down, for who knows how long.

As for interest rates, even zero is unattractive if you're losing money on yield and capital depreciation. So property looks bleak for some time IMO, we need huge adjustments in p/e ratios first because opportunities for capital gain are not going to be there for quite a while. Borrowers just can't ante up again and again in waves when the credit supply isn't there. And with the first wave of boomers moving into retirement, thus adjusting from being net spenders to net savers, I can't see borrowing getting to previous levels for a long time. People in their 40's and 50's are in their peak earning and borrowing years. People in their 60's earn very little and hardly borrow at all. Demographics play a key part in economic cycles. 

Stocks for yield will be there when we reach the bottom. p/e ratios rise as price collapses, but prices collapse further as earnings plummet. It's a vicious cycle and it's only just started. Inventories rise as demand falls, the weak go bust and get swallowed up by the strong, production is adjusted and we return to profit as the system resets. This takes years. 

If we move from AO 4000 to AO 2500 then I suspect we see all the blue chips down about 1/3 from where they are now. So BHP would be $15-$18. That would've sounded crazy in June this year.


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## rederob (16 October 2008)

white_goodman said:


> oh and the answer to this thread is...
> 
> how longs a piece of string?
> how deeps a bottomless pit?



If you have a piece of string, I will measure it for you, seeing you are not up to it.
And a bottomless pit is a "whole", which we can unitise as one.


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## Glen48 (16 October 2008)

What are the chances of most stocks taking a dive of say 20-40% over night or do we watch it go down in increments each day and then one day say well that how it all work out?


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## gfresh (16 October 2008)

awg said:


> the response was as I expected...hey mate, the sun is shining..what are u worried about...thats bullsh!t etc (not from him), but the gathered crowd.
> 
> I said "I have never so hoped to be wrong in all my life"




Yup, people are idiots.. and it until it personally effects *them* they don't believe it is possible. 

Even spending a little time trying to understand the credit markets in basic detail, you'll have more of a clue than half of the managers, junior bank managers, and wanna-be investors out there who just go on recent prior history. Even 1987 will not be an accurate indicator of what may be coming. 

All signs point to the end of at least a 25 year cycle here - 4000 was a very significant break of a long-term trend than began in the early 80's. All bets are off as to where this could lead. Take the rule-book and tear it up I say 

I think 3500 will be reached within the next 6 months on the All Ordinaries, which will take us back to the start of the bubble in 2003. Earlier I had targets of 4800 as being significant, but that's all gone without too much trouble. You can't really be too bearish in this market - as even the most bearish targets are being met.


----------



## Muschu (18 October 2008)

I've just scanned this thread back to July.  Apart from a couple there don't seem to be too many posters "having a go" at the thread title recently.  Maybe that's an indication of the difficulties in predicting just what is going to happen next?
On other general threads there seems to be some element where posters are now starting to talk of getting back in.
In looking at "How low can the all ords go" am I right in thinking that many are seeing 3500, or thereabouts, as a resonable target?


----------



## nick2fish (18 October 2008)

Hi Rick 
Yep its the million dollar question and every answer is just a guess really. 

To say that we are in unknown territory is really an understatement as the widespread magnitude of this financial turmoil has never been seen before as has the emergency response from the fed and other agencies worldwide. What happens when you inject a couple of trillion dollars into the worlds broken economies????????


So who knows..........but my feeling is that your guess is pretty close to mine (3600) and I base this on the fact that the worst of the uncertainty may be behind us as this sub prime slowly unravels which means the fear index may subside markedly to be replaced by caution that will lead eventually to cautious optimism, then to greed down the track. 
Warren Buffet has been buying with his own money(which he has plenty) and he is not trying to get the bottom spot on just near enough is good enough.

Mr Buffett stressed that he could not predict how the market would ride out its roller-coaster days in the short-term. 


He said "what is likely, however, is that the market will move higher, perhaps substantially so, well before either sentiment or the economy turns up. So if you wait for the robins, spring will be over." 

Good investing


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## Julia (18 October 2008)

Having heard several comments about the exacerbation of the current mess which will occur with the unravelling of the Credit Default Swaps, and having very little knowledge about the derivatives market, I've been looking for some info on this.

I found this article, though a few months old now, helpful and thought others might also.

Posters who have a good understanding of what is likely to happen with these CDS's might like to offer some suggestions about what they think will happen here?   Last figure I heard was that the likely value globally of this is around $10 trillion.


----------



## CAB SAV (18 October 2008)

Ten months ago I thought 5000, Three months ago I thought 4200, Today can't see drop by only another 5-600 pts. IMO, lot less than 3000. Just on data from US alone worth 500pt drop . They still have min. 2-3% unemployment rise, housing getting worse, manufacturing worse, retail worse,consumer confidence worse. Now on to $597 trillon of derivatives floating out there. Better not go there. Only 5-600 pts to go?


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## tcoates (18 October 2008)

Julia,



> I found this article, though a few months old now, helpful and
> thought others might also.



Link missing?

Anyway, I will admit to being a bit ignorant of them also.  (As for understanding (general public), it is probably up there with LIBOR). 

Found good article on wiki that explains it quite simply...

http://en.wikipedia.org/wiki/Credit_default_swap

Tim

PS. Will skip over accuracy issues relating to wiki etc. I think this page explains it quite nicely that even I can understand (I think)

PPS. Looking around 3700 as low. Or 3500. But then, I may as well read the tea-leaves in the bottom of my cup


----------



## OzWaveGuy (18 October 2008)

Muschu said:


> I've just scanned this thread back to July.  Apart from a couple there don't seem to be too many posters "having a go" at the thread title recently.  Maybe that's an indication of the difficulties in predicting just what is going to happen next?
> On other general threads there seems to be some element where posters are now starting to talk of getting back in.
> In looking at "How low can the all ords go" am I right in thinking that many are seeing 3500, or thereabouts, as a resonable target?




Posted a series of charts in this forum a few weeks back (couldn't find them to insert url)  so just posted the last chart. The chart shows the first leg down in the bear market. The next major upwards correction and last down leg aren't shown, but the last box 3 gives you my assessment.

We are correcting the whole bull run since the mid 1970's. A 4-6 bear market would be a reasonable assessment of a correction for a 30+ year bull leg.


----------



## jonojpsg (18 October 2008)

Are you serious!!!!????!!!  1000  I personally can't see how you can follow wave analysis to the extent that prices/earnings will drop from where they were 12 months ago to 1/6th of that over the next two years?

And how can you say that the market is correcting a bull run that began in the 70s??  Don't know if the chart is reliable, but the one on the ASX site that shows the Oz market back to 1900 shows a pretty steady rise over the last 100 years.  Why don't you say that we are going to see a correction of that "bull run"?

IMO if Wall St falls through 7000 which I've seen predictions on regarding the whole sub-prime mess, then one could say that we will most likely move down through at least another, what, 1000 points?  so my prediction would be that we would hit 3000 as a worst case low.


----------



## Garpal Gumnut (18 October 2008)

jonojpsg said:


> Are you serious!!!!????!!!  1000  I personally can't see how you can follow wave analysis to the extent that prices/earnings will drop from where they were 12 months ago to 1/6th of that over the next two years?
> 
> And how can you say that the market is correcting a bull run that began in the 70s??  Don't know if the chart is reliable, but the one on the ASX site that shows the Oz market back to 1900 shows a pretty steady rise over the last 100 years.  Why don't you say that we are going to see a correction of that "bull run"?
> 
> IMO if Wall St falls through 7000 which I've seen predictions on regarding the whole sub-prime mess, then one could say that we will most likely move down through at least another, what, 1000 points?  so my prediction would be that we would hit 3000 as a worst case low.




Mate it can go very low.

gg


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## Julia (18 October 2008)

tcoates said:


> Julia,
> 
> Link missing?



Oh, so sorry.  Thanks for waking me up, Tim.

Herewith the link:

http://www.globalresearch.ca/index.php?context=va&aid=8634


----------



## tech/a (19 October 2008)

Julia.
Your topic is ignored or either misunderstood by the masses.
Its certainly not talked about in the "Kochie" type help the people understand programmes.
I'm sure that if Rudd was asked you'd get some very swift political side stepping.

I find this whole topic fascinating.Spending a great deal of time reading all I can.

The "simple" answer to your question from what I can gather is that the total exposure is a point of speculation however it is so great that if it did start causing a chain reaction of defaults due to in ability to pay from those who created these derivatives,the Western Capitalist system would collapse due to simply not having enough to cover the debt.
In other words the world as we know it would become bankrupt.

So the only solution offered up so far is to throw money at it (to those caught) from all sources (Meaning world government intervention) in the hope that eventually these derivatives will "unwind" avoiding armageddon.

Interested in others take on the situation.


----------



## dombat (19 October 2008)

Yes ... that is precisely my fear, although I do not know enough about the cds.  For example do some of them at least have an expiry date?  If not and 2009 turns out to be as bad as it currently appears...then God help us all...as the dominos such as GM in America declare bankruptcy and begin to fall...how big are the loans to that one alone? and therefore the cds covering them.  I can't remember are america and britain covering their banks deposits or are they guaranteeing the whole banking system?  If it is the banking system then just like iceland they will face a default...surely there has to be some sought of a soloution to this?  Anyone got one?


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## tech/a (19 October 2008)

The guarentees are for the next 3 yrs so I guess the economic brains feel this is the time period required.


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## Julia (19 October 2008)

Thanks, Tech/A and Dombat, for taking up my query.   I've just been feeling that this is potentially a massive problem which - if not being ignored - is certainly not being put much in the public face.

Last Friday I was in a gathering of people, mostly self funded retirees and people close to retirement, and I would have thought reasonably financially aware, but was astonished that (a) they have just stood by helplessly and watched their Super being eroded, and (b) demonstrated a sort of blind optimism that it will all be OK pretty soon, despite being unable to come up with any clear rationale about why.

Then when I suggested the whole CDS's market was still out there, full of unknowns, no one had ever heard of any such thing.

Anyone else have any informed views about this?


----------



## dhukka (19 October 2008)

tech/a said:


> Julia.
> Your topic is ignored or either misunderstood by the masses.
> Its certainly not talked about in the "Kochie" type help the people understand programmes.
> I'm sure that if Rudd was asked you'd get some very swift political side stepping.
> ...





The chain reaction effect is troubling since these weapons of financial mass destruction are showing up everywhere. Now we are discovering in the wake of the Icelandic banking meltdown that the three Icelandic banks were amongst others packaged into hundreds of CDO's containing their CDS. 

Now in hindsight the pundits claim that letting Lehman fail was the worst decision yet by the Fed and treasury as that basically cratered the CP market and led to the sellers of $400 billion of CDS to pay out 90 cents on the dollar to cover their exposure. However since sellers of CDS have to mark to market their positions everyday, the additional losses on the contracts was marginal. Still you can see why there is no confidence when you don't know where the next blowup is coming from because just about everyone is exposed to some degree. 

Since the US Treasury and the British Government has ringfenced the deemed "too big to fail" banks in their respective countries, their CDS and CP spreads have come in markedly. However it has the effect of pushing one side of a balloon in only to see the other side blow out. Now other financial companies such as Insurance companies not receiving Federal assistance have seen their spreads blowout. Whilst certaintly around the "chosen ones" has improved, others have become the source of uncertainty. 

It should be remembered that the architects of the global bailout never saw this coming so it is no surprise as they stumble along that the unintended consequences are multiplying at a rapid rate.


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## rederob (19 October 2008)

In relation to this thread, CDS and CDOs are not the instruments of financial destruction to local markets as they are (and have already been) to northern hemisphere markets.
Ultimately the CDS insurers will prove worthless and their unbacked paper debts will impart a similar value.
Although I believe we are destined for a slow and deep market decline it is just possible that Bush and others over this weekend have started to put together plans that will avoid a depression.
An earlier chart suggesting 1000points for the allords is, in my view, too extreme given we should be smarter and able to act more-globally than ever before.
I still reckon low 3000s are inevitable and high 2000s the more likely area to see stabilisation.
If, however, our esteemed leaders are not up to it, a depression and sub-2000 allords would have to come into play.


----------



## OzWaveGuy (19 October 2008)

jonojpsg said:


> Are you serious!!!!????!!!  1000  I personally can't see how you can follow wave analysis to the extent that prices/earnings will drop from where they were 12 months ago to 1/6th of that over the next two years?
> 
> And how can you say that the market is correcting a bull run that began in the 70s??  Don't know if the chart is reliable, but the one on the ASX site that shows the Oz market back to 1900 shows a pretty steady rise over the last 100 years.  Why don't you say that we are going to see a correction of that "bull run"?
> 
> IMO if Wall St falls through 7000 which I've seen predictions on regarding the whole sub-prime mess, then one could say that we will most likely move down through at least another, what, 1000 points?  so my prediction would be that we would hit 3000 as a worst case low.




Some further clarity is here --> https://www.aussiestockforums.com/forums/showpost.php?p=351534&postcount=5214


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## OzWaveGuy (19 October 2008)

OzWaveGuy said:


> Some further clarity is here --> https://www.aussiestockforums.com/forums/showpost.php?p=351534&postcount=5214




read the above first. 

Under the above posting - you are approximately here


----------



## Struzball (20 October 2008)

Looked at news.com.au this morning.

Interesting close for the Dow Jones, a mistake or a prediction??


----------



## tech/a (20 October 2008)

Good sense of humor


----------



## pacestick (20 October 2008)

You have only to go to the top of this thread to see how  wrong people can get their predictions using the best of analytical tools therefore  after examining various goat entrails  from goats sacrificed at full moon time  I predict that all ords have another 15 to 20 per cent to fall but this will not happen as fast as in the past month and there will be a number  of small rallies  on the way down. Actually I have yet to  hear that the hedge funds have  finished getting out of the aust mkt I dont know how much is left in there  and if someone could work that out we would know when we were near bottom


----------



## Indie (23 October 2008)

Thanks OWG.

I think the current panic and dismay at the behaviour of the market is understandable inasmuch as when people get burned they get angry. And a lot of people are being burned by the market right now. But your graph does put into perspective that these collapses are quite normal events. Not common, but normal in that they are an inevitable part of the cycle.


----------



## korrupt_1 (24 October 2008)

OzWaveGuy said:


> read the above first.
> 
> Under the above posting - you are approximately here




 1000-1500!!! bloody jesus f**king christ!!u got to be kidding me!!!.... @%!^&%@^&!!@!!!!!!!!!!

- excuse my above language - but thats the only polite way i could have worded it!!


----------



## tech/a (24 October 2008)

Korrupt.

Its an extreme case.
Much like your reply.
Unikely but could happen


----------



## sparc (24 October 2008)

I can't remember where I heard this or read, but did you know that Warren Buffet does not hold any stock in his personal portfolio other than treasury bonds.

I know this does not have to do much with the thread directly, but it shows that even he does not trust the market, even though he publicly endorses everyone to see it as a good buying opportunity.

Therefore my guess would be in 1000s or less unless we get the worst and the whole system is bankrupt and shutdown.


----------



## deadset (24 October 2008)

That's what buffet used to do.
He's invested his own money back into US stocks last week.
He said he can't predict the bottom short term, but he's happy with what he's bought.  He's bought in with alot of his personal wealth recently.

There's value out there, its just a bit of guesswork as to future near, mid and long term earnings.

Sound byte of last week : "Buy when others are fearful, sell when others are greedy"
Article by Buffet in NY Times last week : 
http://www.nytimes.com/2008/10/17/opinion/17buffett.html

A prudent approach would be to wait until it turns a corner and company profit results show the market what the real value is, but where's the fun in that.  So if results are 20% down, but the stock is 50% down, then you might consider buying, then if Quarter on Quarter results show consistency, then you'd probably start to feel more confident of less downside risk.


----------



## rederob (24 October 2008)

dhukka said:


> It should be remembered that the architects of the global bailout never saw this coming so it is no surprise as they stumble along that the unintended consequences are multiplying at a rapid rate.



It should also be remembered that Al Greenspan presided over the regime of financial instruments that are now crumbling the walls of global financial institutions.
Greenspan has been giving evidence to the House Committee on Oversight and Government Reform. He admitted to putting too much faith in the self-correcting power of free markets and had failed to anticipate the self-destructive power of wanton mortgage lending.

“Those of us who have looked to the self-interest of lending institutions to protect shareholders’ equity, myself included, are in a state of shocked disbelief." 

The flow-on effects to Australia should continue well into 2009, so anyone thinking our market has already bottomed, or has just a little more to fall, is likely to also succumb to a state of "shocked disbelief".


----------



## prawn_86 (24 October 2008)

How low can the All Ords go?

Zero. At least we know an index cant go negative


----------



## nunthewiser (24 October 2008)

hey look at the bright side , the chances of it falling another 3000ish points are pretty remote


----------



## OzWaveGuy (25 October 2008)

I've taken the long term data from the site that someone had previously posted and I have provided one view of the long term Elliottwave counts for the DJI monthly close chart (log scale).

I've looked:


for an extended wave (that is longer and has typically more subdivisions), 
for any Triangle patterns (in wave 4 positions) 
for relationships in price between waves. 
to ensure all 6 points of an elliottwave structure DO NOT touch the parallel lines (contrary to most EW thinking, true impulse wave do not all touch the bounded parallel lines, however corrective waves operate tightly within parallel lines).
Wave Alternation in time, shape and price

The data does not go back far enough to map out a wave I, so there's an assumption here that wave I labeled is actually wave I.


So here's what I found:


Wave III is the longest wave and appears to be the extended wave
Wave IV is a triangle
Wave V is 78% Fibonacci relationship to Wave III (Wave I could also be a 78% relationship to wave III also - but this is only a guess)
Only 3 points touch the 0,I,II,III,IV,V points (although the II - IV trend line's slope perfectly aligns to the ends  wave 1 circle, 3 circle and V which can be a common internal feature)
Wave Alternation between wave II and IV is evident in time, shape and price

Also, almost all wave 4's encroach upon the wave 4's of a lesser degree - which is key to Elliottwave behavior.

Summary: Now is certainly a time for a major correction based on the evidence that 5 waves up is complete since 1982. A trendline hit on the 75yr DJI trendline would be around 4100 points or so, and could be a final low or a resting point for awhile. Encroachment into the price range of the previous wave 4 of a lesser degree (wave IV of around 1000 points in this case) would be common for corrective waves to undertake.

Whether the stock exchanges would even be open in the event of a major extreme correction is questionable, I doubt derivatives would still be operational or legal eg Governments would most likely extend the shorting ban to the whole market, and would most likely create a new financial system (as already indicated by Gov and Banking leaders around the world including Australia).

One things for certain, the current market is evolving in impulse waves (5 waves) down then there is more downside to come. The next significant Elliott 'market milestone' will be upon us very soon and will ultimately determine if the bear market will come to an end or if the market will continue down towards levels cited above. More later on this.


----------



## ROE (25 October 2008)

Julia said:


> Thanks, Tech/A and Dombat, for taking up my query.   I've just been feeling that this is potentially a massive problem which - if not being ignored - is certainly not being put much in the public face.
> 
> Last Friday I was in a gathering of people, mostly self funded retirees and people close to retirement, and I would have thought reasonably financially aware, but was astonished that (a) they have just stood by helplessly and watched their Super being eroded, and (b) demonstrated a sort of blind optimism that it will all be OK pretty soon, despite being unable to come up with any clear rationale about why.
> 
> ...




Retirement approaching, your money shouldn't be in the market
Government bonds is your friend and you getting an extremely good rate right now.

1 year gov bonds fetch 7.5%
5 years bonds at 6.5%

when I retire 80% of my money in the bonds and 20% for me to play the market cos I love it


----------



## GreatPig (25 October 2008)

I've posted this before, but a chart taken from Bob Prechter's book Conquer The Crash. A bit sketchy I'm afraid, due to the manner of its reproduction. The book was first published in 2002, and this is from a 2007 reprint, but I don't think the chart has been added to since the original release.

GP


----------



## tech/a (25 October 2008)

Nice analysis Waves.
Your count still sits well with the one G/P has posted.
If G/P's is correct perhaps the 1000 scenario is unlikely.
Could still happen as it wouldnt be encroaching into wave 1


----------



## charttv (25 October 2008)

GreatPig said:


> I've posted this before, but a chart taken from Bob Prechter's book Conquer The Crash. A bit sketchy I'm afraid, due to the manner of its reproduction. The book was first published in 2002, and this is from a 2007 reprint, but I don't think the chart has been added to since the original release.
> 
> GP




Prechter is known for changing his counts in different versions of his books so as to not look a fool. 

Editions 1 and 2 of one of his books has very different counts compared to later prints of the book. The initial counts were proven to be very, very wrong.


----------



## stoner (25 October 2008)

Good chart OWG,


I do see some problems though.  

-Wave III is only longer than wave V in terms of time and not price. As such it does not fit the tenets of Elliotts work that wave 3’s are usually longest.

-Current move down from the 07 peak does not count best as an impulse. Especially if the current decline has already ended and I think it did so on the 10th October. I have called it a wave A (a e zig zag)


Not sure if the bear market has finished though. Given the similarities between this decline to the initial declines of the DJI in 1929 and the Nasdaq, I would say no. But a multi month wave B rally is expected soon


In my next post I will post some fibonacci spiral charts that in my opinion better explain the longer term Elliott Analysis

All the best

STONER


----------



## MRC & Co (25 October 2008)

tech/a said:


> Nice analysis Waves.
> Your count still sits well with the one G/P has posted.
> If G/P's is correct perhaps the 1000 scenario is unlikely.
> Could still happen as it wouldnt be encroaching into wave 1




Is OWG definately Wavepicker?  

I would think so for sure just by reading the analysis, but not sure it has been confirmed yet..........


----------



## GreatPig (25 October 2008)

charttv said:


> Prechter is known for changing his counts in different versions of his books



Just read this copy of The Elliott Wave Theorist (PDF) from July 2000. At that time (assuming this document hasn't been changed since then) he was predicting a major crash and depression, with a low in 2003. He got the timing right, but the major crash and depression was avoided, supposedly (I've read elsewhere) due to the Fed flooding the market with liquidity - triggering the bull run up from that time.

He was also predicting the depression to be more along the lines of the one following the 1720 collapse of the South Seas Bubble, where he reckons average stock prices, including allowance for those that went to zero, fell by 98%. If the XAO continues to fall that much, we're looking at a bottom around 140. 

Now that's a bear market!

GP


----------



## stoner (25 October 2008)

Some interesting facts on these charts. They might be able to be used togther with the chart OWG posted.


The following are Fibonacci Spiral Charts of the DJIA.

They are self explanetory. The bullmarket of the last 30 odd years started after the low of 1974. To 2008 that is 34 Fibonacci Years. There have been various other LINKS such the low of the crash of 87, the low of 95, the peak of 2000, the low of 2003 ending in 21, 13, 8, and 5 fibonacci years respectively. These links all came together in 2008. 

I knew this from years ago that 2008 was going to special, but not sure in what way, i.e low or high, that was impossible to tell until the low of 2003 was confirmed.

So what Of the future? Well 2011 is the next crucial year followed by 2012/13. Time will tell what that brings!



Fast forwarding to the current decline, as mentioned in my previous post, it was 377 Calendar days from the 2007 peak to the 10 October low. I believe this low has a good chance of holding, but time will tell. 
Also of importance, it will be 55 fibonacci WEEKS from the high of last year in the first week of November which but a week or two away. There are two other links that come together at approximately the same point from two other points. 

As for Charttv and his comments re Prechter. When Prechter wrote his books, his wavecounts were based on the market data that was available at the time. As more data and time passes there sometimes is a need to alter counts as it is a dynamic process. Any other technicain using any other methodology would go through a similar process.

All the best

STONER


----------



## tech/a (25 October 2008)

> As more data and time passes there sometimes is a need to alter counts as it is a dynamic process. Any other technicain using any other methodology would go through a similar process.




Come on Stoner you know as well as I do that the masses *EXPECT* rigid analysis fixed in concrete.
Its about being right you know!
Dynamic?? That simply just wont do!

Mind you Women readers wont have a problem with this----they're perminently dynamic in all they do!


----------



## OzWaveGuy (25 October 2008)

Some good discussion here. The comment about WavePicker - sorry wrong guy.

Prechter's work has certainly been valuable and reasonably accurate although the calls for a major depression have been a little out in terms of timing - I won't hold that against him, He's called major tops reasonably well. One of the problems I do find with Prechters work are in some cases waves tend not to be counted when there is an obvious count that needs to be included or complex corrections aren't called correctly.

Neely's work caters for these missing counts or corrections appropriately with deep discussion on corrections and possible scenarios that Pretchter and his EWI organization don't cover well in some scenarios.


----------



## OzWaveGuy (26 October 2008)

tech/a said:


> Come on Stoner you know as well as I do that the masses *EXPECT* rigid analysis fixed in concrete.
> Its about being right you know!
> Dynamic?? That simply just wont do!




Very true t/a. This is especially the case when there is negative social mood, people will seek a 'holy grail' to light the way, but will quickly discard it should there be an inaccuracy of some kind.


----------



## MRC & Co (26 October 2008)

lol, this reminds of me "Reminiscenses of a stock operator".  Mr Livermore and his endless dribbling about how "people want tips".  The masses are lazy, simple as that IMHO and struggle to understand this is simply a game of probability and application.


----------



## nunthewiser (26 October 2008)

Hi , any good stock tips?


----------



## MRC & Co (26 October 2008)

nunthewiser said:


> Hi , any good stock tips?




lol, you probably should have been buying up all the FMG you could find and particularly averaging down along the way!    Didn't you know how cheap it was and how it was going to hit $50?  :


----------



## nunthewiser (26 October 2008)

MRC & Co said:


> lol, you probably should have been buying up all the FMG you could find and particularly averaging down along the way!    Didn't you know how cheap it was and how it was going to hit $50?  :





wow man thanks i might take have to take a mortgage out on dr ollivers place too and join the suffisticates


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## sinner (26 October 2008)

How are we all feeling about tomorrow?

Timezone shelter from the storm has shown some 'holding out' rallies on the long road down in the last few Mondays, of course wiped out quickly by Tuesday drags, and seemingly dependent on a good Saturday (in the day-behind markets).

Not asking for solid facts, just peoples feelings. Do you feel we are all bottomed out or is there still massive amounts of de-leveraging to go? Do we have a few more holdout 1-day-Monday rallies with all this liquidity or are the big liquidators just going to keep pummeling things? Is the USDX undefeatable? 

I am all out of the game, only one quiet holding remaining in the "portfolio", figuring I only need to hedge against the economic apocalypse. I mean if this is the bottom then I get to keep my job and can get back in the market whenever the smoke clears.

EDIT: Oh and I forgot to mention my naughty word of the day: hyper-stagflation.


----------



## MRC & Co (26 October 2008)

nunthewiser said:


> wow man thanks i might take have to take a mortgage out on dr ollivers place too and join the suffisticates




ha ha, no problems mate.  If you need anymore tips, just ask, I have a bag full of them.

Heard a tip on BNB the other day too, how it's going back to well above and beyond $30.  I think a lot of Property stocks are going to be the next hot sector too!    Don't tell many others though.


----------



## OzWaveGuy (28 October 2008)

I thought I'd update the medium term view posted early this month https://www.aussiestockforums.com/forums/showpost.php?p=351103&postcount=134

on where the market appears to be heading. 

So far, there's been no reason to change the outlook based on the current market action. The short term wave counts on the 15min chart also indicate that the end of wave iii is approaching. Note that alternate counts exist including the end of wave 3 may be approaching too. Many people in this forum have been indicating a bounce is overdue with momentum indicators showing heavily oversold conditions or bullish divergences.

Either way, a small bounce into wave iv should occur soon, and perhaps it will coincide very close to the 138% of wave 1 Fibonacci ratio (which the internal structure of wave iii appears to support at this stage).

I would expect wave iv to be a zig-zag correction or most likely a triangle to take us into the US election next week before breaking lower to complete wave 3.

In addition, an alternate a-b-c count exists shown in blue. Of course we won't know if this alt count is valid until wave 4 completes (or not). This will be the core indicator as to whether the market continues lower for several years. 

In elliottwave, a correction with an initial 5 waves down must be followed by a 3 wave correction then another 5 waves down forming a 5-3-5 zig-zag correction. So either we have a large A-B-C correction (will be confirmed at the end of Wave 5), or a smaller a-b-c correction as shown in blue. Time will tell. 

However, I believe the financial crisis has only just begun, in fact, it began years ago in the 1970's when the markets aggressively departed upwards from the 100 year trendline due to the credit boom which has continued for 30+ years. The last 8 years has revealed unscrupulous lending to almost anyone and everyone, an indicator that new warm bodies to consume credit were fast running out.

Social mood has turned negative which will mean the knives are coming out on those that "allowed" this lending to go unchecked - as already seen with Alan Greenspan recently. However, this will be only the start of more negative mood to come as almost everyone will be affected in some way by this downturn.


----------



## treefrog (28 October 2008)

korrupt_1 said:


> 1000-1500!!! bloody jesus f**king christ!!u got to be kidding me!!!.... @%!^&%@^&!!@!!!!!!!!!!
> 
> - excuse my above language - but thats the only polite way i could have worded it!!




k1,
its not compulsory that you hold till then and sell at that point - many other choices 'en route'


----------



## tech/a (28 October 2008)

MRC & Co said:


> ha ha, no problems mate.  If you need anymore tips, just ask, I have a bag full of them.
> 
> Heard a tip on BNB the other day too, how it's going back to well above and beyond $30.  I think a lot of Property stocks are going to be the next hot sector too!    Don't tell many others though.




Not as silly as some would have this sound.
Diving interest rates 
Diving production costs.
Labor costs at least holding.
A flight away from shares.
Should be able to spot this in the property index XXJ.

Tree
Confluence of Fib levels is not uncommon with many forms of charting.
Not the least Elliott Exponents.Anyone who trades off a count without confirmation is really taking risk.
Mind you some do as there is often the possibility of a low risk trade if some supporting (Not necessarily confirming) analysis is seen.


----------



## jonojpsg (28 October 2008)

stoner said:


> Some interesting facts on these charts. They might be able to be used togther with the chart OWG posted.
> 
> 
> The following are Fibonacci Spiral Charts of the DJIA.
> ...




Only problem with using Fibonacci years this way is that according to the chart the Fib years are measured back from 2008, eg 34 years to 2008, 21 years to 1987, etc.  That means in the Fib sequence that there should be something 3 years ago, then 2 years ago, then 1 year ago, rather than 3 years *from* now or four five years.


----------



## nunthewiser (28 October 2008)

tech/a said:


> Mind you some do as there is often the possibility of a low risk trade if some supporting (Not necessarily confirming) analysis is seen.




on that note has bought BHP and MQG today for a low %loss on stopout point trades ........ happy to take a small loss if wrong , personally expecting a  bounce from here  no waves about it


----------



## korrupt_1 (28 October 2008)

prawn_86 said:


> How low can the All Ords go?
> 
> Zero. At least we know an index cant go negative




purely off topic and a waste of bandwidth, but a negative index would technically mean everything is reversed, longs are shorts, shorts are longs,... dividends paid, will mean dividends owed,.... banks will PAY you to borrow money to trade... what a weird universe that would be...


----------



## tech/a (28 October 2008)

nunthewiser said:


> on that note has bought BHP and MQG today for a low %loss on stopout point trades ........ happy to take a small loss if wrong , personally expecting a  bounce from here  no waves about it





Have done so myself at times.
However best results and by far the most consistent and less frustrating have been those with the trend which I have waited to unfold.
IE saw the future opportunity and waited for it to get to my analysis.
So now if I could Id be shorting up moves!!!


----------



## nunthewiser (28 October 2008)

tech/a said:


> Have done so myself at times.
> However best results and by far the most consistent and less frustrating have been those with the trend which I have waited to unfold.
> IE saw the future opportunity and waited for it to get to my analysis.
> So now if I could Id be shorting up moves!!!





yep ....... fair call


----------



## Boggo (28 October 2008)

tech/a said:


> So now if I could Id be shorting up moves!!!




If only tech, there have been some great shorting setups gone :flush: in the last few weeks


----------



## nunthewiser (28 October 2008)

Boggo said:


> If only tech, there have been some great shorting setups gone :flush: in the last few weeks




the thing is the anti shorters aint realising is that since the short ban came in ,perhaps a quick squiz at the LACK of bounces should be observed , shame but hey funny how time points the way


----------



## tech/a (28 October 2008)

Well a bounce seems likely tommorow at this early stage hence the rally into the close.


----------



## sinner (28 October 2008)

That'd be nice. Can watch the European markets opening stats after dinner and see whether they take the rally baton from the Asian markets which seem to have driven our afternoon rally. (or turn around and beat them with it)


----------



## nunthewiser (28 October 2008)

tech/a said:


> Well a bounce seems likely tommorow at this early stage hence the rally into the close.




 thats fine by me ....


----------



## OzWaveGuy (28 October 2008)

tech/a said:


> Well a bounce seems likely tommorow at this early stage hence the rally into the close.




Let's see if the North American markets can hold it together overnight  However, I suspect there needs to be one more leg down of around 60-100+ points on the XAO before a temporary bottom is in place.


----------



## nunthewiser (28 October 2008)

OzWaveGuy said:


> Let's see if the North American markets can hold it together overnight  However, I suspect there needs to be one more leg down of around 60-100+ points on the XAO before a temporary bottom is in place.




this duck dont care about tempory bottoms on trades entered today .bounce only ........ not entering as an actual buyer of substance at anytime in the nr future BUT a mans gotta eat when the probabilitys point the way  in the immediate trading timeframe


----------



## tech/a (28 October 2008)

Well looks a cert.


----------



## Glen48 (28 October 2008)

Book mark Patrick.Net and read it each working day it gives you an update on what is going on around the World and why we are in this mess and the only Bottom will be a false one in Elton John's Suit case


----------



## tech/a (28 October 2008)

Just looking at tommorow nothing more.


----------



## Whiskers (28 October 2008)

OzWaveGuy said:


> Let's see if the North American markets can hold it together overnight  However, I suspect there needs to be one more leg down of around 60-100+ points on the XAO before a temporary bottom is in place.




Lookin pretty good for a bounce so far OzWaveGuy.

I'll bring a question for yer over here, since the other thread has lost the plot a bit... degenerated into 'about me' tonight... OzWaveGuy, what do you think of the current relationship of the XAO to the standard deviation channel (posted on the XAO thread) ?

Im thinking if the XAO goes to 2000 or 1000 even in a year or two, that's going to look way outa whack on the SD channel.


----------



## treefrog (28 October 2008)

tech/a said:


> Tree
> Confluence of Fib levels is not uncommon with many forms of charting.
> Not the least Elliott Exponents.Anyone who trades off a count without confirmation is really taking risk.
> Mind you some do as there is often the possibility of a low risk trade if some supporting (Not necessarily confirming) analysis is seen.



sorry, got the impression you were asking for info on what it was; and you knew all along; my mistake.


----------



## OzWaveGuy (29 October 2008)

Whiskers said:


> Lookin pretty good for a bounce so far OzWaveGuy.
> 
> I'll bring a question for yer over here, since the other thread has lost the plot a bit... degenerated into 'about me' tonight... OzWaveGuy, what do you think of the current relationship of the XAO to the standard deviation channel (posted on the XAO thread) ?
> 
> Im thinking if the XAO goes to 2000 or 1000 even in a year or two, that's going to look way outa whack on the SD channel.




All is good, the wave iv triangle on the S&P500 looks like it's still in the running as the top count https://www.aussiestockforums.com/forums/showpost.php?p=354062&postcount=5307 Picking the final wave b bottom was a bit of a struggle, but the S&P500 seems to be moving up in impluse waves now. However, it'll be choppy over the coming week(s), option traders beware 

Haven't taken a look at the SD channel, however, looking at the very long term charts, a massive drop on the XAO would look quite 'normal' when compared with previous market actions over the last 100yrs.

Re other thread - I usually don't bother when it's obvious it'll turn into a slinging match - whatever works for you is what counts. If you can pick up useful info along the way (and there's plenty in this forum), even better.


----------



## nunthewiser (29 October 2008)

nunthewiser said:


> on that note has bought BHP and MQG today for a low %loss on stopout point trades ........ happy to take a small loss if wrong , personally expecting a  bounce from here  no waves about it





HO HO HO ...............................................


----------



## tech/a (29 October 2008)

nunthewiser said:


> HO HO HO ...............................................




Indeed.


----------



## prawn_86 (29 October 2008)

Dead cat bounce imo, but im def not 100% sure.

Will it rally for a couple days or is 10% in one day enough for profit takers to move back in?

Also will our market fade from open or keep its strength? So many questions....


----------



## nunthewiser (29 October 2008)

prawn_86 said:


> Dead cat bounce imo, but im def not 100% sure.
> 
> Will it rally for a couple days or is 10% in one day enough for profit takers to move back in?
> 
> Also will our market fade from open or keep its strength? So many questions....




personally will more than likely be out today , trades only ..........a nuns gotta eat


----------



## xyzedarteerf (29 October 2008)

sign of the times when even graffiti vandals can predict where the DOW is heading.


----------



## bribieman (30 October 2008)

US jobs report Friday. Small rally until then IMHO. But could get ugly for next week. But we are in untested water now who really knows?
Mr Imelt from GE said one thing out of text at a spanish cafe today and the dow crashed 270 points, So who out there could show confidence?


----------



## zt3000 (1 November 2008)

Smurf1976 said:


> Due to the way these mortgages work, they have a "reset" date when the required repayments will (in general) greatly increase.




As far as i know, the last of the major resets occur at the end of 2008.

Mid 2009 IMO will be the recovery, although i thought mid 2008 would be the bottom, how wrong i was hahah


----------



## professor_frink (1 November 2008)

zt3000 said:


> As far as i know, the last of the major resets occur at the end of 2008.
> 
> Mid 2009 IMO will be the recovery, although i thought mid 2008 would be the bottom, how wrong i was hahah




this arrived in my inbox this morning. Thought it might be of interest


----------



## Whiskers (1 November 2008)

professor_frink said:


> this arrived in my inbox this morning. Thought it might be of interest




Interesting.

So the Subprime will mostly be done this time next year... BUT if US interest rates happen to rise in the next year or so, which seems almost inevetable (ie if they escape a recession/depression) then it's probably going to inflict considerable more pain across the wider community and keep their growth on the low side.

Go China and India.


----------



## billybaxter (19 November 2008)

*how long will she go?*

so the all ords are around the 3600 mark right now...some cat on another forum told me she's heading to 2000 points by august next year, and other people say she'll be at 1500 by 2010...in reality, I don't see it dropping below 3250.....your thoughts?


----------



## jackliu (19 November 2008)

*Re: how long will she go?*



billybaxter said:


> so the all ords are around the 3600 mark right now...some cat on another forum told me she's heading to 2000 points by august next year, and other people say she'll be at 1500 by 2010...in reality, I don't see it dropping below 3250.....your thoughts?




i say it would drop around 3000....


----------



## otagomed (19 November 2008)

I had this discussion with my friend today. How low can the ASX200 go?
I think we are almost there.
However my friend thinks that it will drop down to 2700 level which we saw in 2003.

In short term(ie next 1-2weeks), what do you guys expect?
When do you think we will see the recent high of 4300?
1. before the end of november
2. before christmas
3. sometime next year
4. never

I believe that no matter what happens in long term, we will see 4300 again by end of the year.  Just wondering what you guys think.


----------



## drsmith (19 November 2008)

My feeling is that the market is in constant chase mode to the evolving economic situation.

In terms of other bear markets, two that were worse were 1987 at 50% and 1973/74 at 59% (according to the Australian). I don't know if their analysis goes back to the great depression.


----------



## OzWaveGuy (19 November 2008)

*Re: how long will she go?*



jackliu said:


> i say it would drop around 3000....




Sure, it'll get there and more, but unlikely on this current leg down


----------



## OzWaveGuy (19 November 2008)

otagomed said:


> I believe that no matter what happens in long term, we will see 4300 again by end of the year.  Just wondering what you guys think.




Any reason why you have chosen 4300 and before the end of the year? Just interested in your timing and target rationale (if you don't mind me asking)


----------



## OzWaveGuy (19 November 2008)

Looking at many of the posts in this forum over recent days - I see a lot of negative sentiment in the posts (and for good reason). One way to read this is as a contrarian indicator ( discussed here--> https://www.aussiestockforums.com/forums/showpost.php?p=351730&postcount=5228 ) 

Hence a bounce (a reasonable short term one) is due very shortly


----------



## OzWaveGuy (19 November 2008)

OzWaveGuy said:


> Looking at many of the posts in this forum over recent days - I see a lot of negative sentiment in the posts (and for good reason). One way to read this is as a contrarian indicator ( discussed here--> https://www.aussiestockforums.com/forums/showpost.php?p=351730&postcount=5228 )
> 
> Hence a bounce (a reasonable short term one) is due very shortly




And for those who are interested - Looking at this specific thread over the last few months - it generally gets active just before a bounce is about to take place or just after it starts - so perhaps a contrarian forecaster of market action?

Note: Now that I've said this, the contrarian logic for this thread will now be broken.


----------



## nunthewiser (19 November 2008)

OzWaveGuy said:


> And for those who are interested - Looking at this specific thread over the last few months - it generally gets active just before a bounce is about to take place or just after it starts - so perhaps a contrarian forecaster of market action?
> 
> Note: Now that I've said this, the contrarian logic for this thread will now be broken.




nah its ok OWG ive stated a bounce due also in other threads/chat here and in my reckoning we both cant be wrong at the same time


----------



## OzWaveGuy (19 November 2008)

nunthewiser said:


> nah its ok OWG ive stated a bounce due also in other threads/chat here and in my reckoning we both cant be wrong at the same time




Maybe only a day out? 

Do you have a specific start and end target of the bounce in mind?


----------



## nunthewiser (19 November 2008)

OzWaveGuy said:


> Maybe only a day out?




 Yes , i have now devised a cunning plan , whenever i state a bounce due or a top formed , i now wait a day before i actually act on it 

like clockwork, lol

re start , imminent, this point to 3400 turnpoint, re end  target between 3700-3800 and will revaluate from there

hey havent entered as yet so will play by ear and vols tommorow


who knows i could always be wrong too 

PS i wouldnt mind your thoughts on a long term view (1-5 years) on the NIKKEI if you find the time
thanks in advance


----------



## kengaikl (20 November 2008)

Most stocks on the All Ords are either not making a profit or companies with debt that they can never repay. Based on that assesment i believe the a low of 0 is quite possible


----------



## skyQuake (20 November 2008)

Doubt we can go to 0. In fact. Find me 1 stockmarket that has gone to 0. 

While it is probably true most companies on the AORD aren't making profits, at least 1/2 of that is junior miner explorer cos with some dirt and a prospecting licence. 
The elephants in the room are the major constituents that are still making a killing.


----------



## Aussiejeff (20 November 2008)

skyQuake said:


> Doubt we can go to 0. In fact. Find me 1 stockmarket that has gone to 0.
> 
> While it is probably true most companies on the AORD aren't making profits, at least 1/2 of that is junior miner explorer cos with some dirt and a prospecting licence.
> The elephants in the room are the major constituents that are still making a killing.




Rumour has it a new, deadly E-Bowler virus may wipe out the last remaining elephant herds...

:horse:


----------



## OzWaveGuy (20 November 2008)

Are we there yet? Soooo close now.

The wave structure on the XAO can be read as bottomed or as one more leg down is required. Assuming the bottom is not quite in place yet, there should be some upwards movement tomorrow (finishing a small wave 4) before heading lower to complete the final wave 5. 

Some previous targets were discussed here --> https://www.aussiestockforums.com/forums/showpost.php?p=361654&postcount=5709

The lower range was 3236 on the XAO, which now seemingly ties into a series of wave relationships on this last down leg that started on the 12th Nov. 

In short, this would complete the down leg of wave (3) that started on 19th March 2008 that has covered some 2750 points so far, and requires a rather decent bounce into wave (4) up.

The S&P futures looks to be finishing an ending Diagonal (but can also be considered complete too) - so an up session followed by a final down leg (maybe tomorrow or early next week) should do it.

Either way - prepare for a change in trend very soon - which should at least take us into Christmas and beyond.


----------



## dhukka (20 November 2008)

dhukka said:


> I see the 2ks on the XAO, CBA trading in the 20's and BHP in the teens as very conceivable. Consider that P/E ratios become very depressed at the end of bear markets. At the end of the 1966 -1982 bear market the P/E of the market was around 6 - 7 times trailing earnings. So if you think CBA is cheap trading at 11 times earnings just remember that history suggests it can get a whole lot cheaper.
> 
> The above is not a forecast, I don't expect the XAO will see the 2k's but I wouldn't be surprised. FWIW I'm looking for a bottoming somewhere between 3400 - 3800.




Noone would have accused me of being an optimist over the last 18 months but it turns out I was. When I made this forecast in March it looked dire to most. I'm not surprised that we have gone lower than 3400 it has been the speed of the decline that has been surprising. The US recession is just getting warmed up and I think analysts are still far too optimistic on earnings. I can see the XAO falling to the *2700 - 2800* area quite easily but of course it won't be straight down move. We are due for a decent rally soon.


----------



## Real1ty (20 November 2008)

Aussiejeff said:


> Rumour has it a new, deadly E-Bowler virus may wipe out the last remaining elephant herds...
> 
> :horse:




Sounds like a new Bangladeshi fast bowler


----------



## nunthewiser (20 November 2008)

i hope this attaches

woo hoo it worked ...... thats the longesrt i can find , was known as something different previously , sorry not in pc but couldnt attach it


----------



## OzWaveGuy (20 November 2008)

nunthewiser said:


> i hope this attaches
> 
> woo hoo it worked ...... thats the longesrt i can find , was known as something different previously , sorry not in pc but couldnt attach it




ah, a bit better - but the last 12 months is chopped off...


----------



## nunthewiser (20 November 2008)

lol this is unreal , can find charts of the nikkei which are up to date but only go back as far as 86 OR i can find longer than that with none of the last years data on them .


anyone out there find a chart with the longest timeframe including this year on it please help

thanks in advance


----------



## nunthewiser (20 November 2008)

best i can find and this is fairly basic


----------



## CanOz (20 November 2008)

Heres one from Premium data.

Cheers,


CanOz


----------



## nunthewiser (20 November 2008)

CanOz said:


> Heres one from Premium data.
> 
> Cheers,
> 
> ...




Thankyou kindly for your time but actually need one from at least 1970 to present day if not longer 

cheers anyways


----------



## dhukka (20 November 2008)

nunthewiser said:


> lol this is unreal , can find charts of the nikkei which are up to date but only go back as far as 86 OR i can find longer than that with none of the last years data on them .
> 
> 
> anyone out there find a chart with the longest timeframe including this year on it please help
> ...




This one only goes back to 1984 but it is up to date.


----------



## nunthewiser (20 November 2008)

dhukka said:


> This one only goes back to 1984 but it is up to date.




thanks and apologies to all for cloggin up this thread with nikkei stuff


----------



## sinner (20 November 2008)

Ask and ye shall receive


----------



## OzWaveGuy (20 November 2008)

OzWaveGuy said:


> And for those who are interested - Looking at this specific thread over the last few months - it generally gets active just before a bounce is about to take place or just after it starts - so perhaps a contrarian forecaster of market action?
> 
> Note: Now that I've said this, the contrarian logic for this thread will now be broken.




Here's a graphical representation of the thread activity in this discussion compared to the XAO market action.

Very telling on when a bounce will occur......


----------



## nunthewiser (20 November 2008)

sinner said:


> Ask and ye shall receive




 thanks sinner man ... remind me to say an extra hail mary this sunday


----------



## dhukka (20 November 2008)

nunthewiser said:


> thanks and apologies to all for cloggin up this thread with nikkei stuff




That's allright, I'm going to clog up this thread a bit more with this lovely chart from Calculated Risk showing comparisons of 4 nasty bear markets.


----------



## CanOz (20 November 2008)

Facinating chart Oz Wave!

Cheers,


CanOz


----------



## OzWaveGuy (21 November 2008)

CanOz said:


> Facinating chart Oz Wave!
> 
> Cheers,
> 
> ...




Thanks CanOz

The reverse is also true - Hence, a thread called "How high will the all ords go" will be another indicator

https://www.aussiestockforums.com/forums/showthread.php?t=13433


----------



## sammy84 (21 November 2008)

Great chart OZ wave guy! Hopefully you can keep posting them in the future? So looking at your chart we should see a bounce either tomorrow or more likely on Monday. I was looking for a Monday bounce previously


----------



## OzWaveGuy (21 November 2008)

OzWaveGuy said:


> Are we there yet? Soooo close now.
> 
> The wave structure on the XAO can be read as bottomed or as one more leg down is required. Assuming the bottom is not quite in place yet, there should be some upwards movement tomorrow (finishing a small wave 4) before heading lower to complete the final wave 5.
> 
> ...




So much for the small upwards movement today  - wave 4 needs to be considered complete as a small triangle. 

Adjusting for this, the XAO target bottom should be in the range of 3116 - 3214. 

However breaking below 3205, will invalidate the preferred count (the larger degree wave 3 will be the shortest) and introduce the possibility of a deeper downside target of 3000 or less under the alternate count scenario.


----------



## CoolChanges (21 November 2008)

OzWaveGuy said:


> So much for the small upwards movement today  - wave 4 needs to be considered complete as a small triangle.
> 
> Adjusting for this, the XAO target bottom should be in the range of 3116 - 3214.
> 
> However breaking below 3205, will invalidate the preferred count (the larger degree wave 3 will be the shortest) and introduce the possibility of a deeper downside target of 3000 or less under the alternate count scenario.




Hi OzWaveGuy,
Thanks for the great posts, I am not really sure where the 'small triangle' is an was hoping you could graph it for the neophyte if you have time 
Cheers


----------



## OzWaveGuy (21 November 2008)

CoolChanges said:


> Hi OzWaveGuy,
> Thanks for the great posts, I am not really sure where the 'small triangle' is an was hoping you could graph it for the neophyte if you have time
> Cheers




tiny wave 4 triangle from 1035 to 3:35pm  on a 5min chart yesterday. Let's see if we can hold a bottom after today.....


----------



## IFocus (21 November 2008)

dhukka said:


> That's allright, I'm going to clog up this thread a bit more with this lovely chart from Calculated Risk showing comparisons of 4 nasty bear markets.




Thanks for the chart Dhukka


----------



## sinner (21 November 2008)

IFocus said:


> Thanks for the chart Dhukka




Second that, thanks dhukka, that is the exact type of chart I have been looking for ages to see!


----------



## tommymac (21 November 2008)

drsmith said:


> In terms of other bear markets, two that were worse were 1987 at 50% and 1973/74 at 59% (according to the Australian). I don't know if their analysis goes back to the great depression.




Unfortunately every downturn is different. I went to a seminar in February and the presenters said these downturns take around 6 months to turn around.

6 months later they said the market should turn around in about "6 months".

Now they just keep quiet.


----------



## drsmith (21 November 2008)

tommymac said:


> Now they just keep quiet.



If there's no one ringing the bell.......


----------



## OzWaveGuy (21 November 2008)

hmmm, A significant low could be in place as of 12:55pm

5 waves down from the 4th wave triangle end on the 12th Nov appears complete. The length of this final leg is slightly over 61.8% of the length of wave 3 that started on 23rd Sept. In addition, 3200 support has been hit.

Looking for a series of 5 waves up and a break above 3250 and higher to validate. Dropping below 3200 invalidates the above arrangements.


----------



## rederob (21 November 2008)

dhukka said:


> That's allright, I'm going to clog up this thread a bit more with this lovely chart from Calculated Risk showing comparisons of 4 nasty bear markets.



dhukka
Translating into simple English:
*We are nearing a point that differentiates a recession from a depression.*
My view is that the ingredients of a recession-proper have only recently finalised the mix; namely collapses of finance, housing and car industries.
These ingredients have not had time to influence the markets as they should.  That is, a total collapse in confidence is beckoning.
I see markets in a weak state for a minimum 6 months, with a year a more realistic duration.
The allords should keep tumbling.
I'm seeing the 2k figure being reached early in 2009 with a dip under 2500 a reasonable outcome by mid year.


----------



## sammy84 (21 November 2008)

Where did this spurt come from? Left the house, come back and we have the beginings of a rally on our hands. I cant find any news out there that has caused this. 

OZwaveguy- So we hit a low of 3,201, so you were pretty much on the money. I'm only just learning about the elliot waves, so help me out, where to from here?

Sammy


----------



## Beej (21 November 2008)

dhukka said:


> That's allright, I'm going to clog up this thread a bit more with this lovely chart from Calculated Risk showing comparisons of 4 nasty bear markets.




Great chart! Any reason why the '87 crash and subsequent bear was left off? ALso was this compiled based of US or AU market data?

Cheers,

Beej


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## OzWaveGuy (21 November 2008)

sammy84 said:


> Where did this spurt come from? Left the house, come back and we have the beginings of a rally on our hands. I cant find any news out there that has caused this.
> 
> OZwaveguy- So we hit a low of 3,201, so you were pretty much on the money. I'm only just learning about the elliot waves, so help me out, where to from here?
> 
> Sammy




Been talked about all week by many for hitting a bottom very soon. I was hoping for Monday, but there you go.

Need to head out, but will probably post something over the weekend once the US markets have closed. XAO will probably retrace a % on Monday.


----------



## dhukka (21 November 2008)

Beej said:


> Great chart! Any reason why the '87 crash and subsequent bear was left off? ALso was this compiled based of US or AU market data?
> 
> Cheers,
> 
> Beej




It's the S&P500, I didn't make the chart but I'm assuming that 87 was left off because it was not your typical bear market. That is it took a relatively short time to bottom before recovering.


----------



## sinner (21 November 2008)

OzWaveGuy said:


> Been talked about all week by many for hitting a bottom very soon.




So isn't that a contrarian indicator that this is not the bottom at all? 

Just kidden..


----------



## dhukka (21 November 2008)

rederob said:


> dhukka
> Translating into simple English:
> *We are nearing a point that differentiates a recession from a depression.*
> My view is that the ingredients of a recession-proper have only recently finalised the mix; namely collapses of finance, housing and car industries.
> ...




Agreed, I think that scenario is entirely plausible, but it will include at least one large sustained bear market sucker rally in which everyone momentarily thinks the worst is over before having their hopes completely dashed.


----------



## sinner (21 November 2008)

Aha so dhukka is not the only one who can post pretty, comparative charts! 







From

http://www.safehaven.com/article-11887.htm


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## OzWaveGuy (21 November 2008)

sinner said:


> So isn't that a contrarian indicator that this is not the bottom at all?
> 
> Just kidden..




Could be! Maybe a false break  Certainly has been in the past - although I don't expect the XAO to carry all that far - but certainly a higher price movement than some of the previous bounces have been.


----------



## otagomed (22 November 2008)

I think we are almost there but not there yet.
I expect to it to move up to 4500 again within next 4-5weeks but it will drop down again, probably down to 3000-3100.
I will be surprised if the bottom goes below 3000.

Once it reaches the bottom(which will happen in January in my opinion) then it will slowly move up in 2009.  

Just my opinion based on studies I've done.  But don't trust me too much.  I'm very new to share trading. 

Anyway, I heard rumours that Chinese will buy lots of American banking and car stocks in next 12months.  What's your opinion on this?


----------



## mayk (22 November 2008)

otagomed said:


> Anyway, I heard rumours that Chinese will buy lots of American banking and car stocks in next 12months.  What's your opinion on this?





Do you think America will allow this to happen? They can print money out of thin air, why then let other nations take control of their iconic banks/industries.

They are just rumors, just like the rumors of china saving the day and decoupling our economy from US. Are they spread by goldbugs; the rumor mill mafia of wall street.


----------



## J.B.Nimble (23 November 2008)

otagomed said:


> Anyway, I heard rumours that Chinese will buy lots of American banking and car stocks in next 12months.  What's your opinion on this?




Sorry I can't give you links to the articles but recent stories in the China Daily and Shanghai Daily indicate that the big state owned companies have been told to sit back and wait for better bargains later. Probably a reflection on Ping An getting burned on their too-early foray in to Fortis. Also saw an article indicating that the powers that be are holding back from topping up the China strategic copper reserve. China has no need to come riding to anyones rescue right now - a huge transfer of economic power towards the east seems inevitable.


----------



## MRC & Co (23 November 2008)

OzWaveGuy said:


> hmmm, A significant low could be in place as of 12:55pm




While I don't believe in EW, on this call I must say, in the words of Borat:  "VERY NICE"!

Hope you loaded up on that one!


----------



## sinner (23 November 2008)

Hi guys,

I am partially in now. I don't have a lot of money but try to do what I can. Already in on 

5000 IGR paid @ 0.135
10000 RMSOC paid @ 0.125

Some physical gold and silver and the remainder in cash.

Tomorrow I will be going long on RMS, TRY, IHK, IZZ (EWH and FXI if you're on an international account) all at roughly the $1000 per holding mark.

I think we are in for a tradeable bounce till around March and will probably get out again mid Feb unless I have to cut my losses and run!


----------



## Wysiwyg (23 November 2008)

The big question is .. would you hold a long contract if bought in at 3200 (XJO)?


----------



## MRC & Co (23 November 2008)

Wysiwyg said:


> The big question is .. would you hold a long contract if bought in at 3200 (XJO)?




Exactly.  This is the most important aspect, the application.

How much of the move can you catch and do you have the conviction to ride the move.  Personally, as I only trade intraday, I don't, but caught 210 ticks intraday Friday.  If more buying pressure comes in intraday (and the instos will need too in order to do their volume), I will try ride it.  

Funny to see the SPI almost leading Asia and the world at the moment.


----------



## OzWaveGuy (23 November 2008)

Well, Friday was certainly an interesting day if you believe the Australian Market simply follows the US markets. With a Higher trading volume, the end of wave (3) down has completed. 

For many of you who follow Elliott Wave, this seemly small event places the XAO at pivotal juncture. Here's why:

1) If the XAO corrects into wave (4) and then heads down to complete wave (5) then the call for a significant low (1000-1500 points) will happen. Why? 5 wave corrections simply don't happen. Corrections must be at least 3 waves - hence if this first five waves does complete, then there will be the 'A' leg of a major A-B-C correction down. Expect 'C' to be similar in price action.

2) If the XAO does not form wave (4), and continues to climb into the price range of wave (2) (around 5200+) then something else is unfolding, either a more complex correction or the end of the bear market (if you believe confidence will suddenly be restored and all the financial problems disappear).

The chart below describes possible targets for wave (4) unfolding as a Flat or a triangle. Target of 38.2% retracement of wave (3) down at around 4300 points or even higher perhaps to a 50% correction. The initial leg up will hopefully give some clues as to what's unfolding.

Note that the wave (4) triangle scenario could call for the wave 'b' of the triangle to head lower than last friday's low. This same scenario occurred in the previous wave 4 triangle.

Also not discussed in the charts below is an alternate count that looks to take the index lower after a small correction to around 3700 points (or lower). This undocumented alternate count is a further subdivision of wave (3) down. For those EWers, I'm happy to discuss on the EW thread - but I'm particularly not fond of this scenario, but should still be in one's periphery vision nonetheless.

For those who are interested, much of what has been discussed here was discussed at the end of October here --> https://www.aussiestockforums.com/forums/showpost.php?p=358838&postcount=5586 

The main difference is the wave labeling has been adjusted in the chart below to follow EW 'standards'.

In summary, it may be hard for longer term investors to leverage wave (4) but there should be opportunity for many as the wave (4) scenario should be larger than some of the more recent bounces. I'm also watching for new short term lows that may play out as discussed above.

Cheers 
OWG


----------



## OzWaveGuy (23 November 2008)

MRC & Co said:


> While I don't believe in EW, on this call I must say, in the words of Borat:  "VERY NICE"!
> 
> Hope you loaded up on that one!




Thx MRC.


----------



## schumie21 (5 December 2008)

Well im going 2 watch the 1.us economy at least show a sign of economic recovery,poss.1year or so away yet.2watch the oil 4 early signs of initial demand.3financials mildly recovering.4CRB index .as early signs of the asx recovering...and not until then.           i feel all these boxes have 2 b ticked before i put my millions in and go long..


----------



## brty (5 December 2008)

schumie,

Any chance of posting in English??

brty


----------



## schumie21 (5 December 2008)

lol, actually rereading it ,well, i cant make sence of it as well.ill try again.                 reason for buying back in
  1. dont worry about any fib level,just worry about the state of the US market,the asx wont improve until US does.
  2.oil and financials will be the first indications of a rise from the ashes
  3.CRB index ,commods will show first signs of global recovery.
   Let me know if anyone doesnt agree,i dont mind at all.


----------



## Struzball (6 December 2008)

I believe by the time the US economy is showing signs of recovery, demand for oil etc, the bottom will have long since been and gone.

Probably a year before.


----------



## michael_t_f (6 December 2008)

The bottom will be when housing prices stabilize in the US and unemployment slightly decreases.
Long way off yet.


----------



## johenmo (6 December 2008)

Just finished reading the FIN REV.  Comments like the US is 2/3 of the way through, middle of next year etc etc don't seem to support the "just around the corner".

Also been looking at weekly sector charts for past 2 years (as I learn).  Does this look like it's bottoming?  Just eyeballing the chart would suggest not yet.


----------



## saiter (6 December 2008)

I see it heading to ~3900 before heading south to 2700. I'm not sure if 2700 is the bottom though.


----------



## rederob (23 January 2009)

rederob said:


> dhukka
> Translating into simple English:
> *We are nearing a point that differentiates a recession from a depression.*
> My view is that the ingredients of a recession-proper have only recently finalised the mix; namely collapses of finance, housing and car industries.
> ...



Nothing has changed my position in the past few months.
If the US and China can get some major infrastructure stimulus underway in the next quarter, we might not hit 2500.  However the flow through of decisions to products is typically beyond 6 months.  So any recovery will only happen in the second half at earliest.


----------



## IFocus (24 January 2009)

rederob said:


> Nothing has changed my position in the past few months.
> If the US and China can get some major infrastructure stimulus underway in the next quarter, we might not hit 2500.  However the flow through of decisions to products is typically beyond 6 months.  So any recovery will only happen in the second half at earliest.




That may create a few jobs but wont speed up the unwinding of the financial problems globally.

Without the flow of credit in the economy's that consume nothing much will happen 

If we are lucky we may go sideways with a couple of sucker rally's  IMHO


----------



## cwamit (26 January 2009)

it wasn't just the sub prim that has created the credit crunch, fixing the credit markets as in healing the banks will take years, its the consumer that has over leveraged through a housing bubble, its the Chinese imbalance of trade (the yens weakness to the us dollar) thats caused problems, there are many factors that have contributed to the credit markets collapses , the only way to fix the problem the easy way is to re inflate by  killing the us dollars value reducing the value of debt in the process but also killing imports from other countries so America can regain trade balances.

 i don't think hyperinflation will come but it will kill any  bonds value in the market creating further credit issues for the yanks. there is also the reset of other honeymoon loans yet to come into effect in 2010, 2011 some will get caught out again with this if the economy isn't back on track by then.

china needs to change from a producer to a self consumer soon than later to see any positives in our  commodities sectors, i don't see the stock market being cheap at the moment far too much has yet to play out globally.


----------



## Cooks (26 January 2009)

XAO should get a rally over Feb / March 09 to about the 3900 - 4000 level. Around April (1st week), watch out this could be the month we see the next leg down... 

As for the bottom, I would say around 1700 - 2000 by the end of 2009


----------



## Sean K (26 January 2009)

Some random plucking of numbers here which require justification.

Please do so.

Cheers!


----------



## cutz (26 January 2009)

michael_t_f said:


> The bottom will be when housing prices stabilize in the US and unemployment slightly decreases.
> Long way off yet.




The stock market is normally a leading indicator so it will begin to turn before the real economy shows any sign of improvement. As Kennas hinted, you guys just pulling numbers out of thin air, how about posting up some charts and a bit of commentary.


----------



## The Edge (26 January 2009)

Sunday  25 January 2009

I will see if I can get copies of the All Ords, this week.

Let me say that an argument could be made for the Dow
to decline to as low as the 4,000 area, not that it
necessarily will, but it is within the realm of probability.
The message is, there is no hurry to expect a bottom
in the markets.

Just my opinion.


----------



## nth brisbanite (26 January 2009)

LRG said:


> I subscribe to Huntley's who's view was that the Jan 22 low of 5200ish was the low to rally off to new highs going forward.
> 
> This has now proven not to be the case.
> 
> ...




Just read the first post to this thread.  Just shows how the "experts" can be so wrong.  "5200ish as the new low to rally off to new highs" - what a laugh!!

It's impossible in this climate to predict what is going to happen in the short term.  Who would have thought that China's growth rate was going to go down to 6.9%?  All the graphs and facts in the world aren't going to help us predict the future


----------



## MRC & Co (26 January 2009)

*Re: How low can All Ords go?*

^^^^^^^^^^^^^^^^



wayneL said:


> How long is a piece of string?
> 
> It is conceivable that the XJO could end up in the 3000s. I say this by drawing a line through the financials... the big banks etc.
> 
> ...




If you want an expert, how about listening to this guy?  Better than the media 'experts' by a country mile and then some!!!!!!


----------



## jonnycage (26 January 2009)

if anyone is thinking a rise is due, where do you reckon we might head then ?
just trying to give myself a little false hope lol

jc


----------



## Largesse (26 January 2009)

we will get to 4981 


"Some random plucking of numbers here which require justification.

Please do so.

Cheers! "


----------



## wonderrman (26 January 2009)

Who knows were the market is heading? I still haven't found anyone that can predict the future. All these guesses are worthless. Look at companies as individuals, not at the market as a whole. 

If your not patient and can't take short term pain you shouldn't be in this market. Wait until there is a defined upswing. But hey, you could have missed out on a 20% rise if you want to sit on the side.


----------



## bunyip (26 January 2009)

LRG said:


> I subscribe to Huntley's who's view was that the Jan 22 low of 5200ish was the low to rally off to new highs going forward.
> 
> This has now proven not to be the case.
> 
> ...




Huntleys are a pretty damn useless crowd in my experience......subscribed to them briefly about 12 years ago and they didn't have much idea at all. 

Markets are driven primarily by fundamentals. 
Fundamentals here and in every other country are atrocious and getting worse by the day.
Our biggest export earner, coal and other mining based resources, are suffering from falling prices due to greatly diminished demand that dries up further week by week.

Company profits are sliding and unemployment is rising, particularly in the mining industry where thousands of workers have been retrenched. 
And that's just in Australia. The situation is even more grim in many other countries whose economies are far bigger than ours.

Does this sound like the sort of economic environment that's conductive to a market comeback?

Nobody knows how far the market will fall. Just about every opinion will be wrong.
The crash of 1929 wiped 65% off the US market before it bottomed out. It took 25 years to regain its losses.
Our market so far has fallen about 53%


----------



## Cooks (26 January 2009)

kennas said:


> Some random plucking of numbers here which require justification.
> 
> Please do so.
> 
> Cheers!




My key focus is on price, patterns and timing of pivots. I have posted a simple weekly chart which has 2 trend lines - using time analysis, we are due to touch the steeper of the 2 trend lines giving us 2 full pivots which should meet at around 3900 - 4000 ish give or take. However, there is the possibility that we may go up to the first trend line for a third touch (adding around another 3 months rally until the end of June). I favour that we sell off around the first trend line, with a projected timing around end of March... but further upside is very possible and would have to re-analyse in April... 

As for the downside, as we are in a mature bear market with all the longer term Moving Averages in steep decline, there will probably be 3 - 4 lower pivots (we are now in the second) ... so as a rough indication it should bottom out at around 1500 - 2000...


----------



## bunyip (26 January 2009)

bunyip said:


> Huntleys are a pretty damn useless crowd in my experience......subscribed to them briefly about 12 years ago and they didn't have much idea at all.
> 
> Markets are driven primarily by fundamentals.
> Fundamentals here and in every other country are atrocious and getting worse by the day.
> ...




Correction....the 1929 crash wiped 89% off the US market.


----------



## gfresh (26 January 2009)

How long did it take our market to recover?


----------



## brty (27 January 2009)

Hi,

Bunyip,



> Correction....the 1929 crash wiped 89% off the US market.




Yes that was the USA. In Australia the market fell by ~46% in '29-31 then recovered to new highs by '34. Our biggest decline happened from Jan '70 to Nov '74, a fall of 63%. However there were 2 retracements to near the high inbetween.

Is history bunk?? Will this be worse than the world wars and the great depression for our market, that was reasonably priced on a PER basis before the GFC started??

brty


----------



## nick2fish (27 January 2009)

Throw history out the window......Bye

Is this the worst one ..........Yes
Charts are useless to us now!!!!
Its uncharted territory
Go on make a prediction and I'll call you a physic 
And to you new punks out there trying to make something out of nothing............Beware


----------



## Cooks (27 January 2009)

nick2fish said:


> Throw history out the window......Bye
> 
> Is this the worst one ..........Yes
> Charts are useless to us now!!!!
> ...




Charts are useless??? use them to make money... trade what you see and trade the trend!


----------



## wayneL (27 January 2009)

Cooks said:


> Charts are useless??? use them to make money... trade what you see and trade the trend!




I'm having more fun trading the non-trend. :


----------



## Cooks (27 January 2009)

wayneL said:


> I'm having more fun trading the non-trend. :




LOL... I tried that and got some grey hairs, one is called CBA and the other is called NAB


----------



## Nick Radge (27 January 2009)

> Charts are useless to us now!!!!
> Its uncharted territory




In actual fact the long term chart patterns on the local market cannot be any clearer that what we're currently seeing. I say that from all time frames, monthly since 1952, weekly & daily since November 2007. The pattern I highlighted in March 2007 are still tracing out as expected. Until they are invalidated there is no reason to think the outcome won't be expected. SEE HERE

Over the weekend I just did a report for subscribers on the four most significant crashes on the S&P500 - 1932, 1974, 1987 and 2002. The pattern we're seeing now is, at this juncture at least, exactly the same. These are not Elliott Wave patterns, but they're clear as day for anyone who takes the time.



_This post may contain advice that has been prepared by Reef Capital Coaching ABN 24 092 309 978 (“RCC”) and is general advice and does not take account of your objectives, financial situation or needs. Before acting on this general advice you should therefore consider the appropriateness of the advice having regard to your situation. We recommend you obtain financial, legal and taxation advice before making any financial investment decision._


----------



## MrBurns (27 January 2009)

Nick Radge said:


> In actual fact the long term chart patterns on the local market cannot be any clearer that what we're currently seeing. I say that from all time frames, monthly since 1952, weekly & daily since November 2007. The pattern I highlighted in March 2007 are still tracing out as expected. Until they are invalidated there is no reason to think the outcome won't be expected. SEE HERE
> 
> Over the weekend I just did a report for subscribers on the four most significant crashes on the S&P500 - 1932, 1974, 1987 and 2002. The pattern we're seeing now is, at this juncture at least, exactly the same. These are not Elliott Wave patterns, but they're clear as day for anyone who takes the time.




Thats a long time in the wilderness, so for the foreseeable future buy and hold is not the way to go ?

That gets me back to real estate again.

My concern is what to do with a large lump of cash from here on, no borrowings.


----------



## Cooks (27 January 2009)

MrBurns said:


> Thats a long time in the wilderness, so for the foreseeable future buy and hold is not the way to go ?
> 
> That gets me back to real estate again.
> 
> My concern is what to do with a large lump of cash from here on, no borrowings.




cash is king right now unless you are a day trader. As for real estate, prices may dip further, sit tight and wait to pick up bargins then... prices won't boom anytime soon, so wait and see


----------



## Glen48 (27 January 2009)

70,000 + people has lost their jobs World wide over the last few days...things and not getting any better soon.


----------



## MrBurns (27 January 2009)

Cooks said:


> cash is king right now unless you are a day trader. As for real estate, prices may dip further, sit tight and wait to pick up bargins then... prices won't boom anytime soon, so wait and see




Everyone says cash is king but I'm concerned about the stability of the banks and getting it out again if things get very much worse which they probably will.

I want to hold out for 2 years because that when I think property will bottom out but the cash is increasingly at risk in the bank the longer I leave it there.


----------



## Cooks (27 January 2009)

MrBurns said:


> Everyone says cash is king but I'm concerned about the stability of the banks and getting it out again if things get very much worse which they probably will.
> 
> I want to hold out for 2 years because that when I think property will bottom out but the cash is increasingly at risk in the bank the longer I leave it there.




you're right about the banks, they aren't looking too stable and they could freeze accounts if things get worse to avoid bank runs.... purchase gold then at the Perth mint... you can store it there for free, and looking at gold right now, it is looking bullish... but that is a high risk investment


----------



## Nick Radge (27 January 2009)

Bill Gates is obviously a subscriber 

http://www.smh.com.au/news/world/10-years-of-woe-gates/2009/01/27/1232818386171.html


----------



## cutz (27 January 2009)

Gee,

With all this doom and gloom in the air and talk of a run on aussie banks I’m starting to feel a tad bullish.


----------



## nunthewiser (27 January 2009)

Cooks said:


> purchase gold then at the Perth mint... you can store it there for free,




maybe a lil research first darl......................


----------



## Cooks (27 January 2009)

nunthewiser said:


> maybe a lil research first darl......................




Under the Perth Mint Certificate Program (PMCP), investors can purchase bullion gold, silver, and platinum at the Perth Mint spot (cash as opposed to future) market ask price with no markup.

The PMCP offers free storage at the Perth Mint, eliminating a
significant cost of physical ownership.
....
....
The beauty
of the Perth Mint is that it’s not a bank account, meaning you
don’t have to disclose it. It’s a government-owned vault and the
storage is free. 


Source: Crash Proof - Peter Schiff

So there are ways to get free storage if you do YOUR research

thanks DARL


----------



## nunthewiser (27 January 2009)

Cooks said:


> Under the Perth Mint Certificate Program (PMCP), investors can purchase bullion gold, silver, and platinum at the Perth Mint spot (cash as opposed to future) market ask price with no markup.
> 
> The PMCP offers free storage at the Perth Mint, eliminating a
> significant cost of physical ownership.
> ...




IT is NOT physical GOLD .certificates only ........ try converting the certificates to bullion currently 

there IS storage fees involved on bullion storage 

there is no mention of certificate gold in your post only this 




> purchase gold then at the Perth mint... you can store it there for free,






haveaniceday


----------



## Cooks (27 January 2009)

nunthewiser said:


> IT is NOT physical GOLD .certificates only ........ try converting the certificates to bullion currently
> 
> there IS storage fees involved on bullion storage
> 
> ...




here is a little more for you

Safety, which can be a concern with other certificate programs,
is assured here because the metals remain on the
premises and cannot be lent out.


----------



## cutz (27 January 2009)

Gold Bullion,

It's just another ponzi scheme, pretty much useless unless there is a greater fool willing to pay more.

My opinion only, please DYOR if considering buying/selling bullion.


----------



## sinner (27 January 2009)

It's also worth noting, if you want "free storage" you will need unallocated certificates, i.e. no gold will be fabricated and stored for you. If you want redemption you will then have to pay fab (which will increase on Feb 1 2009 ccording to the FAQ) and delivery fees.

I cannot prove this currently because the PCMG website is down for maintenance, but I am pretty sure there is a clause in the certificate just like there is for ZAUWBA that states delivery of physical gold (even allocated holdings) is at the discretion and reasonable timeframe of the mint. i.e. in any situation where gold is desirable, you will be getting redemption in AUD.

Cooks, not sure how you can go bashing the governments trustability in another thread then come here and spruik Perth Mint Gold Certs (a product supplied and guaranteed by the WA govt).

Paper gold is paper gold, no changing that no matter what you call it.


----------



## nunthewiser (27 January 2009)

Cooks said:


> here is a little more for you
> 
> Safety, which can be a concern with other certificate programs,
> is assured here because the metals remain on the
> premises and cannot be lent out.




??? uh? why you telling me ? .the original post had nothing to do with certificates or was posted UNCLEARLY by yourself .

i have no intrest in certificates as if i wanted a piece of paper i would trade or hold the GOLD listed on the asx instead without the certificate fees and the % spread on buying and selling from dealer on top of market price fluctuations

i hold PHYSICAL bullion


----------



## brty (27 January 2009)

Any danger of you gold bugs taking your Perth Mint discussion to a gold thread where it belongs??

If history is bunk, as some suggest, then any prediction on where we go from here is probably incorrect, both bull and bear.

We need to keep the discussion about our market, not the US market that has different underlying fundamentals. (for example the XAO stocks pay much higher dividends than the S&P500 stocks, because of differences in taxation treatment in each country).

The falls in markets that some like to highlight of a magnitude of 80-90% seem to start from PER of up to 100 (like the Nikkei in 1989).

Can someone please show a market that fell even 66% that started from a PER of ~17, like ours was in 2007???

brty


----------



## dirty_harry (28 January 2009)

Hi all,

   this is my first post. I hold a lot of stocks and have been buying resources recently. I am long term bullish on natural resources because of the demand from Asia for commodities, and because they are a currency hedge like gold is. I do not trust currencies long term. I have taken hits on property trusts  and banks in 2008, sold some holding some.

   My feelings are that the Aussie economy recovering depends on the banks which depend on the housing market, as they secure most of their loans. The banks underlying businesses are extremely profitable in Australia. The question is if the housing market tanks badly, what will the provisions/losses need to be. If the housing market basically holds then the banks are trading at half price or less right now. They are raising plenty of capital from offshore due to the govt guarantees. They made huge profits last year while US and UK banks made massive losses. However the housing market held for 3 years last time after the '87 stock market crash, but ultimately tanked in the '90s, due to interest rates going to 20%. There are people with 10 or 20 houses that are very proud of their negative gearing (ie losing money). This is not a natural situation and makes me nervous. 

     I can't imagine Western governments would allow the nightmare scenario of deflation and depression, due to the political uncertainty, riots etc that would result. So I expect them to debase the currencies with money printing to devalue their debts and force investment and spending. So significant inflation coming.

    So while there is huge uncertainty, I would place my bets on Warren Buffett who understands these forces. He is buying. All ords should go back to 4500-5000 at some point, but short term I don't know.


----------



## Cooks (28 January 2009)

dirty_harry said:


> So while there is huge uncertainty, I would place my bets on Warren Buffett who understands these forces. He is buying. All ords should go back to 4500-5000 at some point, but short term I don't know.





Hi Dirty Harry,

Agree with your post... and I too would place my bets on Buffet The only thing is that he has the cash to ride out more downside should it come.

I see another proper bull run starting around 2014 - 2015 after we have an accumulation stage on the longer chart time frames


----------



## Cooks (28 January 2009)

sinner said:


> Cooks, not sure how you can go bashing the governments trustability in another thread then come here and spruik Perth Mint Gold Certs (a product supplied and guaranteed by the WA govt).




Hey Sinner,

I bash the government on their reports because a lot of the time from their side there is always this urgency to "please the public" or "lay it down nicely to them". I like to think outside the box and not believe everything I read, avoiding the sheepish ways. However, I do give some trust to government provided it adds up with MY OWN research. So far it has done very nicely for me The topic we were referring to was food prices are declining and this is clearly not the case for me, is it for you? if so, where do you shop?


----------



## drsmith (28 January 2009)

With less volatility and less overall fanfare than the bounce from lows in October and November, I'm wondering whether this week is the turning point.


----------



## Family_Guy (28 January 2009)

drsmith said:


> With less volatility and less overall fanfare than the bounce from lows in October and November, I'm wondering whether this week is the turning point.



I think with the reporting season apon us and some bad news on the way over the next few weeks, i would not be surprised to see the All Ords break 3000 by 4th week of Feb. My call.......lock that in Eddie with $50.


----------



## OzWaveGuy (29 January 2009)

dirty_harry said:


> ....So while there is huge uncertainty, I would place my bets on Warren Buffett who understands these forces. He is buying. All ords should go back to 4500-5000 at some point, but short term I don't know.




Interesting concept. Buffet has lost big money in recent years. In order to 'stabilize' the markets the PR machine will use anything possible from printing cash, giving it away, lowering interest rates and sensationalizing big names that buy into the market. 

These actions are very typical as they have 'appeared' to work in the past. Will they work again - I doubt it.


----------



## dirty_harry (29 January 2009)

People have lost faith in Warren Buffett several times in the past. That's quite natural because he goes against the tide. In the dot com boom some were saying he'd lost the plot because his response to those that were trying to get him to invest in tech stocks was "I've never seen an electron". 
He has been through market crashes where his assets have halved but has come out stronger each time. He bought too early in the 70s but made money on those investments in the following years. If he is right he has not lost any money because he is not selling into these prices. The big skill he has is to calculate intrinsic value, and if the price is 75% or less of it, he buys. Time will tell us if he is right this time.


----------



## michael_selway (29 January 2009)

Family_Guy said:


> I think with the reporting season apon us and some bad news on the way over the next few weeks, i would not be surprised to see the All Ords break 3000 by 4th week of Feb. My call.......lock that in Eddie with $50.




hm i think the bad news will come in the full year reporting in Aug09, so Feb09 may be quite bullish for XAO before Aug09? What do you think?



Thanks

MS


----------



## Aussiejeff (6 March 2009)

michael_selway said:


> hm i think the bad news will come in the full year reporting in Aug09, *so Feb09 may be quite bullish for XAO before Aug09?* What do you think?
> 
> 
> 
> ...




Ummm. Nope.

Make way for 3,000 folks. Going down. Next stop underwear, shoes, ladies & gents fashion... 

Interesting to note S&P giving Babcock & Brown the boot from the All Ords. The effect will be to "artificially" support the AOX now that a big negative influence has been removed & replaced with "more positive" companies like Coka Koala. 

Funny that.... it's a numbers game. We need our index to look better than it has been of late. Maybe they should dump all poor performers from the AOX - that would be even better (oh wait - errr, there are so many poor performers of late that would mean the all ords index would be down to a mere handful of companies to rate)! 

Meh....


----------



## Geoff (7 March 2009)

Just scratch the XAO and make a new indicator called OAO which is the optimistic all ordinaries.  It's the same as XAO except with 3000 points added.  Confidence will skyrocket!


----------



## Gundini (7 March 2009)

*Re: How low can All Ords go?*



wayneL said:


> How long is a piece of string?
> 
> It is conceivable that the XJO could end up in the 3000s. I say this by drawing a line through the financials... the big banks etc.
> 
> ...




Nearly a year has past since this, the second post on this thread.

I would be interested in an update on your current thoughts WayneL when you have some time. 

A lot has happened and things have gone from bad to terrible...

What do you think may be the catylist for a recovery, war? 

US v who ever they choose? Start churning the great economy into action.

Designed asset inflation?


----------



## fapturbo (7 March 2009)

XJO 2750 next stop.....


----------



## Green08 (7 March 2009)

If the dust is shaken out we hopefully will not go below 2300.  Though I do feel at these levels we are not only copping the sins of the twits here but overly done overseas investments through superfunds and the agents they use "big names" to invest in portfolios of international shares. If you do a little tracing it will turn up gems.


----------



## Gordon Gekko (7 March 2009)

I remember watching the finance report back in Aug 2007 where the "news economist", sorry cant remember the name went on to say that because of China "this time it's different.
We all know what happened to the market shortly after.

Today I was reading an article in the financial review where the economist was saying "this time its different". His was talking about why there is no end in sight for the recent falls.

Well to me that's a bullish indicator if I ever seen one! It does not change my plans but reassures me that I am on the right track and this is no different "other than the CNN effect" then any other economic cycle.

But what do I know I only have like 20 posts!

Timendi causa est nescire!

G


----------



## Dangerous (7 March 2009)

could those saying buffet is buying point to what he is buying?...

From what i have read, your research will show that he isn't actually buying that many stocks - only a select few and T-bonds.

It is obvious now that the all ords will break 3000.  all i'll say is that we would be hoping for resistance at 2800.


----------



## nizar (8 March 2009)

Dangerous said:


> could those saying buffet is buying point to what he is buying?...




LOL i remember he bought a $5billion stake in Goldman Sachs sometime ago because he must have saw "value" (he must have coz he certainly wouldnt have been buying it on T/A LOL). And what happened next? It plummeted even more


----------



## Nyden (8 March 2009)

I think we may very well be approaching the bottom, and have taken out a position to gain potential exposure to this. Either way, I'm very happy with the position either way (Woodside ) - the news articles have got to be something of an indicator for this. Just look at them, nearly all of them suggest that there's no end in sight! Soon you'll have the 11pm Channel 10 analysts telling us to buy gold ... golly, I'll put the farm on equities when that happens :


----------



## MRC & Co (8 March 2009)

Nyden said:


> the news articles have got to be something of an indicator for this. Just look at them, nearly all of them suggest that there's no end in sight!




Yes, a very very good indicator.

Could well be a bounce coming.  

Perhaps a little false break or a DB reversal?  In the short-term anyways.  Feel we are going lower eventually, Australia hasn't officially even hit recession yet, but it's as sure bet as any!


----------



## Logique (9 March 2009)

Dangerous said:


> It is obvious now that the all ords will break 3000.  all i'll say is that we would be hoping for resistance at 2800.



I'd go along with that. Unfortunately I see no bottom in sight for US market indices. It would take a monumental effort for us to hold out against this.


----------



## cutz (9 March 2009)

G’Day,

I’ve just observed another bottom indicator; Koshie was on the telly promoting cash in the form of bank deposit as a safe investment, cos the market has dropped 50% since 07.

I don't normally watch the morning show but luckily my missus had the telly on and the segment just caught me attention. 

Some quality advice there.


----------



## Gordon Gekko (6 July 2009)

Just curious on some fellow posters views on if this recent correction (can we call it that yet) has legs?
I get the feeling that there has been a change of sentiment lately and now some are acknowledging that these "green shots" or second half recovery are not going to materialize. Leading laging indicators blah blah blah.
The simple fact is that unemployment is getting out of control and people are going to spend less and that is going to push back a recovery. I find it comical that these market commontators 6 months ago were preaching about a second half recovery and now they are saying June 2010??
They didn't see it coming, they are dropping the ball to fix it and they have no idea when it will be over. (but who does?)
I get the feeling we will retest the lows as there was no reason to rally from them.
Is Australia any different after all, and why?

I read posters saying energy energy energy and it reminds me of tech tech tech.
We will soon find out.

Best

G


----------



## Real1ty (6 July 2009)

Dangerous said:


> *
> It is obvious now that the all ords will break 3000.*  all i'll say is that we would be hoping for resistance at 2800.




Really?

And what is your prediction based on?


----------



## matty2.0 (6 July 2009)

nizar said:


> LOL i remember he bought a $5billion stake in Goldman Sachs sometime ago because he must have saw "value" (he must have coz he certainly wouldnt have been buying it on T/A LOL). And what happened next? It plummeted even more




This is just a silly. 
Have you looked at GS price now?? He's up like 50% almost on his investment in GS. 
Do your research or don't post ill-informed comments.


----------



## So_Cynical (6 July 2009)

LOL ^^^^ nothing like quoting 4 month old posts.


----------



## nunthewiser (6 July 2009)

So_Cynical said:


> LOL ^^^^ nothing like quoting 4 month old posts.




agreed 

some pearlers there calling a bounce also but them ones seem not to be quoted yet


----------



## nunthewiser (6 July 2009)

heres another one that can be quoted within 4 months if one wishes 

3000-2700

a.nun


----------



## skc (6 July 2009)

nunthewiser said:


> heres another one that can be quoted within 4 months if one wishes
> 
> 3000-2700
> 
> a.nun




3000 minus 2700 = 300.

I don't think we will get that low.


----------



## Gordon Gekko (6 July 2009)

nunthewiser said:


> heres another one that can be quoted within 4 months if one wishes
> 
> 3000-2700
> 
> a.nun




Speaking of quotes where's DAVO?

"This is not the bottom" 2700

I think we might see it or near anyway.

G


----------



## skc (6 July 2009)

matty2.0 said:


> This is just a silly.
> Have you looked at GS price now?? He's up like 50% almost on his investment in GS.
> Do your research or don't post ill-informed comments.




For the record, Buffy bought in at around $115. Today GS is about $145. It did once go down 50% after he invested but has now recovered. Buffy also had warrants to buy more at $115.

http://www.nytimes.com/2008/09/24/business/24goldman.html


----------



## wayneL (7 July 2009)

FYI - An article in today's Money Morning (UK based) - via email:



> Why Australia Won't Escape The Crunch..
> 
> “The Aussies aren’t as confident or brash as they normally are”.
> 
> ...


----------



## skyQuake (7 July 2009)

cutz said:


> G’Day,
> 
> I’ve just observed another bottom indicator; Koshie was on the telly promoting cash in the form of bank deposit as a safe investment, cos the market has dropped 50% since 07.
> 
> ...




Haha i just noticed this post and post date 

This 'indicator' definitely going into my books


----------



## moXJO (7 July 2009)

wayneL said:


> FYI - An article in today's Money Morning (UK based) - via email:




Jealous whinging poms

I live close to bhp steelworks, and the have pushed ahead the opening of the blast furnace because of demand. And expect more demand in coming months. Also noticed the coke works (that is in the middle of a suburb down here) open both night and day recently. The boats were lined up out to sea as well. Someone was telling me the ports were also going flat out. But I suppose figures don't lie

I was expecting some kind of fall in the market and hopefully property. But a unit I was looking at buying as an IP sold in about 3 weeks. And if anything property has risen again down here. I'm as busy as every and I don't even advertise.


----------



## SittingDuck (7 July 2009)

moXJO said:


> J
> I live close to bhp steelworks.




I'll pay the rest of your comment, but BHP don't own a steelworks anymore ! 

Yes, ships are lining up, and the blast furnace is coming on line.  The port is starting to live again.


----------



## moXJO (7 July 2009)

SittingDuck said:


> I'll pay the rest of your comment, but BHP don't own a steelworks anymore !
> 
> .



Bluescope or whatever they changed it to.


----------



## nunthewiser (7 July 2009)

moXJO said:


> Bluescope or whatever they changed it to.




knows a trader that works there

dont seem to help him much tho


----------



## nunthewiser (7 July 2009)

anyways reckon we due a small bounce shortly before the index crashes to - 10000


----------



## moXJO (8 July 2009)

nunthewiser said:


> knows a trader that works there
> 
> dont seem to help him much tho




I've heard about those bluescope commodity traders
They chuck copper over the fence and taking it to the local scrap metal yard.


----------



## MRC & Co (8 July 2009)

WayneL, that post is basically my current view for the Australian economy.

Just one question:  Is it worthwhile, as per the last part of the post, measuring the Australian markets rise relative to changes in exchange rates?  

As numerous factors could alter exchange rates and currencies could be hedged by international speculative flows..........


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## Sean K (8 July 2009)

Does the All Ords represent the % growth/fall in earnings from Australian companies?


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## nunthewiser (8 July 2009)

kennas said:


> Does the All Ords represent the % growth/fall in earnings from Australian companies?




no.

kinda a representation of market cap sort of 

hard for a bogan to explain but here goes ...... as the asx  stocks rise the mkt cap gets bigger so does the xao 

and vica versa 

XAO just an indicator of the overall view on them .... 

XAO falling does NOT mean every stock in it is falling

different stocks have different weightings on the xao to do with mkt cap

excuse my vague explanation but im a lover not a typist


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## nunthewiser (8 July 2009)

kennas said:


> Does the All Ords represent the % growth/fall in earnings from Australian companies?





 thats the last time i help any more bloody newbies


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## shag (8 July 2009)

has anyone put the obvious? ie zero...ie zilchh, nada, all bust etc.

and thanks nun for the illuminanting insight.....im assuming u had a few slugs of that dodgy coctail before u came up with that lot.

maybe next week u could do the dow vrs the s and p 500 and nasdaq....


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## nunthewiser (8 July 2009)

shag said:


> has anyone put the obvious? ie zero...ie zilchh, nada, all bust etc.
> 
> and thanks nun for the illuminanting insight.....im assuming u had a few slugs of that dodgy coctail before u came up with that lot.
> 
> maybe next week u could do the dow vrs the s and p 500 and nasdaq....





? 

completely sober

are you disagreeing with my statement that the XAO moves are based on ever changing market caps ?

would you like to give an explanation yourself ?


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## nunthewiser (8 July 2009)

Hmmmmmm

obviuosly not 

another peanut from the gallery that has no idea except to heckle those that are happy to try and give an answer 

onya darl


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## shag (9 July 2009)

im taking the piss mate. wasnt meant to b an insult as poorly worded as it may have been. what else do u do when its a red day/period in the market and u rnt into shorts. and i dont mean u and its not meant to be read too literally.


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## dhukka (9 July 2009)

LRG said:


> I subscribe to Huntley's who's view was that the *Jan 22 low of 5200ish was the low to rally off to new highs going forward.*
> 
> This has now proven not to be the case.
> 
> ...




Interesting to look back at the opening post of this thread. I wonder how many subscriber's Huntley's lost in the last 18 months?


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## shag (12 July 2009)

yes i was closely watching huntley's and fat profits at the time, and they both got it very badly wrong. the latter were by far worse imo, telling us a 70's style rally was imminent each week. since then they have been inundating my mailbox with 'special' offers.


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## Sean K (12 July 2009)

nunthewiser said:


> thats the last time i help any more bloody newbies



Ah, OK, market caps. Thanks!!


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## Bushman (20 May 2010)

Time to re-instate this thread. 

A few punters actually predicted low 3000's in mid-2008 which was spot on. 

So what do we think? Double dip recession on the card due to European woes or is this correction over? 

My tip for the bottom is 4000 and 5000 by the end of the calendar year. The Germans will save the Europe and America is starting to correct. 

No double dip recession this year. 

All best are off though of contagion spreads to Spain or Blighty.


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## tech/a (20 May 2010)

Been discussed here.

https://www.aussiestockforums.com/forums/showthread.php?t=4888&page=403


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