By: perceptions_now
18/11/2009
11:32 pm Yahoo! Profile:
perceptions_now Did this message offend you?
Sign in to report abuse |
Reply to this message |
Perceptions,
1) based on the 'fundamentals' is the Oz market under/over/in money valued (in your opinion.
2) And given your answer, the question still remains; is the market rational?
=============
ang101000,
1) The OZ market is a "follower", it will follow the US, Europe & China.
China & Europe are still attached to the US at the hip (pocket).
The only thing that has changed since the GFC "broke" in 2007 is that an enormous amount of "smoke & mirrors has been thrown at anything that moves, BUT NOTHING HAS CHANGED IN THE FUNDAMENTALS.
The markets are going DOWN!!! 50% +
2) YES! |
|
By: firefly_au
18/11/2009
10:39 pm Yahoo! Profile:
firefly_au Did this message offend you?
Sign in to report abuse |
Reply to this message |
Hi Ferratuss :)
I would say it was very relevant for the following reason The equities markets represent over 95% of our sources of real income and wealth either directly or indirectly.
Namely every significant enterprise not wholly foreign owned or owned by the government and funded by taxes. Even small business derives much of their income or products from larger companies an hence are involved!
While governments can for a while operate while in deficit even they can not continue to spend without real wealth being created to generate tax income without severe consequences. The fall in real wealth creation recently is part of the reason our government's budgets are now so far in the red!
Additionally the increase in stimulus spending is another. Stimulus spending would be pointless unless it worked to improve earnings and hence stock prices would increase and the perceived increase in wealth should have increase consumption spending as well.
So we can only hope :)
BYE :) |
|
By: ferratuss
18/11/2009
1:54 pm Yahoo! Profile:
ferratuss Did this message offend you?
Sign in to report abuse |
Reply to this message |
| market is probably undervalued due to strick capital gains taxes which are discouraging investment in the market.another question is how relevent is the market to the real economy and what % does it make up |
|
By: ang101000
18/11/2009
1:13 pm Yahoo! Profile:
ang101000 Did this message offend you?
Sign in to report abuse |
Reply to this message |
Perceptions,
based on the 'fundamentals' is the Oz market under/over/in money valued (in your opinion. And given your answer, the question still remains; is the market rational? |
|
By: perceptions_now
18/11/2009
1:01 pm Yahoo! Profile:
perceptions_now Did this message offend you?
Sign in to report abuse |
Reply to this message |
Perceptions
What are the absolute, basic fundamentals that drive markets.
PEOPLE...Is what you want me to say ?
However the fundmentals which Im talking about are economic indicators,politics,Inter est rates,etc.
============
lasty,
You may not agree, but yes!
There are "fundamentals" and there are "symptoms", "economic indicators, politics, Interest rates,etc" are symptoms! |
|
By: mentawaisurf
18/11/2009
12:51 pm Yahoo! Profile:
mentawaisurf Did this message offend you?
Sign in to report abuse |
Reply to this message |
The global deflationary trend actually started back in 2000 but was masked due to the unprecedented credit expansion over the last decade (ie. credit created and debt borrowed at record levels). The initial credit crunch of 07/08 highlighted the gross debt imbalance globally (of which US subprime was merely the initial symptom).
The current world-wide trend shows that we have finally reached debt saturation (people are unwilling and/or unable to take on more debt for the purpose of speculation, investment or even consumerism) which is evidenced by a record fall in both bank credit and consumer credit around the world. This is despite the historic and co-ordinated efforts of governments and central banks to reinflate credit markets.
All debt must be either repaid or defaulted on. The more debt that is defaulted, and the less new credit that is borrowed, creates debt deflation (which we are in the early stages of since 2007). Debt deflation is merely the symptom of a larger global debt deleveraging that will only intensify as bad debts are finally realised leading to further debt deleveraging, asset deflation and increasing loan defaults throughout 2010 and beyond (as part of a classic deflationary spiral lasting years). |
|
By: jaymarcel
18/11/2009
8:24 am Yahoo! Profile:
jaymarcel Did this message offend you?
Sign in to report abuse |
Reply to this message |
Hi Menta, how is the debt saturation point known, for me the USA just had a recession like any other but your saying there is a debt saturation which sounds to me like something made up for a magazine article.
Doesn't the debt saturation point moved every time money is printed or a debt is paid off or bankruptcy is claimed.
I feel a bit silly talking about something you just made up sorry ;)
Another thing is people keep talking of money being created from nothing such as debt levels being raised through housing & other assets but if someone claims bankruptcy & owes $10 million, if their assets are liquidated to the value of $1 million does that not mean that $9 million has just been wiped out of the market with nothing traded. |
|
By: glh40
17/11/2009
10:58 pm Yahoo! Profile:
glh40 Did this message offend you?
Sign in to report abuse |
Reply to this message |
<<< gold fever is evident everywhere you look, even our Fin Review had gold as its cover story on the w/end).>>>
Nah !!Yuk !!!..don't tell me, Say it's Not True...They actually used THAT FOUR LETTER WORD... GOLD...,that nasty horrible stuff used by UNSOPHISTICATED INVESTORS...on the Front Page of the Fin no less... What is the World coming too !!!....;) Ha Ha Ha... your killing me !!!
What to Expect is the usual end of Month Shenaniganns when Options Expire... then GOLD will make a New High middle of DEC $1,220....The World has Set course for WW Devaluations as mentioned many Months ago.
This makes currencies dangerous to own and their bonds subject to default....
<<< gold fever is evident everywhere you look >>>
Huh
When the People Wake Up to Buying Gold, there will be... NONE
At the moment they are SELLING their Gold at the Malls to the Multi/Corps...Gold is NOT on the Radar of the Mass Unwashed .
<<<"Does any of you believe that the market is rational?">>>
Because we are NOT Privy to the RISKs taken by the BANKS ..The Fed/Reserve can keep us (the people) all in the dark... which leads to all these Counterintuitive markets.
REAL PHYSICAL GOLD IS INSURANCE AGAINST THIS INSTABILITY ;) |
|
By: ang101000
17/11/2009
5:22 pm Yahoo! Profile:
ang101000 Did this message offend you?
Sign in to report abuse |
Reply to this message |
| Please Sir, can I have some more? |
|
By: mentawaisurf
17/11/2009
5:10 pm Yahoo! Profile:
mentawaisurf Did this message offend you?
Sign in to report abuse |
Reply to this message |
Forget Your Inflation Fears, Think About Investing for a Deflationary Environment;
http://finance.yahoo.com/tech-ticker/article/37308 4/Forget-Your-Inflation-Fears-Think-About-Investin g-for-a-Deflationary-Environment?tickers=%5Edji,%5 Egspc,EEM,dia,spy,XHB,DBC |
|
By: lasty49
17/11/2009
4:53 pm Yahoo! Profile:
lasty49 Did this message offend you?
Sign in to report abuse |
Reply to this message |
"There is nothing left to keep the asset bubbles inflated, either here or around the world, especially once the global liquidity flows reverse and the USD carry trade unwinds."
Well dont lose money trying to second guess it. |
|
By: guy.longshank1
17/11/2009
4:51 pm Yahoo! Profile:
guy.longshank1 Did this message offend you?
Sign in to report abuse |
Reply to this message |
Great post mentawaisurf!
Why is it that some people refuse to see what is right in front of their faces? |
|
By: mentawaisurf
17/11/2009
4:44 pm Yahoo! Profile:
mentawaisurf Did this message offend you?
Sign in to report abuse |
Reply to this message |
| Jay, the US reached debt saturation before us (subprime was the tipping point and since then the US has experienced an unprecedented credit contraction) while our banks and government have extended the final credit tipping point to Australians (cheap money from banks and free money from government) to achieve a similar debt saturation level here today. We are likewise now experiencing the start of credit contraction (both bank and consumer credit). There is nothing left to keep the asset bubbles inflated, either here or around the world, especially once the global liquidity flows reverse and the USD carry trade unwinds. |
|
By: lasty49
17/11/2009
3:03 pm Yahoo! Profile:
lasty49 Did this message offend you?
Sign in to report abuse |
Reply to this message |
Menta,
Yes they herd which forms a trend.
How long that trend remains is yet to be determined by simple mathematical formulas, although many claim they have the secret code. |
|
By: lasty49
17/11/2009
2:56 pm Yahoo! Profile:
lasty49 Did this message offend you?
Sign in to report abuse |
Reply to this message |
Perceptions
What are the absolute, basic fundamentals that drive markets.
PEOPLE...Is what you want me to say ?
However the fundmentals which Im talking about are economic indicators,politics,Inter est rates,etc. |
|
By: jaymarcel
17/11/2009
2:42 pm Yahoo! Profile:
jaymarcel Did this message offend you?
Sign in to report abuse |
Reply to this message |
Hang on a minute, you were calling a property crash in Australia well before the USD crashed out, or are you talking of a US property crash as that happened before the USD crash?
Sounds like you think the US property is at a high & about to crash.
Do you mind just clarifying please menta I may be mis-interpreting your statement. Thanks |
|
By: perceptions_now
17/11/2009
2:40 pm Yahoo! Profile:
perceptions_now Did this message offend you?
Sign in to report abuse |
Reply to this message |
Fundamentals are an influence.
==========
lasty,
What are the absolute, basic fundamentals that drive markets?
Not the symptoms, but the absolute, basic fundamentals that drive markets? |
|
By: mentawaisurf
17/11/2009
2:28 pm Yahoo! Profile:
mentawaisurf Did this message offend you?
Sign in to report abuse |
Reply to this message |
Lasty, most investors herd, even the smart ones, which is why optimism is typically near extreme at markets highs (like now) and pessimism at extreme near market lows (like back in March). Sentiment is crucial in making rational investment decisions based on market timing. For example, currently virtually everyone is pessimistic about the USD while the opposite is true of stocks, commodities and especially gold (gold fever is evident everywhere you look, even our Fin Review had gold as its cover story on the w/end).
On sentiment alone you could make a case that we are near a bottom in the USD and a top in stocks, commodities, precious metals, oil, real estate and generally all assets that rallied so strongly due to global liquidity flows and the mother-of-all carry trades (an inverse relationship to the USD). This key market reversal is nigh. |
|
By: jadeshangrila
17/11/2009
10:31 am Yahoo! Profile:
jadeshangrila Did this message offend you?
Sign in to report abuse |
Reply to this message |
| Market continues to move North breaking the 4800 barrier. The Dow has advanced pass 10400 as oil backs off a little and stop following the dow like a little black dog. As consumer goods remain deflated, even as the USD continues to fall, consumers local and foreign have more money to invest in wealth assets and consequently the such assets contimue to inflate in price. The low prices of consumer goods, thanks to cheap Chinese labor is what causes inflation in wealth assets in Western countries as interest rates can be kept low and inflation under control. Such may be different if there is labor shortage in China due to an aging population or if crude oil goes up in price. |
|
By: lasty49
17/11/2009
8:52 am Yahoo! Profile:
lasty49 Did this message offend you?
Sign in to report abuse |
Reply to this message |
ang,
"Does any of you believe that the market is rational?"
Markets work on emotion and momentum hence a trend.
Fundamentals are an influence.
Charts are an influence.
Time is the key fact.
When so many struggle with short term trends projecting long term trends is extremely difficult. |
|
By: jaymarcel
17/11/2009
8:41 am Yahoo! Profile:
jaymarcel Did this message offend you?
Sign in to report abuse |
Reply to this message |
Thought this made a good read
http://www.theedgeproperty.com/research/474-inflat ion-or-deflation-which-way-is-asia-headed.html |
|
By: jaymarcel
17/11/2009
8:01 am Yahoo! Profile:
jaymarcel Did this message offend you?
Sign in to report abuse |
Reply to this message |
Well I'm keen to see the system work with minimal inflation (but certainly no deflation), such a system would stop or at least minimise the cycles we keep having of boom & bust.
What is wrong with inflation sitting at 1%?
As for deflation it will never happen. |
|
By: mentawaisurf
16/11/2009
2:36 pm Yahoo! Profile:
mentawaisurf Did this message offend you?
Sign in to report abuse |
Reply to this message |
This "recovery" we have seen is based on a mirage, that the debts on the books of banks is not as bad as everyone thought. This is what happens when governments and central banks throw trillions around in bailouts and various stimulus plans.
Central banks are 'creating money/credit' like never before yet total bank credit is in uncharted territory at -5%. The series has never gone below 0 before. We can also see excess reserves piling up at banks. If people are unwilling or unable to take on more debt then it matters little how much money/credit is created as it will have no effect on the economy - just like pushing on a piece of string. Also, during the Great Depression banks chose not to lend because the risk of accumulating bad assets was far too high. So they were sitting on massive reserves. That is what is developing right now as banks prepare for future loan defaults while unwilling to take on more asset debt. Central banks have printed but the money is just sitting there. This is not inflationary.
A good example is what happened in Ja pan in 2001 where the Bank of Ja pan pumped 300% at one stage but lending continued to collapse. We can expect similar this time. If lending is not increasing then likewise we will not experience inflation.
In fact, just the opposite must occur. As bad debt is realised and asset prices fall then debt defaults rise - a classic deflationary spiral. The resulting contraction of credit will cause further deflation (regardless of the actions of governments and central banks). |
|
By: troubador35
16/11/2009
7:47 am Yahoo! Profile:
troubador35 Did this message offend you?
Sign in to report abuse |
Reply to this message |
"That said, there is now more "smoke & mirrors" and downright deceipt, than at any other time, in the modern history of the markets!"
That may well be so but at present there are a few factors to remember that rarely get a mention on this most gloomy of forums. For those of you who think the market is overvalued and is due to crash, consider this:
- The dow has gone nowhere in a decade. That's right, ten years ago it was at the same level it is today. Is your house the same value today as ten years ago? Is your salary the same; your pension?
-The dow is at the same level it was ten years ago despite the fact that the majority of sectors have posted positive returns since 1999.
-Market valuations show that stocks are cheaper today then they were in 1999.
-In 1999, price to earning ratio for the dow stood at 41.4, today the dow has an overall price to earnings ratio of 18.9. That's more than a 50% discount on the 1999 price for shares.
The markets are still in a weak condition, but the reality shows that the current correction may have been overblown, particularly given the stimulous packages the markets have received. |
|
By: jaymarcel
16/11/2009
7:31 am Yahoo! Profile:
jaymarcel Did this message offend you?
Sign in to report abuse |
Reply to this message |
Ang nothing appears rational out there at the moment, shares, property, gold, cash, they all seem to defy anything logical to me.
2010 will likely show some very big winners & very big losers, but I'm not willing to place any bets. |
|
