ASX down how much

[letiha]

Well I haven't bought anything today, still not below what i bought for a few weeks ago. Still think they have some way to come done. Will be interesting to watch what happens on Wall Street overnight.

My crystal ball tells me that the market will drop further over the next week, before rising again when the US government sorts their S**t out and then probably having another fit the week after.

All fun and games at the moment.

 

[VYBerlinaV8]

i cannot understand why so many people are bailing, and losing their capital, when the reason they bought is still strong (dividends, strong company base, strong contracts etc).

anyone want to try and explain this. i would've thought that it was too late to bail in a strong company and one would be better holding on for the short (?) but volitile ride.

Agree, which is why I'm not selling any of my shares. I'm still convinced I could look back to this time 20 years in the future and say "you shoulda been buying, dummy", which is why I still buy on a monthly basis.

But then I see shares investing similarly to how I see property, which is to use an investment asset to generate wealth over the longer term.

 

[AUSPROP...]

i cannot understand why so many people are bailing, and losing their capital, when the reason they bought is still strong (dividends, strong company base, strong contracts etc).

anyone want to try and explain this. i would've thought that it was too late to bail in a strong company and one would be better holding on for the short (?) but volitile ride.

surely it is on the basis that the US is set for depression and the world for recession at best. the beloved dividend yield is yesterdays news, how about profitability going forward?

 

[Peter 14.7]

All this talk of downward movement and collapse got me a tad worried, so I hopped in the car and drove past my investment properties.

Phew, Thank God, still standing exactly as they were yesterday.

Think I'll go home and take a little nap on the couch this arvo, it appears there is nothing to worry about, the sky aint falling after all.

cheers

Social Hero

This deserves a second post!, Peter

 

[AUSPROP...]

This deserves a second post!, Peter

tis the same BHP stock today as it was last week too... just the price tag differs. Same as property across this whole wide brown land

 

[WinstonWolfe]

Think I'll go home and take a little nap on the couch this arvo, it appears there is nothing to worry about, the sky aint falling after all.

cheers

Social Hero

Yeah you don't need to start worrying until your tenants start losing their jobs, and the govt says you can't evict them.

On another point, so long Eddie Groves.

 

[Peter 14.7]

tis the same BHP stock today as it was last week too... just the price tag differs. Same as property across this whole wide brown land

I agree except one significant difference, banks dont margin call residential property from one days trade like they do shares.

You have to concede that point? Regards Peter

 

[Peter 14.7]

Yeah you don't need to start worrying until your tenants start losing their jobs, and the govt says you can't evict them.

On another point, so long Eddie Groves.

Sorry here as well, all my tenants are secure: pensioners, low income and me. And there is no way Gov will step in as you fear WW.

We do agree 100% on Fast Eddie. He is such a shonk! Will go down as the Christopher Skase and Alan Bond of this crash.

Peter 14.7

 

[AUSPROP...]

I agree except one significant difference, banks dont margin call residential property from one days trade like they do shares.

You have to concede that point? Regards Peter

I'll concede it but hey if you are that leveraged in this market you may wish the banks had forced you to sell sooner rather than later. Happened to me - copped margin calls early in the year and thankfully I was forced to sell. If only the bank had told me to sell my properties earlier!

 

[LynnH]

On another point, so long Eddie Groves.

We do agree 100% on Fast Eddie. He is such a shonk! Will go down as the Christopher Skase and Alan Bond of this crash.

Winston, Peter

Care to elaborate on the Eddie Groves saga? I assume he's finally been forced out ... ?

Cheers
LynnH

 

[WinstonWolfe]

And there is no way Gov will step in as you fear WW.

don't bet on it. if enough people were experiencing economic hardship and were threatened with being homeless and on the streets, the govt would make it illegal to evict people. It even happens now where rental tribunals are lenient on tenants experiencing economic hardship, and give them an extra 3-6 months to pay rent arrears.

Check this:
http://www.hreoc.gov.au/legal/submissions/2008/20080704_homelessness.html#protection

We do agree 100% on Fast Eddie. He is such a shonk! Will go down as the Christopher Skase and Alan Bond of this crash.

Peter 14.7

yeah fast eddie announced he is stepping down as ABC CEO today. Hope he goes back to Sth Africa personally.

 

[LynnH]

Thanks for that info, Winston. Must confess I'm amazed that he has managed to hang on for this long.

Cheers
LynnH

 

[Peter 14.7]

I'll concede it but hey if you are that leveraged in this market you may wish the banks had forced you to sell sooner rather than later. Happened to me - copped margin calls early in the year and thankfully I was forced to sell. If only the bank had told me to sell my properties earlier!

LOL every cloud a silver lining!

I know another SStian (who shall remain nameless but no, not me) who was big marginned and forced to sell ( by partner). He/She was lamenting the loss crystalled by partner. Now ironically the partner has saved then big time!

Peter

 

[Peter 14.7]

yeah fast eddie announced he is stepping down as ABC CEO today. Hope he goes back to Sth Africa personally.

Got to give it to Eddie.

today is the day ABC is meant to lodge Annual Fin detials after a 5 week delay! And no sign of detial and he choses to resing the same day when the market crashes ensuring minimal attention.

WW I would bet he is on flight to South Africa as we speak. Sipping Champayne and Caviar in first class. Fat with AUs Gov $$$

On this topic, FYI I got within 1 minute of asking Maxime McKew (Fed Childcare Ministerish) on National Television of ABC "Q and A" Forum whould was the GOv Pland when ABC folded putting I estimated 72,000 kidsin the street and that many parents at home!?

We spke after the show and she replied shame you could not ask as they are really concerned and the number is actually 100,000 kids. This is about to blow up and change Child Care in Australia as the system don't work.

Peter 14.7

 

[Pete_d]

ASX200 Down 207 points for the day around 4.5%

 

[lizzie]

tis the same BHP stock today as it was last week too... just the price tag differs.

that's what i was getting at. i didn't buy into bhp, but similar to the resources company i did buy, they have large, long term contracts at set prices ie, contracts sell X volume of minerals at $X for X years to china/india/korea etc - and the X years are normally 5-10 years. so it's not as tho the profits from the sale will go down - and hence the dividends.

it was also interesting that someone pointed out to me - 80% of china's gdp is currently internal, so how much will a recession in the usa affect them? they are exposed only 20% to outside forces.

will be an interest couple of months.

 

[WinstonWolfe]

We spke after the show and she replied shame you could not ask as they are really concerned and the number is actually 100,000 kids. This is about to blow up and change Child Care in Australia as the system don't work.

Peter 14.7

Ms McKew certainly WANTED it to fail.
She wanted child carer to child ratio for under 2s to be dropped from 1:5 to 1:3.
And she said this wouldn't increase child care fees. go figure...


I suppose she also thinks that any mother who freely chose to have more than 3 children cannot possibly cope.

Gees, even childrens hospitals don't have 1:3 nurse patient ratios.

 

[Sunfish]

it was also interesting that someone pointed out to me - 80% of china's gdp is currently internal,

I've never heard that figure and it sounds reasonable. But, and it's a big "but", price is set on the margin.

Henry Ford did more than develop the production line, he figured that he could pay his workers enough that they would buy one of his cars themselves, thus expanding his market. The rest of American industry followed this example and the rest after that is history. An industrial giant was born.

So can a Communist government (China) follow the lead of the Great Satan? Economically it would be easy: Just revalue the yuan thus getting raw products "cheaper". This would allow the masses a better lifestyle and keep them in line and employed in a more domestically focused economy. Remember, the Party must limit unrest. In practice though, they are fully aware of the pollution which is occurring so their development has serious constraints. I think they must start importing more refined products where the local industry is dirty. For example, they have a lot of iron ore but it is much lower grade (only 50%) than they import. Some day they will ban the use of such polluting ores.

Allowing their currency to revalue would be a bitter pill for America and Europe, (forget that they whinge about this) but OK for us. Without much confidence, I think we can decouple from the US.

 

[GreatPig]

80% of china's gdp is currently internal, so how much will a recession in the usa affect them?

Maybe more than you think, according to this.

the two key trends described here imply that China has become more vulnerable to external shocks, such as a real exchange rate appreciation or a slowdown in external demand, than is generally assumed. This underscores the need to hasten the rebalancing of China's growth away from potentially volatile net exports toward a more sustainable path driven by domestic demand.

GP

 

[chilliaa]

that's what i was getting at. i didn't buy into bhp, but similar to the resources company i did buy, they have large, long term contracts at set prices ie, contracts sell X volume of minerals at $X for X years to china/india/korea etc - and the X years are normally 5-10 years. so it's not as tho the profits from the sale will go down - and hence the dividends.


will be an interest couple of months.

Lizzie are you sure on the first part of your comment. Sunfish you are quite knowledgable on the resources front.

Does BHP and RIO have long term contracts, ie 5yrs or more? If so what proportion of total resource production is tied under long term contracts?
Are the contract prices near the recent high market prices?

thanks info would be appreciated.