Jump to content
Due to a large amount of spamers, accounts will now have to be approved by the Admins so please be patient. ×
IGNORED

Gotta Love the stock Market


buzz66

Recommended Posts

Our Interest rates are not really linked to the US as I understand it (not that I'm any expert).

 

What I don't get is if the US raise their interest rates, their stock market takes a hit (yea, that's all reasonable), but then our stockmarket follows (why? their rates don't affect us). But then if I knew the answer to all the questions about the stock market....well I'd be very rich.

Link to comment
Share on other sites

Guest gunigoogoo
How come if the us drops it interest rate our rates have to go up & if they raise there rates ours have to go up ? either way we are screwed

is it because all we export is our enriched dirt ?

Where have you seen this? US dropped their rates by 0.5% last week and ours didn't move. They are headed for a recession. Soon their rates will be close to 0%. Our economy is not linked to theirs but our investors here tend to follow the US (herd mentality). Because we are small fry compared to them, we tend to follow in their footsteps even if it's contrary to what's happening locally.

Link to comment
Share on other sites

How come if the us drops it interest rate our rates have to go up & if they raise there rates ours have to go up ? either way we are screwed

is it because all we export is our enriched dirt ?

 

Cause we are their bitches :lol

seriously I don't know, it seems as global economy increases everything happens that much quicker , and these days blue chip seem volatile.

Link to comment
Share on other sites

I use a stock broker, Good mate of mine at WHTM.

I have 1.25 Mill invested at the moment and a margin loan worth around $440 K

 

I have been in the market for around 4 years now.

 

Interest rate have gone down by 0.5 % in the US because of the shitty low quality loans the banks have been giving away. Americans are fucking greedy cunts. Anyway the Business sector in the US is solid and inflation is still persisting. So a drop in there rates is not good for the US dollar, and it puts even more pressure on inflation over there. So short to medium term the US will be fine but the pain will be bigger mid to long term. The FED should have left rates along and let the fucking hedge funds and banks collapse. As it is they have learnt nothing and the greed will come back 2 fold.

 

Australia's economy is much stronger than the US. We have the mining sector to thank for that. The greedy seppo's have jack shit to drag them out of the crap they have created. We have record low unemployment , benign interest rates, strong business growth with relatively low borrowings, hence more pressure for the reserve to put up rates.

 

Here's the shit that could go wrong. The US could go into recession, Unlikely, but it could, at best it will go sideways from here. Because they are such big consumers it would send ripples through the World growth senario.

 

The best thing about Asia's rapid growth is that the US will matter less and less in the future when it comes to them fucking up the world's big party. China alone is set to overtake the US domestic economy by 2010. The Brick (BRIC) is Brasil,Russia,India,China. Between them all they have a rapid growing middle class. In effect they are becoming consumers themselves, so the days of the US sneezing and the rest of the world catching a cold is falling away.

 

The best part at the moment is dumb fucking humans always over react. The US Sub prime liquidity crsis, caused our market to drop by nearly 15%. For what, we have no exposure to Sub prime, we fell like all other markets around the world because of fear and panic. I didn't sell a thing, just held on tight and watched the arse fall out of the portfolio because I knew is was only temporary. At the time I said to anyone who would listen the market will be back to where it was in 3 months time. I was wrong it only took 6 weeks. That right, if you bought into the market 6 weeks ago you would be at least 15 % better off now. Right at the bottom is when I picked up the Macquarie Bank at $66.50. They had dropped a massive 30%. Like i Said dumb fucking humans. Today they are trading at $83.80 It is much much easier to pick a market bottom than it is to pick the top. The Stock Market goes up by the stairs and down by the Elevator. Anyway The Mac has earnt me 25 K on paper at the moment, and it not over yet

 

If you are about to get into the market, Solid big cap stocks are the way to go. The Goverment Future fund and Supperannuation are massive players and they just cannot manouver in the smaller companies, so the big money will go into stuff like the big banks, including the Mac. I still own and like Babcock & brown and they still have more to go yet. BHP has had a big run latley but it's still cheap.

Rio tinto is another. Zinifex is another. Woolworths, NOT coles. Westfarmers, sounds a bit boring but they will all return returns as good as mid & small caps with much smaller risk.

 

The Seppos are not out of the woods yet, and even thou they pose no real threat to the world economy, it would only take another hedge fund collapse and the market could have take another hit. September and October are usually weak months on the market.

The stock market is at full value at the moment. It's not overpriced but I beleive it will be. Overreaction works both ways going up and going down. I am quitely confident the ASX all ORDS will be at 6,700 by Christmas. I wouldn't be surprised if we crack the 7,000 mark by the end of April next year. I don't have a crystal ball...Bugger!

Invest at your own risk.

 

I beleive we are entering the 3rd and final stage of this Bull market. Shane Oliver from the AMP thinks it could last as long as 2 years. I don't think so. You do need to look at the big picture thou. The stock market has never been overvalued this last 3 years, the company earnings has kept pace with the increase in value. The big crash in 1987 the average price earnings ratio was 22. The average per at the moment is 15.5, which is more or less the last 100 year average.

What hasn't happened yet is irrational exuberance, this is the 3rd and final stage Shane & myself are betting on, dangerous stuff when you start getting those average PER's up around the 20 mark.

 

IF YOU DON'T KNOW WHAT ......PER.....STANDS FOR AND WHAT IT MEANS YOU SHOULD NOT BE INVESTING IN THE STOCK MARKET BY YOURSELF, STICK WITH MANAGED FUNDS. IF YOU HAVE LESS THAN 100 K TO INVEST STICK WITH MANAGED FUNDS, BECAUSE YOU WON'T GET THE DIVERSITY.

 

An interesting point. If you were full invested in the market for 12 months before the 1987 crash your portfolio would have suffered a relatively modest 10% hit. It did go sideways for 3 years after that.

 

And another if you invested in late 1999, a full 3 years later it would be worth the same amount, not taking into account divy's of course.

 

And another I have increased my net wealth by 150% in the last 3 years from the stock market alone. Everything I own is riding there right now, sort of except for a few toys ETC. I will feel naked when I finally pull it all out and go into property.

 

And another you are not investing in the Stock Market, you are buying a piece of a company, hopefully a sucessfull one. The volatility is brought about by fear & greed. You cannot pick winner all the time.

I have had 2 stock go totally broke on me off the years, to the tune of losing 90 k. Thats why diversity is king.

 

For what its worth my portfolio is 40% mining 60 % industrials

 

National bank. Westpac bank, Austal (high speed ferry builders)

One Steel, woolworths, perpetual trustees, Alumina, Zinifex, Funtastic, BHP, Macquaire Bank

 

One more thing, Never invest in a company that has a CEO with an Ego problem.

 

For example you wouldn't invest in "The Pinball Factory" because the CEO has an ego problem.

 

Probably the only exception is Harvey Norman. He is on TV a lot because he has passion not an ego problem, so don't get them confused.

 

If a CEO has an exotic car collection invest with them..This is just my thoughts...Example John Rothchild brillant CEO and very sucessful company Austal the high speed ferry builder. James Packer and others.

For some reason you will never ever find a company that goes broke with a car finatic running the show.

 

Dotty a De loran doesn't count ok! owning one of those is just plain weird, sorry.

Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • Recently Browsing   0 members

    • No registered users viewing this page.
×
×
  • Create New...