Positive cashflow properties not far away

No, not at all, but if you are going to invest a similar amount of time that the average Australia invests into getting a financial and economical education then I only ask that you don't dismiss my sentiments about the world and its economic climate, because I invest a hell of lot more time, energy, money into it than the average.

To be completely honest dudek I was pretty frustrated and angry at the time of writing that post, and it had little to nothing at all to do with you. Yet unfortunately I came across quite harsh and condescending and for that I apologise. You didn't deserve it.

Though with that said, I'd still really like to encourage you to actively seek to not dismiss alternatives views just because you don't have complete understanding of them, but rather look to get more information to give yourself CHOICE.

Also in all of this, I can hardly claim to be high and mighty, I bought an IP last year as well. I thoroughly regret the decision now, but of course I can't blame myself because I didn't know then what I know now, and unfortunately for me against my better judgement I invested with a friend who unlike myself hasn't seen the dire future threat, at least not to date (and he has been overseas for the last two months) but I'll be passionately trying to convince him to sell it ASAP when he returns in two weeks.

My point of all that was that I didn't mean to be too condescending, because I can appreciate that no one has perfect information and life is a learning process, which will include mistakes along the way. I just hope that you will see my very poor attempt to shed some much needed light on an otherwise largely taboo topic (the possibility of losing money in real estate) was only an attempt to pass on the insights I have come to in the past few months. Whther you agree with them, or use them as further reason to research further, is completely up to you, I just wanted to make sure you had the oppurtunity to hear and alternative view.

You are certainly entitled to your opinion, and like I said above, I wasn't meaning to focus my frustration on you or your opinion. However not all opinions are made equal. Please note that is not me trying to say that my opinion is superior to anyone else's.

My actual belief on the issue is that the most successful people in the world are normally the best at working out whose opinion is best to listen to and how to screen the rubbish because the reality is no one can be an expert in everything. It's up to you to decide how you are going to screen your information sources and which ones form the basis for your actions. But just remember, not all opinions are made equal, and many opinions are spoken with vested interest. Here is a great example in the last week...

Who crashed the economy » Blog Archive » The Real Estate industry is increasingly misleading the public.

There "will be" massive price reductions in real estate, I'm expecting between 10% - 15% at a minimum. I personally think there is scope to justify reductions of 30% - 50% based on the figures I'm analysing, though I personally like to think I'm optimistic about the future and thus I think prices reductions might be limited to only 15%. Though the fact that I also own property might be biasing my optimistic opinion. Whether you consider 10% - 15% as a big loss is up to your interpretation.

I'm not an economist, I'm a marketer by profession, I just happen to be about to graduate from my degree in economics, along with a degree in business management. But as a marketer I actually spend a lot of time studying psychology and human behaviour. I'll admit that my studies don't really focus on human behaviour in a market setting, but I'd like to think I have strong grip on the basics of human behaviour. That's is not to say that my actions don't fall short of ideal from time to time, as was well highlighted by that frustrated post earlier.

OK then, let me rephrase. People don't want to buy IPs, many people will actually sell their houses and opt to rent or move back in with their parents (it it's an option). If there has been one trend that will probably need to be reversed not just for the sake of finances, but the environment and reducing consumption it will be the dynamics of the household...

3236.0 - Household and Family Projections, Australia, 2001 to 2026

Rather than having 2.5 people per household I expect that in the future this may actually rise, especially as more retirees retire without sufficient retirement savings and with reducing government support placing greater onus on the elderly moving in with their children.

BV, from memory you are an engineer. Do you really believe that it is possible that at the time when you graduated from uni that I could design and build a bridge as adequately as you?

I know, without a shadow of a doubt that I couldn't. Now flipping that question around, do you really think that someone that has studied economics for many years does not have better insight into the "likely" chain of events that will unfold in the economy than someone who hasn't?

I may come across strong in my predictions, but they are based on sounder reasons that most of the opinions being thrown around these forums. In addition to that I have never had a problem admitting I'm wrong when I am, and I'll be happy in the knowledge that I will have learn a hard lesson and improve my understanding through the process.

There is no shame in being short of perfect. There is a lot of shame in being ignorant and oblivious of it - and professor Keen is definitely not an ignorant person. Also it just might happen that he is right, at which point I hope you are willing to give him the accolades he deserves.

I've been more right than wrong in the last 6 months. Maybe in that "junk" may be hiding some gems. To be honest the junkiest source of information I read is Invested, 4/5 posts I read on here are absolute rubbish, but I unfortunately am resigned to having to trawl through the rubbish to get to the gems.

Ahhh BV, but they are very relevant - would you expect quality advice on how to wire your electrics from an accountant? I know I wouldn't.

Now I'm not implying that just because someone is an electrician they can't be VERY financially literate, but you'd never expect them to have the depth of understanding of someone who is involved in the financial industry as a profession. Though that is not to say it isn't possible, it's just very unlikely.

I'm more than happy to make the suggestion BV that your economic understanding whilst superior to the vast majority of the population, is still WELL short of you having the arrogance to "imply" what I'm suggesting is "junk". To be completely honest, most of the time I bite my tongue when I read your posts on matters of economics.

I don't think you get it, there is nothing illogical about my predictions. Just because you lack the reasoning and experience to understand where I'm coming from doesn't make them illogical.

I know nothing I have said in this thread is likely to change your actions, but I think if you looked into a lot of the things I post about, then you might not be so condescending of my predictions. I can appreciate that sometimes I do just say what I think rather than qualify it with a large list of research and statistics, but if you ever asked me to compile them I would, but it would seem that you'd rather just dismiss me as being a Doom and Gloom merchant.

Ultimately I don't really care what you do, I'm sure you will be fine at the end of the day no matter what course you take. Like I said I realise that you are probably well ahead of the pack. As for my predictions, fighting over the future seems childish now that I'm a little less aggravated. I will just have to let the result speak for themselves.

I'm not certain to the ins and outs of the Storm situation, but I think I read or heard somewhere this position of negative equity was brought about by the arrangement storm had with CBA and the system Storm used with pooling all their clients funds together which made it difficult, if not impossible, for CBA to determine who, if any, individual clients where into margin call territory. So I think much of the blame lies with Storm there. Though once again I'm not sure of this.

Predicting the future is always a tough business... but my hat goes off to the guys that do actually make good calls on a fairly regular basis. They are all handsomely rewarded mind you...

 

Oh how sweet it is to see you post again 02B, I missed your intelligent and informed posts.

Once again you are very right, I am naive/stubborn in my attempts to force advice/insight upon those who are neither seeking it nor ready to accept that the dream of easy profits based on exploding credit may have come and gone.

Anyway, whilst your posting again, I'd love to hear your what you feel will the likely progression of events will be over the next 6 to 12 months.

I personally think to avoid a deflation spiral the RBA will eventually be forced to push the cash rate much lower than 2%, which most people are predicting, I wouldn't be surprised if we end up at 0% as well before 2009 is out. Though I fear that this will have little expect on the big issue, as I see it, stemming the declining money supply, given that most Australians will look to pay down debt at an ever increasing rate as deflation and unemployment grips the economy.

Firstly, if the cash rate were dropped to 0% I don't expect that banks would be able to pass all of those rate cuts on would they?

Secondly, I don't see how a ZIRP would increase borrowing given the low consumer confidence that will be present along with the highly uncertain in the job market. So what options does this leave the RBA to regulate the decline? Quantitative easing to fight deflation?

The only other alternative that crossed my mind is somewhat of debt transfer scenario, where by the government continues to offer cash hand outs and drop tax rates which will ultimately will help households to pay down debt, but will ultimately just transfer that debt onto the government in the form of massive deficit budgets. And obviously this has HUGE limitations given that the government's size is very small in comparison to household debt, and this sort of policy isn't a realist means of depreciating household debt that is over 150% of GDP (then again the US and UK seem to be coping with their national debts looking to balloon well over 100% of their GDP). What other alternatives are there?

I personally don't subscribe to notion that central banks around the world will opt to let deflation run its course given the destructiveness it has in comparison to its relatively peaceful brother inflation. What are your thoughts on this?

Also what are your thoughts on the potential on a bond market collapse and how do you see that playing out on property prices, interest rates and inflation?

Also if you are bearish on Australian property prices, what are you bullish on at the moment?

 

You should read this sentence a few times
It will do you good

Maybe in very expensive areas

Is that another word for salesman??

It happens all the time, but why do you ignore the existing shortage of housing and the increasing size of our population in a low interest environment?

No because you won't have the qualifications and experience
But as I said, my profession is irrelevant in this instance

Yes, well why don't you add 1 more sound reason in your predictions and this is the human factor. People adapt to situations and so do governments so all of a sudden you have an infinite number of variables into the scene. Try and predict that my friend....

I could say the same about me but I am not going to climb on a high horse and tell every1 about it.

I think you should bite your tongue more often

That's the thing, I don't lack something you have, it's more like the other way around and you can't put out statements like property will fall by 50%because there are different property markets around Australia and properties in many parts are now positive geared so making statements like that, only shows that you know very little.

Your posts speak for themselves

Now that's a very smart thing to do.

If anyone makes a good call in this environment it would be more luck than anything else.

 

Chris,

Sorry to read about you IP but allow me to share some observation and experience.

First off all I don’t discriminate between different types of investment. Principal is always the same. I strongly believe in any type of investment to bring dollar home. Think of IP portfolio like your ordinary share portfolio.
Your tenants pay you dividend in form of rent.
Your property value can reflect you overall portfolio value.
Difference between you income and real loss after tax deductions etc.. is your account keeping/portfolio management fee.

All you have to do is to take care of these three things. No one said investing in IP is easy or quick smart money. It is as hard as timing shares of one particular company.
Just like shares you don’t crystallise losses/gains until you sell. You dividends increase with time automatically reducing cost of maintaining your IP portfolio.
Answer following questions to yourself:
Would you borrow to purchase company shares in partnership with your mate who is traveling overseas?
Would you sell CBA share portfolio worth value of the house when it goes down 15% if you know it will go up again?

I don’t know details of your engagement but I made sure my accounts are clean.

Chris, I am not sure what is what you are looking for. Is it wealth creation or just passionate number crunching. What ever it is it must be adjusted into your lifestyle and long term goals. That is why some prefer IP others shares or bonds or commodity trading.

Bottom line is you have to feel comfortable with what you doing. I don’t jump to buy gov. bonds just because it produced few millionaires. It may not be MY cup of tea.

 

The very expensive areas have already lost 10%, the market is temporarily being support by the FHOGs in the sub $500,000 market.

No, it means I'm a marketer. I'm an online marketer to be specific, as in I make websites popular.

I tried my hand as a telemarketing salesman back in grade 12, but I didn't have the killer instinct you need as a salesman and for some reason people didn't want to give their credit card number to a 17 year old over the phone...

I see how one might feel the need to focus on the "traditional" factors that they are constantly bombarded with in the mass media, but you need to appreciate that the media tends to dumb things down for the average joe blow, and they don't tend to talk in terms of M1 and M3 of money supply, which honestly have a hell of a lot more to do with asset price growth than a couple of people of the UK immigrating.

I'm not saying that supply shortages and easy availability of low interest credit don't play their part, they most definitely do, but from my perspective they are just a side show to the big game (M3 aka money supply).

Also my feeling is the "shortage" for the time being it has been abated as is well represented by the drop in demand, and thus the troubles in the building sector. Also from what I have been reading given the current downturn the government is looking at significantly dropping the number of visas they are offering (by as much as 40%) until the downturn has passed and unemployment abates.

Also I expect that with rising unemployment you will see an increasing number of young people moving back into family households as well as having a lot of potential first home owner looking to delay their purchase until more certain times. These sort of factors will significantly reduce the influence of the often proclaimed shortages in the short and medium term. I won't argue with you on the prospects of shortages in supply in the longer term if we resume aggressive immigration policies and especially if a lot of builders go to the wall over the next couple of years.

That said, I understand why people stick to what they know (the basics and the obvious) when it come to making an analysis of the situation, that's very logical. All I'm suggesting is that if you are just looking at factors like interest rates, supply and demand, rental yields and recent history that is all well and good if you are holding all other things equal, but there are other MAJOR factors that influence asset prices. That's where economics comes into it.

When you understand what the 0.1% contraction in M3 levels of money supply in December 2008 implies, you'll understand why I'm no longer wondering if house prices will fall, rather I'm now questioning by how much they will fall.

You know one of the biggest ironies I have found of late is that whilst the generation proceeding mine definitely has more real world experience, which has helped to better develop instincts and intuition, most of the generation is somewhat constrained by their lack of breathed and in many cases depth of knowledge, which through no fault of their own was just a result of environmental differences between our generations, being that older generations in large was educated through TV and newspapers , and this was a system of supplied information, ie you only learnt about what a journalist or commentator spoke about.

Where as my generation has been largely influenced by the internet and excessive amounts of information being available, from a vast array of sources, but most importantly the information is demanded rather than others making the decisions over what we read and hear.

This is was very apparent to me when I questioned both my parents of their understanding of the demise of the Soviet Union, which no doubt was a massive thing for their generation, yet within a few moments it was very easy for me to see that their understanding was HUGELY lacking given that at the time their information sources were only the newspaper and TV, which are well short of being sources of a good education when it comes to highly complex issues, nor is a couple hundred words in a newspaper article.

I factor the "likely" actions of both the RBA and government into my assessment, and given that human behaviour for the most part is fairly consistent, it didn't take a rocket scientist to predict that the government would try a stimulus package, and will probably try again when this one fails, just like the RBA will probably be forced to drop rates much lower than 2.5% like many are hoping.

I got no problem with attempting to predict institutional reactions, they are probably the easiest thing to predict, because their vested interests a quite clear.

The beautiful thing about chatting on these forums is we have a document history of everyone's predictions, so like I said earlier, I'm happy to let the future make the decisions over who had better insight, and for the record I have never said that property would fall by 50%.

The existences of individuals like Warren Buffet go in stark contrast to your statement, and he is far from alone. That being individuals that beat the market consistently year in year out.

I have never claimed to be an expert, just a man of a different opinion, and the only thing I'm asking of anyone on these forums is to take my opinion seriously, because I say it in earnest. I'm not asking anyone to change their asset allocations or anything. As far as people's finances are concerned, each to their own, but I don't want people to **** on my opinions just because we are talking abut different things.

When I have I ever said the end of the world is coming! I don't believe it is coming!

I do believe we are at an end of an era (that being credit growth). I fail to see why this is some sort of revolutionary statement given the environment around the world, yet I'm dismissed like I must be moronic for even suggesting the system we are currently operating in has some inherent flaws.

Unfortunately many people have been claiming investing in IPs and even the stock market is easy - thus being one of the major reasons we have a serious debt problem. It doesn't take an IQ of 130 to realise that when asset price growth rates are higher than interest rates that borrowing to invest further increase your gains, and his doesn't even include dividend or rental yields.

Anyway my point is, whilst most highly leverage and unqualified or inexperienced individuals have already been pushed out of the stock market as a result of falling share prices, the same is yet to happen in the property market.

Yes and no. I sort of agree, but you still need to be able to know when to cut your loses from a bad investment and move your remaining equity into a better yielding investments - emotion is your enemy in this sense. Also equity plays a part in most financial strategies, and lack of it can reduce your options considerably. So as such, I'm of the opinion you should be looking to preserve wealth as much as you are looking to create further wealth or increase cash flow.

Once again this is not entirely correct. Whilst central banks "aim" to keep inflation between 2% - 3% this is not entirely in their control. The reality is that the RBA has maybe 5 - 10% control over the total money supply the rest is private banking institutions like ANZ, CBA, NAB etc - of course they try and manipulate the market and encourage tightening and loosening of credit, but might light government and stimulus packages, when the masses move in unison there is little they can do to counteract it.

For the vast majority of the population they fail to be able to conceptualize the reality that rental incomes can come down just like they go up. I actually happen to be of the opinion that over the next 12 - 24 months they are more likely to come down than go up. So making an investment upon a principle of dividends or rental yields will ALWAYS go up is naive.

Figuratively speaking the answer is "yes" I would, but in reality I wouldn't because the principles of shares is that you can invest in a company without having to buy the whole company, making it easy for small time investors to get exposure. Unfortunately the place we bought cost $537,000 and we'd preferred to split the cost of investing in an area we thought had much better fundamentals than both of us opting to invest in places worth $300,000 that we didn't believe had the same prospects for growth.

Depends on so many things. Like right now, yes I'd sell CBA shares if i had any - but that is because I believe many of the banks including CBA are in big trouble.

Like for example I sold out of all of my Bank of Queensland shares in November last year at $10, after they had already lost 45%! They are now worth $7, so I would have lost another 30% from their $10 value. I now only wish I had trusted my instincts much earlier rather than base my decisions on optimistic wishful thinking, but live and learn. I have since made a 17% return on my gold investments, as a result of research and trusting my judgement that is based in reality rather than dreams.

The lesson is, just because something goes down, doesn't mean it has to go back up, and more often than not you are probably better off cutting your losses and moving your resources to better performing investments. There are ample examples of this situation having been posted on these forums over the last few months of people holding onto shares because of wishful thinking, or buying in just because shares haven't been this low for a long time. Real investment decisions needed to be backed by more than hunches and feelings.

No argument here. Everyone needs to make consider their position in life before making investments, though I don't think this has much to do with my opinion on the direction of asset prices.

Very true, sticking to what you know is important, though it isn't nearly as important as making sure you know as much as you can know. My point being that getting a good understanding of shares, bonds, commodities, property, whatever doesn't take years and years therefore using the excuse of I just invest in IPs because that is all I know isn't valid over the long term. In the short term, sure stick to what you know, but in the long term if you really want to yield good returns and diversify risk you need to have a wholistic understand of all the asset classes, and the world.

I should point out, getting a good understanding of an asset class and mastering it are very different things. Becoming a true expert in say investing in the stock market may take many many years, probably many decades. But most people are probably ready to make some longer term investments into shares after reading a few books on shares and the stock market along with some basic strategies and speaking with a few people with experience.

 

Yeah right, ok, whatever,
Why don't you have a look @ your post 21 and tell me what data will justify 50% reductions
I have copied the relevant part of your 2 pages long post......

Post#21

 

The existences of individuals like Warren Buffet go in stark contrast to your statement, and he is far from alone.
That being individuals that beat the market consistently year in year out.

Hmmm....

Berkshire’s stock has declined 36 percent in the past year, through yesterday, and profit has fallen in four straight quarters.

Berkshire increased its Ingersoll-Rand stake sixfold in last year’s second quarter, when the shares never fell below $36.54.
Since acquiring the stock, which gives Buffett about 1.8 percent of the firm, the price has fallen more than 50 percent to yesterday’s closing price of $15.59.
Profit at Ingersoll, which makes Thermo King and Hussman refrigeration equipment, has fallen in three straight quarters. etc...
more....Bloomberg.com: Invest

 

I'd like to thank Chris C, BV and Dudek for all the work and interesting content you guys have put into your posts.

The constrasting views, ideas and information have been thought provoking and prompted me to question a number of recently formed assumptions/opinions which is always a good thing and a learning experience.

I'd like to use my knowledge and expertise to choose a side or stance but unfortunately compared to the rest of you, I'm still too ignorant

Oh, I also admire the way every one so far has been passionate and civil/polite at the same time. Not an easy feat.

 

Hi Chris,

What happens from this point is a case of 'pick your poison'. The economic decline continues thats a certainty. The wild card is how much worse will central banks and governments make it?

They've embarked on a neo-classical Keysian approach which is a totally untested experiment. No one can say what will happen. But there many smart people who believe this approach will not only fail but will actually be made worse either by dragging out the whole affair longer or by ultimately crippling the system.

The critics believe that throwing money at the problem will not ultimately work. As time goes by they'll find the system isn't responding as they would have hoped. So their response will be to throw even more money at it but none of this will have the desired effect of increasing money velocity and so the system will continue to de-leverage.

There are at least two very vocal people who have written about this.

Steven Keen -
naked capitalism: Steve Keen: "The Roving Cavaliers of Credit" (or Why Ben's Helicopter Will Fail)

(theres a new interview with Keen on itulip.com but I've not read it yet)

and

Martin Amrstrong

More Martin Armstrong

They both take the view (along with Nouriel Roubini and Taleb see video below)
Dr. Doom & the Black Swan: You Ain’t Seen Nothin’ Yet - Stock Market * US * News * Story - CNBC.com

that the fed and governments have no chance to correct things because they have completely the wrong idea about what needs to be corrected.

If you subscribe to the above then ZIRP will make little difference as money velocity will not increase.

Cutting taxes is probably the best idea (although it won't do much to help people who are living on interest to survive). Naturally this money has to come from somewhere and one way to cover it is to cut and rationalise government. Its insane that a country of 22million has six full state blown state governments, separate police forces and education systems etc.

Unemployment will be the big issue in 2009 in my opinion and I can't see us going back to the high levels of employment we've in the the last 10years, not for many years (I mean 15).

We've just lived through the equivalent of the 1920's and no one has recognised it for what it was, a blow off top in speculation and mal investment.

So back to the wild card, as things turn increasingly desperate we will see governments and cental banks begin to do more and more unconventional (unthinkable) things. Think NIRP (negative interest rate policy). Read the following for a taste.

Contrarian Investors’ Journal » Blog Archive » Bernankeism and hyper-inflation

Seems itulip has concluded that the us gov is going to start buying equities.
If that happens it will of course generate a stock market rally but the likelihood is that after all is said and done the market will give it all back.

Thats enough for me, I've got the flu and I'm exhausted.

take care.

 

I am surprised Mr. Keen can sleep at night. I lost all respect to Mr Keen after an interview when he was trying to convince everyone prices of RE are set for free fall but at the same time he took an opportunity to promote sale of his unit. Now, how can you look someone into eyes telling that this unit will be worth nothing and at the same time handling him the key and cashing in? If Mr. Keen was not seeking opportunity to promote himself and to get some fame and publisity he probably would be rich by now. As always most academic people on this planet can’t practise what they preach.

 

Chris,

It’s not fair to point finger at uneducated part of population when educated top end of the town is trowing money at them. Do you aspect people to say NO to $950 gov. handout? Our PM went on national television once to preach people about money management and now the same person is contradicting what he said in the past. 12 months ago we hit at people spending too much, now the wave changed and we are encourage to spend more. People are simply manipulated by left, right and canter and you can’t blame them for end result.

 

There's more than a touch of arrogance in your post.

Chris, honestly, I'd rather listen to the opinions of a seasoned investor, be they tertiary qualified in economics or not.

In the world of investing, pracademics beat academics any day.

Regards

Mark
ps. My resume, fwiw, includes a Master of Economics degree and time spent both at the Department of the Treasury (Canberra), and the Productivity Commission. I also manage my own multi-million dollar investment portfolio and tens of millions of dollars on behalf of clients. But the people I listen to aren't economists, they're investors with even bigger portfolios than mine which, btw, they didn't get by accident.

 

All right Mark_B, in for a penny etc...

This is an investing site/forum. How do you (and your experienced investing associates) see the real estate, equities and other markets panning out? How will you (and they) be attempting to make money (both spec and investing) over the short, medium and long term?

Thanks in advance.

 

I trust everyone talking about cash-flow positive property is referring to net rather than gross yields. Otherwise it would be as misleading as looking at a company's gross rather than net profit.

 

I think it's great to have someone with Mark_B's experience join the forum.

Some people here could learn a lot by posting a bit less, and reading a bit more...

If you want gauge some of Marks thoughts re: the economy, IR, housing market etc you can just search Somersoft - same user name.

Welcome Mark!

Rgds, Chris

 

I didn't see the interview, but I got a lot of respect for him if he can make his prediction then put his money where his mouth is. By the sounds of it, that is all he did.

My point is not that it is just the uneducated who are at fault, my point is that the uneducated, which is normally the vast majority of people, are very quick to point the finger rather than look in the mirror and truly accept their role i the whole meas. Ignorance is never a defense, and being responsible is the only way to solve any problem.

I expect people to have half a brain and realise that the government has no money of its own. It doesn't make money, it just distributes wealth. With these handouts it has just taken our wealth from the future and given it to us now. Even the name "handout" for many would be associated with the notion of the money being "free" but it isn't anything but.

Unfortunately for me I don't even get the handout, yet will no doubt be the one paying more than my fair share for it. Seems messed up to me that I'm marginalised while those unaware of their own ignorance are rewarded. It's the same with all bailouts, they reward incompetency.

Like I have mentioned a number of times on these forums, democracy is VERY flawed, but unfortunately it is probably the best form of governance we have at the moment.

So the answer to your question is, of course I don't expect them to say "no" but that is only because I don't expect the majority of people have a clue.

Sure you can. As I have said ignorance is not a defence.

I'm not saying people need to be rocket scientists, I'm just saying people need to ask the "why" question more often in their lives. Too many people are more or less just slaves to the system, somewhat-blissfully unaware of their own servitude. The problems of this world are problems of ignorance with allow corruption through indifference. The masses have made their bed and now they must sleep in it.

My only hope is when they wake up from their terible night sleep is that they start asking the "why" question more frequently as we look to reform for the future.

Despite my hopes being slim, I was quietly surprised about the new movie "the International" whose tagline is "They control your money. They control your government. They control your life. And everybody pays." I also heard Michael Moore is doing a new docu on the banks and the government bailouts, which will no doubt be sub par when it comes to the truth but a definite step in the right direction.

This sort of thing makes me think that there is a genuine chance for the masses to be at least exposed to the corruption of the elite of the world. Falling short of mass enlightenment I fear that we are all doomed to repeat our failures.

As I age I become more cynical of the world and with this I am definitely finding it increasingly difficult to suppress my true views. So this coupled the large amount of faith I have in myself makes me arrogant in the eyes of most.

That said I'm more than aware that there is so much I don't know, and more importantly than that I know there is so much more than I don't know I don't know. And I'm not hear trying to tell everyone here I'm right, I'm merely trying to get additional information across for discussion, which in my opinion isn't weighing heavily enough in conversation.

I personally have found that a little arrogance doesn't hurt.

Me too, as long as they are successful, and continue to be successful even in these tough times. I think Donald Trump, said it well on his show the Apprentice, "it doesn't matter whether you are street smart or book smart, what's most important that you are smart."

Once again I agree.

Sounds like a smart move to me. I'd love to here what are they saying?

I'll head over now and have a browse around. Though do you have any links to any threads/posts of particular quality or that you'd like to highlight?

 

Wow - I picked a long thread to come back to after a bit of a holiday from InvestEd. Good on everyone for having some impassioned thoughts

If academic qualifications are important to be allowed to have an opinion, I have an MBA. I only completed it because my employer at the time strongly suggested I should. I can't think of a single time I have put it to use in 'real life' but I still proudly display it in a frame in the back of a cupboard somewhere.

In my mind, if you know what you're investing in reasonably well, and you continually try to keep up to date, you're ahead of 80% of the other people in the game. Like the little dude strapping on his running shoes while the jock looks on and says "you will never outrun that grizzly bear" the kid says "I only have to outrun you" as he takes off.

Sure we are in for some tough times. We are also heading for some opportunities that haven't presented themselves in several decades. Feel free to doom and gloom yourself into oblivion along with the tabloids and the academics, or accuse people of being 'entrenched in a position', but at the end of the day you'll make some decisions which will have consequences.

Personally I am looking forward to the next year and the next decade. I hope my family will end up more secure and placed to enjoy the finer things in life rather than bickering about the end being nigh. It isn't likely to be easy (at least not as easy as gliding through a property boom like some people thing is commonplace) but it should be interesting

Rock on ! And enjoy ...

 

“I have spoken of the rich years when the rainfall was plentiful. But there were dry years too, and they put a terror on the valley. The water came in a thirty-year cycle. There would be five or six wet and wonderful years when there might be nineteen to twenty-five inches of rain, and the land would shout with grass. Then would come six or seven pretty good years of twelve to sixteen inches of rain. And then the dry years would come, and sometimes there would be only seven or eight inches of rain. The land dried up and the grasses headed out miserably a few inches high and great bare scabby places appeared in the valley. The live oaks got a crusty look and the sage-brush was gray. The land cracked and the springs dried up and the cattle listlessly nibbled dry twigs. Then the farmers and the ranchers would be filled with disgust for the Salinas Valley. The cows would grow thin and sometimes starve to death. People would have to haul water in barrels to their farms just for drinking. Some families would sell out for nearly nothing and move away. And it never failed that during the dry years the people forgot about the rich years, and during the wet years they lost all memory of the dry years. It was always that way.”

- John Steinbeck, East of Eden


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Now simply substitute the climate with the economy.
Yes, there will be opportunities but there will also be years of harsh reckoning.

I saved this passage away 4 years ago when it became obvious to me what was taking place in the global economy.

 

Sounds like you've got yourself sorted then Where were you when all the world leaders needed you ?