Australian (ASX) Stock Market Forum

The official "ASX is tanking!" panic thread

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Garpal Gumnut said:
While what you all say is probably correct in each metric individually, one cannot extrapolate that to the market.

You forget one important facet of market behaviour which is to quote that great legal mind, Dennis Denuto,...

The Vibe.

I've been through a number of crashes and there was no obvious warning, and that was before the Governments and Central Banks had the safety of the markets in mind as well as inflation, debt and all the aforementioned. Mainly because of Super and Pension funds being the major investors in the market.

I may be wrong.

Then again, I may be correct, but there are too many balls in the air at the moment to decide on the mood which ultimately decides market direction.

gg
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Thanks. Not to mention the next session after a big drop there's usually a buy up.

Still, eventually the chickens SHOULD come home to Roost. If not can I get a Job as your Driver on Sven's days off?
 
Mohammed Hazabig'un said:
Tonight the U.S. initial Jobless numbers are out. Tomorrow the existing Home Sales (US) and Leading Index. Those shouldn't be good I assume, particularly for Yanks still shell shocked from the Sub prime disaster. Add to that Poms fighting over Food shortages (sadly) and Im confident Red is the colour of choice.
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BAD news hints QT is further away ( and less aggressive rate rises , likely ) , so YES this looks great to the highly leveraged

( i am NOT highly leveraged so all this looks crazy dangerous to me , but i am investing up to $10,000 a time and the lunatics are throwing millions in other peoples money ( the client's and the bank's )
 
Mohammed Hazabig'un said:
Thanks. Not to mention the next session after a big drop there's usually a buy up.

Still, eventually the chickens SHOULD come home to Roost. If not can I get a Job as your Driver on Sven's days off?
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Not to distract from the thread, but my driver's name is Švejk, he is a Checko. I inherited him from a very good book which is a primer for the absurdity of life called "The Fate of the Good Soldier Švejk during the World War," by Jaroslev Hašek.

A good humorous read for anyone in the markets as to all that can go wrong or right, if you are Švejk.

gg
 
ducati916 said:
The total collapse of society will not happen, but it will come pretty close...for the following reasons.

The level of derivatives to the debt, leveraged to the base money supply is now many magnitudes higher than the 2008 crisis and the 2020 crisis.

The 2 bailouts totalled some +/- $9T on just the Fed's Balance Sheet. Add in the Boj, ECB, PBOC and all the tinpots to get an estimate of multiplying that by a factor of 'X' if the world's debt went into a death spiral (deflation), which it currently is.

So to 'bail out' the system the CBs would need to go to....lets use the Fed alone, some $30T+
We already have inflation measured by a somewhat suspect CPI at 8.5%
Add another bailout and there is a very good chance that the USD will hyper-inflate. If USD dies, all other fiats die alongside.

Only at this point, to retain power, will governments and international institutions, try to save the USD and by extension fiat.

The USD would likely be bailed out by the IMF and SDRs. If that worked (the SDR is simply another fiat) then we stabilise. If it fails then the only way forward is to back the USD with gold. All central banks hold gold in varying quantities.

The revaluation of all fiats to gold would probably require $50Koz gold +/-. In that process silver will also revalue as a monetary metal (poor man's gold) rather than as an industrial commodity. We'll likely see a ratio of 10:1 at some point.

The pain until we got to that point would be immense. It would be the 1930's or worse again.

Stocks with hard assets on the balance sheet, land factories, inventories (that were demanded) etc would survive. Stuff with balance sheets measured in 'eyeballs' or whatever will simply go to zero. A number of US stocks are already down 80% from their highs. It will spread to far more before this disaster is over.

The crypto crowd argue that BTC et al will mimic or outperform gold. To date, that is not the case. It may change.

jog on
duc
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What you've described is a complete collapse of modern society.
I don't see how a return to the gold-standard can be considered beneficial to society, when money supply would be restricted to some arbitrary asset, that frankly, is only valuable for historical reasons.
Why not sea shells? Why even pay back the debt?
A debt-free society is a fantasy.
 
waterbottle said:
What you've described is a complete collapse of modern society.
I don't see how a return to the gold-standard can be considered beneficial to society, when money supply would be restricted to some arbitrary asset, that frankly, is only valuable for historical reasons.
Why not sea shells? Why even pay back the debt?
A debt-free society is a fantasy.
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yes a complete collapse IS possible , because the WEF are hoping to bring it down , to a wreck so they can rebuild it to their delusions

if there is any serious rebellion ( say including military or police contingents ) Mad Max 2 would look like a comparative paradise

oh ! on the MAIN currency , will be food , water , and fuel ( to heat with , rather than for transport )

** Why even pay back the debt? ***
several deeply indebted nations have no intention of repaying that debt , they will simply bury the surviving tax payers under it ( already )
 
ASX 200 finished at 7065, 1.65% down.

Looking at a few of my incoherent scribblings: a Supply shock followed by an easing of Demand, Consumer and Business Confidence. ASX200 at high P/E ratio, Inverted Yield Curve. 200dma breached for over 5 consecutive days, inflation, IRs and Oil prices a drag on Businesses. Building Permits and Housing going south. Utilities going south.

3 of the top 5 economies (USA. China, GB) a drag on Aus.
 
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waterbottle said:
Hmmmm nah, I think we will be ok

https://blogs.imf.org/2022/05/05/lo...es-world-from-1970s-style-crude-shock/#post/0

View attachment 141876
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But world population 1970s was below 4 billions ,so half of today.
Worse: with progress number of motor vehicles has exploded...
transportgeography.org

World Automobile Production and Fleet, 1965-2019 | The Geography of Transport Systems

transportgeography.org transportgeography.org
So more than 3 times as many
Luckily we get more with same amount of oil as you pointed out, but we are basically back to a similar situation to 1974 except that we are not the only consumers with China and India key players, and a long history of the west mishandling oil producers so no love lost there in arab countries..as in the 70s or Venezuela /Russia.
If we just have a 1974 economic shock, we will be lucky in my opinion
 
waterbottle said:
Hmmmm nah, I think we will be ok
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A difference is that the 1970's oil shock was just that, oil.

Versus the 2020's energy shock which is centred primarily around gas and then coal, with the oil price increase being comparatively minor.

Present LNG netback price is $38.09 whereas 12 months ago it was $7.64 so an increase of almost 400 over 12 months. Over two years it's up 998%

Coal price year on year is up 310% and over two years it's up 700%.

Crude oil is up a comparatively trivial 64% over 12 months or 207% over two years.

Wholesale electricity price, average all Australian NEM states (all states except WA and NT): May 2022 to date = $445.39 / MWh, up 315% on May 2021 ($107.33) and up 1075% on May 2020 ($37.90).

Energy price inflation is widespread although oil's far less affected than other fuels.

For reference, global energy by source as follows. Data from BP Statistical Review of World Energy (pretty much the "bible" of energy statistics). Data is 2019 intentionally to avoid temporary pandemic effects.

Oil = 33.1%
Coal = 27.0%
Gas = 24.3%
Hydro = 6.4%
Nuclear = 4.3%
Wind = 2.2%
Solar = 1.1%
Biofuels = 0.7%
Other = 0.9%

:2twocents
 
Smurf1976 said:
A difference is that the 1970's oil shock was just that, oil.

Versus the 2020's energy shock which is centred primarily around gas and then coal, with the oil price increase being comparatively minor.

Present LNG netback price is $38.09 whereas 12 months ago it was $7.64 so an increase of almost 400 over 12 months. Over two years it's up 998%

Coal price year on year is up 310% and over two years it's up 700%.

Crude oil is up a comparatively trivial 64% over 12 months or 207% over two years.

Wholesale electricity price, average all Australian NEM states (all states except WA and NT): May 2022 to date = $445.39 / MWh, up 315% on May 2021 ($107.33) and up 1075% on May 2020 ($37.90).

Energy price inflation is widespread although oil's far less affected than other fuels. :2twocents
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the oil price is being obviously manipulated ( as is oil production ) while gas and coal prices seem to be closer to free-market prices ( well as close as it can be when you have several currency manipulators operating )

so how do we assess the oil price when production has been militarily crushed , and heavily sanctioned and bizarrely , by some of the biggest oil importers

... all i can say is Norway had better watch it's ass ( there will be greedy , desperate thugs after it soon ), maybe it should start signing security pacts with Moscow or at least OPEC
 
Mohammed Hazabig'un said:
The S&P 500 slightly in the Red but not enough to effect our Market yet. Our ASX 200 is like a Cockroach, it'll "drift up" unless you absolutely smash it.
There will be more bad news from the US tomorrow night I'd say, but by Monday Aussies will have forgotten it.
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Yes it's absolutely unbelievable for anyone who has travelled the level of complacency in this country.
As if being on an island was excluding us from the world around.
We saw it on covid and it did not act as a lesson.anyeay,you are right and come Monday the asx will surge ..just because..
I have to say having a small market and 10% of all local salaries forced to buy there is indeed creating an out of this world context.
Play with currency and inflation enough and it could go forever..until we need 1 million pacific pesos to buy a made in China can of bean...
 
waterbottle said:
1. What you've described is a complete collapse of modern society.
2. I don't see how a return to the gold-standard can be considered beneficial to society, when money supply would be restricted to some arbitrary asset, that frankly, is only valuable for historical reasons.
3. Why not sea shells?
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waterbottle said:
4. Why even pay back the debt?
5. A debt-free society is a fantasy.
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1. Not a collapse, but certainly a restructuring.

2. It is beneficial to society because (a) the government can no longer inflate (steal) the money supply, thereby (b) limiting the size and power of government, (c) prevents currency wars and further debasement (inflation) of currencies to pursue mercantilist policies which can lead to hot wars, prevents a foreign government (US as primary reserve currency) from abusing world wide that position, essentially living off of other nations savings. Those are just your basic advantages. There are many others.

3. Because sea shells are not fungible, indestructible, divisible or shiny.

4. Because without repayment, no one would lend capital.

5. No one is talking about a debt free society.

jog on
duc
 
Mohammed Hazabig'un said:
Can't see any Government or Reserve Bank doing anything to limit their own power or ability to "pull the levers".
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It would certainly be extreme circumstances, but some third party(s) might not give them the choice.

It seems hard to envisage here, but other parts of the developed world are sufficiently troubled enough that such a situation *could emerge (even the US IMO).
 
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