# Oh dear the Henry tax has just killed my mining portfolio



## Nero64 (4 May 2010)

I decided to buy today on good news. Turns out it was a good day to sell and boy did the selling come hard and fast. 

Anybody else get killed today?


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## skyQuake (4 May 2010)

Nero64 said:


> I decided to buy today on good news. Turns out it was a good day to sell and boy did the selling come hard and fast.
> 
> Anybody else get killed today?




There was good news today? Where?


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## satanoperca (4 May 2010)

You weren't the only one. I had luckly reduced down my portfolio by 70% over the last week and had a few shorts that nearly covered my longs which got hit hard.

Miners are deadmen walking at the moment with the majority showing no signs of strength and lots of selling pressure.

But what do you expect from a Labor Govnuts that only know two things :

1) How to spend money they dont have
2) How to increase taxes to cover point 1.

Go Labor.


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## Buckfont (4 May 2010)

Nero64 said:


> I decided to buy today on good news. Turns out it was a good day to sell and boy did the selling come hard and fast.
> 
> Anybody else get killed today?




Yep, got out of Giralia, down 6.9%, and bought more Korab, up 6.02% 

Shocker of a couple of days and the sooner this dopey gumment goes the better. Mighty p*ssed off.


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## Nero64 (4 May 2010)

> There was good news today? Where?




Coalworks (cwk) signs a farm in agreement with ITOCHU for Vickery South worth 11 Mill. 

The problem was it was in a trading halt and missed yesterdays selling, so it got double today despite the news. Down %14.


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## drsmith (4 May 2010)

Where our dirt turns into cash investors a looking a little nervous.

http://au.finance.yahoo.com/q/bc?s=000001.SS&t=3m&l=on&z=m&q=l&c=

That's a fall of about 10% since mid-April.


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## Prospector (4 May 2010)

*Re: Oh dear the RUDD GOVERNMENT has just killed my mining portfolio*

Henry didnt kill your portfolio Rudd did.  SO much for the increase in Mining Tax to fund our super, mine fell $15,000 over last two days.  Increasing the contributions to 12% can never make up for that. I am so


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## drsmith (4 May 2010)

*Re: Oh dear the RUDD GOVERNMENT has just killed my mining portfolio*

Did Henry mean for it to be levied all in one go or staggered over time to ultimaetly reach 40% (total tax take 55% with a corporate rate of 25%) ?



> *Subject to transitional arrangements*, the new rent-based tax should apply to existing projects, replacing existing charging arrangements. The allocation of revenue and risks from the new tax should be negotiated between the Australian and State governments. A cash bidding system could also be adopted to supplement the resource rent tax and promote the efficient allocation of exploration rights.




http://taxreview.treasury.gov.au/co...ions/papers/Final_Report_Part_1/chapter_6.htm


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## Adam A (4 May 2010)

Tough day for me as well
Even my shares with projects overseas got smashed

Part of the bigger picture?


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## JimBob (4 May 2010)

Although the super rate is proposed to increase to 12%, a majority of super funds would hold resource stocks and most would have taken a good battering the last few days.  Increasing mining taxes would lead to lower dividends, which would also be bad news for super funds as they would then receive lower dividen payments.  Seems the shareholders are also getting shafted with the miners.


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## Atlas79 (4 May 2010)

Interest rates up yet again. Mining investors & everyone in the industry (surely including unions?) ROYALLY pissed at Rudd & co. War declared on Telstra shareholders. Stuffup after stuffup. It really is almost as if they want to lose the election.

I take heart in knowing that some of those affected voted for this.


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## nunthewiser (4 May 2010)

um....... Can i just say a quick "harden the fark up "

This is the stock market folks . stocks go down also at times .......... IF one has a quick look at some charts a lot of the miners were already on there way down from way before this henry tax rubbish ..

At least no ones blaming the shorters this time 

Anyone want to blame anyone for the stellar run a lot of the mining stocks have had for the last year ?


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## Julia (4 May 2010)

There's a bit of over-reaction happening here (and yes, I hold miners also).
This has to get through the Senate yet, and this is imo very unlikely to happen without significant modification, especially given the fight the mining industry is going to mount.

If we want to do a Pollyanna on this and find a positive, there will be quite a few investors out there in voting land who will be blaming Rudd & Co. for the fall in their shares combined with the rise in their mortgage rate.
Coming on the same day as the fairly dramatic fall in Rudd's approval rating, the government must be having the first tremors of panic.


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## brty (4 May 2010)

Julia,



> There's a bit of over-reaction happening here (and yes, I hold miners also).




Why on Earth do you hold them?? There has been an accelerating decline happening for some time, as Nun said since well before the Henry report. China is tightening up credit, their market is falling, this is the big picture.

I have had some miners on my radar as possible buys but they keep breaking support, and look nothing like a buy in their present state. If they don't look like a buy, then why hold??

brty


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## baby_swallow (4 May 2010)

Just watch whats the Copper is doing....
Copper=China=BHP=RIO=Australia


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## pixel (4 May 2010)

Julia said:


> There's a bit of over-reaction happening here (and yes, I hold miners also).
> This has to get through the Senate yet, and this is imo very unlikely to happen without significant modification, especially given the fight the mining industry is going to mount.
> 
> If we want to do a Pollyanna on this and find a positive, there will be quite a few investors out there in voting land who will be blaming Rudd & Co. for the fall in their shares combined with the rise in their mortgage rate.
> Coming on the same day as the fairly dramatic fall in Rudd's approval rating, the government must be having the first tremors of panic.




Same here, Julia;
I was tempted to dump the lot - but then reconsidered:
What if KRudd does (yet another) backflip and "explains" that he never meant to be that harsh - the introduction to be staggered over 5 years, maybe delayed (like ETS) etc... The result may well be an instant support - especially of those miners that earn the biggest part of their profits Overseas. Did you hear "Prof" Palmer and Tony Sage in tonight's News? 

Yes, I'll continue to diversify - even more now than previously. But slaughter my mining stocks in panic I won't.


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## doctorj (4 May 2010)

Investment bank analysis on the tax is available here - https://www.aussiestockforums.com/forums/showpost.php?p=552758&postcount=65


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## skyQuake (5 May 2010)

pixel said:


> Same here, Julia;
> I was tempted to dump the lot - but then reconsidered:
> What if KRudd does (yet another) backflip and "explains" that he never meant to be that harsh - the introduction to be staggered over 5 years, maybe delayed (like ETS) etc... The result may well be an instant support - especially of those miners that earn the biggest part of their profits Overseas. Did you hear "Prof" Palmer and Tony Sage in tonight's News?
> 
> Yes, I'll continue to diversify - even more now than previously. But slaughter my mining stocks in panic I won't.




Also keep in mind right now its also China fears that are driving the miners down. 
Massive liquidation by funds; not just pure HTR, its just contributory imo


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## lemontree (5 May 2010)

Even if the super tax passed the senate, i thought it was due to start in 2012? Why would shareholders be selling off now?


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## doctorj (5 May 2010)

lemontree said:


> Even if the super tax passed the senate, i thought it was due to start in 2012? Why would shareholders be selling off now?



Because it is now more probable that a company's ability to generate distributable earnings in the future has reduced.  When people buy shares, they do so in order to generate a return in the future, if that return is now reasonably assessed to be less than it was before this additional tax became probable, then it makes sense that people are willing to pay less for it.


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## kwallace (5 May 2010)

Why do I feel better knowing that I'm not the only one to get hammered... I remember long ago (2 weeks) with me thinking about selling to make a few little bucks but saying to myself nah this is going to go on and on and on 

I agree about it being tough to get through though, there does seem to be alot of panic. The only up side is that shares will be dirt cheap again and if you have cash or bailed out early it will be a good buy again.  

But then you don't want to catch a falling sword....


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## tech/a (5 May 2010)

kwallace said:


> Why do I feel better knowing that I'm not the only one to get hammered... I remember long ago (2 weeks) with me thinking about selling to make a few little bucks but saying to myself nah this is going to go on and on and on
> 
> I agree about it being tough to get through though, there does seem to be alot of panic. The only up side is that shares will be dirt cheap again and if you have cash or bailed out early it will be a good buy again.
> 
> *But then you don't want to catch a falling sword.*...




Dont!!

Initially like all "shocks" there will be over reaction.
Reality will eventually set in as the realisation strikes that production wont cease and demand will drive supply.
Id be more concerned with a fall in demand.
Youll see where it pulls up--it will be pretty clear.


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## pixel (5 May 2010)

lemontree said:


> Even if the super tax passed the senate, i thought it was due to start in 2012? Why would shareholders be selling off now?




Markets hate uncertainty, that's why.
It only takes a little stimulus to create a stampede. While ludicrous ambit claims may work for unions when a new round of negotiations begins, the ALP has yet to figure out that this isn't about coal miners union vs bosses behind closed doors, but the National Economy being discussed in public.


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## moXJO (5 May 2010)

Unfortunate market timing for Rudd, concerning his mining tax announcement.


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## Julia (5 May 2010)

brty said:


> Julia,
> 
> 
> 
> ...



Because it's just BHP and CEY and these together constitute a very small proportion of my asset base,   CEY actually went up yesterday and I'm still about two thirds in cash.  And because as I said yesterday I think this is an over-reaction and BHP at least is a long term hold.

Further, it's not just the Rudd tax that's affecting the market - it's the fear about Greece et al, and possibly even the foiled terrorist attack in New York.
Fear is contagious and quickly gets disproportionate.

However, I do agree with you that the miners, with a few exceptions, have not been a buy in recent times.


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## The Trooper (5 May 2010)

Time to keep an eye out for stocks to buy. There seems to be mass panic at the moment and this is affecting international as well as domestic mining stocks. The Henry report seems quite clear that the tax is on Australia's non-renewable resources. This combined with the two year waiting period (in which a federal election will occur) and there is likely to be significant opposition means it looks like the chicken littles are running and the market will be ripe with opportunity.

charteredaccountants.com.au/henryreview (not sure if this pasted link will work but it has a good summary of the Henry review)


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## Calliope (5 May 2010)

Julia said:


> Further, it's not just the Rudd tax that's affecting the market - it's the fear about Greece et al, and possibly even the foiled terrorist attack in New York.
> Fear is contagious and quickly gets disproportionate.




And the oil slick in the Mexican Gulf is not helping the oil companies.


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## brty (5 May 2010)

Julia,



> Further, it's not just the Rudd tax that's affecting the market - it's the fear about Greece et al, and possibly even the foiled terrorist attack in New York.
> Fear is contagious and quickly gets disproportionate.




Personally I think it is China, the rest is mostly smokescreen and noise.

I am not a long term holder of any stock, just look for opportunities as they present themselves. I have been watching BHP recently with an intention to buy, but this accelerating move to the downside is an ominous sign for possibly quite a few months. There will obviously be a relief rally sometime soon and holding over 90% cash myself, I am hoping to catch part of that move. 
The only stock I currently hold is well outside the mining sector, being PRY, which unfortunately for me did not catch today's contagion, because I wanted to buy more. 

brty


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## sammy84 (5 May 2010)

tech/a said:


> Dont!!
> 
> Initially like all "shocks" there will be over reaction.
> Reality will eventually set in as the realisation strikes that production wont cease and demand will drive supply.
> ...




A lot of damage can be done waiting for reality to set in can't in Tech? I don't necessarily not agree with your statement (I am hoping you're correct), just find such a fundamental view on price movement very unlike you...


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## nunthewiser (5 May 2010)

LOL . Go some mid cap mining stocks i say 

Different strokes for different folks but gotta love a sell down and mass hysteria......

" Oh dear the Henry tax has just put steak on my table for dinner"


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## nunthewiser (5 May 2010)

Using a break of todays lows as stopout points is classed as catching falling knives? and frowned upon by the more "experienced" traders that use hindsight to plot  a position they shhould of taken ?

not meaning to sound sarcastic just intrested to see at what point "experienced " traders would enter a position .... take MGX and PLA for example .


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## nunthewiser (5 May 2010)

And how about OZL? ........... as " experienced " traders would you take a position at 105/106 with a stop a touch below todays low ?

No signs staring at you  ?

or is this classed as catching knives? instead of a technical entry with low risk/reward criteria,s.

silly  me i must be the only silly bugga here

I spose i have to wait until tommorow till i get an answer tho?


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## tech/a (5 May 2010)

nunthewiser said:


> And how about OZL? ........... as " experienced " traders would you take a position at 105/106 with a stop a touch below todays low ?
> 
> No signs staring at you  ?
> 
> ...




Nun.
You could place a trade as you suggested.
My view is its too early to call and while we see many
charts with tails like these it isnt supported in the majority of cases with a
very high volume bar closing HIGHER than yesterdays close OR a low volume continuation above todays High.

Heres a bit of chart explaination.


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## eddyeagle (5 May 2010)

For those in cash, there are stocks that are starting to look good value again I reckon. Could be some good buying opportunities soon. 



From The Age: 

_KFC: Playing chicken on the mining boom 
BARRY FITZGERALD 
May 5, 2010 - 9:36AM 
It's been a case of small and warm beers for Kevin Rudd in his meetings with mining executives in Perth after kicking them in the guts with the tax grab known as the resource super tax profits (RSTP).
In Perth mining circles, the RSTP is being called the GFC Mark II, or Garimpeiro's personal favourite, the KFC – the Kevin Rudd financial crisis.
The industry is making it loud and clear that there is nothing super about the tax grab, pointing to the share price damage caused since the proposal was unveiled on Sunday. The share price retreat has hit the superannuation accounts of every work'n Australian.
The mining executives are also threatening all sorts of doom around future investment plans, job losses and a mass exodus to warmer investment climes. No wonder, given the KFC will make Australia's mining industry the highest taxed in the world (55 per cent of earnings).
Add the gloom in the mining sector caused by the KFC to the broad retreat in commodity prices caused by China's efforts to slow overheating sectors of its economy and fears that there will be repeats of the Greek debt woes elsewhere in Europe, and you can see why there has been a mighty sell-off in the past couple of days.
Today will be another shocker. Copper has fallen to a seven-week low, oil slumped $US3 a barrel and aluminium has given up any hope of holding above $US1 a pound in overnight markets. Even gold let the side down, with June Comex gold off some $US14 an ounce.
Local miners are just going to have to wear the commodity-price falls. But there is good reason to believe that the sell-off in shares triggered by the KFC is overdone. Why is that so? Because the KFC is not going to proceed as currently planned.
It is a theme picked up by ANZ's head of commodity research Mark Pervan.
Pervan said there was no surprise that the mining industry's response to the proposed tax has been very negative, flagging concerns such as reduced domestic project opportunities, a move offshore, lower foreign investment in the sector and reduced merger and acquisition activity.
But he reckons that after the three-week consultation period between industry and Treasury boffins on the proposed tax, the existing tax proposal "will be watered down and concessions made to appease some of these concerns".
Garimpeiro reckons there is no doubt about that. Apart from anything less, legislation for the KFC is not anticipated before 2012, making the whole thing subject to Labor getting back in to power. Polls earlier this week showed there was no guarantee of that happening.
It is against that background that some brave types out there are using the cover of the KFC dark cloud over the mining sector to snap up miners and explorers at what they reckon could prove to be bargain prices.
They will be encouraged on that score by Pervan's comment on the big picture outlook : "This is not the end game. Australia will remain a primary beneficiary of a China-led commodity boom over the coming decade. And other governments, such as India and China, are reviewing their own resource tax structures, suggesting the comparative change may end up being less than initially thought."
_


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## Julia (5 May 2010)

From the above quote:


> But he reckons that after the three-week consultation period between industry and Treasury boffins on the proposed tax, the existing tax proposal "will be watered down and concessions made to appease some of these concerns".
> Garimpeiro reckons there is no doubt about that. Apart from anything less, legislation for the KFC is not anticipated before 2012, making the whole thing subject to Labor getting back in to power. Polls earlier this week showed there was no guarantee of that happening.




Tony Abbott has now said categorically that there is no way the Libs can support this tax.

The Greens will vote for it in the Senate, so whether or not the legislation passes will come down to the decisions of Fielding, Xenophon, and Scullion.

Rudd will be ardently trying to stick with his 40% in order not to exacerbate his flourishing reputation for being the backflip king.


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## nunthewiser (6 May 2010)

tech/a said:


> Nun.
> You could place a trade as you suggested.
> My view is its too early to call and while we see many
> charts with tails like these it isnt supported in the majority of cases with a
> ...





Thanks for the reply .

We obviously trade different time frames and entry criterias.

Each to there own.........


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## tech/a (6 May 2010)

nunthewiser said:


> Thanks for the reply .
> 
> We obviously trade different time frames and entry criterias.
> 
> Each to there own.........




Which timeframe are you talking of?


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## nulla nulla (6 May 2010)

A lot of mining shares rebounded off the interday lows yesterday to close green. People holding the shares may have felt squeezed by those selling it down. 
The sudden drop obviously made a lot of these shares attractive for some. MGX at $1.40 was a standout for the quick, having dropped a higher percentage in the previous two days than the rest of the miners. FMG & OZL look good at these entry levels as well.
Some may want to bag the Henry Tax revue but the panic reactions of some have created opportunities for others. Go stocks.


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## Calliope (6 May 2010)

Julia said:


> Rudd will be ardently trying to stick with his 40% in order not to exacerbate his flourishing reputation for being the backflip king.




"As you knowwww" Bernie Fraser who is totally unbiased says "I think it is long overdue to be honest" so it must be okaaay.


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## Calliope (6 May 2010)

I hate to think how our superannuation funds are performing after our market has dropped 7.5%  in the last 9 days. They have huge investments in the banks and the big resources.

It is ironic that one of the reasons Rudd is giving for whacking the big miners is to divert more money to super fund managers for them to mismanage.


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## tech/a (6 May 2010)

nunthewiser said:


> And how about OZL? ........... as " experienced " traders would you take a position at 105/106 with a stop a touch below todays low ?
> 
> No signs staring at you  ?
> 
> ...




You would have been stopped nun! at around 11.30
Want to have another go at the $1.02 low now in place?


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## Joe Blow (6 May 2010)

Thought I'd nip that little exchange in the bud before it deteriorated even further.

Back on topic please people, preferably without the insults and personal attacks.

Moving right along...


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## nunthewiser (6 May 2010)

yep i noticed my replys had been deleted , even the last one explaining why i took that tone in my reply.

fair enough.The first one was maybe out of line 

Crux of the matter is that there has been cash to be made on intraday volatility on various mid cap mining stocks in the last 2 days.


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## Muschu (6 May 2010)

tech/a said:


> Dont!!
> 
> Initially like all "shocks" there will be over reaction.
> Reality will eventually set in as the realisation strikes that production wont cease and demand will drive supply.
> ...




So tech/a, and I have said before that I value your analysis and views -- 

Would you sell losing junior mining stocks at this point?   Would you wait for a bounce?  Hold?  

Thinking of such miners as GMG, ETE, EXS, MGX, MMX, MRE, BRM, AGO... etc -- All of whom have taken a massive hit.

I ask only because I am very uncertain about what to do.  Opinions welcome without an accompanying gaurantee....

Best

Rick


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## So_Cynical (6 May 2010)

Gezz Rick...chances are this is just a pull back and just as much a buying opp as it is a panic and sell moment, the only one of the stocks you listed that i hold and follow is MRE so ill keep my comments to just MRE.

Minara is hardly what i would call a junior miner, MC of 900+ mill and has been in production for many years, currently sitting on 280+ mill cash, no debt and pocketing 2 mill a week....now sure there's downside risk, always has been and always will be but there's got to be a fair chance that the super tax will be watered down...just imagine how the SP would surge on any back down announcement.

MRE also have to be close to announcing a divi IMO :dunno: .. imagine how the SP would rally on that!


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## Julia (6 May 2010)

So Cynical, you will hold most things through most events.
As I recall Rick's approach, it's quite different.
Unless I'm remembering incorrectly, Rick sold near his companies' highs, and repurchased at lower prices when an uptrend returned and did very well indeed.

You may be right in suggesting there's nothing much to worry about here.
Or the European situation, where now not banks but *governments* are on the edge of defaulting, may be the start of something every bit as bad as the GFC.

A friend of mine who has an attitude similar to yours scoffed at me when I said I'd sold out.  He boasted that he was 'almost back to where he was before the GFC'.  I bit my tongue instead of telling him that if he'd protected his profits, then bought back in at or near the bottom, he would actually have made a very tidy profit instead of now being poorer than he was two years ago!


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## -Bevo- (6 May 2010)

Don't trade the stocks atm but I see Canada on the news saying your welcome over here I guess they cant believe there luck, which brings the question if this tax was voted in makes me wonder if giving up ASX and trading Canada TSE might be a option for stock traders who like resource stocks?


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## So_Cynical (6 May 2010)

Julia said:


> A friend of mine who has an attitude similar to yours scoffed at me when I said I'd sold out.  He boasted that he was 'almost back to where he was before the GFC'.  I bit my tongue instead of telling him that if he'd protected his profits, then bought back in at or near the bottom, he would actually have made a very tidy profit instead of now being poorer than he was two years ago!




I didn't sell and instead brought the bottom and am now (even with this pull back) about 18 > 20% above my pre GFC portfolio worth...we all know there's a 1000 if's and but's and there's always things what we could of done better.

Personally i hate the thought of selling or buying at the wrong time...im very confident that this is probably a good time to buy some stocks (over sold, low risk) and im also confident that now is a bad time to sell most stocks (over sold, low/med risk)

Last time we were at 4600 i brought ALZ as it took a big dip, made an easy 17% or so 8 weeks later...intend to do the same tomorrow though not ALZ cos its not dipping...i know its easy to have a little panic when the markets tanking, i panic a little too but seem able to talk my self around to behaving more rationally and try and see the upside.

After the last dip i was actually kicking myself that i didn't buy more MRE as it was dipping lower then than it is now, in fact would be buying them tomorrow if MRE was under 65 cents.

Good luck Rick.


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## Space Invader101 (7 May 2010)

I'm switching REIT's or phasing out of the market.  Either all my resource stocks hit their stop losses or I sold them to prevent further damage.

How long do we have to wait until we can vote the extreme socialist government out?


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## nulla nulla (7 May 2010)

tech/a said:


> You would have been stopped nun! at around 11.30
> Want to have another go at the $1.02 low now in place?




That ozl $0.99 entry might be on the cards today. Or will last nights silly bugger action on the djia panic the price lower..$0.95?


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## TheAbyss (31 May 2010)

An interesting email last week around taxation of the high performers.  Explains the taxation system simply and uses beer to keep our interest and certainly has some relevance to the Henry debacle.

Have a read...

Suppose that every day, ten men go out for beer and the bill for all ten comes to $100.

 If they paid their bill the way we pay our taxes, it would go something like this;

    The first four men (the poorest) would pay nothing.
    The fifth would pay $1
    The sixth would pay $3
    The seventh would pay $7
    The eighth would pay $12
    The ninth would pay $18
    The tenth man (the richest) would pay $59

    So, that's what they decided to do..

    The ten men drank in the bar every day and seemed quite happy with
    the arrangement, until one day, the owner threw them a curve ball.

    "Since you are all such good customers," he said, "I'm going to
    reduce the cost of your daily beer by $20". Drinks for the ten men
    would now cost just $80.

    The group still wanted to pay their bill the way we pay our taxes.

    So the first four men were unaffected.

    They would still drink for free. But what about the other six men - the paying customers?

    How could they divide the $20 windfall so that everyone would get his fair share?

    They realised that $20 divided by six is $3.33. 
     But if they subtracted that from everybody's share, then the fifth man and the
    sixth man would each end up being paid to drink his beer.

    So, the bar owner suggested that it would be fair to reduce each
    man's bill by a higher percentage the poorer he was, to follow the
    principle of the tax system they had been using, and he proceeded to
    work out the amounts he suggested that each should now pay.

    And so the fifth man, like the first four, now paid nothing (100% saving).

    The sixth now paid $2 instead of $3 (33% saving).

    The seventh now paid $5 instead of $7 (28% saving).

    The eighth now paid $9 instead of $12 (25% saving).

    The ninth now paid $14 instead of $18 (22% saving).

    The tenth now paid $49 instead of $59 (16% saving).

    Each of the six was better off than before. And the first four
    continued to drink for free. But, once outside the bar, the men began
    to compare their savings.

    "I only got a pound out of the $20 saving," declared the sixth man.

    He pointed to the tenth man,"but he got $10!"

    "Yeah, that's right," exclaimed the fifth man. "I only saved a pound
    too. It's unfair that he got ten times more benefit than me!"

    "That's true!" shouted the seventh man. "Why should he get $10 back,
    when I got only $2? The wealthy get all the breaks!"

    "Wait a minute," yelled the first four men in unison, "we didn't get
    anything at all. This new tax system exploits the poor!"

    The nine men surrounded the tenth and beat him up.

    The next night the tenth man didn't show up for drinks, so the nine
    sat down and had their beers without him. But when it came time to
    pay the bill, they discovered something important. They didn't have
    enough money between all of them for even half of the bill!

    And that, boys and girls, journalists and government ministers, is
    how our tax system works.

    The people who already pay the highest taxes will naturally get the
    most benefit from a tax reduction..

    Tax them too much, attack them for being wealthy, and they just may
    not show up anymore.

    In fact, they might start drinking overseas, where the atmosphere is
    somewhat friendlier. 



    David R. Kamerschen, Ph.D.
    Professor of Economics.

    For those who understand, no explanation is needed.
    For those who do not understand, no explanation is possible.


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## jojoventure (8 June 2010)

Best explanation of the mining tax...

Should be on the front page of  the daily telegraph.......


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## shiftyphil (8 June 2010)

TheAbyss said:


> David R. Kamerschen, Ph.D.
> Professor of Economics.




Take his name off that article, it has nothing to do with him.

http://davidk.myweb.uga.edu/


> "Contrary to Internet folklore, Dr. Kamerschen is NOT the author of "Tax Cuts: A Simple Lesson in Economics" or “Bar Stool Economics” or anything similar to that. Additionally, he does NOT know who wrote it and he has no opinion on its merits."


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