RBA's Unofficial Briefings: Interest Rates Headed Down Soon

Well....this is only the start...but have a look at these articles...as I have said the psychology of investing has a part to play.


The article below talks about the high dollar hurting the Aussie manufacturers...contrary to believe this is still reasonable in Australia. I think the RBA will move on this which means reducing rates...which in turn will lower the strength of the Aussie dollar.

http://www.smh.com.au/business/rising-aussie-dollar-hurting-key-industries-20110502-1e44r.html

And now for the underlying trend of food prices cming down post Yasi and Floods.

http://www.smh.com.au/business/frui...-bringing-consumer-relief-20110502-1e3ti.html

Will be interesting to see how the RBA reacts when the Aug figures clearly show sugglish GDP growth, employment growth flatlining, and inflation coming down rapidly.

If Ghaddafi is knocked off....you will also see Oil prices coming back down.
bluestorm said:
Good luck Sash. I think however you have picked it incorrectly. Interest rates will head up, and property prices will continue to cool.



The main inflation driver will now be the natural disasters mid-term. It will be the fact that inflation is rising globally (everyone has overstimulated). China is fighting inflation. Much of Australia's inflation rise will come from imported inflationary pressure.
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i read a reader article in the west the other day that was interesting it read along the lines in this opion of this person that

petrol prices are high living costs are increasing
the issue with inflation is caused from people buying cars,
interest free products harvey norman etc these should be banned becacaus these people don't have this money and this is misrepresnting the economic situation therefore rates are on the rise

food for thoughts......
 
sammyla said:
LOL how can we get a ticket to these unofficial briefings? Unofficial brifing toJournalists LOL Damn i didnt know that :)
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If you watched Peter Switzer today (heard of him?) interviewing Dr John Hewson (Dr Who?) maybe you'd understand that private briefings do take place. But it was broadcast on CNBC (whats that?), so you may not have seen it.

Peter and John are former RBA men. Both seem to believe that the direction of interest from here is down.

I'm not sure of your credentials. One thing is certain: you clearly have not been employed by the RBA.

Love:)
Oi Oi Oi Annie
Bete Noire

PS. Some of my posts on this thread have been deleted. Apparently there have been a few complaints about my remarks about Aborigines and immigrants.
 
One idea would be to pay attention to those people currently working for the RBA, Glenn Stevens (I'm sure some have heard of him) has a released press statement which has been linked in this thread. It's not really dovish.

Anyhow the market takes, mixes and mashes all the inputs (I'm sure some market participants even risk their sanity by watching CNBC) and pops out some numbers, and those numbers are saying a move up is more likely than a move down for whatever that's worth.

We all like to think we have an edge over the market, proving it is a tad more difficult.

http://www.asx.com.au/sfe/targetratetracker.htm
 
Aaron Sice said:
http://www.rba.gov.au/media-releases/2011/mr-11-07.html

after today's decision to put rates on hold, the attached press release looks like the next move will be up.
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Good news :) I also think that, despite the speculation in this thread, there are too many wild cards in the future for us to know with certainty what will happen. For my own part, people around me are struggling and spending far less than they are accustomed to, and I hence see conditions for stagnant rates.
 
Ocean Architect said:
Good news :) I also think that, despite the speculation in this thread, there are too many wild cards in the future for us to know with certainty what will happen. For my own part, people around me are struggling and spending far less than they are accustomed to, and I hence see conditions for stagnant rates.
Click to expand...

Until recently I had thought that we were at or near the top of the interest rates cycle. Now I really don't know.
 
charlieandkath said:
would love to see rates go down.
Click to expand...

Why?

If you are still in accumulating stage, higher rates are good because they generally put down-wards pressure on property prices.

In addition to that, less people will be able to afford a loan, there will be less buyers around so there will be less competition and vendors become more negotiable.

So its all good, let's hope the next RBA decision will be up.
 
Agree BV, increasing interest rates will bring some good accumulation opportunities down the track.

I have no doubt that rates are heading up. Inflation is slowly turning into a global problem. China has been increasing rates, India went up 0.50% yesterday. Inflation is also starting to show up in the US and Europe.

We've been protected by the higher $A.

If my call is correct, we'll see rates rise over the next 2yrs, resulting is falling property prices. When the cycle turns again, and rates head down, it will be an excellent opportunity ramp up the LVR and accumulated more property in late 2013.
 
annie lumen said:
If you watched Peter Switzer today (heard of him?) interviewing Dr John Hewson (Dr Who?) maybe you'd understand that private briefings do take place. But it was broadcast on CNBC (whats that?), so you may not have seen it.

Peter and John are former RBA men. Both seem to believe that the direction of interest from here is down.

I'm not sure of your credentials. One thing is certain: you clearly have not been employed by the RBA.

Love:)
Oi Oi Oi Annie
Bete Noire

PS. Some of my posts on this thread have been deleted. Apparently there have been a few complaints about my remarks about Aborigines and immigrants.
Click to expand...

Hey Annie

Any chance of putting in a few links to support your ramblings, a quick google on Peter Switzer shows he would not be suprised to see interest rates actually rise sooner than expected


http://www.switzer.com.au/the-experts/peter-switzer-expert


"This is the story of two different economies where the Americans are in no danger of seeing an imminent interest rate rise while in our case it could be sooner than expected."

Apologize to you Annie for putting fact ahead of fiction.

Cheers

Pete

PS I think you make a good comic book character

"Bête Noire, the kitten in the comic strip Gordo by Gus Arriola"
 
Ocean Architect said:
Good news :) I also think that, despite the speculation in this thread, there are too many wild cards in the future for us to know with certainty what will happen. For my own part, people around me are struggling and spending far less than they are accustomed to, and I hence see conditions for stagnant rates.
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omg :eek: we agree again.

personally i am at the stage that "what happens will happen" and there is not a darn thing i can do about it myself - so no point in wasting time speculating. to busy spending time working out how to make more money.
 
BV said:
Why?

If you are still in accumulating stage, higher rates are good because they generally put down-wards pressure on property prices.

In addition to that, less people will be able to afford a loan, there will be less buyers around so there will be less competition and vendors become more negotiable.

So its all good, let's hope the next RBA decision will be up.
Click to expand...

I agree. if you still have room to borrow than you dont want prices to move up.
If you are maxed out with no add value potential left then you have two options.
Pay down the debt
Wait for prices to rise.

In a perfect world you would borrow like mad during your accumulation phase all the while house values do not move.
The day you max your lending out prices start to move and you redraw the gained equity to go again. perfect world remember.
 
annie lumen said:
Yes, it is possible to make money on futures or options on IR. But I'd rather mkae bets with the panicmongers because:

1. Most are too gutless to put their money where their mouths are
2. The financial pain of losing a bet may well put them in their place. Maybe they might learn to switch on their brains before mouthing off on topics they know little about. Losing a few thousand may make them more humble.
Click to expand...

The irony in this post is hilarious. Keep it coming Annie!
 
ON TOPIC

Rates will go up because rates are low. Yes low.

In my investing career, I would guess I have averaged 10%. Presently locked at 7.1% I am relaxed. Do I care if rates go down to 6.1%, well no. Do I worry if they go to 8.1% well no.

What I really focus on is what drives my property investments?

Is employment going up, thus tenants will default? No.
Is Gov policy about to change massively and low building and land costs 25%. No.
Is tax law on property about to change for the worst, Yes, ok focus on that.

OFF TOPIC

Long term investors know that rates go up and down. If you base investing in IP on interest rates then you in the wrong investment class.

IR are one of probably 10 factors that come into IP strategy.

Regards, Peter
 
lizzie said:
omg :eek: we agree again.

personally i am at the stage that "what happens will happen" and there is not a darn thing i can do about it myself - so no point in wasting time speculating. to busy spending time working out how to make more money.
Click to expand...

you must have filled your prescription for smart pills ;) good on you! :D

Honestly Australia is such a tiny economy on the world stage that even a press statement from one of the big economies (eg China announcing that they will buy less resources or whatever) can completely change things, hence my "there are too many wild cards" comment.

Imo a sensible strategy at this point is to watch your leveraging, make sure that you're close to cash flow neutral (or positive), don't overly bank on capital appreciation, and worst case scenario, you ride it out and come out on the other end in good shape. Not a clever time atm to take risks that you cannot cover
 
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