# Congratulations Australia - You are not in a recession



## Trembling Hand (3 June 2009)

Its official. We are not in a "technical" recession of 2 quarters of negative growth.

GPD at 0.4.  for Q1 quarter


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## Timmy (3 June 2009)

Thanks TH!
This is good news but the doomsayers are ready with "Yeah, but..."

Here they come now LOL


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## MS+Tradesim (3 June 2009)

Lol at the spikes on the AUD pairs....and the XAO.


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## awg (3 June 2009)

well good news sure as hell beats the alternative IMO

(unless yr got lots of shorts on)


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## Trembling Hand (3 June 2009)

MS+Tradesim said:


> Lol at the spikes on the AUD pairs....and the XAO.




Much ado about nothing.

back where we started on the SPI.

Skippy on a run


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## Aussiejeff (3 June 2009)

Woohoo!

Will the new economic triumvirate powerteam of Chindalia rule the world?


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## Trembling Hand (3 June 2009)

Aussiejeff said:


> Woohoo!
> 
> Will the new economic triumvirate powerteam of Chindalia rule the world?




Yes and rudd is going to be the new Kim Jon-il


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## glads262 (3 June 2009)

With the governments turnaround in budget equalling 7% of GDP, is anyone really surprised??
Take that out of the equation, and GDP would have been -7% in the last 12 months.
As long as the budget gets back into surplus in the next 2 years, I'll be happy. Hopefully the Rudd govt pulls back on the spending to the tune of about $50 billion over the next 2 years, otherwise as the recovery unfolds, the RBA will have to do all the work - ie raise rates by a huge number rather than a moderate one.

Cant' see this happening though - unless there is a change in government...


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## Timmy (3 June 2009)

Trembling Hand said:


> Yes and rudd is going to be the new Kim Jon-il




Krudd & Co. are going to be unbearable for the next few days with this news.


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## Timmy (3 June 2009)

Timmy said:


> This is good news but the doomsayers are ready with "Yeah, but..."




ps. I should be fair to the Doom-and-Gloomers, there are plenty of "Yeah, but ..."'s in this result.


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## Real1ty (3 June 2009)

Aussiejeff said:


> Woohoo!
> 
> Will the new economic triumvirate powerteam of Chindalia rule the world?




Took you awhile to reply and not one mention of "gum-mint" or a $ sign to be found 

You are slipping...


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## Agentm (3 June 2009)

i am expecting a follow up announcement

"regret to announce we miscalculated the GDP, we traced the error back to an ex westpac employee fresh from new zealand and too many zeros were added to one figure. We understand the employee is now being sought by the treasury department in washington"


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## Bushman (3 June 2009)

glads262 said:


> With the governments turnaround in budget equalling 7% of GDP, is anyone really surprised??




LOL; we had to pay multi-billion dollar retail-based stimulus packages to avoid the stigma of 'recession'. I would have preferred we had kept the money. 
Given most of our hard won surplus has gone on consumer goods manufactured in Asia, all we have done is avoid a historical anecdote without any longer term tangible investment benefits. 

However I concede that it is another feather in Kruddy's cap and will allow him to sell Australia as being both a 'fiscally conservative' and 'politically stable' state. This will help in attracting investment dollars from messieurs [insert cashed up Asian Tiger here]. This will ultimately ensure that we are a nanny service state whose key income producing assets are all owned by offshore interest. But we will have a $1000 plasma to provide soma to the middle class massive. Happy days and 'everybody needs good neighbours'!! 

(Maybe this belongs on Sir O's 'rant' thread.)


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## alwaysLearning (3 June 2009)

Well we did escape a technical recession, but that doesn't matter too much IMO.

There are still big problems to come. It depends how you view it.

If commodities rise too quickly, and the AUD/USD goes a lot higher and just he AUD getting stronger against the other majors means that our exports will become more expensive.

Factor in that world growth is still crap, and translates into less earnings potential from our exports. It also means that there will start to be inflationary concerns if say the price of Oil sky rockets again--which it could, lol. 

The housing bubble here in Australia is still a major concern. If the housing bubble bursts then....

ps--I'm still bearish on equities...I can't believe that we can go from a huge bear market and then jump into a bull market so quickly..


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## Uncle Festivus (3 June 2009)

....thanks to a 7% reduction in imports? Come on people, start spending your stimulus money


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## Beej (3 June 2009)

alwaysLearning said:


> I can't believe that we can go from a huge bear market and then jump into a bull market so quickly..




I can because I always thought the relentless bear market sell off was way over-done for our local market and the long term potential of the economy here - only a full blown depression would have ended up justifying that sell off. Personally though I'm still not expecting to see anything like the 2007 highs again for many many years to come.

Cheers,

Beej


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## nomore4s (3 June 2009)

alwaysLearning said:


> ps--I'm still bearish on equities...I can't believe that we can go from a huge bear market and then jump into a bull market so quickly..




Who says this is a bullmarket? It's yet to be proven that the bear has finished yet and this is anything other then a bear market rally.

But my view as posted on the XAO thread a while ago is that we will trade sideways above the major low for a number of years. Whether we have seen that low or not is still to be decided but the longer this rally goes the more likely we have seen the low.



Beej said:


> I can because I always thought the relentless bear market sell off was way over-done for our local market and the long term potential of the economy here - only a full blown depression would have ended up justifying that sell off. Personally though I'm still not expecting to see anything like the 2007 highs again for many many years to come.
> 
> Cheers,
> 
> Beej




I agree with this, there was a lot of talk of it getting as bad as the great depression and it appeared to me alot of those scenarios where priced in but we have failed to see anything close to that especially in Oz


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## Quincy (3 June 2009)

> Re: Congratulations Australia - You are not in a recession




 ...   ohh McRudd, you've dunnit again !


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## Sir Osisofliver (3 June 2009)

*grabs large wooden stirring stick*

So I guess those Labour election adverts with Lawrence Springborg saying "We aren't in a recession". and the labor voice overs going "Yeah right he doesn't have a clue.".....were just a golden example of the noble profession of politics at it's best. *blarg*

I think I vomited a little bit saying that last line.

Cheers

Sir O


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## Julia (3 June 2009)

Timmy said:


> Krudd & Co. are going to be unbearable for the next few days with this news.



Yep, have been mentally groaning at this thought all afternoon.



Bushman said:


> LOL; we had to pay multi-billion dollar retail-based stimulus packages to avoid the stigma of 'recession'. I would have preferred we had kept the money.
> Given most of our hard won surplus has gone on consumer goods manufactured in Asia, all we have done is avoid a historical anecdote without any longer term tangible investment benefits.
> 
> However I concede that it is another feather in Kruddy's cap and will allow him to sell Australia as being both a 'fiscally conservative' and 'politically stable' state. This will help in attracting investment dollars from messieurs [insert cashed up Asian Tiger here]. This will ultimately ensure that we are a nanny service state whose key income producing assets are all owned by offshore interest. But we will have a $1000 plasma to provide soma to the middle class massive. Happy days and 'everybody needs good neighbours'!!
> ...



Sums up my thoughts too, Bushman. 
So irritating that the electorate largely seems unable to figure this out.

 Have to say you're becoming very cynical.


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## Conza88 (3 June 2009)

Timmy said:


> Thanks TH!
> This is good news but the doomsayers are ready with "Yeah, but..."
> Here they come now LOL




Here I am! With my bag of reality in tow! I come forth with the words of wisdom from the people who actually forewarned of the crisis as early as 2002 & every depression since the FED was implemented in 1913. 

It helps when you have the correct theory - Austrian Economics... and all everyone else has, is but a fist full of fallacies.

*America's Great Depression by Murray N. Rothbard*



> *THE FISCAL BURDENS OF GOVERNMENT*​
> In the pleasant but illusory world of “national product statistics,” government expenditures on goods and services constitute an addition to the nation’s product. Actually, since government’s revenue, in contrast to all other institutions, is coerced from the taxpayers rather than paid voluntarily, it is far more realistic to regard all government expenditures as a depredation upon, rather than an addition to, the national product.
> 
> In fact, either government expenditures or receipts, whichever is the higher, may be regarded as the burden on private national product, and subtraction of the former figure from Gross Private Product (GPP) will yield an estimate of the private product left in private hands. The ratio of government depredation (government expenditures or receipts, whichever is the higher) over Gross Private Product yields the approximate percentage of government depredation of the private product of the economy. *[21]*
> ...




*[21]*Generally, government expenditures are compared with Gross National Product (GNP) in weighing the fiscal extent of government activity in the economy. But since government expenditure is more depredation than production, it is first necessary to deduct “product originating in government and in government enterprises” from GNP to arrive at Gross Private Product. It might be thought that total government expenditures should not be deducted from GPP, because this involves double counting of government expenditures on bureaucrats’ salaries (“product originating in government”). 

But this is not double counting, for the great bulk of money spent on bureaucratic salaries is gathered by means of taxation of the private sector, and, therefore, it too involves depredation upon the private economy. Our method involves a slight amount of overcounting of depredation, however, insofar as funds for government spending come from taxation of the bureaucrats themselves, and are therefore not deducted from private product. This amount, particularly in the 1929–1932 period, may safely be ignored, however, as there is no accurate way of estimating it and no better way of estimating government depredation on the private sector.

If government expenditures and receipts are just balanced, then obviously each is a measure of depredation, as funds are acquired by taxation and channelled into expenditures. If expenditures are larger, then the deficit is either financed by issuing new money or by borrowing private savings. In either case, the deficit constitutes a drain of resources from the private sector. If there is a surplus of receipts over expenditures then the surplus taxes are drains on the private sector. For a more extended discussion, and a tabulation of estimates of these figures for the 1929–1932 period, see the Appendix.​
Now, if you want to lose all your money - buy ALL means put it back into the Stockmarket. Seriously... I'll bump this beauty when the time comes and we can all gather around the camp fire and laugh at those delusional enough to believe the propagandists and intellectual wh0re's of the State.


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## Knobby22 (3 June 2009)

Rudd's stimulus package has meant that very few people have had to be made redundant. It has definitely has had an effect in my work.

Because most people have kept their jobs the downturn has not bit too hard, property prices have not dropped much, spending has essentially continued.

It therefore appears Rudd has ameliorated the worst effects of the recession in Australia while the US, GBR and Europe are a mess. As a swinging voter you have to say that Labor deserve congratulations in this and the comments bagging Rudd for succeeding show a lack of balance and a trace of being a sourpuss.


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## Bushman (3 June 2009)

Julia said:


> Yep, have been mentally groaning at this thought all afternoon.
> 
> 
> Sums up my thoughts too, Bushman.
> ...




LOL; frustrated at the vested interests that sees us replacing private debt with public debt without any tangible benefit. The Aussie version of 'fiscal stimulus' was reactionary at best.


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## MrBurns (3 June 2009)

Trembling Hand said:


> Its official. We are not in a "technical" recession of 2 quarters of negative growth.
> 
> GPD at 0.4.  for Q1 quarter




Thats great the unemployed and bankrupts will be overcome with joy


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## Trembling Hand (3 June 2009)

Conza88 said:


> *Now, if you want to lose all your money *- buy ALL means put it back into the Stockmarket. Seriously... I'll bump this beauty when the time comes and we can all gather around the camp fire and laugh at those delusional enough to believe the propagandists and intellectual wh0re's of the State.




Just LOL

What a joke. While the cowards hide behind their Austrian bagels wrapped up in theories the real smart players are running with the opportunities.

Lose all your money!! Oh Please. You ever seen one of these??


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## nunthewiser (3 June 2009)

EXCELLENT 

three cheers for mr rudd 


cmon burnsie you can be our pin up cheerleader squad leader 

" rudd rudd your the best , your the greatest , fark the rest "

i can see it now , julia and burnsie bouncing around with there pom poms at the airport wishing our great leader well


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## Some Dude (3 June 2009)

Sir Osisofliver said:


> *grabs large wooden stirring stick*
> 
> So I guess those Labour election adverts with Lawrence Springborg saying "We aren't in a recession". and the labor voice overs going "Yeah right he doesn't have a clue.".....were just a golden example of the noble profession of politics at it's best. *blarg*




LOL.. very astute sir!


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## Conza88 (3 June 2009)

Trembling Hand said:


> Just LOL
> 
> What a joke. While the cowards hide behind their Austrian bagels wrapped up in theories the real smart players are running with the opportunities.
> 
> Lose all your money!! Oh Please. You ever seen one of these??




Hahah, the last part was edited in and all in jest. 

Thanks for addressing the only thing I posted with no substance. 

Now how about the real material? You know 90% of the post?


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## Happy (3 June 2009)

Trembling Hand said:


> Its official. We are not in a "technical" recession of 2 quarters of negative growth.
> 
> GPD at 0.4.  for Q1 quarter





Deferred to the time when money borrowed for the stimulus will have to be paid back.

Looks good *today*, only


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## MRC & Co (3 June 2009)

Happy said:


> Deferred to the time when money borrowed for the stimulus will have to be paid back.
> 
> Looks good *today*, only




But experts have been talking about the deficit and it's payback literally, for decades (even in the 80s) until economic theorists stated "perhaps a huge deficit is not bad if you are achieving economic growth".  Perhaps there are truths in both elements (the US would not be where it is today if it were not for debt and excess consumption).

Of course it has to revert at some point, but where will this be?  That is the key and if Soros himself couldn't predict it, then nobody stands a chance IMO.  Just have to take opinions and trade them as best as price permits.


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## Trevor_S (3 June 2009)

Conza88 said:


> Here I am! With my bag of reality in tow! I come forth with the words of wisdom from the people who actually forewarned of the crisis as early as 2002 & every depression since the FED was implemented in 1913.




You seem interested in history, so I thought this article poignant

http://online.wsj.com/article/SB123981155929121475.html

These guys are still alive and were in "the market" during the great depression... so perhaps their experience is worthy of at least a read ?



Conza88 said:


> Now, if you want to lose all your money - buy ALL means put it back into the Stockmarket. Seriously...




This sentiment summed up my feelings I guess (albeit at odds with many on here.)



> "Investors have no reason to feel bearish," he says. "True value investors are glad the markets are down."




and by no means do I or have I ever "had it all" in the Stockmarket.


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## nunthewiser (3 June 2009)

nunthewiser said:


> EXCELLENT
> 
> three cheers for mr rudd
> 
> ...





oh cmon guys .not even a bite ???

i was joking by the way


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## MrBurns (3 June 2009)

nunthewiser said:


> oh cmon guys .not even a bite ???
> 
> i was joking by the way




I've been out distributing food parcels to Rudds followers, the only reason we missed on the recession is we went straight to depression


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## skyQuake (3 June 2009)

MrBurns said:


> I've been out distributing food parcels to Rudds followers, the only reason we missed on the recession is we went straight to depression




Please sir, can I have some more?


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## Uncle Festivus (3 June 2009)

MRC & Co said:


> But experts have been talking about the deficit and it's payback literally, for decades (even in the 80s) until economic theorists stated "perhaps a huge deficit is not bad if you are achieving economic growth". Perhaps there are truths in both elements (the US would not be where it is today if it were not for debt and excess consumption).
> 
> Of course it has to revert at some point, but where will this be? That is the key and if Soros himself couldn't predict it, then nobody stands a chance IMO. Just have to take opinions and trade them as best as price permits.




How much do we pay for 'growth' now, in the future ie deficits? The US now get's 50c worth of GDP for every $1 they spend in stimulis. Same here, only before Big Kev we _only_ had huge private debt; now we have huge private debt AND huge government debt! This will be an interesting ride?


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## MrBurns (3 June 2009)

skyQuake said:


> Please sir, can I have some more?




It's in the mail


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## Conza88 (3 June 2009)

MRC & Co said:


> But experts have been talking about the deficit and it's payback literally, for decades (even in the 80s) until economic theorists stated "perhaps a huge deficit is not bad if you are achieving economic growth".  Perhaps there are truths in both elements (the US would not be where it is today if it were not for debt and excess consumption).
> 
> Of course it has to revert at some point, but where will this be?  That is the key and if Soros himself couldn't predict it, then nobody stands a chance IMO.  Just have to take opinions and trade them as best as price permits.




Those "economic theorists" were Keyesian / Neoclassical / mainstream tools... that's why. 

*The Trouble With Data* - Murray N. Rothbard: A Legacy of Liberty by Llewellyn H. Rockwell, Jr.

"Many economists think numbers are the sum of the discipline. Rothbard turned the tables to argue that government data are gathered and used for piece-meal planning and the destruction of the economy. Whatever information markets need about economic conditions can be garnered privately. 

*A good example is the "trade deficit" between nations, which he said is no more relevant than the trade deficit between towns. There is no justification for assuming that trade must equal out in accounts. The important point is that people are benefiting from exchange, whether across the street or across the world." *​
*Does the widening US trade deficit pose a threat to the economy? by Frank Shostak*



> "By its design the national balances of payments do not disclose the transactions that occurred within the economy. The balances of payments only deal with transactions that are external to the economy. In other words, a balance of payments describes how much money a particular country spent on goods from other countries and how much money it received for the goods it sold to other countries. Now, the larger the economy is the less information, as far as economic activity is concerned, can be derived from the balance of payments statement."
> 
> On this Mises wrote,
> While an individual's balance of payments conveys exhaustive information about his social position, a group's balance discloses much less. It says nothing about the mutual relations between the members of the group. The greater the group is and the less homogeneous its members are, the more defective is the information vouchsafed by the balance of payments. The balance of payments of Denmark tells more about the conditions of the Danes than the United States balance of payments about the conditions of the Americans.[1]​




Soros had no idea it was coming, because he doesn't understand the Austrian Theory of the Business Cycle... which is why what he is calling for to solve the crisis is going to make it all so much worse. He's lost BILLIONS this year, and for good reason.

Now, you can choose to remain ignorant and go on beliefs, whims and opinion... or you can learn some cold hard truths based on deductive reasoning to determine axioms about economic law.


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## Julia (3 June 2009)

Knobby22 said:


> Rudd's stimulus package has meant that very few people have had to be made redundant. It has definitely has had an effect in my work.
> 
> Because most people have kept their jobs the downturn has not bit too hard, property prices have not dropped much, spending has essentially continued.
> 
> It therefore appears Rudd has ameliorated the worst effects of the recession in Australia while the US, GBR and Europe are a mess. As a swinging voter you have to say that Labor deserve congratulations in this and the comments bagging Rudd for succeeding show a lack of balance and a trace of being a sourpuss.



Seems like a fair comment, Knobby. 
What do you think will happen to the economy when the artificial stimulus is removed?

The point some of us have been making is that sure if people are given cash to spend, they will spend some of it and this will be reflected in the quarterly figures.  But once it's spent, that's that, isn't it?

Whereas if a longer term approach had been taken and that same funding put into e.g. hospitals, water infrastructure, roads, the benefits would have accrued over a much longer period of time and there would have been a permanent result from the money being spent.  We could have employed more doctors, nurses, spent more on teacher training so our kids are not semi literate when they leave school.

This is in contrast to Australians lining the pockets of Asian plasma producers and whatever other temporary pleasures provided by the cash splash.

So, no.  I do not feel like congratulating the Rudd government.   I believe their actions are motivated much more by their own political objectives than the fundamental good of Australia for the longer term.


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## Julia (3 June 2009)

nunthewiser said:


> oh cmon guys .not even a bite ???
> 
> i was joking by the way



Have been trying to think of a smart response, Nun.  So far failing miserably.


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## Beej (3 June 2009)

Conza88 said:


> Hahah, the last part was edited in and all in jest.
> 
> Thanks for addressing the only thing I posted with no substance.
> 
> Now how about the real material? You know 90% of the post?




If the advice in that other material had been followed we would almost certainly be in depression now instead of looking like avoiding prolonged recession! Really - the stuff you posted suggests the exact opposite of what should be done, and what has proven to work to stimulate economies during cyclical downturns (Ie suggesting that in a downturn government should CUT expenditure so as to reduce it's "burden" on the private sector! What a joke!). There are many good reasons Austrian economics is confined to the fringe.....and that's putting it politely....



Julia said:


> The point some of us have been making is that sure if people are given cash to spend, they will spend some of it and this will be reflected in the quarterly figures.  But once it's spent, that's that, isn't it?
> 
> Whereas if a longer term approach had been taken and that same funding put into e.g. hospitals, water infrastructure, roads, the benefits would have accrued over a much longer period of time and there would have been a permanent result from the money being spent.  We could have employed more doctors, nurses, spent more on teacher training so our kids are not semi literate when they leave school.




But they are spending on longer term infrastructure as well! I am sure you know this! The cash stimulus was phase 1 - quick and immediate. Phase 2 was the capital works (school halls, minor roadworks, insulation etc) - that's hitting the economy now and into the next 1/4 or 2 and represents a stimulus the equivalent $$ amount of the total cash payments, but probably with a better multiplier effect. Phase 3 is the long term infrastructure like the Melbourne rail tunnel, the Pacific Highway upgrades, the port upgrades, the broadband network etc - the funds (and jobs) from these project will hit the economy from late this year well into the next 2/3/4 years.

So really Rudd and co are doing EXACTLY what you are suggesting - you are just conveniently forgetting about it when you write posts like the above! 

Cheers,

Beej


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## Conza88 (3 June 2009)

Trevor_S said:


> You seem interested in history, so I thought this article poignant
> 
> http://online.wsj.com/article/SB123981155929121475.html
> 
> These guys are still alive and were in "the market" during the great depression... so perhaps their experience is worthy of at least a read ?




Hi, I am. Thanks. Graham Style value investing.. yes. Analyzes businesses, not the market. That's principle no. 1 - Principle 1: Ignore “The Market” and “Market Experts” etc. and there are many others. I studied them myself when I discovered Chris Leithner (Graham style value investor / Austrian economist) at his site, many months ago.  

All they do is crunch numbers etc. models, which is satisfactory for businesses but not for the market. Scientific method / empiricism fails for economics - because it is the wrong epistemology (type of knowledge). Value is subjective. 

Anyway, if you know the proper economic laws, you can position yourself for the inevitable and profit / avoid loses because of it. i.e If the country's money supply was doubled over night, you know that those who first spend it are better off. And if you want to avoid the affects of inflation, you would spend it asap - or purchase something, like commodity (gold) to store the wealth.



> _"But as an investor who has seen dozens of economic downturns, Kahn plainly says this is just part of the natural cycle of the market."_




Hilarious. There is no "natural cycle" of the market. The Business / trade cycle is a result of the 5th plank of the Communist Manifesto, the Central Bank - and more precisely, fractional reserve banking.

Greenspan artificially lowered interest rates in 2001 and kept them below the market level. Easy credit, easy money.. creates malinvestment. This is the artificial BOOM, which is ALWAYS followed by a BUST. It is economic reality being restored. You can try get away from it by printing more money, but it will arrive - you only prolong the inevitable and make it worse.

There is a reason the ONLY people who saw this coming where free market - Austrian Economists. Granted though, there are natural business fluctuations - this differs from cycles though. 



> _"Glickenhaus is a much bigger fan of President Obama and thinks he may be able to work the same magic FDR did during the Depression."
> 
> "Ultimately, though, the man who has an opinion on just about everything acknowledges this economy is confounding. *"I'm not sure I'm right,"* Glickenhaus says, which is why he's keeping at least 30 percent of his clients' money in cash."_



Hahah... he has the right intuition.. he's not right. He's just probably never been shown an alternative theory. FDR prolonged the depression... Obama will do the same. Hoover was horrible as was Bush. The FED is to blame.

Little bit of history: 



> "Ludwig von Mises established the foundations of modern Austrian economics while Irving Fisher established the foundations of modern mainstream macroeconomics and central bank policy.
> 
> Fisher helped create and was a proponent of mathematical economics, statistics and index numbers, and a monetary policy that “stabilized” the value of the dollar. Fisher claimed that his scientific approach established a new era of prosperity during the 1920s.
> 
> *Mises published a book in 1928* that critiqued Fisher’s approach and *predicted that it would lead to an economic crisis and collapse*. Before the stock market crash in 1929 Fisher proclaimed a perpetual prosperity for the economy and continued to recommend investing in stocks long after the market had collapsed. In this important case study, Mises passed the “market test” while *Fisher lost his personal fortune during an economic crisis that his economics help create."* Article.


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## Conza88 (3 June 2009)

Beej said:


> If the advice in that other material had been followed we would almost certainly be in depression now instead of looking like avoiding prolonged recession! Really - the stuff you posted suggests the exact opposite of what should be done, and what has proven to work to stimulate economies during cyclical downturns (Ie suggesting that in a downturn government should CUT expenditure so as to reduce it's "burden" on the private sector! What a joke!). There are many good reasons Austrian economics is confined to the fringe.....and that's putting it politely....




If the advice had been followed, ala those who started warning everyone in 2002 - "Hey, umm, guys.. you're creating a bubble here..." If the advice of those in '70 had been followed about staying on the Gold standard.. If the advice of those in ww2... if the advice of those in 1921 leading up the Great Depression had been followed... if the advice of those who were again the creation of the FED in 1913 had been followed...

*Then we wouldn't be in this mess. *​
I mean really... mainstream Keynesian economics and every other school had no idea this was coming... completely unaware, ignorant and flabbergasted... and YET, you want to take their advice about what to do now? Wow... just _wow_. 

The only people prolonging the depression are the tools in power, who are following advice from fundamentally flawed economic doctrines... and we're all going to have to suffer because of it.

The bust HAS to come. It is inevitable. It is economic reality coming back to fruition. It is like gravity, you can't avoid it. Granted, you can violate it temporarily by getting in a plane and nose diving to achieve weightlessness (printing money, stimulus etc) - but it's temporary and the trouble is - you eventually have to land (suffer the consequences of your fun, easy credit, easy money), if you don't you're going to run out of fuel (the value of money will be devalued) and crash (hyperinflation).

Personally, I'd like the plane to land on a tarmac and get the ride over with... not crash


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## MRC & Co (3 June 2009)

Conza88 said:


> Soros had no idea it was coming, because he doesn't understand the Austrian Theory of the Business Cycle... which is why what he is calling for to solve the crisis is going to make it all so much worse. *He's lost BILLIONS this year*, and for good reason.




Where is the proof of that statement?  

Oh and Soros did see this coming, he was only predicting it since the 1980s (point is, even though you may know what's coming, profiting off it can be a completely different matter), he is far from a Keynesian or a Neoclassical economist, infact, he has touted your EXACT Boom/Bust model, how about you learn something before you go shooting your mouth off with assumptions?


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## Conza88 (4 June 2009)

MRC & Co said:


> Where is the proof of that statement?
> 
> Oh and Soros did see this coming, he was only predicting it since the 1980s (point is, even though you may know what's coming, profiting off it can be a completely different matter), he is far from a Keynesian or a Neoclassical economist, infact, he has touted your EXACT Boom/Bust model, how about you learn something before you go shooting your mouth off with assumptions?




*Inside Soros by Llewellyn H. Rockwell, Jnr.*​


> "This year, it is George Soros, the billionaire hedge-fund operator who has turned like a snake on the system of economics that made him rich. His new book is _The Crisis of Global Capitalism_, which argues for a world central bank and an army of new global regulators to straighten out the world monetary mess, according to the Sorosian prescription.
> 
> ... But *today's system was constructed by the very planners that Soros says ought to be given the power to redesign the world economy once again*. In fact, what we need is a monetary system that manages itself the way the gold standard used to.
> 
> ...




Howsabout I didn't run my mouth off, so _no_. And now it's your turn to source - where Soros believes in the Austrian Theory of the Business / Trade Cycle... lmfao


----------



## It's Snake Pliskin (4 June 2009)

Timmy said:


> Thanks TH!
> This is good news but the doomsayers are ready with "Yeah, but..."
> 
> Here they come now LOL




Timmy,

We've had a very low dollar rate with many countries so exports would have benefited and contributed to the economy. Let's see where it is considering the rise of late, by the next quarter.

Cheers...


----------



## bluelabel (4 June 2009)

Yeah but,
This staving off of the recession is on the back of some very good retail figures as a result of Kevs throw it and see where it lands policy of recession fighting.

What happens after all the stimuli has been spent, saved, hoarded, stuffed in a Milo tin and buried next to my childhood pet under the lemon tree?  

My questions are these… 

Can the entire market be propped by retail and over inflated house prices?  

and...

What of next period when negative GDP occurs again?

We will still see Kevs cohorts spruiking we are not in a recession as there haven’t been 2 periods of shrinkage.


:bier:

blue


----------



## Aussiejeff (4 June 2009)

bluelabel said:


> Yeah but,
> This staving off of the recession is on the back of some very good retail figures as a result of Kevs throw it and see where it lands policy of recession fighting.
> 
> What happens after all the stimuli has been spent, saved, hoarded, stuffed in a Milo tin and buried next to my childhood pet under the lemon tree?
> ...




LOL. It's hilarious that now after seeing the good spin, a number of NSW bull$hitter$ have also demanded that that state's recent poor economic statistics which had shown it WAS in *R*ecession over two succesive quarters be judiciously "altered" to include import/export data to show it, too, was technically NOT in an unspeakable *ecession.

 

Ya just gotta larf in the face of diversity.


----------



## noirua (4 June 2009)

It's Snake Pliskin said:


> Timmy,
> 
> We've had a very low dollar rate with many countries so exports would have benefited and contributed to the economy. Let's see where it is considering the rise of late, by the next quarter.
> 
> Cheers...



Yes indeed, the next quarterly report will be very interesting. Rudd & Co are probably hoping that the sudden demand for Aussie coal by China, orchestrated by their Government, will offset reductions elsewhere.


----------



## Trembling Hand (4 June 2009)

Conza88 said:


> Anyway, if you know the proper economic laws, you can position yourself for the inevitable and profit / avoid loses because of it. i.e If the country's money supply was doubled over night, you know that those who first spend it are better off. And if you want to avoid the affects of inflation, you would spend it asap - or purchase something, like commodity (gold) to store the wealth.




That's funny. Reading all your stuff. Makes me guess that you have been out of the market for some time? Maybe holding some precious?


----------



## MRC & Co (4 June 2009)

Conza88 said:


> *Inside Soros by Llewellyn H. Rockwell, Jnr.*​
> 
> 
> Howsabout I didn't run my mouth off, so _no_. And now it's your turn to source - where Soros believes in the Austrian Theory of the Business / Trade Cycle... lmfao




You have got to be the DUMBEST MAN I HAVE EVER COME ACCROSS.

With all your supposed intellect, you listen to the USA bullsheeeet analysts about Soros views and opinions.

Those BILLIONS of dollar losses were YEARS ago FOOL!  

His views are not ANTI-CAPITALISM.  Look at his OPEN SOCIETY where he PROMOTES capitalism AND democracy.

He has made BILLIONS off his BOOM/BUST model, the one he himself CREATED, which is FAR in excess of your Austrian friends.

His belief in regulatory authorities is in sync with his belief that free markets are the way to go, but that prevailing bias can actually blow this apart, hence the need for some regulation (not complete protectionism).  His short of the pound sterling actually saved their citizens, dire consequences.  For that, he should be thanked.  

The market is not science, and as such, those who understand it's operations, are obviously the ones with the most insight to correct it.  Central Banks and Governments are no traders, hence, they always act in hindsight, then you have the sideline dwellers (such as your Austrian friends) who discredit guys who have prooven they understand the system and it's flaws (proof through their monetary gains).  Academics are no traders, and as such, are poor regulators, which infact, renders your views with little to no value.  They are simply theory.  

Study the man, IN-DEPTH and don't just rely on some BS article that are all written to discredit the greatest trader of all-time, not full-time, not part-time, not this time, not that time, but of ALL-TIME!  

Where is my source:  How about you read "The Alchemy of Finance" written by him, himself, about his life's work, not some junk journalist or analyst, that is, if you can actually understand it, which I highly doubt.


----------



## Bushman (4 June 2009)

Austrian forecast for GDP - 'After growing by 1.6% in 2008, *GDP will contract by 4.3% in 2009*, before contracting a little further, by 0.8%, in 2010.' 

Gimme a break. Didn't their banks go hard into Eastern Europe? Lol Austrians.


----------



## Uncle Festivus (4 June 2009)

"Congratulations Australia - You are not in a recession" technically not going by the lagging GDP data, but the champion of the 'surprise' result yesterday just took a haircut. Exchange rate some 30% better for importers than exporters since the GDP data was compiled. BHP & RIO playing hard ball over iron ore prices in a buyers market - take a cut of 40% maybe? Where's this GDP growth to pay back the deficit going to come from?



> Australia's exports fell 11% during April on a seasonally adjusted basis, resulting in an unexpected trade deficit for the month, according to data released Thursday. Imports fell just 2% from March, resulting in a 91 million Australian dollars ($73 million) deficit, compared to a surplus of 2.3 billion Australian dollars in March, according to the Australian Bureau of Statistics. Analysts had expected an April trade surplus of 1.7 billion Australian dollars


----------



## Knobby22 (4 June 2009)

Julia said:


> Seems like a fair comment, Knobby.
> What do you think will happen to the economy when the artificial stimulus is removed?
> 
> The point some of us have been making is that sure if people are given cash to spend, they will spend some of it and this will be reflected in the quarterly figures.  But once it's spent, that's that, isn't it?
> ...




Julia

The handout should be treated as a  temporary TAX CUT!

Many of the right are saying the best way for government to increase spending is by tax cuts however we cannot afford permanent structural tax cuts otherwise we will end up like the US where tax comes no where near to paying for services. A lot of people used the money to pay off credit card debts etc. I used it to help me put a new kitchen in which supplied work to many people. 

I agree that at this later stage the handouts are not required but at the time it was the fastest way to stimulate the economy. The schools upgrade program which I am involved in as a designer is providing a very good stimulus.

I tend to believe people like to think they are doing good and federal pollies generally are decent people so I cannot believe that Rudd does not believe that what he is doing is for the fundamental good of Australia. With regard tp political objectives, I am sure he thinks they are what's good for Australia and his party's view will be coloured by this, that is not to say he is correct in thinking this.


----------



## Knobby22 (4 June 2009)

Well said MRC&co.


----------



## Conza88 (4 June 2009)

Trembling Hand said:


> That's funny. Reading all your stuff. Makes me guess that you have been out of the market for some time? Maybe holding some precious?




Gold. Silver. Hedge against inflation. _(Defined as: the Increase in the money supply)_ And I only really discovered Austrian Economics and Graham style investing within a year & a half ago. I'm fairly autodidactic.  

Austrian Economics can't predict precisely when the crash or event will occur, only that it will. 



Bushman said:


> Austrian forecast for GDP - 'After growing by 1.6% in 2008, *GDP will contract by 4.3% in 2009*, before contracting a little further, by 0.8%, in 2010.'
> 
> Gimme a break. Didn't their banks go hard into Eastern Europe? Lol Austrians.




Haha  The Austrian School of Economics doesn't actually have anything to do with Austria the country, bar that several of it's founders came from there. One of them, Ludwig Von Mises fled Austria from the Nazi's. His economics kind of undermined everything they were doing... He came to the United States, and this is were the Austrian School (i.e like Chicago school was founded in Chicago) is fundamentally orientated.

So the banks in Europe went retardo, because they didn't listen to people like Ludwig von Mises etc...


----------



## sammy84 (4 June 2009)

Is it just me or has there been an influx of posters recently posting their nonsensical and outright silly views lately? Many threads are now littered with posters stating some of the most ridiculous market statements.


----------



## Conza88 (4 June 2009)

MRC & Co said:


> You have got to be the DUMBEST MAN I HAVE EVER COME ACCROSS.*[sic]*








> With all your supposed intellect, you listen to the USA bullsheeeet analysts about Soros views and opinions.
> 
> Those BILLIONS of dollar losses were YEARS ago FOOL!




Of course. And I'm not sure how that changes anything? If he was familiar with the Austrian Theory of the Business cycle or better yet, that socialism cannot calculate. He would have realised the Soviet Union would inevitable collapse. Pretty bad investment decision, no? You said he didn't lose billions - I showed he did. You then moved the goal posts of the debate, from "didn't" to "recent". I could search out for recent losses if need be? 

Oops, I forgot to mention his _"60%+ losses in his funds when he was caught in the 1987 crash."_



> His views are not ANTI-CAPITALISM.  Look at his OPEN SOCIETY where he PROMOTES capitalism AND democracy.
> 
> He has made BILLIONS off his BOOM/BUST model, the one he himself CREATED, which is FAR in excess of your Austrian friends.




Ok, link me to it? He wrote a book that is directly at odds with the previous one he wrote? Also you haven't sourced this "boom/bust" model... and he created it? Hahaha, hilarious. Did he get a Nobel Peace Prize for it like Hayek? _/appeal to authority fallacy_



> His belief in regulatory authorities is in sync with his belief that free markets are the way to go, but that prevailing bias can actually blow this apart, hence the need for some regulation (not complete protectionism).  His short of the pound sterling actually saved their citizens, dire consequences.  For that, he should be thanked.




Soros Fund Loss On Lehman May Be $120MBy Bloomberg News | September 11, 2008

First thing that came up on google. Don't worry, I'll stop there - don't want you to get too pissed at me bashing your idol with the truth.

His book he wrote earlier makes it clear, he's anti-capitalist. What are you going off? He didn't save them, that's a myth and was addressed specifically in the other article. 



> Yet the roots go deeper to a rejection of economics. Back in 1992, Soros's hedge fund speculated against an overvalued British pound. That nation's central bank chose the brainless path of "defending" the currency and thereby depleted its reserves. The press began to call Soros "the man who broke the Bank of England." He began to believe it.
> 
> "It is sort of a disease when you consider yourself some kind of god, the creator of everything," the New Oxford Review quotes him as observing. "But I feel comfortable about it now since I began to live it out."
> 
> ...





> The market is not science, and as such, those who understand it's operations, are obviously the ones with the most insight to correct it.  Central Banks and Governments are no traders, hence, they always act in hindsight, then you have the sideline dwellers (such as your Austrian friends) who discredit guys who have prooven they understand the system and it's flaws (proof through their monetary gains).  Academics are no traders, and as such, are poor regulators, which infact, renders your views with little to no value.  They are simply theory.




The Market is a science. The science / study of human action, which is called praxeology. It is build on axioms (self evident truths) and logically deduced from there. Humans exist. (truth) They always act. (truth) and they are extended to generate substantial truths about economic reality, getting further and further complex.

Mises outlined them in his magnum opus, Human Action. And Rothbard extended them in his Man, Economy and State (with Power and Market)

Sideline dwellers?  Hilarious. Do you know who Peter Schiff is?

​
Simply theory? You are profoundly ignorant of what Austrian Economics is, if that is your contention.



> Study the man, IN-DEPTH and don't just rely on some BS article that are all written to discredit the greatest trader of all-time, not full-time, not part-time, not this time, not that time, but of ALL-TIME!




You clearly worship him. Sad... don't let emotions get in the way of logic and thorough analysis. It is far more profitable to be intellectually honest with yourself and realize someones, including your own flaws - than to carry on in merry ignorance until the cows come home to roost.  

He has made a considerable amount of money from State actions. 



> Where is my source:  How about you read "The Alchemy of Finance" written by him, himself, about his life's work, not some junk journalist or analyst, that is, if you can actually understand it, which I highly doubt.




_



			47 of 58 people found the following review helpful:
2.0 out of 5 stars Disappointing,, December 15, 1999
By A Customer
In this book, Soros openly admits that he is completely unable to predict major developments in finance and economics. In addition, he admits that he has never been able to profit consistently in commodities markets. What does that leave us with? Soros is a glorified stock picker, and the Quantum Fund, a glorified mutual fund. Soros does not discuss equity analysis techniques, however; the book is comprised of macroeconomic analysis and prediction which is - by Soros' own admission - of questionable value.
		
Click to expand...




_​


----------



## Trembling Hand (4 June 2009)

Conza88 said:


> Gold. Silver. Hedge against inflation. _(Defined as: the Increase in the money supply)_ And I only really discovered Austrian Economics and Graham style investing within a year & a half ago. I'm fairly autodidactic.
> 
> Austrian Economics can't predict precisely when the crash or event will occur, only that it will.




So all your theroy has keep from making money. 

Mate you can gladly have it along with your incorrect statements such as,


Conza88 said:


> Anyway,* if you know the proper economic laws, you can position yourself for the inevitable and profit */ avoid loses because of it. i.e If the country's money supply was doubled over night, you know that those who first spend it are better off. And if you want to avoid the affects of inflation, you would spend it asap - or purchase something, like commodity (gold) to store the wealth.
> 
> 
> 
> Hilarious. There is no "natural cycle" of the market. The Business / trade cycle is a result of the 5th plank of the Communist Manifesto, the Central Bank - and more precisely, fractional reserve banking.


----------



## Conza88 (4 June 2009)

sammy84 said:


> Is it just me or has there been an influx of posters recently posting their nonsensical and outright silly views lately? Many threads are now littered with posters stating some of the most ridiculous market statements.




Who are you referring too? 

​


----------



## Conza88 (4 June 2009)

Trembling Hand said:


> So all your theroy has keep from making money.




Nope. Amazing the logical fallacies you folks are coming out with.

Just because my individual actions, means I haven't chosen to invest in stocks doesn't mean that others can't, using the same foundations.

See Peter Schiff, head of Europacific capital. *Euro Pacific Capital *: _"Because there's a bull market somewhere."_ "We are a global investment strategies company focused on finding thriving markets wherever they exist."

And numerous others, JIM ROGERS being another. 

From down under, Frank Shostak is an adjunct scholar of the Mises Institute and a frequent contributor to Mises.org. He is chief economist of *M.F. Global*http://www.mfglobal.com.au/. - _"MF Global Australia Limited (MFGA) is focused on providing customers with everything they need to trade in global futures, equity, CFDs etc..."_

And Chris Leithner, head of a private investment company in Brisbane. - _"*Leithner & Co.* adheres strictly to the traditional “value” approach to investment pioneered by Benjamin Graham and adapted by his colleagues Warren Buffett, Thomas Knapp and Walter Schloss. Its motto is its method: to undertake investment operations that are based upon thorough research; to provide reasonable safety of principal and offer an adequate return; and to inform its shareholders regularly, fully and in plain language about these investment operations. It strives to remain a low-cost, low-risk and reasonable-and-steady-return investment vehicle."_



> Mate you can gladly have it along with your incorrect statements such as,




No, I'll be right. It's correct, why would I refute the truth.


----------



## Trembling Hand (4 June 2009)

Conza88 said:


> Nope. Amazing the logical fallacies you folks are coming out with.
> 
> Just because my individual actions, means I haven't chosen to invest in stocks doesn't mean that others can't, using the same foundations.




No my friend its you that have it ar$e about. Most here who actually trade seen this mess coming and have profited from it. Not only on the way down but again on the way up.

You have just stood aside with the nutters waiting for gold to go to $3000.

So I will get to my point. What are you telling us?


----------



## Conza88 (4 June 2009)

Trembling Hand said:


> No my friend its you that have it ar$e about. Most here who actually trade seen this mess coming and have profited from it. Not only on the way down but again on the way up.
> 
> You have just stood aside with the nutters waiting for gold to go to $3000.
> 
> So I will get to my point. What are you telling us?




You've got a short term outlook & I have a long term outlook.

We'll see who ends up "winning" in the _long_ run.  Congratulations on your 'profits' so far, I hope they last. 

I'd be interested in *why* you thought this mess was coming, *how* you saw it before everyone else and *what* caused it.

Please enlighten me.

And please don't personify me as the embodiment of an entire school. That would be retarded. Again, I chose one path and NUMEROUS OTHERS who run investment companies, worth billions of dollars or themselves worth billions have done otherwise. They didn't just _"[stand] aside with the nutters"._ Which is a fallacy. You do understand fallacies kill arguments, right?


----------



## Trembling Hand (4 June 2009)

Conza88 said:


> You've got a short term outlook & I have a long term outlook.
> 
> We'll see who ends up "winning" in the _long_ run.  Congratulations on your 'profits' so far, I hope they last.
> 
> ...




Many here were calling trouble from easy money at the end of 07. Many were calling a significant rally from March because of easy money. :


----------



## Conza88 (4 June 2009)

Trembling Hand said:


> Many here were calling trouble from easy money at the end of 07. Many were calling a significant rally from March because of easy money. :




- Failure to address the *why*, _who_ / (*what*) and *how*, duly noted...

Thanks for the _'when',_ but the end of 07 / start of 08 - has nothing on 2002. :


----------



## Beej (4 June 2009)

Conza88 said:


> - Failure to address the *why*, _who_ / (*what*) and *how*, duly noted...
> 
> Thanks for the _'when',_ but the end of 07 / start of 08 - has nothing on 2002. :




LOL - you are seriously proud of someone making a call *6 years*  before it actually happened? How more wrong could you be? There was a full blown bull stock market for 4 of those 6 years that you would have completely missed out on by paying head to such predictions!

Beej


----------



## robots (4 June 2009)

hello,

great news we not in recession and to celebrate anybody in Melbourne can get down to the Harmony Walk this sunday

leaving at 11am from the Flemington Community Centre and walking to Etihad Stadium for the Essendon game

its been a great community effort in keeping australia plodding along out of recession, 

the next challenge for the community is solving the issue's many foreign students are facing

thankyou
associate professor robots


----------



## MS+Tradesim (4 June 2009)

Always amused by the pipsqueaks on forums who are somehow "more in the know" than guys like Buffet and Soros, yet I seriously doubt they'll ever have the same clout or success. 

The Guru oscillator is spiking again.


----------



## Conza88 (4 June 2009)

Beej said:


> LOL - you are seriously proud of someone making a call *6 years*  before it actually happened? How more wrong could you be? There was a full blown bull stock market for 4 of those 6 years that you would have completely missed out on by paying head to such predictions!
> 
> Beej




LOL - that is precisely the point. The bubble was being artificially inflated and the Austrians were the only ones that called it. The trouble is, you can't gauge precisely when the bubble will burst because it is pinned on many factors. Government intervention? Does the FED lower rates even more? Or do what they are supposed to do and raise them? It is risky. But more knowledge about the CAUSES, about the actual true happenings of the market (or the things that affect it, i.e money - it's supply etc.) allows you to position yourself accordingly.

As I said previously, I discovered Austrian Economics / Graham style investing a year and a bit ago. Well before the bubble started to be inflated... getting in now would be the completely idiotic thing to do, I missed the boat essentially. For just before it all started to unravel, I listened to the folks who said it would and advised others I know to get their stocks out aswell. They did and benefited from it.

Now, If I had taken advice from the 'mainstream' folk, whilst remaining completely ignorant of Austrian Economics... I should have bought a house because "prices only go up." "New land doesn't just appear". "It's guarenteed". 

And that is exactly what a bloke was telling me, he just bought a house and was suggesting I do the same. I know now, it's a bubble. And it will burst. What's holding it up atm? Home buyer grants. Greaaaaaaaaaat.

But yes, if I was aware of it back in 2002+ someone could easily have bought many houses, if they had the capital / equity. Sat on them for a few years, then sold them just before the doom started to come on the horizon. Again, risk involved - it could have go pear shaped real fast... like it did in 1920, but it was over in a year and that's why you never hear about it in the history books.

So once again, thanks for completely misinterpreting what I've said...


----------



## GumbyLearner (5 June 2009)

Conza88 said:


> And that is exactly what a bloke was telling me, he just bought a house and was suggesting I do the same. I know now, it's a bubble. And it will burst. What's holding it up atm? Home buyer grants. Greaaaaaaaaaat.
> 
> 
> So once again, thanks for completely misinterpreting what I've said...




I'm not going to misinterpret what you have said Conza. I understand that there 'maybe'  people who will twist what you're trying to say. But seriously it's all twenty/twenty to me. Keep 'em coming. 

Fantastic that you joined ASF.

Cheers mate.


----------



## Trembling Hand (5 June 2009)

Conza88 said:


> LOL - that is precisely the point. The bubble was being artificially inflated and the Austrians were the only ones that called it.



 Complete and utter :bs: . The only ones. You have to be kidding? 



Conza88 said:


> As I said previously, I discovered Austrian Economics / Graham style investing a year and a bit ago. Well before the bubble started to be inflated...




Boy Boy. How funny are these recent experts. I mean what a joke. Here's a guy that has "discovered Austrian Economics"  18 months ago and here he is banging on telling everyone who makes money from the markets for a very much longer period than that they didn't see it coming and they don't know because they aren't part of the group.

The funniest thing is with all this the best he can come up with is to stand aside like a lost fool and "hedge for inflation". And then convince himself that he can tell others he's ways the way!! Just too much!!


----------



## Beej (5 June 2009)

Conza88 said:


> LOL - that is precisely the point. The bubble was being artificially inflated and the Austrians were the only ones that called it. The trouble is, you can't gauge precisely when the bubble will burst because it is pinned on many factors. Government intervention? Does the FED lower rates even more? Or do what they are supposed to do and raise them? It is risky. But more knowledge about the CAUSES, about the actual true happenings of the market (or the things that affect it, i.e money - it's supply etc.) allows you to position yourself accordingly.




That's like saying _"I know that roughly once every ten years or so there will be a stock market correction and economic slump, so I will always position myself for the slump"_, and then of course NEVER make any money from the good times which represent the MAJORITY of the time period!

Conza it's nothing personal, but since everyone started banging on about Austrian economics on internet forums over the past couple of years I have done a bit of research into it, and my conclusions are that it is widely disproven and not regarded well at all in academic and mainstream economic circles at all. Comments like the above really just vindicate this conclusion completely IMO. Sorry to burst YOUR bubble! 



> Now, If I had taken advice from the 'mainstream' folk, whilst remaining completely ignorant of Austrian Economics... I should have bought a house because "prices only go up." "New land doesn't just appear". "It's guaranteed".




I don't want to get into this topic here too much as we have two other comprehensive threads! But bottom line is I think you are wrong on this one too. For a start there are no mainstream economic theories that say that house prices only rise - of course they can fall, certainly in real terms moreso than in nominal. It's only industry spruiking and perhaps popular AU housing culture that says they only go up. 

The housing market is complex though and simplistic Austrian idea's will never provide you with decent entry/exit signals IMO, especially for something as specialised as a purchase in a specific suburb/city, and with such high costs of entry/exit plus even a high cost of not being in the market (ie rent!). If that is what you are looking for - all they will tell you is to never enter the market! Riiiighhhht....... I mean if you can't pick an inevitable stock market correction to within +/- 5 years when they occur roughly every 10 years, what hope do you have to time a major housing market correction when they have happened (in a serious way - Ie more than 20% nominal price falls) maybe only 2 or 3 times in the past century?? Anyway good luck with that one - but I am very confident now that this period in history is NOT the time when the AU housing market is going to see any major correction - the opportunity for a systemic financial crisis to trigger that has passed - so maybe if you wait another 10, 20 or 30 years you might be proven correct 

Cheers,

Beej


----------



## Conza88 (5 June 2009)

Trembling Hand said:


> Complete and utter :bs: . The only ones. You have to be kidding?




Don't take it out of context. The context was 2002. They were the only ones who were aware of the bubble was starting to be inflated. Fine, call bs? But can you actually back it up with an argument? Like I dunno, ____ also called it in 2002? Examples help.



> Boy Boy. How funny are these recent experts. I mean what a joke. Here's a guy that has "discovered Austrian Economics"  18 months ago and here he is banging on telling everyone who makes money from the markets for a very much longer period than that they didn't see it coming and they don't know because they aren't part of the group.




 I don't consider myself an expert, yet. I'm just letting others know there are alternative theories out there, that they were never shown nor mentioned at University - if they went. And if they didn't, still more likely they've never heard of the alternatives.

The alternatives have a theory, and it has constantly been vindicated over and over, and over again. Every crisis and recession has been foretold by the only true free market economists.

I don't know why anyone who wants to make money, wouldn't listen to them? What's the problem? My incentive is that I want to spread the message of Sound Economics and Liberty. The more Australians using logic and deductive reasoning the better. 



> The funniest thing is with all this the best he can come up with is to stand aside like a lost fool and "hedge for inflation". And then convince himself that he can tell others he's ways the way!! Just too much!!




I am open to persuasion, completely. I used to be a Chomskyite independent socialist before I discovered Ron Paul and subsequently eventually decided to take a look at Austrian Economics. I then went about the process of shedding fallacies.

There is a lot I can learn from folks here no doubt, about investing and other intricacies. I asked for your explanation behind, how _(theory / method)_ you called it, and what you think caused this crisis. Yet you have been completely silent.




Conza88 said:


> I'd be interested in *why* you thought this mess was coming, *how* you saw it before everyone else and *what* caused it.
> 
> *Please enlighten me.*






Conza88 said:


> - Failure to address the *why*, _who_ / (*what*) and *how*, duly noted...



Don't just be a critic, put forward your explanation and we'll see how it stands up. I'm not saying - DO IT this way, I'm just suggesting there is an alternative - which I think many would benefit from. Again - don't be a clown & brand a school of thought with what I have done, can't you see the fallacious of that? Fundamentally, that's the exact same thing as - a person robs a bank, he is black. You then consider all black people as potential bank robbers. Is that logical?


----------



## Conza88 (5 June 2009)

Beej said:


> That's like saying _"I know that roughly once every ten years or so there will be a stock market correction and economic slump, so I will always position myself for the slump"_, and then of course NEVER make any money from the good times which represent the MAJORITY of the time period!




This article will outline precisely what I am talking about. Since a few here seem to have an aversion to theory, this doesn't contain any. It's all real world events, pragmatic, blah blah - with the correct theory implicit behind it.

*The Banker who Said No - Forbes*
*"While the nation's lenders ran amok during the boom, Andy Beal hoarded his money. Now he's cleaning up--with scant help from Uncle Sam...."*

Beal plays his cards patiently. For three long years, from 2004 to 2007, he _virtually stopped making or buying loans_. While the credit markets were roaring and lenders were raking in billions, Beal shrank his bank's assets because he thought the loans were going to blow up. He cut his staff in half and killed time playing backgammon or racing cars. He took long lunches with friends, carping to them about "stupid loans." His odd behavior puzzled regulators, credit agencies and even his own board. They wondered why he was seemingly shutting the bank down, resisting the huge profits the nation's big banks were making. One director asked him: "Are we a dinosaur?"

Read on...​


> Conza it's nothing personal, but since everyone started banging on about Austrian economics on internet forums over the past couple of years I have done a bit of research into it, and my conclusions are that it is widely disproven and not regarded well at all in academic and mainstream economic circles at all. Comments like the above really just vindicate this conclusion completely IMO. Sorry to burst YOUR bubble!




And... so you are siding with those completely blindsided by this whole mess? Those who were refuting the possibility of a recession up until mid 2008 after the US elections? lol.

Yes, those in "academia" consider it wrong. And it all stems from their flawed Economic reasoning. They are positivists and empiricists. They believe you can establish economic laws through modeling and by trying to use the scientific method (trial and error) to achieve the truth.

The problem is that economics is different. It deals with human interaction of individuals. The correct theory of value is SUBJECTIVE. You may value something more or less than I do. It depends on the individuals tastes, preferences etc. You can't model that - and attempts to do so will fail completely.

*Epistemological Problems of Economics by Ludwig Von Mises*

_"The science of human action that strives for universally valid knowledge is the theoretical system whose hitherto best elaborated branch is economics. In all of its branches this science is a priori, not empirical. Like logic and mathematics, it is not derived from experience; it is prior to experience. It is, as it were, the logic of action and deed."_​


> I don't want to get into this topic here too much as we have two other comprehensive threads! But bottom line is I think you are wrong on this one too. For a start there are no mainstream economic theories that say that house prices only rise - of course they can fall, certainly in real terms moreso than in nominal. It's only industry spruiking and perhaps popular AU housing culture that says they only go up.




I'll also avoid going into it here. Could you maybe link to those other threads, where it is more relevant? Thanks! I'd really like to know why you consider it wrong. Who knows, I may have overlooked something! 



> The housing market is complex though and simplistic Austrian idea's will never provide you with decent entry/exit signals IMO, especially for something as specialised as a purchase in a specific suburb/city, and with such high costs of entry/exit plus even a high cost of not being in the market (ie rent!). If that is what you are looking for - all they will tell you is to never enter the market! Riiiighhhht....... I mean if you can't pick an inevitable stock market correction to within +/- 5 years when they occur roughly every 10 years, what hope do you have to time a major housing market correction when they have happened (in a serious way - Ie more than 20% nominal price falls) maybe only 2 or 3 times in the past century?? Anyway good luck with that one - but I am very confident now that this period in history is NOT the time when the AU housing market is going to see any major correction - the opportunity for a systemic financial crisis to trigger that has passed - so maybe if you wait another 10, 20 or 30 years you might be proven correct
> 
> Cheers,
> Beej




As far as I'm aware, Australian hasn't got an institution such as Freddie Mae, or Freddie Mac... but we have government handouts, 'first home owners grant', that distorts the market just the same.

The Austrian ideas aren't simplistic in their logical structure. One of the prime reasons Austrian economics is harder for layman to grasp is that it usually takes 2 steps to reach the right conclusion. Whereas the fallacies of modern day economics only take 1. For instance the broken window fallacy! And what is seen, and unseen.* Would love to elaborate on this if anyone so chooses or doesn't quite know what I am on about.

You are right about specific suburb, timing and buying. It wouldn't be able to help you with that, and it DOESN'T PRETEND that it could. 

Austrian School of _Economics_. It doesn't deal with investing methods etc, because that isn't its goal. Nor should it be. Yet that is where / why Graham style investing comes in for me. Understanding political economy and political philosophy is fundamental though, imo - because you know what certain actions politicians and government intervention will create. And again, you can position yourself accordingly to avoid risk, or profit.

You also doesn't seem to understand the proper connection between inflation and prices. According to the Reserve Bank of Australia's figures, M3 rose 114% since June 2001 to May 2008. From 469.3 Billion to 1004.8 Billion.

There is a reason a paddle pop used to cost below $1, and now it's just below $2. Essentially doubling in price. Hint: it's not because the company got greedy. lol Housing prices are exactly the same.

*The Bailout Reader*​
Currently the correction is being prevented by government intervention. Which is detrimental. Instead of letting prices fall - as they would have, so that then poor people, young couples, first home buyers etc. can afford to buy, INSTEAD - they PROP UP the artificial prices, and offer a solution - ok, we'll steal (tax) from the populace (other individuals), and give you the money so you can buy a house at the artificially high price levels. 

More examples of government addressing the SYMPTOMS of a problem, caused by government intervention. Making it worse... You don't think this knowledge would be useful to an investor?


----------



## Trembling Hand (5 June 2009)

Conza88 said:


> Don't take it out of context. The context was 2002. They were the only ones who were aware of the bubble was starting to be inflated. Fine, call bs? But can you actually back it up with an argument? Like I dunno, ____ also called it in 2002? Examples help.
> 
> I don't consider myself an expert, yet. I'm just letting others know there are alternative theories out there, that they were never shown nor mentioned at University - if they went. And if they didn't, still more likely they've never heard of the alternatives.
> 
> ...




OMG! No buddy let me make it perfectly clear. You are telling us stuff thats

*OLD*

Please you have some theories in your head and no doubt a bunch of quotes to up-chuck.

But you have nothing. Certainly no way to profit and sitting in gold is as good as you get??


----------



## prawn_86 (5 June 2009)

Have to say i agree with TH. Its all well and good knowing about Austrian Economics, but in rewality that form of thinking is not going to take over for a long longe time, if ever. 

So in the meantime why not focus no making money with the system that is in place? As opposed to 'sitting it out' for years on end


----------



## Conza88 (5 June 2009)

Trembling Hand said:


> OMG! No buddy let me make it perfectly clear. You are telling us stuff thats *OLD*




Old doesn't make it WRONG. Now does it?



> Please you have some theories in your head and no doubt a bunch of quotes to up-chuck.




Theory? I love it how there are those who berate "theory", as having nothing to do with reality. No - your theory sucks if it has nothing to do with reality. There is no distinction.



> "In the first place, we must challenge the very idea of a radical separation between something that is “true in theory” but “not valid in practice.”
> 
> *If a theory is correct, then it does work in practice; if it does not work in practice, then it is a bad theory.* The common separation between theory and practice is an artificial and fallacious one. But this is true in ethics as well as anything else. If an ethical ideal is inherently “impractical,” that is, if it cannot work in practice, then it is a poor ideal and should be discarded forthwith.
> 
> To put it more precisely, if an ethical goal violates the nature of man and/or the universe and, therefore, cannot work in practice, then it is a bad ideal and should be dismissed as a goal. If the goal itself violates the nature of man, then it is also a poor idea to work in the direction of that goal.” – _Egalitarianism a Revolt Against Nature by Murray N. Rothbard_





> But you have nothing. Certainly no way to profit and sitting in gold is as good as you get??




Why do you continue to use the same fallacies? It is disingenuous and to be honest, getting rather tiring.

Certainly no way to profit? Tell that to Peter Schiff and Jim Rogers.. Frank Shostak and Chris Leithner.. seriously, stop peddling bs. It gets you no-where. "Sitting in gold" is not as good as it gets, as I have already elaborated.

*Again* - you evaded my questions. What's the problem? 



Conza88]- Failure to address the [B]why[/B] said:


> Have to say i agree with TH. Its all well and good knowing about Austrian Economics, but in rewality that form of thinking is not going to take over for a long longe time, if ever.
> 
> So in the meantime why not focus no making money with the system that is in place? As opposed to 'sitting it out' for years on end




Reality from what form of thinking? Austrian _ECONOMICS_ explains reality as it is now. It explicitly states the results of public policy. If you implement price controls, what will happen. If you give the government control of the printing presses, if interest rates are artificially lower than the market level, etc etc.

As far as your last concern, yes - and my point is Austrian Economics gives you a better way of doing it. I personally have chosen to sit it out, but that doesn't mean anyone else is. I'm a student, none of the big investment fund managers who adhere to the school are, or those wealthy enough with their own capital are. Some like Rogers are focusing on China and India, also commodities extensively. Others are gold stocks, gold itself, silver. Mining stocks etc. Others do value investing, looking for overlooked good value businesses to invest in.

All I'm saying is a fundamental understanding of Austrian economics would HELP a lot of people here make BETTER decisions, because they understand where the market is potentially going - economic law, is like gravity as per the example I gave earlier.

I thought there would be folks here susceptible and open to the benefits, I guess not... Fine, your loss.


----------



## MRC & Co (5 June 2009)

MS+Tradesim said:


> Always amused by the pipsqueaks on forums who are somehow "more in the know" than guys like Buffet and Soros, yet I seriously doubt they'll ever have the same clout or success.
> 
> The Guru oscillator is spiking again.




Yes and the ones like this idiot, who obviously is completely oblivious to a guy like Soros and his strategies.

He lost billions in the Russian crisis, has lost hundreds of millions on Lehman or on the 87 crash and how about the tech boom, yet, is still the most successful?  Just LOL.

Then quotes the book review from a guy who could be an anybody and obviously didn't understand the book.  How about you quote the reponse to the book of Paul Tudor Jones?  I guess, none of these billionaire traders are anything close to the Noble Prize Austrians (see Black and Scholes and their nobility and investment record ). Soros admits he isn't all knowing and makes plenty of mistakes, because he is a TRADER, not a theorist.  Every trader looses and gets it wrong plenty of times.  Exactly why trading is not a science, there is no fact.  Yet apparently to this guy it is a science, because he can predict it with such perfection.  

I won't even both replying to the rest of that BS from a guy with more quotes than I made in my entire years at University but little to no substance and a whole heap of misinformation.

Yes, the guru oscillator is spiking again and on that note, I am out of here.  To be honest, I just can't be bothered anymore with the amount of junk filling this place upto the rafters.


----------



## MRC & Co (5 June 2009)

Conza88 said:


> Soros had no idea it was coming, because he doesn't understand the Austrian Theory of the Business Cycle... which is why what he is calling for to solve the crisis is going to make it all so much worse. *He's lost BILLIONS this year*, and for good reason.
> 
> .




Now who is shifting the goalposts, student?


----------



## Green08 (5 June 2009)

> I don't consider myself an expert, yet.




Experts - with a real need to learn and humility -  need TIME  - years, in their chosen profession unless your a gifted bloody genius with an IQ over 200.

Even "experts" stuff it up completely.

Knowledge and knowledge that you don't agree with so you can make critical analysis.

Victories and losses - so you learn Techa has seen the barrel bottom and the clouds

Ability to move with new scenarios and information.

Conza - don't shoot yourself in the foot.  Most of these boys / ladies are gifted and knowledgeable in what they do - regardless of style.  They make money - and a lot of it in some cases.


----------



## Trembling Hand (5 June 2009)

Conza88 said:


> Old doesn't make it WRONG. Now does it?



 I didn't say that FGS!! I said that you are not telling us anything we haven't heard before.



Conza88 said:


> Theory? I love it how there are those who berate "theory", as having nothing to do with reality. No - your theory sucks if it has nothing to do with reality. There is no distinction.




Again I didn't say that theory doesn't have anything to do with reality.

Please listen.

What I am saying is you cannot name billion dollar traders and put yourself in the same "school".
You are just an unproven mug who thinks he knows enough to lecture people like myself who take $$ out of the system daily which you think you are an expert on. But you are empty.


----------



## MRC & Co (5 June 2009)

The thing is, Conzo even admits the Austrians know it WILL happen by not WHEN.  

This was my exact point of bringing Soros into the scenario, he has been stating the downfall of the situation since the early 1980s, yet we are still yet to see it.  So how will you profit from it if Soros himself has got it wrong so many times?  It's all a matter of taking an opinion on a global-macro theoretical framework and letting price proove or disproove you.  Nothing more, nothing less.  

Then you get the rhetoric about Soros being an anti-capitalist, thinking his a god, trying to interpret his books with their limited brains.  Fact is, if you understand what he is saying, you will see how open his mind is to any possibility (which is why he even constantly criticizes his own analysis which is what Gonzo tried to quote as a bad thing).  

And on the talk of Black Wednesday, perhaps understand it before you shoot your mouth off again, what most don't understand is he saved the people of England further distress, because their high currency valuation peg was causing half of their problems.   By Soros breaking this and forcing it's devaluation, he saved them numerous ongoing problems.   

Later.


----------



## Trembling Hand (5 June 2009)

Any bets on Conza's Profession. 

I got him marked in the "education" field.


----------



## awg (5 June 2009)

Hi Conzza88

May I ask if the economic theories you have drawn attention to suggest any asset class which are likely to out/under perform over the next 12 months.

Its a fairly dense thread, but I cant seem to distill this, other than you would support physical gold?

Not seeking any investment advice, fairly broad range of possibilities with answer

thanks


----------



## beamstas (5 June 2009)

Who is this guy? What a muppet


----------



## nulla nulla (5 June 2009)

beamstas said:


> Who is this guy? What a muppet




Another constructive post from beamstas. Good contribution, way to go. Maybe next time you could flesh it out with some specifics?


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## Gordon Gekko (5 June 2009)

beamstas said:


> Who is this guy? What a muppet




He may be right he may be wrong, he may have somethings to learn but he is entitled to an opinion without being made out to be an idiot.

So stop being such a prick.

G


----------



## beamstas (5 June 2009)

Now, if you want to lose all your money - buy ALL means put it back into the Stockmarket. Seriously... I'll bump this beauty when the time comes and we can all gather around the camp fire and laugh at those delusional enough to believe the propagandists and intellectual wh0re's of the State.


----------



## nulla nulla (5 June 2009)

Your posts seems a bit irrational. You should consider letting people know what you are on. That way when they have to call the medics, they can tell them what you've been taking. Might save your life one day.


----------



## beamstas (5 June 2009)

nulla nulla said:


> Your posts seems a bit irrational. You should consider letting people know what you are on. That way when they have to call the medics, they can tell them what you've been taking. Might save your life one day.




His words
Not mine

If he is going to come out with idiotic posts like that (on a share trading forum too)
Then he deserves to be questioned.

Maybe read through a topic before you jump on trying to be a white knight.


----------



## Trembling Hand (5 June 2009)

His not wrong. The theory as we all know is right and proper.

Where he has miss-stepped is the believe that, 

1. He's ahead of the curve

2. He has no actual skill for extracting money from the market - yet laughably will lecture those that have the balls to step up and do it.


----------



## Temjin (6 June 2009)

An excellent post by Steve's Keen on his thoughts with the latest GDP data.

http://www.debtdeflation.com/blogs/2009/06/05/the-pool-room–week-ending-friday-5th-june-2009/



> *The Pool Room–Week Ending Friday 5th June 2009*
> 
> Published in June 5th, 2009
> Posted by Cassander in Debtwatch
> ...





That's how the ABS play around with statistics and numbers to hide the fact that Australia is in a serious downturn. 



Of course, the general public would all believe that we aren't in one at all because the government's calculation on official GDP say so.


----------



## Timmy (6 June 2009)

Nice post Temjin, - will be reading the links etc. more closely ... initial thoughts are wondering why the ABS used revised pricing (apart from the obvious 'massage the figures' reason) and how they will justify it if questioned (which I hope they are).


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## Conza88 (6 June 2009)

MRC & Co said:


> Now who is shifting the goalposts, student?




Ah, you are right. I got mixed up with Warren Buffet. Buffet lost billions this year. _"His worst financial performance since taking over famed US investment group Berkshire Hathaway in 1965.

The group's net worth dropped by $10.9bn (£7.6bn) in the final quarter of 2008."_ I apologize.

Soros seems to appreciate the bubble has been building since the US went off the Gold standard, i.e that's the "20's" thing that was mentioned... 

His proposition he made at Davos, which is what I was criticizing originally isn't exactly a solution to the crisis.



Trembling Hand said:


> What I am saying is you cannot name billion dollar traders and put yourself in the same "school".
> 
> You are just an unproven mug who thinks he knows enough to lecture people like myself who take $$ out of the system daily which you think you are an expert on. But you are empty.




Again with the strawman. Are you a farmer or something? 

Learn to differentiate between investment and economics. Then re-consider the one I said I was fairly proficient at, and the area I said I wasn't. Then re-read your post as see if what you have said is correct and applies to me or not.


----------



## Conza88 (6 June 2009)

beamstas said:


> His words. Not mine.
> If he is going to come out with idiotic posts like that (on a share trading forum too). Then he deserves to be questioned.






Conza88 said:


> Hahah, the last part was edited in and all in jest.





Trembling Hand said:


> Any bets on Conza's Profession.
> 
> I got him marked in the "education" field.




Loss Adjuster in the Insurance Industry. International Business / Business, studying economics on the side.

What's with all the attempts at character assassination? I'm open to a reasonable civil discussion, yet I don't seem to be getting one in return? Ignoring my questions isn't exactly polite. 

Are you ever going to address those questions I raised earlier, or are you just going to take bets?



Trembling Hand said:


> His not wrong. The theory as we all know is right and proper.
> 
> Where he has miss-stepped is the believe that,
> 1. He's ahead of the curve
> 2. He has no actual skill for extracting money from the market - yet laughably will lecture those that have the balls to step up and do it.




Ok, so you think Austrian Economics is correct? _"right & proper"_ 

1. Only in terms of _economics_, and _only_ if you believe the Keynesian's & Monetarists / mainstream fools, who didn't see this coming - yet have the gall to proclaim they have the answers as to how to solve it.

i.e where this whole thread section, started from: The believe Australia avoided a recession. You can model your way out of anything with statistics. And from the very start I proposed why the model they used to say Australia is out of recession is FALSE and provided the argument for it.

Anyone address it? No - it's all about me personally, ad hominem's, attack the person, not the argument. Fist full of fallacies.

2. Strawman. I haven't done such a thing. In fact, I explicitly stated I am still learning about _investing_ and that folks here could help.  I simply stated, a better understanding of economics - the fundamental underpinnings of a market and knowledge about how it works, could be very useful to investors? I know about the Economic side fairly well. I just thought others could be interested & should be. I don't understand what the hostility is for?


----------



## Conza88 (6 June 2009)

Temjin said:


> An excellent post by Steve's Keen on his thoughts with the latest GDP data.
> 
> That's how the ABS play around with statistics and numbers to hide the fact that Australia is in a serious downturn.
> 
> Of course, the general public would all believe that we aren't in one at all because the government's calculation on official GDP say so.




 Thanks for the data and re-iterating the point that we're not out of a recession, and that governments often alter their modeling / statistics to achieve desired results.

I rejected the notion out of the fact, that _"since government’s revenue, in contrast to all other institutions, is coerced from the taxpayers rather than paid voluntarily, it is far more realistic to regard all government expenditures as a depredation upon, rather than an addition to, the national product."_ 

But it's more interesting to note that from even their own Keynesian modeling it should be considered a down turn, if they were being honest about it with the numbers!


----------



## noirua (6 June 2009)

A few congratulations from the UK after Australia avoided recession. Mind you, this singer is bound to have put the mockers on it for the next quarter: http://www.youtube.com/watch?v=oLV4c-QRKn0


----------



## Beej (6 June 2009)

> You also doesn't seem to understand the proper connection between inflation and prices. According to the Reserve Bank of Australia's figures, M3 rose 114% since June 2001 to May 2008. From 469.3 Billion to 1004.8 Billion.
> 
> There is a reason a paddle pop used to cost below $1, and now it's just below $2. Essentially doubling in price. Hint: it's not because the company got greedy. lol Housing prices are exactly the same.




Just on this - what exactly is it I don't understand? What all the Austrian-heads don't seem to understand is that what you describe above is exactly the sort of outcome that the central banks/governments of this world are trying to engineer! Inflation of 2-3% pa - nice and steady without any great troughs, deflation or peaks, + 3-4% pa of real economic/GDP growth. Ideally without interruption but dealing with the reality that growth will be interrupted from time to time and deal with these periods accordingly (as we see right now) with appropriate monetary and fiscal policy responses. This is how you provide an increasing standard of living and grow wealth over-all within an economy, without periodic depression and regular bouts of deflation as used to be the the norm in the 19th and early 20th century..... when we had the gold standard and all that.....

M3 (total money supply) is of course going to increase in line with (and actually help produce) this economic growth and limited inflation. 7% compounded M3 growth (3% inflation + 4% growth let's say) gives us an EXPECTED 83% growth in M3 anyway right? The actual growth is slightly higher, but I bet if you look at the figures in a years time they will pretty much match the growth + inflation trend due to the over-all pull back in lending from the current down-turn; exactly as would be expected, then it will accelerate again to help kick start growth once more.

A steady rate of relatively low inflation is desired as it stops people from sitting on cash for too long. Actual money is only an abstract concept anyway and the system wants to keep the money moving in the economy. Cash hording is the opposite to this. Once you realise this and accept it, I think it is clear that it is best to join the party and consume (enjoy life - get things you like thta make your life more fulfilling, comfortable, fun, whatever floats your boat) with a portion of what you earn and INVEST the rest (hopefully a fair amount!) in things other than cash (except for shorter terms), like shares, property, bonds, businesses etc etc. If you do these things inflation is your friend, not your enemy! 

I know this is so very mainstream of me!  But well - you know - that's the way the world works! You can't fight city hall - better to accept it and figure out how to make a buck/get ahead in that context, rather than just bang on about the "theroretical" flaws and injustice in the prevailing system. Key point - actual money is abstract - it's only good for what you can do with it, Ie consume, and invest to build income producing wealth through assets.

Just because the internet has suddenly enabled all the fringe idealogy to get a hearing once again does not mean the the way things actually work is likely to change anytime soon! Tell me about it again when you have convinced all the university academics that do the research for and train all the future politicians and RBA board members etc etc..... then I might be more interested! 

Cheers,

Beej


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## prawn_86 (6 June 2009)

Ok for all those with a short attention span like mine i have managed to distill this thread down:

Economics = theory and conjecture and does not explain how to make money

Investing/trading = experience and learning how to use the system to ones own advantage instead of trying to change it.

That about right Conza?


----------



## prawn_86 (6 June 2009)

Conza88 said:


> 2. Strawman. I haven't done such a thing. In fact, I explicitly stated I am still learning about _investing_ and that folks here could help.  I simply stated, a better understanding of economics - the fundamental underpinnings of a market and knowledge about how it works, could be very useful to investors? I know about the Economic side fairly well. I just thought others could be interested & should be. I don't understand what the hostility is for?




You will find that economics and succesful investing have very little correlation. Economics seems to more concerned with forecasting from historical data, whereas the share market is a leading indicator. Individual stocks do not behave rationally or as they should in 'theory' hence why the study of economics is not that useful.


----------



## MR. (7 June 2009)

Beej said:


> The housing market is complex though and simplistic Austrian idea's will never provide you with decent entry/exit signals IMO, especially for something as specialised as a purchase in a specific suburb/city, and with such high costs of entry/exit plus even a high cost of not being in the market (ie rent!). If that is what you are looking for - all they will tell you is to never enter the market! Riiiighhhht....... I mean *if you can't pick an inevitable stock market correction to within +/- 5 years when they occur roughly every 10 years, what hope do you have to time a major housing market correction when they have happened (in a serious way - Ie more than 20% nominal price falls) maybe only 2 or 3 times in the past century?*? Anyway good luck with that one - but I am very confident now that this period in history is NOT the time when the AU housing market is going to see any major correction - the opportunity for a systemic financial crisis to trigger that has passed - so maybe if you wait another 10, 20 or 30 years you might be proven correct
> Cheers,
> 
> Beej




Perhaps a little exaggerated! Could you not assume an inevitable stock market correction was on the cards? Come-on. It was pretty clear. Staying out all together (ie +/- 5 years) isn't the solution, do agree, but we had a nice old run didn't we, 16 years wasn't it!  .......   

Somehow Australia is still going to avoid a major correction in the property market and what? Another 10, 20 or 30 years perhaps now are needed. With property leveraged in Australia of some of the highest in the world and with worldwide prices falling, blah blah blah, you heard it all before......  

1. How exactly did stock investors sound before the stock market crash?
2. What did the property investors speak after the 1987 crash? .... What did it take "a year longer"?

We all see the risks (not just in property), so it’s all about the timing.........  

Of some interest 48 minutes “Property”
http://video.google.com/videoplay?docid=2696194771594185697&hl=en


----------



## Bushman (7 June 2009)

beamstas said:


> (on a share trading forum too)
> Then he deserves to be questioned.
> 
> Maybe read through a topic before you jump on trying to be a white knight.




Since when did the ASF become a 'share trading forum'?


----------



## nunthewiser (7 June 2009)

prawn_86 said:


> Economics = theory and conjecture and does not explain how to make money
> 
> Investing/trading = experience and learning how to use the system to ones own advantage instead of trying to change it.





amen


----------



## Green08 (7 June 2009)

Up the creek with one paddle.

Let's see the biceps and balance steer this current - the ride should be one to remember. The rapids are well ahead of the route yet.


----------



## moXJO (7 June 2009)

Seeing some skittish bond traders about with the massive amount coming to market. Will the powers that be tank the market to move people to bonds, and soak up the debt?



> What's happening in bond land? The latest US govt bond auction was for $110 billion. Two years ago the average monthly bond auction total was $5 billion, $10 billion, numbers like that. The US govt finances its debt with bonds. A $2 trillion deficit means $2 trillion in new bonds needs to be issued. Approx. $200 billion a month.


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## MRC & Co (7 June 2009)

moXJO said:


> Seeing some skittish bond traders about with the massive amount coming to market. Will the powers that be tank the market to move people to bonds, and soak up the debt?




Yes, this is the one that is very interesting to watch, the correlation between Treasuries and equities........

I thought we would see a Treasury rally with the USD rally, but it's yet to be seen.  Obviously, this QE problem, along with inflation (potential for negative real interest rates) are a real concern at the moment for bond holders who are pushing up yields (though, these same factors should be an issue for USD holders).

Looks like the potential factoring in of an economic recovery is the difference with the better than expected jobs data.  This would give rise to the USD and a fall in Treasuries.  Ultimately, we should by this logic, see a further rise in equities........


----------



## Conza88 (12 June 2009)

prawn_86 said:


> Ok for all those with a short attention span like mine i have managed to distill this thread down:
> 
> Economics = theory and conjecture and does not explain how to make money
> 
> ...




No, but good effort. The thread went like this.


OP starts thread with an economic point, not investment. "Australia is not in a recession".
Others agree and "LOL @ the coming doomsayers"
I understand Keynesian / mainstream economics, and it is fundamentally retarded, built on modeling with amazingly flawed premises and assumptions. Keynes wasn't an economist, he was a witch doctor. If you have read his General Theory, you'll understand what bs it is. Citing humans "animal spirits" was the best he could come up with. These clowns had no idea the crisis was coming, so I take issue with them pronouncing it is over / we're not in a recession.
I enter the thread, for I am somewhat proficient at economics. I make the point attacking the very premise of the figures and their foundation in reality. In jest, I get rhetorical and add some fiery words at those foolish enough to think we were out of a recession. That 'this whole crisis must be over'.
 No-one addresses the economic argument put forward, which destroys the notion we're out of a recession. Instead it is ignored, as the thread devolves as several folks take issue with me highlighting some prominent investors faults, in response to a post - 'that if THEY didn't see it, then no-one could have.' The focus continued to shift onto me personally, my personal investment style, what I do as a profession etc. Ad hominem's and fallacies galore.
 Temjin posts good info, confirming - govt fudged numbers and even by their own flawed modeling, they're not out of a recession.

That about right?

As far as Economics - if it is built of axioms & apriori reasoning (Austrian Economics), then it can give profound truths about the world and where the market will be heading, since the market is affected by government intervention & it's policies. It can give entrepreneurs & investors an insight into what the market will do, that they wouldn't otherwise have with all the other flawed and fallacious schools of economic thought.

*Why Austrian Economics Matters * - gives a good concise overview. It's "theory" is more of an explanation and it is correct. Again, there is a reason they said all this mess was coming - because they have the correct theory. And it describes reality. No other school does.

Investment - if it's Graham style investing sure. Where you fail is that you believe there needs to be a dichotomy between the two, which is completely wrong. Economics and Investment can compliment eachother. Furthermore, Austrian Economics is value free, it describes what IS. 

Classical Liberalism, or Libertarianism in political philosophy - moves to what OUGHT to be.


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## Conza88 (12 June 2009)

MRC & Co said:


> The thing is, Conzo even admits the Austrians know it WILL happen by not WHEN.




*The Fortune Tellers*

"The question is often asked, in James Buchanan's famous phrase, What Should Economists Do? Mainstreamers answer, in part: forecast the future. This goal is legitimate in the natural sciences, because rocks and sound waves do not make choices. But economics is a social science dealing with people who make choices, respond to incentives, change their minds, and even act irrationally.

Austrian economists realize that the future is always uncertain, not radically so, but largely. Human action in an uncertain world with pervasive scarcity poses the economic problem in the first place. We need entrepreneurs and prices to help overcome uncertainty, although this can never be done completely.

Forecasting the future is the job of entrepreneurs, not economists. This is not to say that Austrian economists cannot expect certain consequences of particular government policies. For example, they know that price ceilings always and everywhere create shortages, and that expansions of the money supply lead to general price increases and the business cycle, even if they cannot know the time and exact nature of these expected events."



> This was my exact point of bringing Soros into the scenario, he has been stating the downfall of the situation since the early 1980s, yet we are still yet to see it.  So how will you profit from it if Soros himself has got it wrong so many times?  It's all a matter of taking an opinion on a global-macro theoretical framework and letting price proove or disproove you.  Nothing more, nothing less.




As have the Austrians. And we are in the process of seeing it. Soros is not a God, he is not omniscient, so I don't see why you continue to give him such attributes? 

It's not a matter of _"opinion on a global-macro theoretical framework"_, it's a matter of logical deductions and economic reasoning built on premises that are correct. He "has got it wrong so many times", because he doesn't properly understand completely alternative models, nor the current one. Or he has, and bet against it and lost. i.e Russia. But winning sometimes, Ei.e Pound. 

_"letting price proove or disproove you. Nothing more, nothing less."_ - You mean empirically play out, right? Wouldn't that be the Austrians explaining everything years before, that it would - and is currently taking place, as they said it would?

Or do you mean to adhere to the fallacy, if you're not rich, you're wrong? If I'm Bill Gates with billions (because I provided a service to people), then my word on any given issue is unquestionable? Is that it? 



> Then you get the rhetoric about Soros being an anti-capitalist, thinking his a god, trying to interpret his books with their limited brains.  Fact is, if you understand what he is saying, you will see how open his mind is to any possibility (which is why he even constantly criticizes his own analysis which is what Gonzo tried to quote as a bad thing).




Of course, open to persuasion - as am I. Nothing is worse than a closed mind. This furthers my point, he should learn about Austrian Economics... as should everyone else here in my opinion. You could better protect yourself assessing risk, and earn more by being able to correctly read the business cycle and attempt to assess it's points, of where it is in the cycle.



> Later.




Kthxbye.


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## Trembling Hand (12 June 2009)

Conza you are a ripper.

There is not a trader here that actually makes money who would gives a toss about what the Gov says happened last quarter.

The thread was a throw away tongue in cheek comment.


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## MRC & Co (12 June 2009)

LOL

I feel sorry for anybody who listens to this drivel.


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## MRC & Co (12 June 2009)

Let me first state, I bought Soros into this argument because he is a GREAT trader, far superceeding anybody of which you subscribe too.  Now, the point was that if he KNEW the downfall was coming and could not time his exit, how could you?  I guess you wouln't as you would not be in the bull market since the 1980s?  Now to the rest of this BS.

_Austrian economists realize that the future is always uncertain, not radically so, but largely. Human action in an uncertain world with pervasive scarcity poses the economic problem in the first place. We need entrepreneurs and prices to help overcome uncertainty, although this can never be done completely._

Read Soros book.

_As have the Austrians. And we are in the process of seeing it. Soros is not a God, he is not omniscient, so I don't see why you continue to give him such attributes? _

I am not, you are doing so on my behalf.  Read first paragraph of why I bought him into the arguement.

_It's not a matter of "opinion on a global-macro theoretical framework", it's a matter of logical deductions and economic reasoning built on premises that are correct. He "has got it wrong so many times", because he doesn't properly understand completely alternative models, nor the current one. Or he has, and bet against it and lost. i.e Russia. *But winning sometimes*, Ei.e Pound_. 

Whey even state such BS?  Logical deductions and economic reasoning built on a premise that are correct is complete and utter rhetoric when it comes to the market.  And winning SOME of the times, are you serious?  Where are your billions?  You formulate a theory and it prooves you right, or disprooves you, that leads to the next paragraph:

_"letting price proove or disproove you. Nothing more, nothing less." - You mean empirically play out, right? Wouldn't that be the Austrians explaining everything years before, that it would - and is currently taking place, as they said it would?_

You mean empirically play out, right?  WTF, try hard academic.  Explaining everything years before it played out and missing an entire bull market and the opportunity to cut and reverse.

_Or do you mean to adhere to the fallacy, if you're not rich, you're wrong? If I'm Bill Gates with billions (because I provided a service to people), then my word on any given issue is unquestionable? Is that it? _

Soros is rich because of the markets, we are talking about the markets and not a textbook right? 

_Of course, open to persuasion - as am I. Nothing is worse than a closed mind. This furthers my point, he should learn about Austrian Economics... as should everyone else here in my opinion. You could better protect yourself assessing risk, and earn more by being able to correctly read the business cycle and attempt to assess it's points, of where it is in the cycle._

Open to persuasion?  L O L.  He should learn about economics to better protect himself assessing risk and miss all the profits in the mean-time?  And to more correctly read the business cycle?  Which one?  The one that was in the contraction phase in 1982 or in the early 2000s, both JUST before the biggest bull markets we have EVER witnessed?  

DO YOU UNDERSTAND WHAT YOU ARE TALKING ABOUT?  OBVIOUSLY NOT.  SORRY TO THE MAN THAT EVEN LISTENS TO YOUR ACADEMIC BS.

BTW, I have an economics degree, yet I am still ignorate to many things, as are you, as are the Austrians.  Hence, you are not an open mind as you are not a trader.

Now let's go get two of the greatest traders of all-time confused (Soros and Buffett), no idea how ANY trader would do that.  But I can see how an academic could.  More concerned about being right, than about trading the markets.


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## Conza88 (12 June 2009)

Trembling Hand said:


> Conza you are a ripper.
> 
> There is not a trader here that actually makes money who would gives a toss about what the Gov says happened last quarter.
> 
> The thread was a throw away tongue in cheek comment.




Haha, _good_. 

And MRC, mate, you've misunderstood basically everything I said in that post. Shame


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## Trembling Hand (13 June 2009)

Conza it seems you have much "invested" into your school so its hard, maybe even fruitless, to argue but I will give it a go.


Conza88 said:


> As far as Economics - if it is built of axioms & apriori reasoning (Austrian Economics), then it can give profound truths about the world and where the market will be heading, since the market is affected by government intervention & it's policies. It can give entrepreneurs & investors an insight into what the market will do, that they wouldn't otherwise have with all the other flawed and fallacious schools of economic thought.




The problem I and I would think most practitioners of the markets have with your thinking is that you think you are ahead of the curve. That your knowledge of "government intervention & it's policies" give you an advantage of what the markets SHOULD do. But I would gladly bet against you that a trader would run rings around you in that regard. Around all of your Austrian friends. 

Infact your theory, if you are honest with us, is exactly what I am saying. Is it not true that the basis of your Austrian School of Eco is that boffins, bureaucrats and economist are the MOST useless at pricing and finding opportunity. The true masters of the economy and where it is heading are the entrepreneurs?



Conza88 said:


> Again, there is a reason they said all this mess was coming - because they have the correct theory. And it describes reality. No other school does.



 Thats laughable but the quote from your own article sums it up best,



> http://mises.org/about/3224
> *Forecasting the future is the job of entrepreneurs, not economists*. This is not to say that Austrian economists cannot expect certain consequences of particular government policies. For example, they know that price ceilings always and everywhere create shortages, and that expansions of the money supply lead to general price increases and the business cycle, *even if they cannot know the time and exact nature of these expected events.*



Exactly, that is what traders DO.




Conza88 said:


> Investment - if it's Graham style investing sure. Where you fail is that you believe there needs to be a dichotomy between the two, which is completely wrong. Economics and Investment can compliment each other. Furthermore, Austrian Economics is value free, it describes what IS.



 It does not describe how to trade a bubble.


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## beamstas (13 June 2009)

Conza, 
Let me take a punt here;

You are aged 18-25.
You are doing a uni degree in economics OR have recently completed one.
You think your economics degree makes you king of the markets AND you know more than everyone including George Soros who is the most successful trader of all time.
You are not a profitable trader.
When you trade you concentrate on one thing - being right. 

How many out of 5 did i get 
Brad


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## nomore4s (13 June 2009)

> Again, there is a reason they said all this mess was coming - because they have the correct theory. And it describes reality. No other school does.




Big difference between theory & practical application imo, and you are yet to show any way to apply your theories to actually make money.


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## Conza88 (13 June 2009)

Trembling Hand said:


> Conza it seems you have much "invested" into your school so its hard, maybe even fruitless, to argue but I will give it a go.




What have I got "invested" in it? Please enlighten me? I said I am autodidactic. There has been no massive monetary investment. The only thing I am "invested" in is the _truth_ and_ justice_.  I could level the EXACT same criticism back at you and the rest of the tribe.



> The problem I and I would think most practitioners of the markets have with your thinking is that you think you are ahead of the curve. That your knowledge of "government intervention & it's policies" give you an advantage of what the markets SHOULD do. But I would gladly bet against you that a trader would run rings around you in that regard. Around all of your Austrian friends.




Economic Laws are like gravity. They can't be avoided for long, and the more you do - the greater the pain will be. How did most traders go when the Tech Bubble burst? Housing Bubble? 



> Infact your theory, if you are honest with us, is exactly what I am saying. Is it not true that the basis of your Austrian School of Eco is that boffins, bureaucrats and economist are the MOST useless at pricing and finding opportunity. The true masters of the economy and where it is heading are the entrepreneurs?




You are going to have to make what you are saying clearer. Thanks. And you should probably stop using "theory" as a jibe. If your theory doesn't work in the real world, then it is a **** theory and wrong. "Good in theory" - is completely retarded and fallacious. The separation between theory and reality is wrong. Btw, the Austrian School doesn't have that problem - which all others do.



> Thats laughable but the quote from your own article sums it up best




'No other "SCHOOL" does.' Economic SCHOOL of Thought. No other SCHOOL did. Why is this so hard to understand? Why do I feel like I am addressing children, when I'm clearly not? 



> Exactly, that is what traders DO.




That is a part of my god damn POINT! What I find hilarious is you think I contradicted myself. Haha.. Yes, that is what they DO. They allocate capital, just an entrepreneurs do. And they would be better at it, if they also understand the laws of Economics. 

Do you not think, Economics should have ANY relevancy to investing at all? You don't think economic reality is a factor, not one iota? You don't think someone should consider what is happening in the agriculture industry, if there is going to be a policy passed, Carbon trading scheme? An increased tax for the coal industry? etc.. before investing?  

You don't think it would be beneficial to realise the ramifications of such policies and the affect they will have? You don't think that the unintended consequences created by government intervention, doesn't provide unique opportunities for those in the know? Entrepreneurs can't benefit from such instances? 



> It does not describe how to trade a bubble.




Nor is it meant to. See above para. I mean REALLY, you don't think any of that is relevant, or beneficial?


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## Conza88 (13 June 2009)

beamstas said:


> Conza,
> Let me take a punt here;
> 
> You are aged 18-25.
> ...




Beamstas, 2.
Let me take a punt here;


You don't understand that age has no correlation with the truth?
You don't understand that a uni degree in economics, doesn't contain Austrian Economics, for the precise reason the "intellectuals" have the wrong epistemology in the social sciences, and that this is part of the reason the world is in the mess it is in. 
You didn't see me openly proclaim I don't profess to know more than people here about investing and trading.
You don't realise that monetary gains, achieved through government intervention in the market are ill gained, and also don't translate to the truth.  

How many did i get 
Conza


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## Conza88 (13 June 2009)

nomore4s said:


> Big difference between theory & practical application imo, and you are yet to show any way to apply your theories to actually make money.




Excuse me?



Conza88 said:


> This article will outline precisely what I am talking about. Since a few here seem to have an aversion to theory, this doesn't contain any. It's all real world events, pragmatic, blah blah - with the correct theory implicit behind it.
> 
> *The Banker who Said No - Forbes*
> *"While the nation's lenders ran amok during the boom, Andy Beal hoarded his money. Now he's cleaning up--with scant help from Uncle Sam...."*
> ...


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## prawn_86 (13 June 2009)

Conza88 said:


> You don't realise that monetary gains, achieved through government intervention in the market are ill gained, and also don't translate to the truth.




LOL!!! 

So you dont make any money at all Conza, because to do so would be supporting the current system and means its ill-gained.

Instead of trying to change the rules, why not work within them.

I couldnt care if its 'the truth' or not, as long as i have enough to live comfortably, then why should i give a toss?

And im sure you will go and write some essay as an answer trying to baffle people, but really no one here cares too much. We would rather make money.

Simple question - How do *YOU *plan on making money from this? And in what time frame?


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## beamstas (13 June 2009)

Conza88 said:


> Beamstas, 2.
> Let me take a punt here;
> 
> 
> ...




You still didn't answer my question.


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## Trembling Hand (13 June 2009)

Conza88 said:


> Do you not think, Economics should have ANY relevancy to investing at all?
> 
> You don't think it would be beneficial to realise the ramifications of such policies and the affect they will have? You don't think that the unintended consequences created by government intervention, doesn't provide unique opportunities for those in the know? Entrepreneurs can't benefit from such instances?




Conza I understand what you are saying. But its all useless for taking to the market Monday morning and taking money out of it. It really is.Its just common sense stuff but its why you are in gold since March not oil or bank stocks.

And I can prove it. I can prove that I know the system better than you. We can open accounts with any amount over any time and I will blow you out of the water with return.

Why?

Because you know how a car is put together and "should" perform under certain conditions, just an engineer or mechanic. I also know how it is put together & performs BUT I also know how to race it. 

*Being a mechanic is a world away from being a racer* :


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## Conza88 (13 June 2009)

prawn_86 said:


> LOL!!!
> 
> So you dont make any money at all Conza, because to do so would be supporting the current system and means its ill-gained.
> 
> Instead of trying to change the rules, why not work within them.




You have the wrong definition of 'ill-gained'. For eg. Mercantilism, ie. using coercion to achieve your monetary gains, is more accurate. And it depends on what you mean by the current system. 

You _can_ work within the rules, whilst also advocating they be changed. See: Peter Schiff, Jim Rogers, Mish etc.



> I couldnt care if its 'the truth' or not, as long as i have enough to live comfortably, then why should i give a toss?




Would you care if it was unjust? Ie. Would you care if, you had to be a concentration camp director or guard? Or: _"as long as i have enough to live comfortably, then why should i give a toss?"_



> And im sure you will go and write some essay as an answer trying to baffle people, but really no one here cares too much. We would rather make money.




Haha, not exactly trying to baffle people...  

*Living in a State-Run World*

_"Does that mean that all libertarians can cheerfully work for the government, apart from not lobbying for statism, and forget about conscience in this area? Certainly not. For here it is vital to distinguish between two kinds of State activities: (a) those actions that would be perfectly legitimate if performed by private firms on the market; and (b) those actions that are per se immoral and criminal, and that would be illicit in a libertarian society. The latter must not be performed by libertarians in any circumstances. Thus, a libertarian must not be: a concentration camp director or guard; an official of the IRS; an official of the Selective Service System; or a controller or regulator of society or the economy.

Let us take a concrete case, and see how our proffered criterion works. An old friend of mine, an anarcholibertarian and Austrian economist, accepted an important post as an economist in the Federal Reserve System. Licit or illicit? Moral or immoral? Well, what are the functions of the Fed? It is the monopoly counterfeiter, the creator of State money; it cartelizes, privileges and bails out banks; it regulates””or attempts to regulate”” money and credit, price levels, and the economy itself. It should be abolished not simply because it is governmental, but also because its functions are per se immoral. It is not surprising, of course, that this fellow did not see the moral problem the same way.

It seems to me, then, that the criterion, the ground on which we must stand, to be moral and rational in a state-run world, is to: (1) work and agitate as best we can, in behalf of liberty; (2) while working in the matrix of our given world, to refuse to add to its statism; and (3) to refuse absolutely to participate in State activities that are immoral and criminal per se." _​


> Simple question - How do *YOU *plan on making money from this? And in what time frame?




The artificial boom is over, the bust has just started. I'd look at food, agriculture & commodities. Long term is the time frame. Short financials _(But see the problem is, government intervention - banks should have gone bust, but the bailouts (keep these zombies alive) propping them up for a longer time, so it's risky.)   _

Part of the rational below:

*Why Agriculture Commodities Are The Best Place To Invest - Jim Rogers*
"The world has been consuming more than it produced. Food inventories are at a multi-decade low. And we haven't had any bad weather. We had isolated cases of droughts and things. That may never happen again. But if it does, the prices of food would go through the roof.

If there is climate change taking place, the best way to participate is through agriculture or through agriculture products. There are many positive things happening. Right now, there is a shortage of everything in agriculture ”” seeds, fertilisers, tractors, tractor tyres. We have a shortage of farmers because farming has been a horrible business for the past 30 years."​
​


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## Conza88 (13 June 2009)

beamstas said:


> You still didn't answer my question.






Conza88 said:


> Beamstas, 2.



You still didn't answer my question.



Trembling Hand said:


> Conza I understand what you are saying. But its all useless for taking to the market Monday morning and taking money out of it. It really is.Its just common sense stuff but its why you are in gold since March not oil or bank stocks.




Again, the fallacy of conflating what I have done personally with an entire school. You REALLY need to get past that. Who has said, all you can do is take money out of it? Again for  the blind, deaf and dumb - See: Schiff, Rogers, Mish etc.



> And I can prove it. I can prove that I know the system better than you. We can open accounts with any amount over any time and I will blow you out of the water with return.




And Jim Rogers, Peter Schiff would blow you out of the water with return. What have you refuted? Nothing. Good try but.  And again, you could go on to try cite bigger gainers, yet the fallacy still remains. Funny that.



> Why? Because you know how a car is put together and "should" perform under certain conditions, just an engineer or mechanic. I also know how it is put together & performs BUT I also know how to race it.
> 
> *Being a mechanic is a world away from being a racer* :




To continue with this analogy. No, see you'd like to think you know how it performs better than the "mechanic", but you don't. (Economics) A racer doesn't necessairly know how the car is put together, but yes - he can race it better than the mechanic. (Entrepreneur / Investor). If the "track" is money, which it obviously is.

The kicker is - as a mechanic, I can tell if the car is about to fall apart, and the next time you race it, or experience overstear, understeer - you're going to crash, the breaks will buckle and you'll end up splattered against a tree.

The reality is - you can be a better racer, i.e Mick Doohan IF you ALSO KNOW THE MECHANICS.

_"Despite up to eight rivals on almost identical Honda motorcycles Doohan's margin of superiority over them was such that in many races Doohan would build a comfortable lead and then ride well within his limits to cruise to victory. Although pure riding skill clearly played a large part in his success, his ability to perfect the suspension and geometry of a racing motorcycle gave him an enormous advantage over his rivals, even though other Honda riders (particularly Doohan's teammates) benefited somewhat from his ability to perfect the bike's handling."_​
So, as we can clearly see in this analogy, the best and 5 time world champions are those that have a combination of mechanics (Economics) and racing skills experience (Investment / trading / Entrepreneurship) 

Which, has been my point ALL along, and that of which I have not deviated. Again, I am struggling to comprehend the derision and opposition here...


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## nomore4s (13 June 2009)

Conza88 said:


> Excuse me?






> he owns 100% of the bank and is acting accordingly.




lol, you give a link to some banker who is now currently killing it. Great if you own a bank! Do you own a bank? Cause I don't, so more useless info.



> "I thought it would end in six months, and sanity would return," he says. "If I knew it would last nearly four years I would have thought of something else to do."



lol, the fact he mistimed the market by such a large amount of time also points to how your theories are nearly impossible to actually trade or invest with. For the average Joe to have missed nearly 4 years of the biggest bull market ever isn't very good advice. There are people on these forums that rode the bull up, made money on the short side down and have made very good money on the long side again in the last 4 months.

You just keep spending time on your theories while we keep concentrating on actually pulling money from the markets.


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## Trembling Hand (13 June 2009)

Conza88 said:


> And Jim Rogers, Peter Schiff would blow you out of the water with return. What have you refuted? Nothing. Good try but.  And again, you could go on to try cite bigger gainers, yet the fallacy still remains. Funny that.




Two thinks.

1. No they haven't as a % return. But they are in another league as far as $$. 

2. This is the really annoying load of toss that you keep spewing up is your association to them? WTF?? They are traders first and foremost. You are nothing! They develop and implement and profit from their own Ideas you try to align yourself with them 

You have to be kidding? So with all you knowledge of the mechanics of the car You post a YouTube link on how someone wants to drive?? 

*You don't even know what you don't know*. That is why you align yourself with others, *you have nothing unique to offer*. You are a beginner.


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## Conza88 (13 June 2009)

nomore4s said:


> lol, you give a link to some banker who is now currently killing it. Great if you own a bank! Do you own a bank? Cause I don't, so more useless info.




No, I give you a link that completely destroyed your statement. You've then moved the goal posts. Originally requiring an example of real world application, I showed you exactly that. Cry me a river.



> "I thought it would end in six months, and sanity would return," he says. "If I knew it would last nearly four years I would have thought of something else to do."
> 
> lol, the fact he mistimed the market by such a large amount of time also points to how your theories are nearly impossible to actually trade or invest with.




The fact that he is now killing it, destroys your theory _"impossible to actually trade or invest with."_



> For the average Joe to have missed nearly 4 years of the biggest bull market ever isn't very good advice. There are people on these forums that rode the bull up, made money on the short side down and have made very good money on the long side again in the last 4 months.
> 
> You just keep spending time on your theories while we keep concentrating on actually pulling money from the markets.








And what school of thought gives that advice?


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## Conza88 (13 June 2009)

Trembling Hand said:


> Two thinks.
> 
> 1. No they haven't as a % return. But they are in another league as far as $$.




It'd be good to know what that % is. And generally, they're in a bigger league as far as $$ because they have made better % returns previously / have a reputation for being spot on?



> 2. This is the really annoying load of toss that you keep spewing up is your association to them? WTF?? They are traders first and foremost. You are nothing! They develop and implement and profit from their own Ideas you try to align yourself with them




Schiff is a follower of the Austrian School of Economics. Same with the others, Shostak, Leithner etc. that is why. 

The exact thing you keep saying investors have no need for. _lmao_



> You have to be kidding? So with all you knowledge of the mechanics of the car You post a YouTube link on how someone wants to drive??




Kidding about what? Do you want me to personally write a report on the fundamentals of the Australian economy or something? Sure, I'll do it for you - if you pay me. I don't particularly see a need considering, there are those that have already done it for me, and I agree with the analysis. See Leithner. And more to the point; it is like footnoting, you keep pawning it of as if this is just me, some crackpot spewing theories that have never been proven -- yet that is fundamentally fallacious, wrong and primarily retarded. So I back up what I've been saying, with the words of others, it makes it so much harder for the clowns to outright dismiss it. 



> You don't even know what you don't know. That is why you align yourself with others, you have nothing unique to offer. You are a beginner.




I do know what I don't know, and that is part of wisdom. _"Real knowledge is to know the extent of one's ignorance." _- Confucius

I have openly stated, I am relatively new to investing / trading, but not to economics. I admit I am a beginner, in one area, yet you won't in another. Whose being intellectually honest? Eh? I don't align myself with others, I simply point out that there are others that believe in this school of economic thought, they adhere to it, they run Hedge funds, own investment firms and are amazingly successful - it is a complete refutation or your attempts to attack and belittle me personally, and try drag down the School of thought with me, to dismiss it entirely, out of hand.


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## prawn_86 (13 June 2009)

Conza88 said:


> It'd be good to know what that % is. And generally, they're in a bigger league as far as $$ because they have made better % returns previously / have a reputation for being spot on?




Conza,

Here is just one of many examples TH has posted of his ability and % returns:
https://www.aussiestockforums.com/forums/showthread.php?t=12683


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## Trembling Hand (13 June 2009)

Conza88 said:


> I have openly stated, I am relatively new to investing / trading, but not to economics. I admit I am a beginner, in one area, yet you won't in another. Whose being intellectually honest? Eh? I don't align myself with others, I simply point out that there are others that believe in this school of economic thought, they adhere to it, they run Hedge funds, own investment firms and are amazingly successful - it is a complete refutation or your attempts to attack and belittle me personally, and try drag down the School of thought with me, to dismiss it entirely, out of hand.




Thats because I'm not new to economics. I have been a *practising *entrepreneur all my working life through my OWN business and trading. I have spent less than 10% of my life working for the man. I live and practise ECONMICS.

You read books!!

Enough said.


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## MRC & Co (13 June 2009)

Conza88 said:


> Economic Laws are like gravity. They can't be avoided for long, and the more you do - the greater the pain will be.




LOL.

And you do understand that Jim Rogers was a partner but JR and analyst, to Mr Soros?  And that Soros has ALWAYS believed in regulation to correct market flaws but Rogers believes in pure free markets?  

Your entire arguement is based on mis-information.  

BTW, why would traders loose in crashes?  Many take the short side and make a mint, it's one of the best times for most shorter timeframe traders (such as intraday) as initial turning points in a boom/bust sequence are characterised by increases in volatility (just look at the VIX).


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## Mr J (13 June 2009)

Conza88 said:


> It'd be good to know what that % is. And generally, they're in a bigger league as far as $$ because they have made better % returns previously / have a reputation for being spot on?




I'm just going to jump in here and point out that Rogers and Schiff are not traders. Rogers regularly points this out. A trader should be able to achieve a much better return than an "investor", since they're trading on a far faster timescale.

Rogers and Schiff are certainly not spot on, and Rogers admits it. Schiff has been warning us about the end of the world for a good 7-8 years. Apparently he hasn't performed so well since his predictions started coming true, which brings up a couple points of interest. 

First, successful predicting does not equal successful trading. It's very common for people to be "right" while still losing on their trades. A good economist does not necessarily make a good trader (in fact most economists are horrible traders), and one does not need to have a solid understanding of economics to be a good trader. They're two different activites.

Second, timeframe. Some might say that Schiff's strategies haven't had enough time to play out, and that his current poor performance can very well still come good. This may be true, but while he's waiting, a good trader has made a small fortune. 

Should we ignore that he has never indicated a timeframe for all of this? I might as well say roulette, red 36. It will come up eventually, and I'll be able to say "I told you so". This crisis was certainly not unpredictable, and Schiff has just happened to be one of the loudest opposing voices. Yes, a little credit for picking the inevitable crash, but it's of little use for trading.

I'm not trying to attack Schiff, but I don't see how his name can be used as an argument for being right. I also question, if he's so successful, why he runs a brokerage rather than a managed fund.

Rogers we know is in it for the long haul and will take longer to play out, but again, while we wait for that to happen, a small but good trader has made a small personal fortune.



> Schiff is a follower of the Austrian School of Economics. Same with the others, Shostak, Leithner etc. that is why.




Not all Austrians have the same point of view.


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## beamstas (13 June 2009)

I'd love to see TH and Conza go head to head on a live trading account.

Let's make it a fair game though. TH gets 1 week to trade and Conza gets 10 years to trade. 

My  is on TH still.


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## MRC & Co (13 June 2009)

MRC & Co said:


> LOL.
> 
> And you do understand that Jim Rogers was a partner but JR and analyst, to Mr Soros?  And that Soros has ALWAYS believed in regulation to correct market flaws but Rogers believes in pure free markets?
> 
> Your entire arguement is based on mis-information.




Oh and before you rip into Soros advising the liquidity pump into the banks, you may want to see he is a believer in human behaviour driving fundamentals and hence, boom/bust sequences.  He believes regulation should be in place to stop such blow-outs and that expansion of credit and liquidity need to be controlled and balanced with economic growth and trade balances and currencies need to be controlled or you get situations of unhealthy blowouts (which ended in the recent bust).  

Rogers, on the other hand, is a free markets man.  

Do you understand you are ripping into a man who is MUCH closer to your school of though (in Soros) and praising a man who does not believe in just about ANYTHING you have stated (in Rogers)?  

Oh and Rogers took 16mil out of Quantum fund worth 381mil when he left.  Very very little in the scheme of things.

He then went on to make huge gains on commodities and held them the entire way down.  Soros owns nearly the entire worth of Quantum fund now, in excess of 11bil and has given away 6bil since the 70s (that haven't been compounded, which would make him the richest man in the world).  Soros sold out of commodities and bought huge stakes in energy and metals near the bottom. 

Enough said.  

Try understanding what you are talking about and how successful traders apply it, before assigning traits and theories to certain people with such firm conviction.


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## skyQuake (14 June 2009)

Conza88 said:


> Economic Laws are like gravity. They can't be avoided for long, and the more you do - the greater the pain will be. How did most traders go when the Tech Bubble burst? Housing Bubble?




I think most _traders_ who know what they're doing did quite well out of it.

Disagree on econ laws being like gravity. Please provide a proper example of such.
Equity markets can ignore even the most basic econ rules. Supply and Demand graph for example; When prices go up demand should fall, supply should rise  however Demand can go up instead _momentum_ etc.. its a gross generalisation but econ will tell u nothing about how that just happened or why that happened other than the usual more supply than demand or more demand than supply stuff.


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## Uncle Festivus (14 June 2009)

skyQuake said:


> I think most _traders_ who know what they're doing did quite well out of it.
> 
> Disagree on econ laws being like gravity. Please provide a proper example of such.
> Equity markets can ignore even the most basic econ rules. Supply and Demand graph for example; When prices go up demand should fall, supply should rise however Demand can go up instead _momentum_ etc.. its a gross generalisation but econ will tell u nothing about how that just happened or why that happened other than the usual more supply than demand or more demand than supply stuff.




Economic laws don't really mean much currently, as most things are being manipulated to suit an outcome ie have a look at the Dow chart for the last 10 days. Hedge funds will push or pull a price depending on which way the wind blows, without much regards for fundamentals either eg the oil price - do we have an oil glut; is there 100m barrels of oil sitting in tankers? Doesn't matter, the market thinks there will be a recovery and is second guessing again, pre-empting a possibility?

It's become an even bigger money shuffling flip flop excercise the last 4 months as markets re adjust to some sort of manipulated price discovery system without the usual number of market participants to counter any particular trend by those who simply can make the trend _their_ friend!

We are in recession, despite whatever the technical definition is, and the apparently flawed way in which the last set of figures were calculated. You only have to look at the State's budget's having to sell off more of the farm just to break even - clearly unsustainable in even the medium term - indicating some severe structural abnormalities that need to be addressed.


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## Aussiejeff (14 June 2009)

Uncle Festivus said:


> We are in recession, despite whatever the technical definition is, and the apparently flawed way in which the last set of figures were calculated. You only have to look at the State's budget's *having to sell off more of the farm just to break even - clearly unsustainable in even the medium term - indicating some severe structural abnormalities that need to be addressed.*




Or, maybe we could just BULLDOZE THE FARM like Unca ObamaSan will be forced to do? 



> *DOZENS of US cities may have neighbourhoods bulldozed as part of drastic "shrink to survive" proposals being considered by the Obama Administration to tackle economic decline.*



http://business.theage.com.au/business/us-cities-bulldoze-their-way-to-survival-20090613-c6r9.html

Of course, the myopic, inward-looking US could always adopt an ETERNAL GROWTH strategy (like good ol' OZ), instead of BULLDOZING their way to oblivion, by opening up Fortress USA to easy-peasy mass immigration (like good ol' OZ!) 

Instead of manning the Mexicano Border, them good ol' Yankees jest need a flood of good ol' cheep-cheep peasantry to work tha good ol' land for 'em!   :hide:


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## doctorj (14 June 2009)

Aussiejeff said:


> Them good ol' Yankees jest need some cheep-cheep peasantry to work tha land for 'em!   :hide:



That's exactly why, despite all their huffing and puffing, they're not all that concerned about illegal mexicans.


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## Trembling Hand (14 June 2009)

Uncle Festivus said:


> Economic laws don't really mean much currently, as most things are being manipulated to suit an outcome ie have a look at the Dow chart for the last 10 days. Hedge funds will push or pull a price depending on which way the wind blows, without much regards for fundamentals




Uncle I disagree with why we are getting theses moves. Its not the old conspiracy fans favorite of straight manipulation by hedge funds/PPT/Catholic church :

Its just the movement of punters to intraday timeframe because of the uncertainty of how this market is moving over the larger time frame. Have a look at the ES futs increase in volume over these large last 30 min swings.

its just closing of trades by the punters that have not yet been stopped out.


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## Trembling Hand (14 June 2009)

Mr J said:


> I'm not trying to attack Schiff, but I don't see how his name can be used as an argument for being right. I also question, if he's so successful, why he runs a brokerage rather than a managed fund.




So he can get paid during the 9 out of 10 years when his wrong about the market.


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## MRC & Co (14 June 2009)

Trembling Hand said:


> So he can get paid during the 9 out of 10 years when his wrong about the market.




Yes, the fact he uses guys like this, or Rogers (as close to Keynesian, neo-classical and Adam Smith as you get), shows his academic nature.  He is more concerned about being right and 'prooving' his theory, than with the reality of his arguement.  

Sad, for someone who claims an open mind, he sure fits (false) inflormation into his debate. 

But most academics are the same, hence why they make poor traders.  I've heard some funny stories of THE BEST (literally) students from Oxford trying to make their way on trading floors.  Don't even last longer than a few wks.


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## Mr J (14 June 2009)

Trembling Hand said:


> So he can get paid during the 9 out of 10 years when his wrong about the market.




Those that can't do, sell .



> I've heard some funny stories of THE BEST (literally) students from Oxford trying to make their way on trading floors. Don't even last longer than a few wks.




Trading and related activities are a good judge of practical intelligence.


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## So_Cynical (21 June 2009)

I went shopping this afternoon at Macquarie Centre...in what i would call "inner north west Sydney"...and the place was packed, took me a good 15 minutes to get a parking spot, i go to Macquarie Centre every few months and this is the first time in 18 months ive seen it full to capacity.

People cueing up at the registers in Myers, all shops with customers...the recession is over.


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## Uncle Festivus (21 June 2009)

Trembling Hand said:


> Uncle I disagree with why we are getting theses moves. Its not the old conspiracy fans favorite of straight manipulation by hedge funds/PPT/Catholic church :
> 
> Its just the movement of punters to intraday timeframe because of the uncertainty of how this market is moving over the larger time frame. Have a look at the ES futs increase in volume over these large last 30 min swings.
> 
> its just closing of trades by the punters that have not yet been stopped out.




I'm not fully up to speed with the qaunt markets/trading, but from what I can assume there is some sort of SP500 futs window dressing by the likes of Goldmans and Morgan Stanley - what do you make of it? Now this is where the conspiracy part comes into play - the question is then where are they getting the money to do this & on who's behalf? SP500 earning are down on ave 35% YOY, and that was back in Feb, so unless ther's been a big turnaround in company earnings since then, the P part in P/E is getting on the overbought side?



So_Cynical said:


> I went shopping this afternoon at Macquarie Centre...in what i would call "inner north west Sydney"...and the place was packed, took me a good 15 minutes to get a parking spot, i go to Macquarie Centre every few months and this is the first time in 18 months ive seen it full to capacity.
> 
> People cueing up at the registers in Myers, all shops with customers...the recession is over.




Was it raining? Seems to bring the bored shoppers out - but are they spending?

Oz is lagging because of the commodities bounce - new projects are gettting canned and as the projects in the pipeline are completed unemployment will rise, and the effects will flow on - all the governments are facing an income/expense squeeze, less income, massive (stimulis) debts to service, cutbacks in services - the user will definately pay.....


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## jono1887 (21 June 2009)

So_Cynical said:


> I went shopping this afternoon at Macquarie Centre...in what i would call "inner north west Sydney"...and the place was packed, took me a good 15 minutes to get a parking spot, i go to Macquarie Centre every few months and this is the first time in 18 months ive seen it full to capacity.
> 
> People cueing up at the registers in Myers, all shops with customers...the recession is over.




just because shops are full... doesnt mean they're paying customers :


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## MrBurns (21 June 2009)

jono1887 said:


> just because shops are full... doesnt mean they're paying customers :




Exactly, shopkeepers are bleeding at present but it doesnt mean people stay at home, the walk , window shop, buy a coffee, no big spend up though.


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## knocker (21 June 2009)

Exactly. Homeless people often go to shopping centres for warmth in the winter and air conditioning in the summer. They look and dream. Enjoy your recession aus it is going to hit you like a ton of bricks.


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## Timmy (22 June 2009)

So_Cynical said:


> People cueing up at the registers in Myers






jono1887 said:


> just because shops are full... doesnt mean they're paying customers :




Ummm ... why would people be queuing up at the registers if they weren't paying customers?  



knocker said:


> Exactly. Homeless people often go to shopping centres for warmth in the winter and air conditioning in the summer.



Homeless people at the Macquarie Centre?  No - too hard to get to without a car.


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## Beej (22 June 2009)

Timmy said:


> Homeless people at the Macquarie Centre?  No - too hard to get to without a car.




Actually not anymore as there is now the Chatswood -> Epping rail link that has a stop right at the Macquarie Centre  Having said that, it's not exactly a homeless person area anyway........ Love the bearish denials though - great stuff! 

Cheers,

Beej


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## Timmy (22 June 2009)

Beej said:


> Actually not anymore as there is now the Chatswood -> Epping rail link that has a stop right at the Macquarie Centre




Oh, thanks Beej, I didn't know that.


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## Ageo (22 June 2009)

All my customers (alot in westfields etc..) are crying and doing it very tough. 

I cant see many of them lasting till the end of next yr.


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## moXJO (22 June 2009)

I have been flat out. Unemployment in my town is at 9.6% though. People still seem to be spending here, but I think some retailers are doing it tough. Specialty stores have all bit the dust.


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## Wysiwyg (12 August 2009)

*



			Happy consumers confident worst is over
		
Click to expand...


*
For those that remained in work the government handout was a nice bonus. Three kids even better.


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## tech/a (13 August 2009)

Well I just keep adding to the forward works inventory.
Demand is at an all time high.
Cashflow is crap due to larger Civil Contracts.
The domestic market is now becoming the leader in contract acceptances.


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