Black Monday

[SailorRob]

Its not direct govt spending that causes inflation as you suggest. The issue is QE and providing banks with cheap money. If G. Robertson and the finance ministry actually had any clue they would have priced their bonds better. When The Bank (RBNZ) buys these bonds (at a huge loss to the tax payer, and I have commented on this in the past so won't revisit that now) it paves the way for the govt to provide further stimulus. The Bank issues dollars to itself to buy bonds, mortgage backed securities, etc. This money makes its way back to the banks which can be lent out stimulating the economy. As the binds mature and the coupons from those bonds are then used to buy more bonds and the cycle continues.


Umm the market prices the bonds not Big Grant.

QE is just an asset swap, noting new is created. Yes it does affect the price of money granted.

It's the bonds getting issued that is the problem.

With QE you lose a bond asset and gain a cash asset, your net worth is unchanged.

It's the creation of the bonds and the spending that is the problem.

[Panda-NZ-]

Consumer Price Index and the different weights given to item categories:

https://www.stats.govt.nz/methods/consumers-price-index-review-2020

[SailorRob]

Also some other stuff the government has done to crank inflation;

Raised the minimum wage massively

Reduced the ability of the economy to produce goods and services.

For those who think government spending does not create inflation... The size of our economy is what 400 billion or close?

What if the government spent 800? Would that create inflation, if yes, then could a smaller amount?

Anyone have any idea how much they have increased spending in the last 6 years?

Have a look...

[JBmurc]

Also some other stuff the government has done to crank inflation;

Raised the minimum wage massively

Reduced the ability of the economy to produce goods and services.

For those who think government spending does not create inflation... The size of our economy is what 400 billion or close?

What if the government spent 800? Would that create inflation, if yes, then could a smaller amount?

Anyone have any idea how much they have increased spending in the last 6 years?

Have a look...

Well net GOVT DEBT has increased by over $80Bill since 2018.. then of course with the ever increased TAX take as growth in Kiwis incomes move into higher TAX brackets.. higher consumer goods prices = more GST gathered ... all of this of course spend by present GOVT ..why we have such an increase in DEBT ..

I see in todays OTAGO times the local Dunedin Council is hoping to lift Council DEBT ceiling towards $1.4Bill .... no way thats ever getting paid down.. with such limited rate payers... higher interest rates

[SailorRob]

Well net GOVT DEBT has increased by over $80Bill since 2018.. then of course with the ever increased TAX take as growth in Kiwis incomes move into higher TAX brackets.. higher consumer goods prices = more GST gathered ... all of this of course spend by present GOVT ..why we have such an increase in DEBT ..

I see in todays OTAGO times the local Dunedin Council is hoping to lift Council DEBT ceiling towards $1.4Bill .... no way thats ever getting paid down.. with such limited rate payers


Exactly, not just the doubling in the tax take but also massive unprecedented increase in debt.

But,

THIS IS NOT THE CAUSE OF INFLATION :t_up:

Of bloody course it is

[ValueNZ]

Well net GOVT DEBT has increased by over $80Bill since 2018.. then of course with the ever increased TAX take as growth in Kiwis incomes move into higher TAX brackets.. higher consumer goods prices = more GST gathered ... all of this of course spend by present GOVT ..why we have such an increase in DEBT ..
Higher prices don't mean more GST gathered in real terms... Definitely agree with the moving into higher tax brackets part though, fiscal drag definitely impacts government tax revenue in real terms.

[SailorRob]

Higher prices don't mean more GST gathered in real terms... Definitely agree with the moving into higher tax brackets part though, fiscal drag definitely impacts government tax revenue in real terms.


Depends on the mechanism of the higher prices. It could mean more tax in real terms, but not lately.

[ValueNZ]

Depends on the mechanism of the higher prices. It could mean more tax in real terms, but not lately.
Sure, I suppose it also is dependent on the output of the economy.

Money supply * Velocity = Price * Quantity

[ValueNZ]

Different when you helicopter money to the plebs.. this type of government spending is very inflationary
Lol this. As a 15 year old with no need for the cash I was eligible for $359 a week from the wage subsidy with my part time job. That was about $100 more a week I would have otherwise made working my "normal hours". Even I knew at the time all it was a wealth transfer from the wealthy to the poor through inflation.

[Panda-NZ-]

Well net GOVT DEBT has increased by over $80Bill since 2018.. then of course with the ever increased TAX take as growth in Kiwis incomes move into higher TAX brackets.. higher consumer goods prices = more GST gathered ... all of this of course spend by present GOVT ..why we have such an increase in DEBT ..


Doesn't inflation erode the value of debt?

Feel sorry for the suckers holding NZ's debt..

[jonu]

Any injection of money supply without a corresponding rise in productivity must be inflationary.

NZ is plagued with non-productive compliance costs that make us less productive by the day. A huge proportion of our economy is day to day consumptive, without added value. Most of the population have no clue as to what genuinely adds value, and there is an entire sector of the economy both blocking and feeding off any other sector that seeks to add value.

[ValueNZ]

Doesn't inflation erode the value of debt?

Feel sorry for the suckers holding NZ's debt..
It does erode the value of debt because the purchasing power of cash falls. Feel bad for the people that made the loans. Those who took on loans or companies that issued bonds at low rates are better off.

It's one of the problems with erratic inflation, it creates an unknown variable and causes inefficiencies. It creates winners and losers which otherwise wouldn't occur.

[SailorRob]

Any injection of money supply without a corresponding rise in productivity must be inflationary.

NZ is plagued with non-productive compliance costs that make us less productive by the day. A huge proportion of our economy is day to day consumptive, without added value. Most of the population have no clue as to what genuinely adds value, and there is an entire sector of the economy both blocking and feeding off any other sector that seeks to add value.

Feeding off, absolutely right. Even the blind can see that. And a right feast they're having.

Technically a money injection that isn't spent, lower velocity, may not be inflationary, but your post was extremely accurate.

[Daytr]

Also some other stuff the government has done to crank inflation;

Raised the minimum wage massively

Reduced the ability of the economy to produce goods and services.

For those who think government spending does not create inflation... The size of our economy is what 400 billion or close?

What if the government spent 800? Would that create inflation, if yes, then could a smaller amount?

Anyone have any idea how much they have increased spending in the last 6 years?

Have a look...

I don't believe anyone said Government spending doesn't have some inflationary impact. All spending does no matter who is spending it.
However in the scheme of things the increases of Government spending has had a very small impact on inflation.
Quite correct re the minimum wage, but this is not Government spending of course and some of the increases were made prior to the pandemic.
If increased Government spending was a major contributor to inflation then the NZ inflation rate would be a lot higher than other countries and it's not. In fact we seem to be ahead of the game compared to the likes of the UK & Australia.

The main contributors of course were things like the oil price & construction materials going up by circa 50%.
Chinese manufacturing shuttered.
The Ukraine War and its impact on grain prices & energy prices.
Major domestic weather issues wiping out huge amounts of fruit & vege, let alone the rebuild required.
And of course the near zero interest rates which I said at the time would create an asset bubble when at first virtually the whole market was doom & gloom on things such as property.

I commend you on your understanding of quantitative easing, as most don't have any idea what it is or the impact of it, displayed in a few comments here.
Funny, when tapering is in play, like it is currently in the US, I never here the opposite comments from the uninformed. I.e they are destroyed money or burning money. NZ is also likely to enter a tapering phase as bonds come up to maturity.

The one thing I can't agree on is that the Government bonds related to QE cost the taxpayer more than it should. It is probably the most efficient way to borrow and certainly cheaper than borrowing offshore.

[Panda-NZ-]

There should be a multi-national consumer group, which runs on principles like OPEC, for the purchase of oil.

Why should countries with tolerant advanced societies be dragged down to give a premium price to countries which run on medieval principles who do nothing good with their revenue.

[Valuegrowth]

I agree with some of the facts in this video.


https://www.youtube.com/watch?v=bgKq6FQB6BM

Inflation is caused by several factors. Money supply, consumer buying pattern thanks to rising income and wealth, interest rates play, currency fluctuation, Geo political issues, weather pattern, supply issues, global pandemic and government and private sector policy decisions all contribute to inflation.I don’t think even economists can fix inflation and deflation once for all.

https://hbr.org/2022/12/what-causes-inflation

[Valuegrowth]

https://www.youtube.com/watch?v=GJ4TTNeSUdQ

[Valuegrowth]

Learning to live with inflation belongs to wisdom.

https://www.youtube.com/watch?v=UMAELCrJxt0

[Valuegrowth]

https://www.abc.net.au/news/2023-07-21/asx-markets-business-live-news-july-21/102629452

"After the tech stock sell-off on Wall Street overnight, the local tech stocks on the ASX led its lower performance for the day, with the technology sector shedding 1.1%.

Xero slipped by 3.9%, Technology one and Life360 fell by 2.9%, and Block was down by 2.1%.

Consumer non-cyclicals were the best-performing sector, up 1.2%, and energy gained 1.1%"

[winner69]

https://www.abc.net.au/news/2023-07-21/asx-markets-business-live-news-july-21/102629452

"After the tech stock sell-off on Wall Street overnight, the local tech stocks on the ASX led its lower performance for the day, with the technology sector shedding 1.1%.

Xero slipped by 3.9%, Technology one and Life360 fell by 2.9%, and Block was down by 2.1%.

Consumer non-cyclicals were the best-performing sector, up 1.2%, and energy gained 1.1%"

And NZ seemed to follow this

[Bobdn]

https://www.kiwiblog.co.nz/2023/07/inflation_by_term.html#google_vignette

Interesting snipet on inflation here. The war doesnt appear to be a significant cause looking at this.

On another matter, why is our NZD so weak and will get it stronger? I have a small percentage of my money in a fund hedged to NZD. I want to make all my funds unhedged but I'm not doing so until it goes up. Will the NZD strengthen or will the NZD go the way of the Rand or Turkish Lira? Or is this not a fair comparison?

I'll tell you what though: having 90 per cent of my money unhedged has helped my investments, as of yesterday, to reach an all time high. Theyre now slightly higher than in December 2021. Feels good to be back on top. There and Back Again - an 18 month journey.

Of course if i add inflation in - its still a sh@t show. An absolute cluster fuc@. My buying power has gone down drastically and I am much much poorer.

[Valuegrowth]

Listed companies in non-cyclical.

Food related

ATM,CVT,SAN,TGG,ALF

Electricity

MEL, MCY,CEN,VCT,GNE,MNW,NWF

Healthcare

FPH,RYM,SUM,ARV,OCA,RAD,TAH,TRU

And NZ seemed to follow this

[kiora]

https://www.civildefence.govt.nz/assets/Uploads/publications/wela-risk-to-lifelines-from-natural-hazards-chapter-5.pdf

If anything, not Vodafone,
"network description
The Vodafone network within the Wairarapa region
consists of eight cell sites and one future cell site. These
sites link into base station controllers in Wellington
and Palmerston No rth and a switch centre at
Wellington."

More likely a Telecom/Landline problem if it is
"Restoration of lead-sheathed cables could take many months, but virtually all other elements of the PSTN might be restored within one week ."

[Azz]

Yeah and I jumped off a hay bale in the past and didn't get hurt.

Then I jumped out of a plane at 40,000 feet and the result was different.

Do you have any concept at all of this governments spending in relation to anything that has occurred in the past?

SailorRob, what NZ stocks you into?

[SailorRob]

SailorRob, what NZ stocks you into?

Generally I like to steer well clear of socialist regimes with my capital and I don't really look at nor understand the NZ market. I think the risks of investing here are dramatically misunderstood, in terms of us being a very isolated and backward 2 crop agrarian state, multiple things could see our $ collapse and stay down for the count and anyone who ever tries to produce anything gets jumped by parasites.

The entire NZ capital markets have CAGR at less than 0.5% for 35 years. They are tiny and insignificant. The entire market combined would be a small company in the USA.

I only own 2 companies here and one is fing off to ASX soon.

The other is OCA which attracts me due to the balance sheet, the liabilities are assets superior to equity capital.

All this is not to say there is not money to be made here, I just don't really know how.

[Azz]

Generally I like to steer well clear of socialist regimes with my capital

lol !

.................

[Azz]

Generally I like to steer well clear of socialist regimes with my capital and I don't really look at nor understand the NZ market. I think the risks of investing here are dramatically misunderstood, in terms of us being a very isolated and backward 2 crop agrarian state, multiple things could see our $ collapse and stay down for the count and anyone who ever tries to produce anything gets jumped by parasites.

The entire NZ capital markets have CAGR at less than 0.5% for 35 years. They are tiny and insignificant. The entire market combined would be a small company in the USA.

I only own 2 companies here and one is fing off to ASX soon.

The other is OCA which attracts me due to the balance sheet, the liabilities are assets superior to equity capital.

All this is not to say there is not money to be made here, I just don't really know how.

OCA, I'll read up on it.

I don't much like the NZ market either, and it is very difficult to figure out, especially for volume for individual stocks. US has always been my market, but I only hold one US stock now (Nvidia).

[SailorRob]

OCA, I'll read up on it.

I don't much like the NZ market either, and it is very difficult to figure out, especially for volume for individual stocks. US has always been my market, but I only hold one US stock now (Nvidia).


Yeah, well done there bloody hell!

[Azz]

Yeah, well done there bloody hell!

The gift that keeps on giving! :-)

[Azz]

I commend you on your understanding of quantitative easing, as most don't have any idea what it is or the impact of it, displayed in a few comments here.

Congratulations, you've cornered the market in patronizing pomposity.

[Bjauck]

https://www.kiwiblog.co.nz/2023/07/inflation_by_term.html#google_vignette

Interesting snipet on inflation here. The war doesnt appear to be a significant cause looking at this.

On another matter, why is our NZD so weak and will get it stronger? I have a small percentage of my money in a fund hedged to NZD. I want to make all my funds unhedged but I'm not doing so until it goes up. Will the NZD strengthen or will the NZD go the way of the Rand or Turkish Lira? Or is this not a fair comparison?

I'll tell you what though: having 90 per cent of my money unhedged has helped my investments, as of yesterday, to reach an all time high. Theyre now slightly higher than in December 2021. Feels good to be back on top. There and Back Again - an 18 month journey.

Of course if i add inflation in - its still a sh@t show. An absolute cluster fuc@. My buying power has gone down drastically and I am much much poorer.

NZ loses many of its great companies, that would help support a strong currency, to other countries as NZ capital prioritises investment in land.

Long term, my guess is that the NZD will go much lower if co-governance gets off the ground and/or ever manifests itself in an appointee chamber of parliament.

Unlike RSA we don't have many precious minerals and unlike Turkey we are not strategically located.

[bull....]

Home building costs up 9.5%, but the increases are slowing
https://www.stuff.co.nz/business/property/132613278/home-building-costs-up-95-but-the-increases-are-slowing

Median weekly rents climb to record high on Trade Me

https://www.stuff.co.nz/business/property/132613831/median-weekly-rents-climb-to-record-high-on-trade-me

sticky inflation still , anyway good to see stat's dept going to release mthly inflation data points from end of yr

[Daytr]

Congratulations, you've cornered the market in patronizing pomposity.

I was being genuine.
Nice unsolicited snipe though
Just in case your radar is off as much as it appears, that last comment was sarcasm.

[Bobdn]

@Bjauck, good points.

[Daytr]

NZ loses many of its great companies, that would help support a strong currency, to other countries as NZ capital prioritises investment in land.

Long term, my guess is that the NZD will go much lower if co-governance gets off the ground and/or ever manifests itself in an appointee chamber of parliament.

Unlike RSA we don't have many precious minerals and unlike Turkey we are not strategically located.

Hi Bjauck, pretty pleased not to be strategically located to be honest.
Unlikely co-governance sees light of day bit not sure it would have much impact on the NZD if it did.
Our strategic advantage is our climate & environment for growing & seeing things (tourism).
It's a pity we aren't looking after our environment and largely treat it as a bovine latrine.

[Bjauck]

Hi Bjauck, pretty pleased not to be strategically located to be honest
Sure, it has its pros and cons. NZ has fought over the Dardanelles but Turkey hasn’t bothered about Cook Strait.

Unlikely co-governance sees light of day bit not sure it would have much impact on the NZD if it did.
Sure, co-governance as policy in an election manifesto would probably not succeed. Anyway, any effect is conjecture and would depend on particular kaumātua?

Our strategic advantage is our climate & environment for growing & seeing things (tourism).
Climate change willing? That also comes up up against carbon neutral policies. Will there be penalties for being so far away from tourist markets? Headlines today are that the Atlantic currents and convections are reaching a critical point sooner rather than later.

It's a pity we aren't looking after our environment and largely treat it as a bovine latrine.
NZ’s economy developed as Britain’s farm, and now mostly China’s with little change - or appetite for the hard reforms to change it, imho.

[SailorRob]

I was being genuine.
Nice unsolicited snipe though
Just in case your radar is off as much as it appears, that last comment was sarcasm.

I know you were Daytr, cheers. Lots of misunderstanding about QE.

[Azz]

I was being genuine.
Nice unsolicited snipe though
Just in case your radar is off as much as it appears, that last comment was sarcasm.

"I commend you on your understanding of quantitative easing, as most don't have any idea what it is or the impact of it, displayed in a few comments here."

I just don't like the attitude, "most don't have any idea what it is", what an arrogant statement.

[Daytr]

"I commend you on your understanding of quantitative easing, as most don't have any idea what it is or the impact of it, displayed in a few comments here."

I just don't like the attitude, "most don't have any idea what it is", what an arrogant statement.

I really don't care what you don't like.

[Azz]

I really don't care what you don't like.

More arrogance.

[Daytr]

More arrogance.

So let's get this straight.
You made a bad assumption and said I was being patronizing.

When corrected you have the cheek to call me arrogant.

Waste of space.

[Azz]

So let's get this straight.
You made a bad assumption and said I was being patronizing.

When corrected you have the cheek to call me arrogant.

Waste of space.

Corrected? I stand by my description of your comment as being patronizing. Apparently only you and a special elite have an understanding of quantitative easing; that's about as patronizing as anyone can get.

[Daytr]

Well it's getting close to my bedtime and your rhetoric should do the trick nicely of getting me off to sleep. Cheers for that.

[bull....]

Federal Open Market Committee raised its funds rate by a quarter percentage point to a target range of 5.25%-5.5%

https://www.cnbc.com/2023/07/26/fed-meeting-july-2023-.html

each meeting is data dependant now

[Daytr]

Federal Open Market Committee raised its funds rate by a quarter percentage point to a target range of 5.25%-5.5%

https://www.cnbc.com/2023/07/26/fed-meeting-july-2023-.html

each meeting is data dependant now

Yeah I listened to Powell this morning.
Love trading around a FED decision as there is typically a lot of volatility.

My take from what he said.
I think it's 50:50 maybe slightly higher odds that there is one more 0.25% hike. Economy to slow.
Similar to us in housing market, with lots of mortgage holders still on low rates not wanting to sell which is putting pressure on housing stock.
Doesn't see inflation back to range until at least 2025, but will lower rates once it sees consistent easing in inflationary pressures likely in 2024.

[bull....]

Yeah I listened to Powell this morning.
Love trading around a FED decision as there is typically a lot of volatility.

My take from what he said.
I think it's 50:50 maybe slightly higher odds that there is one more 0.25% hike. Economy to slow.
Similar to us in housing market, with lots of mortgage holders still on low rates not wanting to sell which is putting pressure on housing stock.
Doesn't see inflation back to range until at least 2025, but will lower rates once it sees consistent easing in inflationary pressures likely in 2024.

i listened to gundlach on cnbc always good to hear his thoughts after a fed meeting he see's fed easing next yr

[alokdhir]

NZ Politics scene is becoming clearer with Labour's chances weakening day by day by their own infighting and clash of ideas ...Though other side is not that flash but by default they may get power to undo some economy unfriendly stuff of last few years .

That should start pulling more funds into NZ markets and our stocks chances of doing well ahead becoming brighter as sentiment will be more positive if there is a change of Govt !!

PS : If change of guard become more clear or done deal ....we may also have consecutive 13 positive days record like DOW ...:t_up:

[causecelebre]

I wonder. I hope that money flows into productive assets but perhaps a change of govt will see money flowing back into property investment

[bull....]

NZ Politics scene is becoming clearer with Labour's chances weakening day by day by their own infighting and clash of ideas ...Though other side is not that flash but by default they may get power to undo some economy unfriendly stuff of last few years .

That should start pulling more funds into NZ markets and our stocks chances of doing well ahead becoming brighter as sentiment will be more positive if there is a change of Govt !!

PS : If change of guard become more clear or done deal ....we may also have consecutive 13 positive days record like DOW ...:t_up:

Climate Change Minister James Shaw confirms petrol, electricity prices will rise after carbon pricing backtrack
https://www.newshub.co.nz/home/politics/2023/07/climate-change-minister-james-shaw-confirms-petrol-electricity-prices-will-rise-after-carbon-pricing-backtrack.html

more money coming out of everyone's pockets wont help economy

[alokdhir]

Climate Change Minister James Shaw confirms petrol, electricity prices will rise after carbon pricing backtrack


https://www.newshub.co.nz/home/politics/2023/07/climate-change-minister-james-shaw-confirms-petrol-electricity-prices-will-rise-after-carbon-pricing-backtrack.html

more money coming out of everyone's pockets wont help economy

Mr Bull if Govt changes so will Climate change minister and his ways ....I thought thats the point I was trying to make ...Elementary mate :p

[SailorRob]

Climate Change Minister James Shaw confirms petrol, electricity prices will rise after carbon pricing backtrack
https://www.newshub.co.nz/home/politics/2023/07/climate-change-minister-james-shaw-confirms-petrol-electricity-prices-will-rise-after-carbon-pricing-backtrack.html

more money coming out of everyone's pockets wont help economy

Where does this money go? Permanently removed from the economy??

[bull....]

Where does this money go? Permanently removed from the economy??

from consumers pockets to mainly offshore operators i imagine esp if they dominate the carbon credit market. just another take from the poor give to the rich scheme lol

[SailorRob]

from consumers pockets to mainly offshore operators i imagine esp if they dominate the carbon credit market. just another take from the poor give to the rich scheme lol


I must admit it was amusing seeing all the poor people who voted for this crap shuffling around in the 11 degree high, battling in their cheap clothes against driving horizontal rain with a wind chill that must have been under 5 degrees.

At least they have paid their carbon taxes so the uber wealthy elite and the upper middle class political and consultant layer can live off them while flying business class, staying warm and driving massive SUV's to the house on the beach.

Hard to feel sorry for the poor and working classes as they constantly vote to eat this s**t

[haewai]

Where does this money go? Permanently removed from the economy??

. Answered but realised it was pointless after reading your horrendous last post.

[Valuegrowth]

Borrowing cost are not going to go down any time soon.

https://www.bankrate.com/banking/federal-reserve/steps-to-take-after-fed-rate-decision/#s7

"The failures of SVB, First Republic and Signature Bank illustrate that something can always break when rates start to rise — but those cracks will be for nothing if the Fed can’t get control of inflation (https://www.bankrate.com/banking/federal-reserve/what-is-stagflation/) first.

“Whether the Fed raises interest rates further or not, borrowing costs are the highest in years,” McBride says. “Between a robust job market and the rate of inflation more than double the 2 percent target, the recent economic data makes one thing clear — the Fed is nowhere close to cutting interest rates.”

[SailorRob]

. Answered but realised it was pointless after reading your horrendous last post.

Agreed it's absolutely horrendous, but variations of this have occurred since time immemorial. I hope they all had a good time in Fiji.

Usually the poor slowly wake up over a period of many decades and then sort it all out.

[Daytr]

Where does this money go? Permanently removed from the economy??

It only leaves the economy if it's a foreign owner offsetting their overseas emissions.

Otherwise mostly the money is paid to farmers or forestry owners.

A farmer I know has converted his hill country to forestry and he will earn more than double what he was out of cattle. So not only has reduced emissions caused by the cattle but created a carbon capture. That money will stay in the rural community.

What I find bizarre is that you have a green / environmental party trying to cap the price of carbon & people on here arguing against a free market.

There is a ban on foreign land ownership so new purchases need to be Government approved. Should we be selling our farms & forests to offshore entities? Possibly not.

Should we be creating a future problem with untended pine plantations by trying to offset climate change? Probably not as there are much better ways we could be doing this.
Including the end product of the pine in the pricing mechanism. Is it going into pulp & paper and be back in the atmosphere in months or is it going to go into house framing or cladding & locked away for 50 - 100 years?

We have an opportunity with the pine to be utilized far more in our construction sector rather than importing manufactured products that have a record for catastrophic failure & typically are emissions intensive to manufacture.

Imo, pine plantations shouldn't be allowed unless there is a plan to harvest. If it's a plant & lock up situation then diverse native forest planting should be mandated.

[kiora]

It only leaves the economy if it's a foreign owner offsetting their overseas emissions.

Otherwise mostly the money is paid to farmers or forestry owners.

A farmer I know has converted his hill country to forestry and he will earn more than double what he was out of cattle. So not only has reduced emissions caused by the cattle but created a carbon capture. That money will stay in the rural community.

What I find bizarre is that you have a green / environmental party trying to cap the price of carbon & people on here arguing against a free market.

There is a ban on foreign land ownership so new purchases need to be Government approved. Should we be selling our farms & forests to offshore entities? Possibly not.

Should we be creating a future problem with untended pine plantations by trying to offset climate change? Probably not as there are much better ways we could be doing this.
Including the end product of the pine in the pricing mechanism. Is it going into pulp & paper and be back in the atmosphere in months or is it going to go into house framing or cladding & locked away for 50 - 100 years?

We have an opportunity with the pine to be utilized far more in our construction sector rather than importing manufactured products that have a record for catastrophic failure & typically are emissions intensive to manufacture.

Imo, pine plantations shouldn't be allowed unless there is a plan to harvest. If it's a plant & lock up situation then diverse native forest planting should be mandated.

"A farmer I know has converted his hill country to forestry and he will earn more than double what he was out of cattle. So not only has reduced emissions caused by the cattle but created a carbon capture. That money will stay in the rural community."

And if the CC are cashed in they will be taxed.
And then, after 30 years the plantation has reached maturity and earns...... next to zilch.
The land has no earning capacity ?
Then the land is worth.....zilch?

[Daytr]

"A farmer I know has converted his hill country to forestry and he will earn more than double what he was out of cattle. So not only has reduced emissions caused by the cattle but created a carbon capture. That money will stay in the rural community."

And if the CC are cashed in they will be taxed.
And then, after 30 years the plantation has reached maturity and earns...... next to zilch.
The land has no earning capacity ?
Then the land is worth.....zilch?

Hence what I said about utilizing the pine & replanting.

[haewai]

It only leaves the economy if it's a foreign owner offsetting their overseas emissions.


No, there is no international transfer of our national emission units.
Though if a NZ comany decides to voluntarily offset its emissions by buying reductions offshore, their cash will flow out.
If an offshore company invests in regenerating NZ bush or whatever to offset its emissions somewhere else, then that cash comes into NZ


Otherwise mostly the money is paid to farmers or forestry owners.


And cash is received by the government through auctioning emission units four times a year. That cash goes through this system: https://www.treasury.govt.nz/information-and-services/nz-economy/climate-change/climate-emergency-response-fund

[kiora]

Hence what I said about utilizing the pine & replanting.

And then the CC need to be paid back?

And if a fire goes through the forest, the CC also need to be paid back?

[haewai]

And then the CC need to be paid back?
Only if the forest land owner is using actual measurements of carbon stored in the wood, called 'stock change accounting'. And not all of them as some carbon stays in the ground in roots etc.
There's a new type of accounting, called averaging, where CC's are earnt up to the long term average, and what happens afterwards doesn't matter, as long as the land stays in trees


And if a fire goes through the forest, the CC also need to be paid back?
Not under average accounting, as long as it is replanted.
An exemption can be applied for under stock change and no more CC's are earnt until the trees are regrown to the original age.
That stuff is from the MPI website so I might be slightly wrong. Pay to read it closely and contact them if you're affected, rather than rely on my guesses. https://www.mpi.govt.nz/forestry/forestry-in-the-emissions-trading-scheme/

[Daytr]

And then the CC need to be paid back?

And if a fire goes through the forest, the CC also need to be paid back?

I haven't studied it but my understanding is it's only repaid if not replanted.
Not sure in the case if fire, if I was a farmer I earning that sort of income of it I would have it insured.

I'm not saying the system is perfect, far from it, but pricing emissions in a free market is the right mechanism to get those who emit to pay & those who create carbon capture are rewarded.
Unless you are a farmer of course, then you only get to receive and not pay.

[Azz]

Usually the poor slowly wake up over a period of many decades and then sort it all out.

Sometimes with pitchforks.

[Azz]

get those who emit to pay

Like every time you breathe out.

[Bjauck]

I must admit it was amusing seeing all the poor people who voted for this crap shuffling around in the 11 degree high, battling in their cheap clothes against driving horizontal rain with a wind chill that must have been under 5 degrees.

At least they have paid their carbon taxes so the uber wealthy elite and the upper middle class political and consultant layer can live off them while flying business class, staying warm and driving massive SUV's to the house on the beach.

Hard to feel sorry for the poor and working classes as they constantly vote to eat this s**t
The poor and “working classes” tend not to vote in as high proportions as the rich and “gentrified.” So Labour and National have both mostly morphed into landowner parties with non-major differences. They both have to wrangle their lunatic coalition partners and their particular Punch & Judy side-shows.

[Valuegrowth]

IMO Markets are due for major pull back but not a huge drop as predicted by the following.

https://markets.businessinsider.com/news/stocks/stock-market-crash-sp-500-64-percent-john-huwing. ssman-bubble-2023-7 (https://markets.businessinsider.com/news/stocks/stock-market-crash-sp-500-64-percent-john-hussman-bubble-2023-7)

[winner69]

IMO Markets are due for major pull back but not a huge drop as predicted by the following.

https://markets.businessinsider.com/news/stocks/stock-market-crash-sp-500-64-percent-john-huwing. ssman-bubble-2023-7 (https://markets.businessinsider.com/news/stocks/stock-market-crash-sp-500-64-percent-john-hussman-bubble-2023-7)

Jeez down 64% will be tears for many

But for some the opportunity of the life time

That’s SPX at 1650 …ouch …that’s even lower than the popular 2800 figure

[ynot]

Jeez down 64% will be tears for many

But for some the opportunity of the life time

That’s SPX at 1650 …ouch …that’s even lower than the popular 2800 figure

Bring it on.

[Valuegrowth]

Right now is not the opportunity of a life time. Valuations much be much lower to create the life time opportunity. Just because it’s a growth stock it dosen’t make sense to me to pay very high PE ratio to buy stocks. Besides not all growth stories will succeed in the long run. As long as there is a demand for overvalued growth stocks, value of growth funds (not only growth investors but also Sovereign wealth funds and Pension funds have invested in these so-called overvalued growth funds)won’t fall and investors and retirement fund members will be happy. What will happen, if growth stocks underperform in the coming decade and value stocks get the limelight again?

https://www.cnbc.com/2023/01/01/market-misery-deals-sovereign-wealth-funds-historic-setback-in-2022-study.html

Heavy falls in stock and bond markets over the last year have cut the combined value of the world’s sovereign wealth and public pension funds for the first time ever - and to the tune of $2.2 trillion, an annual study of the sector has estimated.

Jeez down 64% will be tears for many

But for some the opportunity of the life time

That’s SPX at 1650 …ouch …that’s even lower than the popular 2800 figure

[Azz]

IMO Markets are due for major pull back but not a huge drop as predicted by the following.

https://markets.businessinsider.com/news/stocks/stock-market-crash-sp-500-64-percent-john-huwing. ssman-bubble-2023-7 (https://markets.businessinsider.com/news/stocks/stock-market-crash-sp-500-64-percent-john-hussman-bubble-2023-7)

From the article:

"long-time equity bear who called the 2000 and 20008 crashes"

This guy, John Hussman, I guarantee he has made many failed predictions too.

[Valuegrowth]

We cannot predict but we can find out real value of a business. In stock markets, history can repeat in a different manner. What happened in the past will happen in the future too. Markets can have a major shift when we are least expected.

From the article:

"long-time equity bear who called the 2000 and 20008 crashes"

This guy, John Hussman, I guarantee he has made many failed predictions too.

[Azz]

We cannot predict but we can find out real value of a business. In stock markets, history can repeat in a different manner. What happened in the past will happen in the future too. Markets can have a major shift when we are least expected.

Yes, agree. :-)

[Daytr]

From the article:

"long-time equity bear who called the 2000 and 20008 crashes"

This guy, John Hussman, I guarantee he has made many failed predictions too.

After a quick Google it appears he called for a 70% crash a year ago & a similar call in 2018 as well. With such regular calls for market capitulation its quite surprising he missed the crash of 2020.

Markets overall do seem pricey to me and I wouldn't be surprised to see a 15 - 20% correction.

[SailorRob]

Sometimes with pitchforks.


Always with violence yes.

[SailorRob]

The poor and “working classes” tend not to vote in as high proportions as the rich and “gentrified.” So Labour and National have both mostly morphed into landowner parties with non-major differences. They both have to wrangle their lunatic coalition partners and their particular Punch & Judy side-shows.


Good points yes.

[SailorRob]

From the article:

"long-time equity bear who called the 2000 and 20008 crashes"

This guy, John Hussman, I guarantee he has made many failed predictions too.


Anyone even considering bringing up Hussman is a uncouth moron.

Do some damned work.

He's predicted a massive crash every year since 2000.

And his flagship fund has returned something crazy like 2% over 23 years.

[SailorRob]

https://tomorrowsaffairs.com/governments-never-curb-inflation-because-they-benefit-from-it/


Posted WITHOUT COMMENT...

[SailorRob]

After a quick Google it appears he called for a 70% crash a year ago & a similar call in 2018 as well. With such regular calls for market capitulation its quite surprising he missed the crash of of 2020.

Markets overall do seem pricey to me and I wouldn't be surprised to see a 15 - 20% correction.


Exactly, a quick google.

Imagine what a solid one hour of research into this guy would bring up.

[winner69]

From @RBAdvisors as copper continues an uptrend -

“Dr Copper” again proves to be a better economic forecaster than most economists. A year ago 90% of economists predicted economic recession but Dr Copper correctly said otherwise.

[Entrep]

https://twitter.com/tuurdemeester/status/1686152177159467009

14692

[Daytr]

https://twitter.com/tuurdemeester/status/1686152177159467009

14692
Plenty have called the end of Japan, including me, due to its burden of debt.
Got to happen at some stage but guessing when is not easy.

[Bobdn]

Would be good to see a crash. Any body else in boring old ETFs getting tired of winning day after day after day?

It loses all meaning after awhile.

I see Mzy (Australian mid caps) is just a few cents off ATHs *yawn*.

This is starting to feel less and less like a bear market every passing day.

[Azz]

........................

[Daytr]

Fitch downgrades the US.

https://www.cnbc.com/2023/08/01/fitch-downgrades-us-long-term-ratings-to-aa-from-aaa.html

[winner69]

I agree with my mate Michael Reddell re latest labour data -

Nothing much in the labour market data to suggest that monetary policy has yet got much traction in lowering core inflation.

Increasingly hard to see why a central bank that was seriously interested in a prompt return of inflation to target would not have been raising the OCR further, rather than expressing "confidence" (based on nothing specific or observable) that they had done enough already.

[Daytr]

I agree with my mate Michael Reddell re latest labour data -

Nothing much in the labour market data to suggest that monetary policy has yet got much traction in lowering core inflation.

Increasingly hard to see why a central bank that was seriously interested in a prompt return of inflation to target would not have been raising the OCR further, rather than expressing "confidence" (based on nothing specific or observable) that they had done enough already.

Probably because debt levels are too high.
US downgrade should be good for gold imo.

[Habits]

I agree with my mate Michael Reddell re latest labour data -

Nothing much in the labour market data to suggest that monetary policy has yet got much traction in lowering core inflation.

Increasingly hard to see why a central bank that was seriously interested in a prompt return of inflation to target would not have been raising the OCR further, rather than expressing "confidence" (based on nothing specific or observable) that they had done enough already.

Even though most of the inflation was due to lack of supply, you want to cause businesses to retreat further

[Valuegrowth]

Both commodity and stock markets are more fragile than we think. Consumer defensive stocks are making move.

[Valuegrowth]

Not a good day for global chip stocks.

https://www.cnbc.com/2023/08/02/amd-forecast-us-credit-downgrade-drags-down-chip-stocks.html

[Bjauck]

Even though most of the inflation was due to lack of supply, you want to cause businesses to retreat furtherIf interest rate tightening is not resumed to reign in inflation to within the RBNZ remit, at the very least other measures should be enabled to stop the resumption of over-investment in residential land instead of business.

[alokdhir]

Downgrade has been the catalyst to lead long term yields higher ...thus increasing reference rates for loans and stocks ...this is more like 50bips rates increase by FED which will disturb the dreams of US stocks Bulls ...or they were already looking for an excuse to lighten up and let markets drift lower from almost 4600 levels which were beyond anyone's dreams when 2023 started

Our market is stuck in its own rut ...elections and low activity signals coming from all leading indicators like Port traffic etc

Last qtr clarity will return on politics as well as economy direction thus rates outlook ...till then W69 will keep us informed and scared :p

[Sideshow Bob]

Ouch, this will hurt......

https://www.nzx.com/announcements/415776

Fonterra Co-operative Group Ltd today reduced its 2023/24 season forecast Farmgate Milk Price range from $7.25 - $8.75 per kgMS, with a midpoint of $8.00 per kgMS, to $6.25 - $7.75 per kgMS, with a midpoint of $7.00 per kgMS.

[bull....]

Ouch, this will hurt......

https://www.nzx.com/announcements/415776

Fonterra Co-operative Group Ltd today reduced its 2023/24 season forecast Farmgate Milk Price range from $7.25 - $8.75 per kgMS, with a midpoint of $8.00 per kgMS, to $6.25 - $7.75 per kgMS, with a midpoint of $7.00 per kgMS.

yep much lower profits coming for farmers.
add the fact politicians are now saying the tax take is collapsing and robinson has called in bosses to slash jobs ? then the nz economy is looking very weak going forward.

stagflation :scared:

[Sideshow Bob]

Watch the dollar go......

[bull....]

Watch the dollar go......

already has to a degree .... us dollar has been down recently and nzd cannot get up ( normally nzd goes up when usd falls ) continually being sold down on any meaning full rise

[causecelebre]

Hmmm Does the govt and RBNZ know something we don't? Half billion given to RNBZ by the govt last month to prop up NZD if it all turns to custard

[causecelebre]

Might seem like a lot but all the NZD needs is another Andy Krieger moment...

[Bobdn]

Oil ripping, NZD dipping. Fortunately, we're a post oil economy. It was our Nuclear Free moment. Felt so proud when we ditched our reliance on fossil fuels.

[stoploss]

Hmmm Does the govt and RBNZ know something we don't? Half billion given to RNBZ by the govt last month to prop up NZD if it all turns to custard
That’s the Govt just recapitalizing RBNZ after $10bio of losses due to the Bond purchases .
I thought they were paying $ 250 mio a month

[Baa_Baa]

Oil ripping, NZD dipping. Fortunately, we're a post oil economy. It was our Nuclear Free moment. Felt so proud when we ditched our reliance on fossil fuels.

Which 'oil' are you looking at "ripping"?

[Bobdn]

What "oil" do you think I'm talking about? Cooking oil?

[causecelebre]

That’s the Govt just recapitalizing RBNZ after $10bio of losses due to the Bond purchases .
I thought they were paying $ 250 mio a month

Stealing from Peter to pay Paul. If only the govt hadn't made a debacle of their bond issuance and had performed a book build to determine the coupon.

[Daytr]

Oil ripping, NZD dipping. Fortunately, we're a post oil economy. It was our Nuclear Free moment. Felt so proud when we ditched our reliance on fossil fuels.

Are you seeing something I'm not?
The NZD has gained against the AUD.

[Bobdn]

Is oil priced in AUD? Serious question.

[causecelebre]

Oil ripping, NZD dipping. Fortunately, we're a post oil economy. It was our Nuclear Free moment. Felt so proud when we ditched our reliance on fossil fuels.

Wish I was rich enough to buy an EV.

[Bobdn]

Me too. Eventually we'll be forced too I guess.

[Baa_Baa]

What "oil" do you think I'm talking about? Cooking oil?

Brent, or Crude, or something else?

[winner69]

Might seem like a lot but all the NZD needs is another Andy Krieger moment...

That Andy guy is one of SailorRobs mates ….hey Rob sound him out about the NZD for us

[Bobdn]

Brent, or Crude, or something else?

Its pretty much all the same to me. I have a small amount in VDE (Vanguard's Energy ETF) and my two dividend funds are both 10 per cent energy each (VYM and VYMI).

Energy was the best sector overnight by a long way.

https://www.cnbc.com/2023/08/03/oil-rises-as-markets-weigh-inventory-data-us-ratings-downgrade.html

"Oil prices gained about 2% on Thursday as Saudi Arabia and Russia took steps to keep supplies tight into September and possibly beyond.
Brent futures rose $1.94, or 2.3%, to settle at $85.14 a barrel, while U.S. West Texas Intermediate crude rose $2.06, or 2.6%, to settle at $81.55."

[Daytr]

Is oil priced in AUD? Serious question.

Well if you buy it in Australia it is.

[SailorRob]

Watch the dollar go......

Please provide a detailed analysis of what happened to the USD in the aftermath of the 2011 credit downgrade.

And why...

[SailorRob]

Bull**** what were you saying about Berkshires earnings earlier in the year again?

[Daytr]

Bull**** what were you saying about Berkshires earnings earlier in the year again?

Not sure who you are ranting at, maybe one less coffee in the morning...

Anyway I thought this report was interesting.
BH selling stocks & buying treasuries & cash pile growing.

I have been shorting the DOW consistently for the last few weeks. Done ok out of it so far, wouldn't be surprised to see a further 10 - 15% pullback over time.

https://fortune.com/2023/08/06/warren-buffett-economy-berkshire-hathaway-earnings-147-billion-in-cash/

[SailorRob]

Not sure who you are ranting at, maybe one less coffee in the morning...

Anyway I thought this report was interesting.
BH selling stocks & buying treasuries & cash pile growing.

I have been shorting the DOW consistently for the last few weeks. Done ok out of it so far, wouldn't be surprised to see a further 10 - 15% pullback over time.

https://fortune.com/2023/08/06/warren-buffett-economy-berkshire-hathaway-earnings-147-billion-in-cash/

At bull**** the 12 screen trading guru.

Berkshire cash pile isn't growing as a percentage of firm assets, has been around the same for 20 years.

Berkshire bought net 41 billion of equities in Q1 2022 right before market tanked and then sold net all through the rally.

But market timing isn't difficult.

To be clear regarding your post, nothing has changed at all with Berkshire, just media has zero clue.

[bull....]

Bull**** what were you saying about Berkshires earnings earlier in the year again?

part of being a sucessful investor is being allowed to change your views or opinions when - ever you want but anyway obviously the view was at the time and now my view is buffett da man he beat inflation in his operating earnings

the rest was thx to the ai rally as apple is in that grp and is a huge holding for buffett which helped lift the prior investment losses ... anyway the stock has underperformed the sp500 so far again this yr so being invested in sp500 etf would have been a better bet in hindsight again so i still dont get why you would be so heavily invested in berkshire when sp500 etf is doing better the last 5yrs of the top of my head

[Bobdn]

Guys, let's not argue the small stuff. The important thing is we've all made a ton of money this year doing next to nothing. That's what's important.

[ValueNZ]

part of being a sucessful investor is being allowed to change your views or opinions when - ever you want but anyway obviously the view was at the time and now my view is buffett da man he beat inflation in his operating earnings

the rest was thx to the ai rally as apple is in that grp and is a huge holding for buffett which helped lift the prior investment losses ... anyway the stock has underperformed the sp500 so far again this yr so being invested in sp500 etf would have been a better bet in hindsight again so i still dont get why you would be so heavily invested in berkshire when sp500 etf is doing better the last 5yrs of the top of my head
Berkshire Hathaway class A shares have risen 71% over the last 5 years
The SP500 has risen 58% over the last 5 years.

But let's say hypothetically Berkshire's share price underperformed the SP500 during this time period, shouldn't this make you even more inclined to be invested in Berkshire?

[SailorRob]

part of being a sucessful investor is being allowed to change your views or opinions when - ever you want but anyway obviously the view was at the time and now my view is buffett da man he beat inflation in his operating earnings

the rest was thx to the ai rally as apple is in that grp and is a huge holding for buffett which helped lift the prior investment losses ... anyway the stock has underperformed the sp500 so far again this yr so being invested in sp500 etf would have been a better bet in hindsight again so i still dont get why you would be so heavily invested in berkshire when sp500 etf is doing better the last 5yrs of the top of my head

Oh really? Apple and AI increased Berkshire operating earnings?

Theres a lot of things you don't get old boy. Pays to think sometimes.

[SailorRob]

Berkshire Hathaway class A shares have risen 71% over the last 5 years
The SP500 has risen 58% over the last 5 years.

But let's say hypothetically Berkshire's share price underperformed the SP500 during this time period, shouldn't this make you even more inclined to be invested in Berkshire?

Yeah and what nobody, and I mean nobody understands is that the sp500 performance is multiple expansion.

Berkshire is earnings per share growth.

[Snow Leopard]

Yeah and what nobody, and I mean nobody understands is that the sp500 performance is multiple expansion....

What nobody actually understands is whether you are a complete idiot or is there a bit missing.

[SailorRob]

What nobody actually understands is whether you are a complete idiot or is there a bit missing.

What facts would lead you to think either exactly?

Please contest my statements.

[bull....]

Oh really? Apple and AI increased Berkshire operating earnings?

Theres a lot of things you don't get old boy. Pays to think sometimes.

what you talking about i said apple being lifted by the ai rally contributed to the investment losses being reversed somewhat from prior period

and your statement about operating earnings means little to me other than great they are performing
im only interested in stock performance as thats how i get paid

[bull....]

Berkshire Hathaway class A shares have risen 71% over the last 5 years
The SP500 has risen 58% over the last 5 years.

But let's say hypothetically Berkshire's share price underperformed the SP500 during this time period, shouldn't this make you even more inclined to be invested in Berkshire?

based on yearly returns i thought sp500 has outperformed last 5 yrs

[ValueNZ]

what you talking about i said apple being lifted by the ai rally contributed to the investment losses being reversed somewhat from prior period

and your statement about operating earnings means little to me other than great they are performing
im only interested in stock performance as thats how i get paid

You should just buy bitcoin or some sh!tcoin that's been pumped 1000% in a week then. After all you're only interested in past performance.

Earnings is everything in investing. Otherwise you're just playing a game of whose a greater fool between you and the other party involved in the transaction.

[ValueNZ]

based on yearly returns i thought sp500 has outperformed last 5 yrs
Nope. Just search it up?

[bull....]

Otherwise you're just playing a game of whose a greater fool between you and the other party involved in the transaction.

isnt that what your doing anyway irrespective of earnings

[bull....]

Nope. Just search it up?

i did berkshire is now underperforming the index over 5 , 10 even 20 yrs now

[ValueNZ]

isnt that what your doing anyway irrespective of earnings
Well if you're purchasing stock in a company which is generating cash it has a set intrinsic value, which is just the sum of its future cash flow discounted however you decide. Which means that cash generated can be distributed out to its shareholders at some point in the future. If you are buying a stock significantly below its intrinsic value with an adequate margin of safety, then you certainly cannot be the fool in that scenario.

If you are purchasing stock above its intrinsic value in hope you can sell it to a "greater fool" then it is impossible to know if you were the fool. Although you could make money doing that for a bit, more often you lose.

That's probably a poor explanation of greater fool theory but the point is earnings is very important.

[bull....]

Well if you're purchasing stock in a company which is generating cash it has a set intrinsic value, which is just the sum of its future cash flow discounted however you decide. Which means that cash generated can be distributed out to its shareholders at some point in the future. If you are buying a stock significantly below its intrinsic value with an adequate margin of safety, then you certainly cannot be the fool in that scenario.

If you are purchasing stock above its intrinsic value in hope you can sell it to a "greater fool" then it is impossible to know if you were the fool. Although you could make money doing that for a bit, more often you lose.

That's probably a poor explanation of greater fool theory but the point is earnings is very important.

so if i can value a stock better than you am i a better fool ?

[Baa_Baa]

i did berkshire is now underperforming the index over 5 , 10 even 20 yrs now

That's not what my charts show, 5 year BRKa ahead of SP500, 10 year well ahead, 20 year way ahead.

What are you looking at?

[bull....]

Yet Berkshire stock is behind the S&P 500 over the past 20 years with a 10.1% annualized return against 10.3% for the index. Over the past five years, Berkshire stock has risen 8.3% annually, behind the 10.5% yearly return on the S&P 500, and it also is behind the index in the past 10 years with a 12.3% annual return, versus 12.7% for the index

https://www.barrons.com/articles/berkshire-hathaway-stock-warren-buffett-51675450214


with such a big cash pile how can he out - perform ? i say

[Baa_Baa]

Yet Berkshire stock is behind the S&P 500 over the past 20 years with a 10.1% annualized return against 10.3% for the index. Over the past five years, Berkshire stock has risen 8.3% annually, behind the 10.5% yearly return on the S&P 500, and it also is behind the index in the past 10 years with a 12.3% annual return, versus 12.7% for the index

https://www.barrons.com/articles/berkshire-hathaway-stock-warren-buffett-51675450214


with such a big cash pile how can he out - perform ? i say



Looking at BRKa vs SP500

https://invst.ly/10ywjf - 5 year, beats.
https://invst.ly/10ywjv - 10 year, bigger beats
https://invst.ly/10ywkd - 20 year, smashed it

Comparing apples and oranges?

[bull....]

Looking at BRKa vs SP500

https://invst.ly/10ywjf - 5 year, beats.
https://invst.ly/10ywjv - 10 year, bigger beats
https://invst.ly/10ywkd - 20 year, smashed it

Comparing apples and oranges?

i suggest you contact barron's if you think there figure's are wrong

[Baa_Baa]

i suggest you contact barron's if you think there figure's are wrong

Ok, will do if you contact investing.com to let them know their data is wrong.

LOL.

[Snow Leopard]

i suggest you contact barron's if you think there figure's are wrong


Ok, will do if you contact investing.com to let them know their data is wrong.

LOL.

Probably Barron's is comparing BRK against SP500 Total Returns (compounding [reinvested] dividends)
And
Investing.com is comparing BRK against the SP500 capital index.

So neither is wrong, both are wrong, nobody is wrong & everybody is wrong...

...except me. :t_up:

[Valuegrowth]

https://www.bloomberg.com/news/newsletters/2023-07-26/hsbc-sees-us-stagflation-not-recession-as-worst-case-scenario

Surveillance: HSBC Sees Worst Case as Stagflation, Not Recession

Price pressures threaten to kick off a new upward cycle just when economy may be cooling

[SailorRob]

Snow leopard is correct, Berkshire needs to be compared to Sp500 total return.

However.

The SP500 has outperformed over a couple of very specific time periods purely by being far more expensive. Berkshire earnings per share have always outperformed the index by large amount.

Cash pile is pretty small at 14% of assets.

Going forward Berkshire will absolutely demolish the index over the next decade.

Anyone who thinks otherwise, Bloomstran has open bet at a million USD. I'd also be interested in a wager with anyone keen.

Math doesn't lie.

[Valuegrowth]

https://www.claytoncountyregister.com/news2/jpmorgan-says-this-sector-is-in-pole-position-and-names-5-global-stocks-set-to-outperform/67743/

Analysts at JPMorgan have identified five global consumer staple stocks that they believe are in a prime position to outperform in the aftermath of the Federal Reserve’s recent rate hike. The Fed’s decision marks its 11th interest rate hike since the tightening process began in March 2022, bringing borrowing costs to their highest level since 2001.

JPMorgan is particularly bullish on consumer staples, highlighting that it has been one of the best-performing sectors following the last Fed hike. The bank believes that lower bond yields and better relative earnings per share momentum will further support this sector.

[SailorRob]

But also an individual investor will get different returns as you can't reinvest index dividends fee and tax free.

Remember Berkshire pays tax on all their dividends they receive from equity portfolio. But index return you see online doesn't factor this in.

All that matters is our real world returns.

[SailorRob]

https://www.claytoncountyregister.com/news2/jpmorgan-says-this-sector-is-in-pole-position-and-names-5-global-stocks-set-to-outperform/67743/

Analysts at JPMorgan have identified five global consumer staple stocks that they believe are in a prime position to outperform in the aftermath of the Federal Reserve’s recent rate hike. The Fed’s decision marks its 11th interest rate hike since the tightening process began in March 2022, bringing borrowing costs to their highest level since 2001.

JPMorgan is particularly bullish on consumer staples, highlighting that it has been one of the best-performing sectors following the last Fed hike. The bank believes that lower bond yields and better relative earnings per share momentum will further support this sector.



This bot needs to have it's plug pulled and preferably soon.

[SailorRob]

But also an individual investor will get different returns as you can't reinvest index dividends fee and tax free.

Remember Berkshire pays tax on all their dividends they receive from equity portfolio. But index return you see online doesn't factor this in.

All that matters is our real world returns.

Another way to think about it is that if Berkshire was a company that had 100% of assets in a SP500 index fund, then Berkshire would underperform the index by quite a lot over time, as it would be paying tax.

[Baa_Baa]

Another way to look at it, rather than just capital share/index price, is that neither the SP500 nor BRKa pay dividends, per se. Invest in a SP500 index linked fund, vs BRKa and it's clear which is winning. BRKa is winning, over the short, medium and longer long term.

So taking the entire 500 companies combined, in the SP500 and comparing it to just one company, BRKa, on capital share price vs index alone, is valid. BRKa has smashed the capital index​ comparison.

But, comparing BRKa that doesn't pay dividends, against 500 of the largest companies in the USA combined, including their dividends, it's remarkable that BRKa is even close to those total shareholder returns. Just a few 10ths of percentage points either way.

Remarkable.

The only difference, in real terms, is that if you owned some of every one of the 500 companies in the SP500 (which is not realistic) and got their dividends as well as unrealised capital gains, you'd be doing a little bit better than EPS on BRKa.

500 companies combined, capital unrealised gains + dividends, versus one company BRKa that doesn't pay dividends, and it's neck and neck. Only a few 10th's of percentage separating them.

That's what Barrons are suggesting. An impossible investment proposition, unless maybe you're a massive fund. Certainly it's impossible for an average investor.

[ValueNZ]

But also an individual investor will get different returns as you can't reinvest index dividends fee and tax free.

Remember Berkshire pays tax on all their dividends they receive from equity portfolio. But index return you see online doesn't factor this in.

All that matters is our real world returns.
Good point. Buffett was bragging about how much tax they paid in his most recent shareholders letter lol.

[SailorRob]

But, comparing BRKa that doesn't pay dividends, against 500 of the largest companies in the USA combined, including their dividends, it's remarkable that BRKa is even close to those total shareholder returns. Just a few 10ths of percentage points either way.

Remarkable.




Yes, but the 500 companies are dramatically underperforming Berkshire and always have, they are just currently getting more votes but weigh much less.

Its all multiple expansion that's done it. The SP500 trades around 20 x vs BRK at around 13.

Berkshire EPS growth is far higher. Accounting is much better and far less write downs, dumb buybacks and equity going to insiders.

[ronaldson]

Yes, but the 500 companies are dramatically underperforming Berkshire and always have, they are just currently getting more votes but weigh much less.

Its all multiple expansion that's done it. The SP500 trades around 20 x vs BRK at around 13.

Berkshire EPS growth is far higher. Accounting is much better and far less write downs, dumb buybacks and equity going to insiders.

And isn't another problem that the Index is a constant, but the constituents are dynamic. BRKa doesn't get the benefit of comparison against companies that either fail absolutely (eg Signature Bank) or perform sufficiently poorly to drop out of the Index over time and be replaced, because you are always measuring vis-a-vis the Index.

[Daytr]

And isn't another problem that the Index is a constant, but the constituents are dynamic. BRKa doesn't get the benefit of comparison against companies that either fail absolutely (eg Signature Bank) or perform sufficiently poorly to drop out of the Index over time and be replaced, because you are always measuring vis-a-vis the Index.

So you just highlighted a positive for investing in the index.

[bull....]

All that matters is our real world returns.

exactly and for all investors that is measured from div's and capital gains

[nztx]

When the Craft Breweries, Wineries & Hospitality outfits start feeling the pinch, falling over and getting sold at fire sale values then there would appear to be a large problem out there ..

https://www.nzherald.co.nz/business/brothers-beer-put-into-voluntary-administration/SD5DO6BYWBAAHBDGRDKBFZIBRE/

Brothers Beer put into voluntary administration

How many is that in craft beer / wine line including likes of Good Spirits being hocked off at less than loans value ?

A sure sign of things getting tougher

[Daytr]

When the Craft Breweries, Wineries & Hospitality outfits start feeling the pinch, falling over and getting sold at fire sale values then there would appear to be a large problem out there ..

https://www.nzherald.co.nz/business/brothers-beer-put-into-voluntary-administration/SD5DO6BYWBAAHBDGRDKBFZIBRE/

Brothers Beer put into voluntary administration

How many is that in craft beer / wine line including likes of Good Spirits being hocked off at less than loans value ?

A sure sign of things getting tougher

Yep, also a bit of a saturated market if you will pardon the pun

[Watchful]

Interesting the swathe of Blackrock SPH notices on the nzx this morning, not from purchases but all that I checked were in-specie transfers from Aug 8th. Notices all now removed, not just redacted or corrected but vanished. But they didn’t appear to be mistakes.

I was busy digging into annual reports to look for who had comparable holdings that could have handed them over. I was only two deep when they disappeared, but there appeared to be one holder who held very similar amounts of both companies, at record time for annual reports. Not exact, but allowing for some minor movement..

ACC.


Update: ACC’s SPH notice for THL released this afternoon, seems to prove my theory false.

[Baa_Baa]

Interesting the swathe of Blackrock SPH notices on the nzx this morning, not from purchases but all that I checked were in-specie transfers from Aug 8th. Notices all now removed, not just redacted or corrected but vanished. But they didn’t appear to be mistakes.

I was busy digging into annual reports to look for who had comparable holdings that could have handed them over. I was only two deep when they disappeared, but there appeared to be one holder who held very similar amounts of both companies, at record time for annual reports. Not exact, but allowing for some minor movement..

ACC.

Did NZ govt just hand over management of ACC funds in return for the election sweetener 2bn renewables fund?

There were a lot of 'in specie' transfers, but the ones I looked at had buys/sells as well. Weird though that all of the announcements have been removed!

[Watchful]

Yes true, should have said there were some buys/sells mixed in the ones I saw, but they looked fairly routine, and the large transactions seemed to be the in specie ones.

Here comes the retraction notice finally, too.

To be fair, because the notices disappeared so quick while I was digging, I had to go off memory for a couple of the numbers, and there were a few other holders in that ballpark that potentially lined up, forbar etc. but ACC looked the most likely from the two holdings I managed to check before they vapourised.

[thegreatestben]

The links still appear to work, I just opened the OCA one through jarden - http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/OCA/416077/400064.pdf

[bull....]

Winston Peters is back in latest poll result with NZ First hitting 5.8%

https://www.stuff.co.nz/national/politics/300947153/live-winston-peters-is-back-in-latest-poll-result-with-nz-first-hitting-58

[percy]

The Secret Broker...enjoy

https://stockhead.cmail20.com/t/d-l-vjijuhy-yupddjlly-h/

[Valuegrowth]

https://markets.businessinsider.com/news/stocks/stock-market-outlook-no-recession-relief-rally-is-finally-over-2023-8

[Panda-NZ-]

All is not well in China... deflation, unemployment, risk of a population collapse in the future.

US President: China a ‘ticking time bomb’ over economic problems.

https://www.nbcnews.com/news/world/biden-calls-china-ticking-time-bomb-economic-problems-rcna99397

[Valuegrowth]

https://www.youtube.com/watch?v=XFZ5TX7Dat0

[winner69]

………..not relevant

[nztx]

All is not well in China... deflation, unemployment, risk of a population collapse in the future.

US President: China a ‘ticking time bomb’ over economic problems.

https://www.nbcnews.com/news/world/biden-calls-china-ticking-time-bomb-economic-problems-rcna99397


Meanwhile in NZ - a ‘ticking time bomb’ over economic problems.

Deep in Debt up to our ears, COL, Inflation, Interest, Housing, Crime, Roading, Infrastructure, Export markets & Governance issues

and a Govt potentially facing a landslide out on the back of 5.5 years gross incompetence giving rise to many of the issues ;)


At least Ryman fixed their issues at great cost .. without any help from wannabe Nelson Fiscal advisers ;)

[Valuegrowth]

I also was worried. After listening to it, my worry disappeared. After all, it’s not the end of the world even if there is a recession,stagflation or deflation.

They know markets are over valued, but not timing the market. They are also constantly looking for attractive value stocks like me. In addition to going against the diversifcation, they invest for the long run as well. Intelligent investors will look for attractive stocks which are trading below the market price and trading below the prices of peers in the sector in a situation like today. As I said before, I am not going to pay historically very high PE ratio for stocks when I can find attractive low-leveraged dividend champions, value and neglected companies with long term potential in markets. Currently, my few stocks are beating world markets. As I said, my portfolio is filled with defensive stocks and most of the time, I’m fully invested while re-balancing my portfolio periodically. Good luck for you trading!


Weekends are meant to be worry free …now you’ve got me worried …esp for our mate Rob

[nztx]

I also was worried. After listening to it, my worry disappeared. After all, it’s not the end of the world even if there is a recession,stagflation or deflation.

They know markets are over valued, but not timing the market. They are also constantly looking for attractive value stocks like me. In addition to going against the diversifcation, they invest for the long run as well. Intelligent investors will look for attractive stocks which are trading below the market price and trading below the prices of peers in the sector in a situation like today. As I said before, I am not going to pay historically very high PE ratio for stocks when I can find attractive low-leveraged dividend champions, value and neglected companies with long term potential in markets. Currently, my few stocks are beating world markets. As I said, my portfolio is filled with defensive stocks and most of the time, I’m fully invested while re-balancing my portfolio periodically. Good luck for you trading!


Doesn't look like he's worried any more :)

The last 12 months have attracted a worry free option here .. irrelevant but then a low exposure to things sliding & sagging :)

The proof on this course can be measured in many NZX share prices against where they were ..

[Valuegrowth]

https://www.youtube.com/watch?v=IlQt_SVNyCU&t=1s

[nztx]

https://www.youtube.com/watch?v=IlQt_SVNyCU&t=1s


Don't some think the answer on our local turf is NTL or was it OCA ? ;)

[Valuegrowth]

https://www.youtube.com/watch?v=ZjodUgfMt-0

[Valuegrowth]

https://www.youtube.com/watch?v=D9rmcIVXmqI

[bull....]

NZ dairy auction results a shocker ... more downgrades coming to milk payout soon i reckon and hence more downward pressure on economy from less farmer spending. add in china issue's as well to that down ward pressure

https://www.globaldairytrade.info/en/product-results/

[Leemsip]

Recession shouldnt be too far away now, as the pull back in housing starts, new orders and profits start to impact hiring and spending intentions. The seek data this week showed hiring intentions down already. Once employment comes off we should see tax receiepts down further and govt forced to pull back spending a bit. House prices should start to dip below pre-covid levels in 2024?

All pretty gloomy stuff. Should be some great opportunities coming on the nzx tho.

[Toddy]

Hopefully that's the end of anymore talk about Ocr hikes.

We will just have to suck up the imported inflationary pressure.

Time to look after our farmers. The $$$ that are going to be lost in export earnings and tax take are becoming material.

[Sideshow Bob]

Time to look after our farmers. The $$$ that are going to be lost in export earnings and tax take are becoming material.

GDT took another big hit overnight.

Could start to get very painful.....

[Muse]

NZD/USD back in the fifties! Jesh when did that happen. Good for some, painful for others.

[winner69]

NZD/USD back in the fifties! Jesh when did that happen. Good for some, painful for others.

And sinking v GBP …..back to 2016 levels ….and punters say UK economy stuffed

[Daytr]

A fairly sizeable punt!
https://www.cnn.com/2023/08/15/investing/michael-burry-stock-market-crash/index.html

[DavidB]

NZD/USD back in the fifties! Jesh when did that happen. Good for some, painful for others.

I was living in the States in 2000 and 2001, and the exchange rate got right down to 48 US cents to the NZD that I can recall. It wasn't pretty, although it was great coming home. Popped my American ATM card into the machine in Auckland and out came a bit over NZ$200 for my US$100! The NZD was like monopoly money. Hmmm.....? A Labour government was in power then too. Funny that.

[stoploss]

I was living in the States in 2000 and 2001, and the exchange rate got right down to 48 US cents to the NZD that I can recall. It wasn't pretty, although it was great coming home. Popped my American ATM card into the machine in Auckland and out came a bit over NZ$200 for my US$100! The NZD was like monopoly money. Hmmm.....? A Labour government was in power then too. Funny that.
It hit .40 Oct 2000

[DavidB]

It hit .40 Oct 2000

Wow, it got as bad as that! It was a long time ago, and I remember it definitely been in the 40s. Even though I rented my house out while I was away, there was absolutely no point in bringing NZ money to the US. it was just a joke.

[winner69]

First time I went to USA I got about US$1.20 for my NZ buck

[bull....]

ocr unchanged , i see there ocr tracking has stretched out further now before cuts come

[Gerald]

A fairly sizeable punt!
https://www.cnn.com/2023/08/15/investing/michael-burry-stock-market-crash/index.html

13 F's report notional value of the underlying security, not market value of the options. He could have in theory only spent a few mil just deep out of the money, really short dated or a combo.

[clearasmud]

First time I went to USA I got about US$1.20 for my NZ buck

About 1973?
Where did you go.Was it a long trip?

[clearasmud]

It hit .40 Oct 2000
I think 37c was about the low in 2001?

[Bjauck]

And sinking v GBP …..back to 2016 levels ….and punters say UK economy stuffed UK interest rates are expected to have more rises until Northern Spring 2024.

[bull....]

rbnz noted china a risk to nz exports. lucky national say today they are going to let foreign buyers buy nz property again :eek2: need to support the property market which nz is built on lol

[FTG]

First time I went to USA I got about US$1.20 for my NZ buck

Back in the late 60's it was even better, US$1.62 IIRC!

[clearasmud]

Back in the late 60's it was even better, US$1.62 IIRC!
Huh?
It was I think about $1.1 nzd/usd in the late 60's
The high was $1.40 after labour (Norman Kirk) took office in 1973
Then it all turned to s*t a bit like now .haha
Just checked it nzd was fixed at 1.36 usd,although it was pounds ie 2.72usd
thrugh the 60s until NZ devalued by 18% around 1/1/1968 due to a recession in NZ.
After 1971 NZD started to appreciate again due to high export prices and usd devaluation due to Vietnam war financing.

[nztx]

rbnz noted china a risk to nz exports. lucky national say today they are going to let foreign buyers buy nz property again :eek2: need to support the property market which nz is built on lol


be on a number of levels -

their own economy with deflation / negative growth
yet another heavily indebted property company up there teetering threatening to fall over (Country Garden)
reduced exports from NZ & lower Chinese demand

[bull....]

be on a number of levels -

their own economy with deflation / negative growth
yet another heavily indebted property company up there teetering threatening to fall over (Country Garden)
reduced exports from NZ & lower Chinese demand

looks like bigger declining tax revenue ahead for NZ .. how we going to pay the bill's ?

[Panda-NZ-]

Unhedge the NZ super fund..

Apparently it was a highly debated topic among the fund too.

https://www.stuff.co.nz/business/116962012/nz-super-fund-considers-no-longer-hedging-all-of-its-bets

https://www.top1000funds.com/2020/11/nz-super-debates-currency-risk/

[FTG]

The high was $1.40 after labour (Norman Kirk) took office in 1973
Then it all turned to s*t a bit like now .haha
Just checked it nzd was fixed at 1.36 usd,although it was pounds ie 2.72usd
thrugh the 60s until NZ devalued by 18% around 1/1/1968 due to a recession in NZ.
After 1971 NZD started to appreciate again due to high export prices and usd devaluation due to Vietnam war financing.

Believe it or not Clearasmud, the high of the 70's was even higher. $1.49 in the 4th Qtr of '73...and yes you are right, things then rapidly went downhill from there.

I'll 'stand down' and happy to be corrected re my claim on the super high sometime in the sixties. In my defense though, I think we need to remember currency pricing mechanisms were very different than today, and far more opaque. ;)



Either way though and despite the continued value destruction of the USD, it's a little sad to see the Kiwi continue to lose value, from those "good ol' days".

Just for fun (sentimental reasons) one day I should probably do a deep dive into my archives and see what sort of numbers were being printed 50+ yrs ago!

[Bobdn]

@panda, thanks for the links. Yes I came to that conclusion a few years ago. If my job and house is in NZ, why would I need to also have my foreign investments hedged back to NZD? I have enough NZ risk.

[SailorRob]

@panda, thanks for the links. Yes I came to that conclusion a few years ago. If my job and house is in NZ, why would I need to also have my foreign investments hedged back to NZD? I have enough NZ risk.


Absolutely right, well actually one thing I disagree with 'enough' no you have WAY too much.

None of us would invest more than 5% of assets in a tiny isolated socialist republic 2 crop Agrarian trading nation elsewhere, so why would we here?

[SailorRob]

Things may seem bleak out there but I'm selling a property for a trust at the moment and back in June I was expecting 4.5 million if I could get it. Had zero enquiries for 6 weeks through June.

Now I have 4 offers between 5.75 and 6.25 and will sign with one of them plus other interest.

Just sold my boat, these things are notoriously difficult to sell, often take years and you never get anything like asking price.

I had 4 cash offers, well over quarter million and sold her for cash on the boat ramp, less than 4% lower than asking price and 3 of the offers were similar level.

Had over 40 separate enquiries.

Often cant find a park in town and marine services like canvas work and electrical are booked Months in advance.

Both investment and consumption spending are at record highs as a share of GDP at the same time, this is unheard of.

This economy is running hotter than hell.

Seems something changed in June.

[Fortunecookie]

Things may seem bleak out there but I'm selling a property for a trust at the moment and back in June I was expecting 4.5 million if I could get it. Had zero enquiries for 6 weeks through June.

Now I have 4 offers between 5.75 and 6.25 and will sign with one of them plus other interest.

Just sold my boat, these things are notoriously difficult to sell, often take years and you never get anything like asking price.

I had 4 cash offers, well over quarter million and sold her for cash on the boat ramp, less than 4% lower than asking price and 3 of the offers were similar level.

Had over 40 separate enquiries.

Often cant find a park in town and marine services like canvas work and electrical are booked Months in advance.

Both investment and consumption spending are at record highs as a share of GDP at the same time, this is unheard of.

This economy is running hotter than hell.

Seems something changed in June.

Hey SR what kind of property is it?

[Azz]

None of us would invest more than 5% of assets in a tiny isolated socialist republic 2 crop Agrarian trading nation elsewhere, so why would we here?

Just out of interest, are we the number one tiny isolated socialist republic 2 crop Agrarian trading nation?

[Bobdn]

@Sailor, no I agree. Just having a house here gives me the willies. Should have sold at the peak.

[Valuegrowth]

https://www.reuters.com/markets/us/bridgewaters-flagship-fund-was-bearish-us-stocks-rally-fizzled-2023-08-16/ (https://www.reuters.com/markets/us/bridgewaters-flagship-fund-was-bearish-us-stocks-rally-fizzled-2023-08-16/)


Bridgewater's Pure Alpha most bearish on developed market bonds
Also bearish about the U.S. dollar, metals and stocks
Euro, Singapore dollar were top bullish views
Pure Alpha 12% volatility fund gained 2.5% so far this year


The fund had bearish positioning in 15 of the 28 assets it analyzed, including the U.S. dollar, metals and global equities. It was neutral on five categories, such as emerging market currencies and equities, euro zone equities and energy, according to the presentation.
Its top two bullish bets were on the euro and the Singapore dollar, while it was moderately positive about the Mexican peso and inflation-linked bonds.

Bridgewater's Pure Alpha 12% volatility fund gained 2.5% in the year through Aug. 11, a third source familiar with the matter said, while the Defensive Alpha fund, less dependent on equities, rose 2.1%. Since it was launched in 1991, Pure Alpha 12% has generated 7.7% net total returns annually, according to the same source.


https://www.claytoncountyregister.com/news2/doug-kass-why-a-2023-stock-market-top-has-likely-already-been-established/104083/ (https://www.claytoncountyregister.com/news2/doug-kass-why-a-2023-stock-market-top-has-likely-already-been-established/104083/)


We assess equities objectively and without bias, considering upside/downside risk in the broader markets, industry sectors, and individual company shares. Emotional factors like FOMO and animal spirits can be fleeting catalysts and may lead to risky investment decisions. History has shown that risk can materialize quickly, with markets often taking the stairs up and the elevator down.


There are various fundamental, policy, positioning, sentiment, and valuation threats that we view as vulnerabilities for equities in the current market. One of the key factors in our market outlook is the expectation of higher interest rates for an extended period and a decline in liquidity, as the Fed maintains a tighter monetary policy. Interest rates have a significant impact on valuations, as they are a crucial component of discounted dividend models used for valuation purposes.

In conclusion, even though the stock market has been performing well ,there are factors that suggest potential risks ahead. At Seabreeze, we strive to make data-driven investment decisions and avoid relying on emotions. We will continue to monitor the market closely and adapt our strategies accordingly to navigate potential challenges in the future.

[mike2020]

I have noted similar, we have been in the property market and missed two properties in a deadline sale and one I had huge foop after I let an agent set my offer price and someone went way over the top in a 14 party multi. I got the next one pre open home and went along saturday to see a few disappointed faces. I feel the mood changed around May 12th when AO said he expected no more on the ocr. I think people were holding back until then. Also I think people are sure Labor is done and dusted.

[Fortunecookie]

I have noted similar, we have been in the property market and missed two properties in a deadline sale and one I had huge foop after I let an agent set my offer price and someone went way over the top in a 14 party multi. I got the next one pre open home and went along saturday to see a few disappointed faces. I feel the mood changed around May 12th when AO said he expected no more on the ocr. I think people were holding back until then.

If you talking about residential property. It will be due to changes to CCCFA, LVR restrictions and market sentiment (expect future minimal rate increase if any).

I will be honest it amazes me how many think they can catch bottom(reading other sites). I have been saying all along if you have the means to buy and long term is to live in it. Just buy something that ticks the boxes.

Howard Marks make a good point. We don't know the bottom until it's happened, but you will get twice as much competition on the way back up. I have learnt my lesson from this as well.

[Valuegrowth]

https://realmoney.thestreet.com/investing/broad-selloff-china-s-economy-retail-sales-defense-stocks-ai-spending-fomc-16131126

[Daytr]

Anecdotal evidence isn't sways useful and no the economy isn't running hotter than hell. Quite the opposite and things are going to get a lot tougher which may see interest rates come down sooner than forecast imo.

It's true housing is picking up but that's after a 10 - 20% fall in price depending on what region you are in & the floodgates on immigration reopening. Private building however has collapsed due to the costs and supply chain issues following Covid. I suspect the Auckland townhouse / apartment market may have still more room to fall as those is where most of the supply has come in.

I am a member of a nationwide networking group and the reports on the business activity out of Auckland have been dire for months.

Now regional NZ is about to be hit by low dairy prices, kiwifruit isn't what it was, weather impacted production in Hawkes Bay etc

Still around half of mortgage holders are yet to roll onto the new interest rates which will suck a massive amount out of the economy.

Speaking of boats, I have seen plenty of one's with big price cuts and going cheap of late, so SailorRob you did well and if you had hung on to it for another 6 months or so I suspect it would have been different.

So in my view things are going to get tougher before they get better but the housing market might be on the outer as it shows slow improvement.

[clip]

It's true housing is picking up but that's after a 10 - 20% fall in price depending on what region you are in & the floodgates on immigration reopening. Private building however has collapsed due to the costs and supply chain issues following Covid. I suspect the Auckland townhouse / apartment market may have still more room to fall as those is where most of the supply has come in.


Don't think so, auckland CBD apartments are easier to find tenants to rent to, and getting higher rental prices than over the last 2 years with return of migration and students. Town houses maybe but apartments have been hit hard and are picking up

[SailorRob]

Anecdotal evidence isn't sways useful and no the economy isn't running hotter than hell. Quite the opposite and things are going to get a lot tougher which may see interest rates come down sooner than forecast imo.

It's true housing is picking up but that's after a 10 - 20% fall in price depending on what region you are in & the floodgates on immigration reopening. Private building however has collapsed due to the costs and supply chain issues following Covid. I suspect the Auckland townhouse / apartment market may have still more room to fall as those is where most of the supply has come in.

I am a member of a nationwide networking group and the reports on the business activity out of Auckland have been dire for months.

Now regional NZ is about to be hit by low dairy prices, kiwifruit isn't what it was, weather impacted production in Hawkes Bay etc

Still around half of mortgage holders are yet to roll onto the new interest rates which will suck a massive amount out of the economy.

Speaking of boats, I have seen plenty of one's with big price cuts and going cheap of late, so SailorRob you did well and if you had hung on to it for another 6 months or so I suspect it would have been different.

So in my view things are going to get tougher before they get better but the housing market might be on the outer as it shows slow improvement.

Not anecdotal.

Investment and consumption spending is fact.

Provide details of your most recent 25 calls on the economic future.

If you can call it, you're rich list.

You might be right who knows.

Of the three parties that missed out on boat, one crying on phone, one trying go me on contract breach, other just 'gutted'

[SailorRob]

Hey SR what kind of property is it?

Residential waterfront.

[Daytr]

Not anecdotal.

Investment and consumption spending is fact.

Provide details of your most recent 25 calls on the economic future.

If you can call it, you're rich list.

You might be right who knows.

Of the three parties that missed out on boat, one crying on phone, one trying go me on contract breach, other just 'gutted'

Such an A-typical response from you.
You maybe surprised that I am not at your beck and call.
You are comparing consumption to GDP in an inflationary & recessionary environment. Can't you see what this indicates?

Many younger people say under 35 - 40 have never experienced a recession, so it will be interesting to see if there is overconfidence in the economy.

I will give you one of my latest calls and that was stocks were expensive & I have been shorting the US stock indices.
I also went long gold & picked up more over the same time, however that is down as the USD has rallied, but not nearly as much as US equities. And I will now hold unless it breaks down.

I also converted all my super to cash about 8 months ago which has proven to be by far the right move.

So like all of us we get it wrong, we get it right.
I have made big calls for a living and published those views daily to a wide audience. I don't think it's a big call to say the economy is NOT running hot. It's obvious to anyone who has a clue.

[bull....]

nz market tanking , orr just on bloomberg saying might not cut rates even when nz goes into recession

add in china big shadow bank near collapse , protests on china streets apparently now

[Azz]

Big bets by Burry. Look at the Puts.

https://www.sec.gov/Archives/edgar/data/1649339/000090514823000689/xslForm13F_X02/informationtable.xml

[Daytr]

Don't think so, auckland CBD apartments are easier to find tenants to rent to, and getting higher rental prices than over the last 2 years with return of migration and students. Town houses maybe but apartments have been hit hard and are picking up

Interesting, I hadn't heard that. I have a few mates looking at buying apartments and they think it's still very soft.

I can understand the rental market being strong as most of the 100k of immigrants can't buy for at least a year and I imagine there has been a return of international students over time.

[bull....]

Big bets by Burry. Look at the Puts.

https://www.sec.gov/Archives/edgar/data/1649339/000090514823000689/xslForm13F_X02/informationtable.xml

he's betting on a crash , also worth noting buffett sold more of his stock holdings than he brought last quarter too ..... increasing his cash pile

[Azz]

he's betting on a crash , also worth noting buffett sold more of his stock holdings than he brought last quarter too ..... increasing his cash pile

He doesn't say much, Burry, but he Puts his money where his mouth is.

[clip]

Interesting, I hadn't heard that. I have a few mates looking at buying apartments and they think it's still very soft.

I can understand the rental market being strong as most of the 100k of immigrants can't buy for at least a year and I imagine there has been a return of international students over time.

Will be interesting to see and maybe I am wrong, prices are down yes but number of sales is significantly up e.g. on apartments/units we are seeing around double what it was at the start of the year. Rents for apartments are up which may drive investor activity, especially being easier to rent them out. A lot hinges on the election/interest deductibility still and interest rates though.

[Maverick]

Will be interesting to see and maybe I am wrong, prices are down yes but number of sales is significantly up e.g. on apartments/units we are seeing around double what it was at the start of the year.
Clip, are you able to be specific where you are getting these apartments sales numbers from?

[Bjauck]

Absolutely right, well actually one thing I disagree with 'enough' no you have WAY too much.

None of us would invest more than 5% of assets in a tiny isolated socialist republic 2 crop Agrarian trading nation elsewhere, so why would we here?

NZ is a “2-crop agrarian” country precisely because it is not “socialist republic” enough!

[Daytr]

NZ is a “2-crop agrarian” country precisely because it is not “socialist republic” enough!
Good point!

[Muse]

nz market tanking , orr just on bloomberg saying might not cut rates even when nz goes into recession

add in china big shadow bank near collapse , protests on china streets apparently now

Full interview here.
https://www.bnnbloomberg.ca/investing/video/new-zealand-central-bank-says-mild-recession-bare-minimum-to-tame-inflation~2747383

Certainly got a reaction. NZ 10 yr government bond (risk free rate) breached 5% for the first time since June 2011.
https://www.marketwatch.com/investing/bond/tmbmknz-10y?countrycode=bx

Currency weak as.
https://www.fxempire.com/currencies/nzd-usd

[clip]

Clip, are you able to be specific where you are getting these apartments sales numbers from?

I have access to the data of a company with a large number of body corp units under management (tens of thousands), when a unit is sold, a post-settlement statement/report is required to be generated. I am seeing double the amount of reports generated in the last 2 months than were generated in jan/feb. albeit not all are apartments, some may be for example a house in a shared lane in hobsonville point, or cross leases, over the data I am skimming over for the past 3 months, the vast majority I am looking at is units in buildings

also looking at barfoot residential sale reports https://www.barfoot.co.nz/market-reports/2023/july/residential-sales-report
14 sales in july 22 vs 24 in july 23 for central auckland
going to the detail of these sales (2 tables down), a lot of these sales are for 0 or 1 bedroom places which is why i'm counting them as appartments not town houses

[Daytr]

Thanks Clip that's interesting

[Valuegrowth]

https://www.claytoncountyregister.com/news2/australia-stocks-lower-at-close-of-trade-sp-asx-200-down-1-50-by-investing-com/101450/


The S&P/ASX 200 index closed with a decline of 1.50% in Sydney, reaching a new 1-month low.

The best performers of the session on the S&P/ASX 200 were Mesoblast Ltd, which rose 9.72% to trade at 0.40 at the close. Codan Ltd added 7.18% to end at 8.21, and Bapcor Ltd was up 5.45% to 6.77 in late trade.

On the other hand, the worst performers of the session were Fletcher Building Ltd, which fell 9.27% to trade at 4.60 at the close. Megaport Ltd declined 5.72% to end at 10.38, and Champion Iron Ltd was down 4.92% to 5.22.

Falling stocks outnumbered advancing ones on the Sydney Stock Exchange, with 766 stocks falling, 467 advancing, and 427 ending unchanged.

The S&P/ASX 200 VIX, which measures the implied volatility of S&P/ASX 200 options, reached a new 1-month high, increasing by 7.49% to 12.25.

In commodities trading, Gold Futures for December delivery slightly declined by 0.01% to $1,935.10 a troy ounce. Crude oil for delivery in September rose by 0.11% to $81.08 a barrel, while the October Brent oil contract rose by 0.15% to trade at $85.02 a barrel.

The Australian dollar remained relatively stable, with AUD/USD unchanged at 0.65, while AUD/JPY rose slightly to 94.11.
The US Dollar Index Futures decreased by 0.17% to 102.92.

[Maverick]

I have access to the data of a company with a large number of body corp units under management (tens of thousands), when a unit is sold, a post-settlement statement/report is required to be generated. I am seeing double the amount of reports generated in the last 2 months than were generated in jan/feb. albeit not all are apartments, some may be for example a house in a shared lane in hobsonville point, or cross leases, over the data I am skimming over for the past 3 months, the vast majority I am looking at is units in buildings

also looking at barfoot residential sale reports https://www.barfoot.co.nz/market-reports/2023/july/residential-sales-report
14 sales in july 22 vs 24 in july 23 for central auckland
going to the detail of these sales (2 tables down), a lot of these sales are for 0 or 1 bedroom places which is why i'm counting them as appartments not town houses
Thanks for that Clip. I enjoy getting Tony Alexanders reports which give a pretty thorough country wide summary on what's going on. He did point out today how much Auckland / Hamilton and Tauranga were picking up ( around 10% YOY turnover) but crikey, some of those suburbs up there are really taking off.
Thanks again for the link.

[bull....]

Full interview here.
https://www.bnnbloomberg.ca/investing/video/new-zealand-central-bank-says-mild-recession-bare-minimum-to-tame-inflation~2747383

Certainly got a reaction. NZ 10 yr government bond (risk free rate) breached 5% for the first time since June 2011.
https://www.marketwatch.com/investing/bond/tmbmknz-10y?countrycode=bx

Currency weak as.
https://www.fxempire.com/currencies/nzd-usd

sure did nz bonds at 5.08 % huge jump after the interview, be putting pressure on banks to lift mtge's again soon if they keep rising. yield sensitive stocks taking a hit today

[clip]

Thanks for that Clip. I enjoy getting Tony Alexanders reports which give a pretty thorough country wide summary on what's going on. He did point out today how much Auckland / Hamilton and Tauranga were picking up ( around 10% YOY turnover) but crikey, some of those suburbs up there are really taking off.
Thanks again for the link.

Yes I receive his reports as well, tony's view etc. We provide data for some of his reports, or one in particular. TBH I enjoy getting his reports as well, while I think he has some good insights I take most things most property commentators/economists say with a grain of salt as I feel they are always giving a certain slant to things. Haven't had a chance to read today's tony's view yet

[Azz]

NZ is a “2-crop agrarian” country precisely because it is not “socialist republic” enough!

What are a bunch of socialists doing on a share trader forum??

[Daytr]

What are a bunch of socialists doing on a share trader forum??

Providing you with an education. 😉

[Panda-NZ-]

NZ is a “2-crop agrarian” country precisely because it is not “socialist republic” enough!

The free market would see china and america owning much of NZ.

[Azz]

Providing you with an education. 😉

On the share market?

[Azz]

Shouldn't you be posting on a world socialism chat site, gratifying yourselves with the wonders of state ownership - instead of on a site based around the share market which is the free movement of capital by private individuals?

[Panda-NZ-]

Shouldn't you be posting on a world socialism chat site, gratifying yourselves with the wonders of state ownership - instead of on a site based around the share market which is the free movement of capital by private individuals?

That would lead to extremism if we only talk to an echo chamber.

Cross-pollination is essential and healthy.

People don't always agree with you in the real world either and you need to be prepared for that. :sleep:

[ValueNZ]

Providing you with an education. 
I think I speak on behalf of everyone on sharetrader when I say you can keep your education to yourself.

Unless you're teaching us all how to get rich day trading capital markets on your phone lmao

[Daytr]

Wow the fishing is good today.
Hardly used any bait either.
A bit like fish a 3 second memory perhaps?

[Azz]

That would lead to extremism if we only talk to an echo chamber.

Cross pollination is essential and healthy.

People don't always agree with you in the real world either & you need to be prepared for that.

That's not what I'm saying.

Private capital is the ENEMY of any socialist worth their salt. So what are they doing here, on this site, exactly?

[Azz]

Wow the fishing is good today.
Hardly used any bait either.
A bit like fish a 3 second memory perhaps?

You've just admitted to being a troll.

[bull....]

Reserve Bank governor Adrian Orr spells out big risks to NZ of China downturn

https://www.stuff.co.nz/business/132759852/reserve-bank-governor-adrian-orr-spells-out-big-risks-to-nz-of-china-downturn

[Daytr]

You've just admitted to being a troll.

Still biting. Comedy central!

[Azz]

Still biting. Comedy central!

Can you stop trolling please.

[Fortunecookie]

Residential waterfront.

My guess a slight ease up on CCCFA and change to market sentiment regarding rate expectations. Perhaps also awareness of lack of supply for certain type of properties. Supply of stand alone housing is low. More rare when they want a waterfront location I imagine.

[SailorRob]

Such an A-typical response from you.
You maybe surprised that I am not at your beck and call.
You are comparing consumption to GDP in an inflationary & recessionary environment. Can't you see what this indicates?

Recessionary? You must be bloody kidding. Some technical case where a propellor head calculates inflation slightly wrong puts us in a recession? Mate get out and about.

Many younger people say under 35 - 40 have never experienced a recession, so it will be interesting to see if there is overconfidence in the economy.

I will give you one of my latest calls and that was stocks were expensive & I have been shorting the US stock indices.
I also went long gold & picked up more over the same time, however that is down as the USD has rallied, but not nearly as much as US equities. And I will now hold unless it breaks down.

You're not a teenage girl, get off the trading app on your phone and do some real investing. (previously you have told us you trade the global markets from your cellphone while trying to run a business)

Shorting US equities must be the stupidest thing you've done for a while! Mateeee you must be bleeding some serious red.

I also converted all my super to cash about 8 months ago which has proven to be by far the right move.

Going to cash 8 Months ago was by far the right move? WTF are you insane?

So like all of us we get it wrong, we get it right.

I have made big calls for a living and published those views daily to a wide audience.

So bloody what? What does this prove? Why were you working for someone else publishing 'big calls' when you could get rich for yourself off these big calls? This is bloody ridiculous. Daily big calls... for gods sake man.


I don't think it's a big call to say the economy is NOT running hot. It's obvious to anyone who has a clue.

Answered your own statement there.



Real world vs the world of a day trader.

[SailorRob]

he's betting on a crash , also worth noting buffett sold more of his stock holdings than he brought last quarter too ..... increasing his cash pile


Where did he bring them?

[SailorRob]

NZ is a “2-crop agrarian” country precisely because it is not “socialist republic” enough!


Yes we'd be down to one crop if we go to absolute communism.

[SailorRob]

Yes I receive his reports as well, tony's view etc. We provide data for some of his reports, or one in particular. TBH I enjoy getting his reports as well, while I think he has some good insights I take most things most property commentators/economists say with a grain of salt as I feel they are always giving a certain slant to things. Haven't had a chance to read today's tony's view yet


These are the insights he doesn't delete from his website I take it?

Tony could not see through a bloody green house.

[Ricky-bobby]

Where did he bring them?
Didn’t he buy into something else the other day as well? Some US construction firm?.. can’t remember

[SailorRob]

What are a bunch of socialists doing on a share trader forum??


You'd be surprised where these sniveling commies lurk. Interst.co.nz has a huge pile of them too. Sickening.

Their thinking can be summed up in a single sentence: Hate the man who is better off than you are.Never under any circumstances admit that his success may be due to his own efforts, to the productive contribution he has made to the whole community.

Always attribute his success to the exploitation, the cheating, the more or less open robbery of others.Never under any circumstances admit that your own failure may be owing to your own weakness, or that the failure of anyone else may be due to his own defects — his laziness, incompetence, improvidence or stupidity.

Never believe in the honesty or disinterestedness of anyone who disagrees with you.This basic hatred is the heart of the Daytra typesThis is their animating force.You can throw away the technical jargon, the “scientific” analysis, and millions of pretentious words, and you still have the core: The implacable hatred and envy that are the raison d’etre for all the rest.

[SailorRob]

Didn’t he buy into something else the other day as well? Some US construction firm?.. can’t remember


My comment was related to Bull saying Buffett had brought stocks. I asked where to?

What I think he was trying to say was that he'd bought.

But yeah he *bought* 3 x construction type firms.

[SailorRob]

I think I speak on behalf of everyone on sharetrader when I say you can keep your education to yourself.

Unless you're teaching us all how to get rich day trading capital markets on your phone lmao


Post of the year.

[clip]

These are the insights he doesn't delete from his website I take it?

Tony could not see through a bloody green house.

Haha I am unsure about his website as I only get them by email. I'm sure if I read some from a year ago it would be entertaining by now

[SailorRob]

Haha I am unsure about his website as I only get them by email. I'm sure if I read some from a year ago it would be entertaining by now


Correct.

Or any other time in the past.

However, good luck as he has deleted some of the more entertaining ones.

https://twitter.com/AKLpropertynow

This legend cuts him the shreds all the time.

Fine for Mav to use him for raw data, but 'insights' well hell.

[Baa_Baa]

You'd be surprised where these sniveling commies lurk. Interst.co.nz has a huge pile of them too. Sickening.

Their thinking can be summed up in a single sentence: Hate the man who is better off than you are.Never under any circumstances admit that his success may be due to his own efforts, to the productive contribution he has made to the whole community.

Always attribute his success to the exploitation, the cheating, the more or less open robbery of others.Never under any circumstances admit that your own failure may be owing to your own weakness, or that the failure of anyone else may be due to his own defects — his laziness, incompetence, improvidence or stupidity.

Never believe in the honesty or disinterestedness of anyone who disagrees with you.This basic hatred is the heart of the Daytra typesThis is their animating force.You can throw away the technical jargon, the “scientific” analysis, and millions of pretentious words, and you still have the core: The implacable hatred and envy that are the raison d’etre for all the rest.

You're on fire! Wonderful insights, crap on the successful while blaming them for your own lack of success, and more, demand a share of their success to compensate for your lack of success! Unbelievable.

And on a capital markets share trading and investments website? Unbelievable that these people exist, let alone take the time (a lot of time for some of them) to tell us we are all greedy capitalists and deserve to be be taken down by the socialistic regimes who demand a share of our success, while criticising and condemning it!

Incredible hypocrisy, but it happens, it is happening, truely unbelievable.

[bull....]

US 10-year yield rises to highest level since October 2022


https://www.cnbc.com/2023/08/17/us-treasury-yields-nvestors-digest-fed-meeting-minutes.html

More upside pressure on NZ rates


DairyNZ has revised down its break-even milk price to $7.51 per kilogram of milk solids (/kgMS) from $8.16/kgMS, reflecting adjustments that farmers have already made to reflect sharply lower milk prices.

https://www.nzherald.co.nz/business/milk-price-slump-dairynz-sees-12-18-months-of-reduced-income-for-farmers/UN6HYJ4FZ5B6VHZNOSHZYTJZKM/

[Panda-NZ-]

You'd be surprised where these sniveling commies lurk. Interst.co.nz has a huge pile of them too. Sickening.

Yet, you still rely on others and can't isolate yourself from the world.

Hope you don't end up in a traffic accident or your security gaurds decide they want to be in charge now.

[SailorRob]

Yet, you still rely on others and can't isolate yourself from the world.

Hope you don't end up in a traffic accident or your security gaurds decide they want to be in charge now.

If I get into an accident I will be looked after by the products of a free market, administered by a shambolic system that is horribly inefficient but will do the job. I will have contributed to the service I get many times over.

Yes we don't want a police state which is what your commie system always leads to.

Did that post describe you and your attitudes perfectly?

[SailorRob]

Yet, you still rely on others and can't isolate yourself from the world.

Hope you don't end up in a traffic accident or your security gaurds decide they want to be in charge now.


The entire point of the market you fool isn't to isolate yourself from the world.