Possibility of a Greek default in next week

[Shadow]

It would be of limited benefit to me personally from an investment point of view, as I can't see myself taking such a balanced approach until much older.

The price jumps to $480 in a few weeks.

Good luck to Macro Associates, but I can't see their newsletter being of much benefit to anyone.

As a very smart guy from another property forum wrote...

'One thing I never understood about investment newsletters like this. If the blokes writing them are as smart as they claim to be, why do they need to sell newsletters to make money? Wouldn't they keep their secrets to themselves, and instead of wasting time writing newsletters, spend that time investing in whatever it is they're promoting? Same applies to people selling property seminars and other get rich quick schemes. Do the people who buy the newsletters never consider that aspect? $480 a year is a lot of money to spend on information that can probably mostly be gleaned for free from various other online sources.'

At this time I prefer Jim Roger's philosophy:

"The way to get rich is to put your eggs in one basket, but watch that basket very carefully. And make sure you have the right basket."

Excellent philosophy, and one that I agree with.

But it was actually Mark Twain who originated the saying...

http://www.notable-quotes.com/t/twain_mark.html

 

[hobo-jo]

$480 a year is a lot of money to spend on information that can probably mostly be gleaned for free from various other online sources.

With a newsletter like this you are not paying for data/news, you are paying for the analysis of the individuals involved. So it can't be "gleaned for free" elsewhere. It's a unique perspective being provided and the guys at MacroBusiness have been well ahead of the curve in respect to many macro, property and market developments.

I've only ever subscribed to one other newsletter which is similar in nature: https://smartmoneytrackerpremium.com/

I don't action the portfolio trades, I pay for his unique analysis on the Gold (and other) markets. I can't get it anywhere else.

 

[Shadow]

With a newsletter like this you are not paying for data/news, you are paying for the analysis of the individuals involved. So it can't be "gleaned for free" elsewhere. It's a unique perspective being provided and the guys at MacroBusiness have been well ahead of the curve in respect to many macro, property and market developments.

Ahead of the curve? LVO has been expecting house prices to crash for a decade. Chris Becker recommended buying JBHiFi shares at $20, now they're down below $8. DLS claimed Australia has no national savings. The list goes on... you can read more of their blunders on the 'Macrobusiness Exposed' blog.

They just churn out bearish headlines because that's what their readers want to hear.

 

[hobo-jo]

Cherry picking and twisting their views belongs on your troll forum Shadow. Don't waste your time here.

Let me know when you can provide this:

How about you link to the 8-9 predictions you got right to offset the incorrect prediction of a "Sydney construction boom in 2010/2011"?

 

[Shadow]

Cherry picking and twisting their views belongs on your troll forum Shadow. Don't waste your time here.

Let me know when you can provide this:

Originally Posted by hobo-jo View Post
How about you link to the 8-9 predictions you got right to offset the incorrect prediction of a "Sydney construction boom in 2010/2011"?

As you know well, most of my predictions are posted on what you call the 'troll forum' so I can't provide links to them here.

Why don't you ask 'tech_support' to put the question to me over on that forum, and I'll gladly respond there.

BTW - it's on the record that Leith van Onselen has been expecting house prices to crash for a decade, and that Chris Becker recommended buying JBHiFi shares at $20 (now below $8), and that David Llewellyn-Smith claimed Australia has no national savings. No twisting or cherry-picking on my part... just pointing out the facts.

 

[Aaron Sice]

The price jumps to $480 in a few weeks.

must be the carbon tax.

 

[hobo-jo]

As you know well, most of my predictions are posted on what you call the 'troll forum' so I can't provide links to them here.

You've got my email address

 

[hobo-jo]

Wonder if the ECB will step in if the IMF pulls support for Greece...

It appears that following the resignation letter fiasco from Friday, the venerable IMF is trying to regain some level of credibility in the world. In a note obtained by SPIEGEL, senior IMF officials patience has clearly come to an end and has decided that, with Greece likely to go bust by September, it is no longer willing to provide additional Greek aid (we assume in light of the push-backs on the promised cuts that the aid was based upon). Pointing to this now being a euro-zone problem, their cessation of Greek aid is even more critical since both Holland and Finland pledged support because the IMF was involved. August 20th marks an important short-term hurdle as Greece is required to pay back EUR3.8bn to the ECB - and with collateral being withdrawn, we wonder how long before the ECB pulls the plug entirely - even on Greek T-Bills. Whether this is sabre-rattling before the delayed TROIKA visit or the IMF (and the rest of the TROIKA) indeed deciding enough is enough and realizing finally that more debt (or even maturity extensions) does not solve the problem of too much debt - only default will do that!

http://www.zerohedge.com/news/no-more-mr-nice-guy-imf-set-kick-out-greece

 

[Graemsay]

Couple of bits up on the FT Alphaville blog (not behind a paywall ).

Firstly Citi's chief economist Willem Buiter reckons that there's a 90% chance of a Greek exit from the Eurozone.

http://ftalphaville.ft.com/blog/2012/07/26/1096631/buiters-now-predicting-grexit-probability-of-90/

And there's another piece that argues a Greek exit is unlikely because the worsening state of Spain would mean it's likely to follow, leading to the Euro unravelling.

http://ftalphaville.ft.com/blog/2012/07/26/1097261/whos-bluffing-about-a-grexit/

 

[Graemsay]

There's a discussion of the Greek situation at the Motley Fool's forum.

http://boards.fool.co.uk/macro-stuff-12629001.aspx?sort=whole

Views seem to be diverging, though seemingly based on the same evidence. The possible scenarios being debated are:

• Greece exits the Euro sooner rather than later, and returns to the Drachma.
• A Greek exit is pushed back for a couple of years until the rest of the Eurozone can cope with the shock.
• The cost of keeping Greece in the Eurozone is significantly lower than the country exiting, so steps are take to prevent this from happening.

No idea how this is going to play out, but I suspect that that third is the most likely scenario. This is because if Greece leaves the Euro then pressure will mount for Spain, Italy or Portugal to follow.

 

[Ausprop]

yeh, forgot about Greece!

 

[Ausprop]

they probably won't default this week either

 

[redwing]

Best to worst asset classes over the last 12 months

1. Greece Government Bonds 156.00%
2. Greece Equities 74.20%
3. Japan Equities 30.70%
4. Ireland Equities 29.30%
5. Switzerland Equities 29.20%
6. France Equities 29.10%
7. Germany Equities 23.60%
8. Spain Equities 21.80%
9. US Equities 19.70%
10. Portugal Equities 19.10%

 

[Burramys]

Interesting. Buy in gloom, sell in boom. The trouble is that some places are still very much in gloom and will most likely stay there due to the way governments and society operate. I use the word "governments" for want of another word.

 

[Intrinsic_Value]

yes this action strategy will be phase 2, but phase one will be internal chaos in Greece.

How do the banks operate?
What % of greek pensions are tied up in Greek government bonds?
How will the government pay for things given they are runing a structural deficit? The government will be forced to immediately stop a % of their payouts, that will include pensions, salaries, payment for supplies, military etc etc.
How will businesses operate immediately after, especially those importing.
How do people collect their salaries if the banks are shut??

By the way CBA shares will not drop by 50%. Greece is too small to effect global affairs. You need Spain or Italy to default before this happens.

and a year+ later we see phase one progressing as anticipated

 

[Intrinsic_Value]

so, you're saying that greece is too small to affect global affairs?

lets see.

greece default and shake up the eurozone.

spain defaults because greece did.

italy defaults because spain did.

ireland says "bugger this" and defaults too.

chinese worries start to surface on the back of negative IMF reports.

AUD is sold down.

panic sets in, ASX sold down.

BHP and RIO slammed, CBA takes a massive hit.

next week ill be buying more gold, some USD, lining myself up for a mid march purchase of Aug 3700 XJO puts and waiting to purchase CBA at under $30.

yip and a year or so later we see the results, analyse the fundamental risk, buy when there is blood on the streets

 

[Intrinsic_Value]

Aaron you stated in another thread 'why is so hard for you to say "yes, i agree" without posing ANOTHER set of questions that form part of a drawn out, borderline contrived, response?'

Well its because there are so many moving parts, so the 'opinionated answer' has so many subject to qualifications.

Its not a simple a+b=c in this environment.

Overall my internal antenna is switched onto the 'risk' in the system. But after this one needs to give consideration to what extend is that risk being priced in already by the markets, then one needs to give consideration to what extent is the market positioned for this risk, then one needs to give consideration to ones own investments, how are they priced based on their own merits, how will their intrinsic value change from a change in market risk, how will their market pricing change from a change in market risk.

Most of the more sophisticated members of this forum just gravitate towards gold. My exposure is equities.

So obviously my opinions reflect a different analysis prism.

and so now a year + after the event my equity positions have made a couple of million more profit to me.

However equity markets are now trading above intrinsic value and are playing musical chairs

When the music stops I have no idea, its much harder to gage changes in investor psychology than to determine intrinsic value.

But here is another freebie clue:
as always the markets are multi-dimensional (ie not two dimensional) and the smart investors know its a game of musical chairs, so the 'exit' strategy of the smart market will be an interesting one.

 

[Intrinsic_Value]

Mentioned in another thread somewhere, but I am now exiting my sole investment in Greece:
OPAP.

Its been a very enjoyable ride, great dividends at my purchase price, a great capital gain, a total investment return of some 150%+ because of leverage but its time to move onto new pastures.

By the way Chinese banks are starting to look interesting.
Only dipping my toes in at this stage.