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Actually i think i should appologise, my above post was a bit 'in your face' to some of the regulars here in Somersoft and this was not my intention. My intention is more to stress that investors must control their feelings: both gread (during the good times) and fear (during the bad). I...

I love your post, only you know what is right for your own situation. For those people that are in safe employement this environment is the opportunity of a lifetime. The secret to investing is to enter a position before that investment becomes crowded out and the returns marginalised...

Manufacturing accounts for 10% of australian GDP and 10% of the work force. If the aussie dollar stays down, this will increase as a % of GDP. Educational services for overseas students will also increase as the AU$ has also depreciated significantly against the asian currencies. Then there...

I dont know if anyone has noticed but CBA's preliminary interim profit was announced after market. Half year cash profit came in at $2billion a drop of 16% compared to the 08 half year, but more importantly 20% above analyst expectations. As human beings we condition ourselves according to...

In the medium-long term you are quite correct but then over the medium to onger term i can nearly guarantee that the RBA wont be keeping interest rates at these sought of depressed levels (and as you pointed out their hand will be played for them by the need to finance our foreign debt)...

I am refering to the stimulatory effect from the reduced cost of financing existing debt, rather than economic stimulation from increased debt/gdp (the issue of which i fully agree with you, its like a rubber band you can only stretch it so far before it snaps)

Yes and under which scenario is it easer to survive: one where interest rates have staid the same and one in which interest rates are dropping signficantly. The whole point is that as interest rates drop the marginal ability to save to pay off debt increases, and the marginal interest of buyers...

Spot on this is the point im trying to emphasise, even if consumers use additional savings to repair their balance sheets, it still puts them in a better future position and hence their internal confidence will build. Some consumers will use the reduced interest rate costs to save (restore...

But interest rates do have a huge stimulatory effect on the economy, if as you suggest it doesnt then monetary policy would never be used as an economic tool. Its just that because of the credit crisis, monetary policy is not as effective as in normal economic conditions, hence the ability to...

I think the Australian residential property market was the first to have a euphoric peak (in 2003 from memory). Hence enough time has passed to enable people to have build additional equity buffers in their loans. Also the the fact that australia had much higher interest rates will prove a...

The major reasons why i dont see Australia having the same degree of economic pain as the US and UK (and i emphasise same degree) are: 1) This is a financial crisis caused essentially by lending to people who couldnt afford the asset and had the legal right to hand back the asset and underlying...

I guess at the end of the day it depends on your view of risk versus return. Sure i see risk, but i see that risk being compensated for by very attractive returns (in this case industrial and big 4 australian banking shares shares, but not property except for some listed ARIETS). Too many...

Dont get me wrong, im not forecasting that things will be restored soon, history shows that debt inspired recessions take a long time to fix. This is not going to be over soon. However i keep emphasising the degree of recession that i think Australia is going to have: what ever happens in the...