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The herd "experts" are now pointing to a recession as it becomes safer to do so, another example of why most of these "experts" are fools and the better play is to stay invested and carefully build positions. The stage of life I am at doesn't allow me a lot of free cash flow, but if I was 10 years older or younger, I'd be trickling in.
 
sabre_ac said:
The herd "experts" are now pointing to a recession as it becomes safer to do so, another example of why most of these "experts" are fools and the better play is to stay invested and carefully build positions. The stage of life I am at doesn't allow me a lot of free cash flow, but if I was 10 years older or younger, I'd be trickling in.
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Under normal circumstances I would agree, but not so much now.

We are now in an inflationary bear market. The worst kind other than outright crash.

There will be no easy money to keep the zombie and pretender companies going, so its going to be survival of the fittest until the Fed stops. They are on the express elevator to hell.
 
sabre_ac said:
The herd "experts" are now pointing to a recession as it becomes safer to do so, another example of why most of these "experts" are fools and the better play is to stay invested and carefully build positions. The stage of life I am at doesn't allow me a lot of free cash flow, but if I was 10 years older or younger, I'd be trickling in.
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I was thinking that but speaking to someone over the weekend that knows waaay more than me and seen all this stuff before they advised to be very cautious atm in a rising interest rate environment.

Also whilst they have come off a long way equities still aren't really 'cheap'.
 
Kram said:
I was thinking that but speaking to someone over the weekend that knows waaay more than me and seen all this stuff before they advised to be very cautious atm in a rising interest rate environment.

Also whilst they have come off a long way equities still aren't really 'cheap'.
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I read today the average NYSE P/E right now is 17.9x

The average bear market P/E is 12.6x

so yep, still not cheap..
 
Kanga Commando said:
I read today the average NYSE P/E right now is 17.9x

The average bear market P/E is 12.6x

so yep, still not cheap..
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US be like that.

Approximate numbers and using ETFs as a proxy - Europe Stoxx 600 PE should be about 13, emerging markets about 11, Japan about 13, and Australia about 12.

I don't know how much you can trust ETF providers and I guess the earnings are subject to change but there are options that seem cheap.
 
Kanga Commando said:
Under normal circumstances I would agree, but not so much now.

We are now in an inflationary bear market. The worst kind other than outright crash.

There will be no easy money to keep the zombie and pretender companies going, so its going to be survival of the fittest until the Fed stops. They are on the express elevator to hell.
Click to expand...

I'm a fan of the speed and trajectory that the Fed is raising interest rates back to the historical mean, I don't think the low-interest rates and liquidity in the markets (stocks / real estate) have been a net positive for the world.

I agree there is a risk of stagflation, though I feel I've heard that term too many times of the years, that said, a broken clock is correct twice a day.
 

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Kram said:
I was thinking that but speaking to someone over the weekend that knows waaay more than me and seen all this stuff before they advised to be very cautious atm in a rising interest rate environment.

Also whilst they have come off a long way equities still aren't really 'cheap'.
Click to expand...

Fair enough, there are certainly a lot of experienced people who I'd be listening to, I feel that experience trumps technical ability in a market like this.

Personally, I know I am terrible at timing the market, I've sat out too long too many times to have decided I'm not doing that anymore. I'm certainly not shoveling funds into the share market but I haven't stopped incrementally buying.
 
So if I have this right, this is the simplified version of what happened in England.

  • The UK decides to cut taxes to help with cost of living pressures.
  • This inflationary move pushes up yields on bonds, as higher interest rates are now needed to curb inflation
  • Meanwhile UK pension funds need to hold a certain level of bonds as a capital reserve, due to them being less risky compared to equities. Sort of like a 60/40 portfolio
  • As we all know, yields going up means bonds values go down so pension funds now need to add bonds to meet their reserve obligations
  • This should be fine except the large move in bond yields has caught pension funds off guard they can't afford to buy enough bonds quickly enough:

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  • Pension funds are also in breach of loan terms due to not holding enough collateral so margin calls are coming in (?)
  • Pension funds can't come out and say they're going to be in breach of their requirements for a little while because confidence will be shot and people will withdraw their funds immediately. Sort of like a run on banks. Also, their lenders won't allow it
  • Pension funds tap the Bank of England on the shoulder and let them know they could blow up unless something is done



  • Bank of England steps in as the buyer of last resort, and buys bonds, increasing their value and effectively saving pension funds
  • Equity markets somehow see this as a positive, since BoE can't crush inflation if the government isn't on board (remember the government started this with tax cuts) and this is a 'pivot' of sorts by the BoE. FTSE 100 ends up 0.3%

This is how I understand everything. Apparently, we got pretty close to a pension fund blowing up and then any unpaid debts by the fund perhaps blowing up other organisations around the world, like in 2008.
 
BuddysBiggestFan said:
Anyone still in CDT? “Encouraging” latest assay results done fill me with hope.
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How much would someone usually invest in a stock like that trading in the single digit cents? It's not any of my business what you personally have in there but I worry that on something so small, if you were to buy a parcel too large you'll have a hard time liquidating it before the price runs back down to lower levels again - even though small movements on something that size are big percentage gains/losses.
 
Taylor said:
Hopefully the super funds don't turn out to be a ponzi scheme right as people are trying to draw out their mone
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Interesting topic.

Without getting into conspiracy theory territory..

2022 marks 30 years of super in Australia, which as you suggested, we are now going to start seeing people who have invested in it their entire working careers starting to withdraw for the first time. There has to be a risk that some of the funds are vulnerable.
 
sabre_ac said:
Interesting topic.

Without getting into conspiracy theory territory..

2022 marks 30 years of super in Australia, which as you suggested, we are now going to start seeing people who have invested in it their entire working careers starting to withdraw for the first time. There has to be a risk that some of the funds are vulnerable.
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Depends on the underlying assets. The affect is more likely to be felt by the share market than the fund itself. Though some of the funds that have high levels of illiquid assets (like CBUS with direct property) might be in a tighter bind.




I'm not far off a significant investment into the market.
 
sabre_ac said:
Interesting topic.

Without getting into conspiracy theory territory..

2022 marks 30 years of super in Australia, which as you suggested, we are now going to start seeing people who have invested in it their entire working careers starting to withdraw for the first time. There has to be a risk that some of the funds are vulnerable.
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I'm glad my main super is defined benefit. Right up until the point in time my employer remains solvent.

All of our plans are audited

markets will plumb lower depths this week imho.
 
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Jimmy_the_Gent said:
So if I have this right, this is the simplified version of what happened in England.

  • The UK decides to cut taxes to help with cost of living pressures.
  • This inflationary move pushes up yields on bonds, as higher interest rates are now needed to curb inflation
  • Meanwhile UK pension funds need to hold a certain level of bonds as a capital reserve, due to them being less risky compared to equities. Sort of like a 60/40 portfolio
  • As we all know, yields going up means bonds values go down so pension funds now need to add bonds to meet their reserve obligations
  • This should be fine except the large move in bond yields has caught pension funds off guard they can't afford to buy enough bonds quickly enough:

View attachment 1521101
  • Pension funds are also in breach of loan terms due to not holding enough collateral so margin calls are coming in (?)
  • Pension funds can't come out and say they're going to be in breach of their requirements for a little while because confidence will be shot and people will withdraw their funds immediately. Sort of like a run on banks. Also, their lenders won't allow it
  • Pension funds tap the Bank of England on the shoulder and let them know they could blow up unless something is done



  • Bank of England steps in as the buyer of last resort, and buys bonds, increasing their value and effectively saving pension funds
  • Equity markets somehow see this as a positive, since BoE can't crush inflation if the government isn't on board (remember the government started this with tax cuts) and this is a 'pivot' of sorts by the BoE. FTSE 100 ends up 0.3%

This is how I understand everything. Apparently, we got pretty close to a pension fund blowing up and then any unpaid debts by the fund perhaps blowing up other organisations around the world, like in 2008.
Click to expand...


Short term fix, the problem is still there. Imagine handing down your first budget as new PM and getting it so ******* wrong.
 
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