DTM said:An interesting read showing a looming bear market.
http://www.kitcocasey.com/displayArticle.php?id=162
Dr. Kurt Richebächer:
“A bubble economy implicitly accumulates two growing problems: debt excesses and structural distortions. The most striking, and most important, features of the structural distortions in the U.S. case are the virtual abolishment of domestic saving and the exploding current account deficit. Generations of policymakers and knowledgeable economists would have been horrified by such macroeconomic self-destruction. In today’s America, they cause no more than a yawn.”
(“The Richebächer Letter”, no. 383, May 2005)
DTM said:An interesting read showing a looming bear market.
http://www.kitcocasey.com/displayArticle.php?id=162
“… history tells us that major asset bubbles have long and lasting consequences that are not easily remedied by conventional policies. While the painful experience of the 1930s is the most obvious example in modern times, Japan’s persistent deflation fully 15 years after the bursting of its bubble is hardly a lesson to be taken lightly. Nor, unfortunately, is the state of the US economy as it faces what may well be yet another pitfall in its own post-bubble journey.”
(Stephen Roach, “Global Daily Economic Comment”, May 2, 2005)
An economist with the Commonwealth Bank, Michael Workman, said NSW's economy probably shrank in the June quarter as it did in March, meaning the state was technically in recession. "It's a pretty good chance of it happening when the data is released on September 7," he said. "You're lucky if you've got a full-time job in NSW."
Sydney house prices have fallen 7 per cent since December 2003 and NSW building approvals by 23 per cent.
Population figures show that for every four immigrants arriving, three people leave NSW. Retail sales are also among the weakest in the country.
"I ask myself every day what's going on, but I know every shop in the street is struggling," said Kristy Jones, owner of Gate-One, a streetwear shop in Newcastle. She said her Darby Street precinct was booming 18 months ago but had recently grown "pretty lonely".
Stocks closes down in New York last night after a bigger-than-expected drop in home sales raised concerns about consumer spending and the outlook for the economy. All three indexes were weak early, slipping after the National Association of Realtors said existing home sales fell 2.6% in July from a record pace in June.
The Dow Jones slid 50.31, or 0.47% to 10,519.58, while the S&P 500 dropped 4.16, or 0.19% to finish at 1,217.59 and the Nasdaq fell 4.16, or 0.34% to end at 2,137.25.
The market was expecting a downturn, but a much smaller one, which had many concerned that the housing boom is nearing its end. With a downturn in home sales, construction companies and home improvement retailers tend to see business slide.
Hanrahan said:The bears will tell you that the only safe haven for this scenerio is gold, the metal. I reckon some would be a good insurance.
Maybe it would be possible to buy gold and give it to the bank as collateral for a loan (free storage?) otherwise not many of us would have much left to invest.
H
loakglen said:Resource and energy stocks would more than likely cop a hit though, wouldn't they? Maybe not as much as some but still; with an economic slowdown there would be less demand for all non essential goods, therefore the resources that they are made from and the energy that powers their factories. Oil prices should fall given the weakened demand. Maybe anything that uses oil heavily and won't see a big decrease in demand would go up.
If our currency de-values against third world countries and europe and america can't afford to pay massive subsidies to their farmers; maybe agriculture? Maybe i'm just biased because I milk cows. Anything not heavily exported to the US or possibly europe and not heavily geared should be good buying. You can buy my share of the farm if you want.
What countries' currencies are likely to improve against ours?
If I had to grow food to feed the family, we'd starve. I'm thinking of a farm up north with 1,000 tallow wood trees on it. Reckon I can use a chainsaw and timber will be in even more demand Post Oil.Aussiejeff said:Well, "ultimately" the safest haven is to own your own totally self-sustaining farm(let) with a stash of gold coins hidden in the ground nearby!
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