numbercruncher
Beware of Dropbears
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Re: Perhaps we'll ride it out?
5. Deadly worldwide Pandemic.
5. Deadly worldwide Pandemic.
Perhaps we'll ride out this correction/crash/bear/recession/depression?
- Thread starter Sean K
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Re: Perhaps we'll ride it out?
You know I don't expect the bull run to last forever like some do
: But I was thinking of getting out for good early April next year too... Scarey... Maybe get out in may in case everyone was thinking the same thing
I agree that China is the key as to whether we come out of this squish any time soon, not so much because there's a threat to the demand for Chinese manufactured product (which I assume will remain strong), rather my concern is: what is the capacity of the Chinese financial system to avoid catching the meltdown? WHEN there's a run on Chinese stocks is when the poo hits the fan. Prior to the current mess I held the assumption that this will occur by the middle of 2008; now I wonder why it isn't happening yet.
China is grossly over-heated, and its economic health is utterly opaque. There are quite literally millions of small investors whose modest life-savings are due to evaporate further and faster than anything the world has seen since 1929. When it goes awry there will be massive social and political upheaval in China; the consequent meltdown in world stock markets will dwarf what we're seeing now.
Right now I'm inclined to believe that whatever damage China is suffering will be absorbed (and in fact hidden). Current events will give their government the opportunity to treat this as a dress rehearsal, but it also gives warning to the corrupt and cynical elements to get ready to run far, and run fast.
Unhappily, I suspect that the most corrupt and cynical elements in their investment bubble are in fact also in their government.
So I'm holding, not buying. Some cautious buying in a few weeks perhaps.
As for 2008, I'm selling everything in April, assuming we're still functioning.
PS: my favourite stocks have been harder than many recently, which may give fair indication of the quality of my powers of prediction: AVX, UXC, OEC
Regards, P
You know I don't expect the bull run to last forever like some do
: But I was thinking of getting out for good early April next year too... Scarey... Maybe get out in may in case everyone was thinking the same thing
wayneL
VIVA LA LIBERTAD, CARAJO!
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Re: Perhaps we'll ride it out?
1/ Ripping off the poor is the the cause of the credit problem, it is merely a symptom of the overall mispricing of risk. This is where everybody misses what is actually going on with this credit crunch. Sub-prime is just where the pus exploded on the surface, there is a whole rotting and festering core still waiting to reveal itself. There are more shocks on the horizon.
2/ Depression is a word that is often over-dramatized in order to create a straw man. Depression need not be catastrophic. The 1929 version was, because of a number of exacerbating decisions and circumstances. The coming depression, though painful (and catastrophic for some) will actually be of benefit in a few key ways.
It will be positive:
* in repricing of risk
* in repricing value
* in re-establishing community values
* in the re-evaluation of recourses
* in cleansing some of the predatory financial practices common ATM
One need only position themselves for the eventuality (if possible) and it will be smooth sailing. Those most hurt will be the Ostriches.
Two points.
1/ Ripping off the poor is the the cause of the credit problem, it is merely a symptom of the overall mispricing of risk. This is where everybody misses what is actually going on with this credit crunch. Sub-prime is just where the pus exploded on the surface, there is a whole rotting and festering core still waiting to reveal itself. There are more shocks on the horizon.
2/ Depression is a word that is often over-dramatized in order to create a straw man. Depression need not be catastrophic. The 1929 version was, because of a number of exacerbating decisions and circumstances. The coming depression, though painful (and catastrophic for some) will actually be of benefit in a few key ways.
It will be positive:
* in repricing of risk
* in repricing value
* in re-establishing community values
* in the re-evaluation of recourses
* in cleansing some of the predatory financial practices common ATM
One need only position themselves for the eventuality (if possible) and it will be smooth sailing. Those most hurt will be the Ostriches.
theasxgorilla
Problem solved... next bubble.
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Re: Perhaps we'll ride it out?
I still don't think we're are as globalised and all-loving and homogenised through business-orientation as many people like to think. Everyone is still practising reserved capitalism. The US and Europe protects its industries with subsidies and tarrifs and China won't float its currency. The more you look at the current wave of prosperity the more it looks like a Nash Equilibrium...but under the surface, we still don't all love one another.
Thomas Friedman came up with his McDonalds theory which said a country with a middle class big enough to support McDonalds francise never goes to war with another country in a similar position. Of course, this can be proved false and you need to make all kinds of exceptions to the rules to keep it true. Its a fair and prudent expectation that at some stage in the future national borders will snap back into place, along with racial and cultural identity.
I still don't think we're are as globalised and all-loving and homogenised through business-orientation as many people like to think. Everyone is still practising reserved capitalism. The US and Europe protects its industries with subsidies and tarrifs and China won't float its currency. The more you look at the current wave of prosperity the more it looks like a Nash Equilibrium...but under the surface, we still don't all love one another.
Thomas Friedman came up with his McDonalds theory which said a country with a middle class big enough to support McDonalds francise never goes to war with another country in a similar position. Of course, this can be proved false and you need to make all kinds of exceptions to the rules to keep it true. Its a fair and prudent expectation that at some stage in the future national borders will snap back into place, along with racial and cultural identity.
Re: Perhaps we'll ride it out?
Yeah the Media does like to use "over Weight Words"... Compare: Crash, Collapse, Plummeted... with retrace, lowered, consolidated... They try their best to create headlines don't they
Two points.
1/ Ripping off the poor is the the cause of the credit problem, it is merely a symptom of the overall mispricing of risk. This is where everybody misses what is actually going on with this credit crunch. Sub-prime is just where the pus exploded on the surface, there is a whole rotting and festering core still waiting to reveal itself. There are more shocks on the horizon.
2/ Depression is a word that is often over-dramatized in order to create a straw man. Depression need not be catastrophic. The 1929 version was, because of a number of exacerbating decisions and circumstances. The coming depression, though painful (and catastrophic for some) will actually be of benefit in a few key ways.
It will be positive:
* in repricing of risk
* in repricing value
* in re-establishing community values
* in the re-evaluation of recourses
* in cleansing some of the predatory financial practices common ATM
One need only position themselves for the eventuality (if possible) and it will be smooth sailing. Those most hurt will be the Ostriches.
Yeah the Media does like to use "over Weight Words"... Compare: Crash, Collapse, Plummeted... with retrace, lowered, consolidated... They try their best to create headlines don't they
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Re: Perhaps we'll ride it out?
I am a country lad who has over the years produced and sold. Its quite simple really. USD up and AUS down. Metals down. Correct me if I am wrong but does this mean China gets our resources at a cheaper price and then the USA gets what china produces at a cheaper price. USA spending and growth then has an increase and Chinas profit goes up anyway because they are getting a discounted metal.
Keep the answers simple.
I am a country lad who has over the years produced and sold. Its quite simple really. USD up and AUS down. Metals down. Correct me if I am wrong but does this mean China gets our resources at a cheaper price and then the USA gets what china produces at a cheaper price. USA spending and growth then has an increase and Chinas profit goes up anyway because they are getting a discounted metal.
Keep the answers simple.
IFocus
You are arguing with a Galah
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Re: Perhaps we'll ride it out?
Hi Kennas
If you haven't already I recommend John Mauldin's free weekly news letter where he generally gives a balanced view
His last one about the current situation is quite good not quite the total doom as being suggested by others for good reason.
http://www.frontlinethoughts.com/gateway.asp
Focus
Hi Kennas
If you haven't already I recommend John Mauldin's free weekly news letter where he generally gives a balanced view
His last one about the current situation is quite good not quite the total doom as being suggested by others for good reason.
http://www.frontlinethoughts.com/gateway.asp
Focus
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Re: Perhaps we'll ride it out?
A little more upbeat....
WITH the wild fluctuations on global and local sharemarkets, many investors have been too preoccupied to give much thought to the reporting season.
However, with confidence ”” temporarily, at least ”” restored to the markets following the US Federal Reserve's surprise move to cut the lending rate it charges banks, focus can now turn to the more fundamental questions of profit and loss.
About 45 major companies have so far reported, with another 57 to come under the microscope in the next week or two. To date, the results have been slightly above market expectations, said Citi Investment Research director Graham Harman.
"It has been a good season so far," he said. "We are having positive surprises coming in a little bit ahead of the number of companies disappointing."
This follows a solid US reporting season that, like Australia's, has been largely overlooked.
Profit growth is about 15 per cent, slightly higher than the US's 11 per cent, though as little as six weeks ago the American market was expecting growth of a mere 3 to 4 per cent.
"At some point, if and when things settle down, people will be able to look back on these results and say, 'Ah, we were a bit harsh on that stock,' but it's not going to be a consolation on a one or two-week view," Mr Harman said.
AMP Capital Investors' head of strategic investment, Shane Oliver, said outlook statements had generally been strong.
"Cost controls remain good and, out of 45 major companies to have reported so far, 56 per cent have come in better than expected and only 4 per cent have come in below expectations," he said.
Still, that has not stopped the market from marking down companies for no apparent reason.
Construction giant Leighton Holdings posted a 65 per cent increase in second-half profit to $260 million, a swelling order book and the extension of its contract with long-time chief executive Wal King, only to see its share price fall 4.7 per cent.
"Once the dust settles from the current market turmoil, the profit-reporting season will provide a strong base for a bounce-back in the Australian sharemarket," Mr Oliver said.
With the S&P/ASX200 Index down about 12 per cent from its peak, the average price-to-earnings ratio used to value stocks is down to about 13 times ”” lower than the 15-year average.
"We know profits are strong," said CommSec's Craig James.
"Any investor who doesn't take the opportunity of these wonderful times to be buying stocks ”” in a year's time they are going to be kicking themselves."
A little more upbeat....
WITH the wild fluctuations on global and local sharemarkets, many investors have been too preoccupied to give much thought to the reporting season.
However, with confidence ”” temporarily, at least ”” restored to the markets following the US Federal Reserve's surprise move to cut the lending rate it charges banks, focus can now turn to the more fundamental questions of profit and loss.
About 45 major companies have so far reported, with another 57 to come under the microscope in the next week or two. To date, the results have been slightly above market expectations, said Citi Investment Research director Graham Harman.
"It has been a good season so far," he said. "We are having positive surprises coming in a little bit ahead of the number of companies disappointing."
This follows a solid US reporting season that, like Australia's, has been largely overlooked.
Profit growth is about 15 per cent, slightly higher than the US's 11 per cent, though as little as six weeks ago the American market was expecting growth of a mere 3 to 4 per cent.
"At some point, if and when things settle down, people will be able to look back on these results and say, 'Ah, we were a bit harsh on that stock,' but it's not going to be a consolation on a one or two-week view," Mr Harman said.
AMP Capital Investors' head of strategic investment, Shane Oliver, said outlook statements had generally been strong.
"Cost controls remain good and, out of 45 major companies to have reported so far, 56 per cent have come in better than expected and only 4 per cent have come in below expectations," he said.
Still, that has not stopped the market from marking down companies for no apparent reason.
Construction giant Leighton Holdings posted a 65 per cent increase in second-half profit to $260 million, a swelling order book and the extension of its contract with long-time chief executive Wal King, only to see its share price fall 4.7 per cent.
"Once the dust settles from the current market turmoil, the profit-reporting season will provide a strong base for a bounce-back in the Australian sharemarket," Mr Oliver said.
With the S&P/ASX200 Index down about 12 per cent from its peak, the average price-to-earnings ratio used to value stocks is down to about 13 times ”” lower than the 15-year average.
"We know profits are strong," said CommSec's Craig James.
"Any investor who doesn't take the opportunity of these wonderful times to be buying stocks ”” in a year's time they are going to be kicking themselves."
Re: Perhaps we'll ride it out?
A lot of sale contracts are in USD so if the USD goes up it costs China more and if the AUD goes down we get paid more so it is another reason to be bullish. The USD went up against the AUD but i'm not sure of the change in it's relationship with chinese currency which doesn't float like the AUD.
Re: Perhaps we'll ride it out?
Good discussion.
Perhaps we did hit bottom last week. US financials lead the markets down, and now they were bought fairly well on friday night, most up 3-4%.
They might lead the markets back out of this.
Good hunting tomorrow.
Good discussion.
Perhaps we did hit bottom last week. US financials lead the markets down, and now they were bought fairly well on friday night, most up 3-4%.
They might lead the markets back out of this.
Good hunting tomorrow.
Sean K
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Sean K
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Re: Perhaps we'll ride it out?
Past performance is no indication of future blah blah, BUT!
Past performance is no indication of future blah blah, BUT!
Yep, depression is just around the corner.
numbercruncher
Beware of Dropbears
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Re: Perhaps we'll ride it out?
Woot !! No more systematic collapse of the banking system , no more children starving in the streets , no more 50pc unemployment !
Who was it calling a Depression anyways ?
Past performance is no indication of future blah blah, BUT!
Yep, depression is just around the corner.
Woot !! No more systematic collapse of the banking system , no more children starving in the streets , no more 50pc unemployment !
Who was it calling a Depression anyways ?
Sean K
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Re: Perhaps we'll ride it out?
Today's definition of depression is only one plasma per RV!Who was it calling a Depression anyways ?
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Re: Perhaps we'll ride it out?
Todays article about problems in NSW over sub-prime mortgages in the US shows the problems are very widespread: http://compareshares.com.au/show_news.php?id=410617
Todays article about problems in NSW over sub-prime mortgages in the US shows the problems are very widespread: http://compareshares.com.au/show_news.php?id=410617
Sean K
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Re: Perhaps we'll ride it out?
???????????*****I'm even more confused, as link goes to NSW*****????????
You trying to ramp OneSteel with that noirua?
???????????*****I'm even more confused, as link goes to NSW*****????????
Sean K
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Re: Perhaps we'll ride it out?
When I clicked on it the first time it went to an article about OneSteel and Smorgan.....
Well, I was trying to keep this bullish, but this article doesn't fill me with cheer:
They are the only bearish articles allowed today. No more please! Thank you.
THE MARKET'S UP 3%: BUY, BUY, BUY!!
Or, is a great opportunity to SELL, SELL, SELL!!
When I clicked on it the first time it went to an article about OneSteel and Smorgan..... Well, I was trying to keep this bullish, but this article doesn't fill me with cheer:
They are the only bearish articles allowed today. No more please! Thank you.
THE MARKET'S UP 3%: BUY, BUY, BUY!!
Or, is a great opportunity to SELL, SELL, SELL!!
Re: Perhaps we'll ride it out?
From your snippet about requiring 20% - that actually makes sense. (Forget the percentage or the amount,) if you can't afford payments then why are you buying in the first place.) It was the ability to borrow without any proven saving history (ignoring documentation) that got us (the world) into this mess anyway. (There are/were a lot of other factors as well!)
Tim
From your snippet about requiring 20% - that actually makes sense. (Forget the percentage or the amount,) if you can't afford payments then why are you buying in the first place.) It was the ability to borrow without any proven saving history (ignoring documentation) that got us (the world) into this mess anyway. (There are/were a lot of other factors as well!)
Tim
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