Hi guys,

i have given a few tibbits of information regarding the stock market over the last few years including stating months and years earlier then it happened the recession/depression and here is my latest..

today is a very important day! - maybe

as some of you know during these dark days of doom and gloom there is actually a lot of strength in trading.. stock patterns become stronger as more people trade fewer stocks. my stock of choice in bad economic times is BHP.

BHP is a leading indicator of market activity.. it supplies raw material to the world to power economies and produce stuff. When BHP goes south the world goes south... when BHP turns the world turns with it... (actually BHP is responding to the world so its opposite.. but you get what i'm saying..)

today BHP turned... south..

why is this good?

i went to bed last night saying.. if BHP goes south tomorrow the global economies will start to turn around..not right away.. not even for a number of months.. but my indicators and trading charts indicate that now a possible trend will emerge.

technical jargon (if your not financially inclined you might want to tune out)
BHP had an EOD resistance indicator at over 4400 the other day with a tumble the next day and some pick up over the following days..

if you notice the trading band has been steady with a slight tilt upwards over the last few cycles. todays drop could be the start of a tumble which will see the stock move to hopefully 2850-2900 where i will expect to see support.. then in the next cycle it should move well above 4400 maybe to something like 4450-4475 (45 might be too optimistic)

the important point of this is that BHP has started to show a clear upward trend in its cyclic activity and this is a very good signal for the global economy.

anyway i say its maybe an important day.. cause its very early is my analysis and alot more indicators need to be hit and obviously anything can happen.. but we will see

anyway you heard it here first...

http://tinyurl.com/c9k58x

Rejoice. After much pious posturing – and criminal wastage of time – the European Central Bank at last seems ready join the Anglo-Saxons, Japanese, Swiss, and Isrealis in printing money to fend off disaster.

More countries are starting to print money. Disaster is coming
" The Quickening " has begun...

yeah well my view is things will be tough for a while to come.

500,000 people every month are joining the bread line in the US.

we are in for some very rocky times ahead.

Posting in this thread.

The global economy is losing more money from the disappearance of forests than through the current banking crisis, according to an EU-commissioned study.

It puts the annual cost of forest loss at between $2 trillion and $5 trillion.

The figure comes from adding the value of the various services that forests perform, such as providing clean water and absorbing carbon dioxide.

The study, headed by a Deutsche Bank economist, parallels the Stern Review into the economics of climate change.

It has been discussed during many sessions here at the World Conservation Congress.

Some conservationists see it as a new way of persuading policymakers to fund nature protection rather than allowing the decline in ecosystems and species, highlighted in the release on Monday of the Red List of Threatened Species, to continue.

Capital losses

Speaking to BBC News on the fringes of the congress, study leader Pavan Sukhdev emphasised that the cost of natural decline dwarfs losses on the financial markets.

"It’s not only greater but it’s also continuous, it’s been happening every year, year after year," he told BBC News.

"So whereas Wall Street by various calculations has to date lost, within the financial sector, $1-$1.5 trillion, the reality is that at today’s rate we are losing natural capital at least between $2-$5 trillion every year."

The review that Mr Sukhdev leads, The Economics of Ecosystems and Biodiversity (Teeb), was initiated by Germany under its recent EU presidency, with the European Commission providing funding.

The first phase concluded in May when the team released its finding that forest decline could be costing about 7% of global GDP. The second phase will expand the scope to other natural systems.

Stern message

Key to understanding his conclusions is that as forests decline, nature stops providing services which it used to provide essentially for free.

So the human economy either has to provide them instead, perhaps through building reservoirs, building facilities to sequester carbon dioxide, or farming foods that were once naturally available.

Or we have to do without them; either way, there is a financial cost.

The Teeb calculations show that the cost falls disproportionately on the poor, because a greater part of their livelihood depends directly on the forest, especially in tropical regions.

The greatest cost to western nations would initially come through losing a natural absorber of the most important greenhouse gas.

Just as the Stern Review brought the economics of climate change into the political arena and helped politicians see the consequences of their policy choices, many in the conservation community believe the Teeb review will lay open the economic consequences of halting or not halting the slide in biodiversity.

"The numbers in the Stern Review enabled politicians to wake up to reality," said Andrew Mitchell, director of the Global Canopy Programme, an organisation concerned with directing financial resources into forest preservation.

"Teeb will do the same for the value of nature, and show the risks we run by not valuing it adequately."

A number of nations, businesses and global organisations are beginning to direct funds into forest conservation, and there are signs of a trade in natural ecosystems developing, analogous to the carbon trade, although it is clearly very early days.

Some have ethical concerns over the valuing of nature purely in terms of the services it provides humanity; but the counter-argument is that decades of trying to halt biodiversity decline by arguing for the intrinsic worth of nature have not worked, so something different must be tried.

Whether Mr Sukhdev’s arguments will find political traction in an era of financial constraint is an open question, even though many of the governments that would presumably be called on to fund forest protection are the ones directly or indirectly paying for the review.

But, he said, governments and businesses are getting the point.

"Times have changed. Almost three years ago, even two years ago, their eyes would glaze over.

"Today, when I say this, they listen. In fact I get questions asked - so how do you calculate this, how can we monetize it, what can we do about it, why don’t you speak with so and so politician or such and such business."

The aim is to complete the Teeb review by the middle of 2010, the date by which governments are committed under the Convention of Biological Diversity to have begun slowing the rate of biodiversity loss.

http://www.adbusters.org/blogs/adbusters_blog/real_crisis_ecological.html

so are you saying good time to buy BHP shares?

my brain hurts

just for all those in the know out there, im thinking of buying a few woodside share: WPL. For someone who has never bought shares personally before, is this a dumb buy? Also what is the easiest way to buy shares over the net? I remember once before looking at CommSec, but they had to send stuff out to me and i had to sign first. Is there an easier way?

Posting in a faceman "the end is coming" thread.

WPL is an ok buy. It will (obviously) track the fortunes of the oil price so ask yourself if you think oil is going up or down over the next 12 months?

I don't think we will see $100/barrel any time soon but it depends on how long this depressions lasts for. We could have sub $50/barrel oil for another 2 years, in which case WPL wont go anywhere.

That being the case I do own some of them.

or infi, does the stock market own YOU?

i cant give advise on what shares to buy so i wont sorry..

im over this economic crap.

so should i be buying or selling?

and yes i agree things will be tough for a long time to come possible years.. however this bit of info is like seeing the very first drop of a drought busting rain

so should i be buying or selling?

imho you should always be doing both

so should i be buying or selling?

BUY BUY BUY! Do your part for the economy!

note: I have no idea...

so should i be buying or selling?

you shouldn't be asking qgl :D

or infi, does the stock market own YOU?

presently? yes.

I think its extremely naïve to suggest that a recovery is on the way due to analysis of 1 stock. Sure, BHP is generally a decent litmus test for the ASX, but trying to judge where the market is going based on BHP alone is a big leap of faith.

sorry superform, rather then advice on what to buy, i was more after what site or way have you found is an easy starter? commsec anygood? dont really want much setup difficulty

commsec is the best. i still use it for charts over my broker's site!

Superform I think it is too early to tell if it was simply a result of the DJI being up for a few consecutive days which was a direct result of the US stimulus package being announced at the start last week. Or is this a sign of the times as things improve?

As to weather woodside is a good buy this depends on a few things, are you in for long term( 2-7 years) if not then no
Do you beleive in peak oil?

technical jargon (if your not financially inclined you might want to tune out)
BHP had an EOD resistance indicator at over 4400 the other day with a tumble the next day and some pick up over the following days..

if you notice the trading band has been steady with a slight tilt upwards over the last few cycles. todays drop could be the start of a tumble which will see the stock move to hopefully 2850-2900 where i will expect to see support.. then in the next cycle it should move well above 4400 maybe to something like 4450-4475 (45 might be too optimistic)

Superform, this is what I dont understand:
- wtf are terms like "resistance indicator" & "expect to see support" actually mean?
- Are there some principles that I missed in finance 101 (albeit 10+ years ago, so could be memory loss)?

I swear some finance nutcase made these types of "indicator jargon" up so the crowd follows the same logic and produces the result implied... ie a self fulfilling prophecy! I just dont buy it as a sound analytical tool.
Is your above analysis not just based on daily volumes? Ie supply & demand at varying prices?

I prefer stock picking based on fundamentals and general market/economic knowledge of the world.

" The Quickening " has begun...

http://upload.wikimedia.org/wikipedia/en/0/04/Highlander.jpg

Connor MacLeod of the Clan MacLeod frowns on your shenanigans.

ok... looking at the basics

and Fibonacci Retracement

still leads me to believe it is the crowd ALL following the same method hence you get the desired result. So in fact it the race is fixed.


Btw, those that trade, does anyone actually know what their overall return is? Income or capital return on all there asset classes? (ie cash, equity & property)

twat i can only assume it's some kind of retarded technical analysis that some guru promotes and hence other people jump on board.

kind of like how infi was pimping Elliot Wave theory once upon a time.

it wasn't covered in finance 10 years ago and it's still not covered in finance now.. make of that what you will. (doing my honors in econ/commerce dual in 1-2 years in corp fin)

last edited by taggs at 19:00:41 30/Mar/09

support and resistance is pretty basic trading terminology.. you see pics of all those guys on the trading floors... they all use support and resistance in daily trading - i tried to keep it basic but i'll spell it out

support is a price range when the market considers a stock a good buy...

when i say expect to see support it means that i expect to see the market start buying the stock at around 2850-2900 this support buys up all available shares at this support level

resistance is the market wanting to sell because they think the share is over valued

picking support and resistance depends alot of watching the stock price intraday (through out the day) and not relying on end of day data) as you get a better feel for the market.

the band i'm talking about is the gap between support and resistance

so for the last few months you will see BHP has a trading range of 28-32 approx thats the band - make 4AUD doesnt sound like alot but if you were to buy 200k worth thats close to 7000 shares x 4 dollars 28000 x 4 = more then you make in a year

taggs get out of school and get into practice.. make a few 100k from trading then come talk about who is the retard... i remember you were the first to bag me when i was predicting a depression or deep recession months before it became mainstream news

finance and trading are interlinked but not the same thing - i would have thought someone working on there masters would recognise this difference

I think the point is more about how ludicrous it is to forecast the entire markets performance in times of uncertainty based upon technical analysis of just one stock.

taggs get out of school and get into practice.. make a few 100k from trading then come talk about who is the retard... i remember you were the first to bag me when i was predicting a depression or deep recession months before it became mainstream news

How does trading a few 100K of profit qualify you to predict recessions better than somone doing their honors in finance? Your idea for prediction based on BHP stock makes less sense than most of hitler's theories.

haven't you been predicting a downturn for years and years, pretty much every time a stock thread pops up? or is that infi, i can never remember what you self-proclaimed stock market gurus ramble about. anyway, a saying about a broken watch comes to mind...

i just have a healthy suspicion of most (all?) forms of technical analysis. trying to seriously claim that stock markets follow fiboncci sequences or the golden ratio or whatever bulls*** is in vogue these days is simply retarded.

haha, yeah i understand what finance and trading are. how about you read twat's post, then post your REAL AND TRUTHFUL annual return on equity trading over the years? edit: of course even if you calculated that number (most people like you don't, it would deflate their ego too much) you'd have no reason to be truthful about it. people on the internet might not think you're as awesome as you keep telling them you are!

oh and honors =/= masters. for someone so "educated" i thought you'd know that :D

edit2: only mentioned what i study cause twat was talkin about what he studied 10 years ago. a degree doesn't somehow magically make you know everything or be right about stuff. if anything, the more you learn the more you realise you don't know.

last edited by taggs at 20:34:37 30/Mar/09

Plenty of people with honors in finance just 24 months ago were worried about rising interest rates, tight employment market and arguing over whether resource booms were 18 or 24 year cycles and if that would matter this time around

12 months ago very few were saying things would be worse in 12 months, it was all BUY bhp at $32 and that pretty much everything was good value with current P:Es as they blindly believes the earnings estimates while white-washing over the seriousness of the underlying problem.

haven't you been predicting a downturn for years and years

yes

ever since i could see lenders offering loans at 0% to stimulate an over stretched economy and destroying the natural credit cycle.

i predicted it should have turned down in 2005/6 it was 2-3 years propped up by bad policy which is why we are in such a mess now

its good to have a healthy suspicion of most trading styles.. however alot of people make alot of money trading.. if it was so unprofitable would people still be doing it?

and nats yes i did tell people to buy BHP at 32 and sell at 37-38 (if i remember) one of the few tips i have ever given.. and it was right.. just remember trading is not investing.. having a good exit and sticking to it is the key to any good trading style

and i said

its very early is my analysis and alot more indicators need to be hit and obviously anything can happen.. but we will see

i'm basing my theory on 1 share.. but i'm obviously looking at indicators in the market as a whole as well

however alot of people make alot of money trading

A lot of people loose a lot of money too.

I wasnt having a go at you superform, I genuinely dont understand the principle the theory is meant to uphold. Looking at the links I posted, i have a better picture of what happens in practice, but no idea why people use it.

My point being that if most every trader uses a similar trading strategy, then what you say will always hold true because they are looking at the same data, hence it becomes self prophesising. Only when heavy weights come in and buck the trend, do these high and low limits change. (eg the hedge funds that short sold the financial stocks)

As a small time investor, it would be smarter for me to follow the masses and make some money, I just cant bring myself to do it as I dont have faith in that analytic tool.

I certainly use other questionable techniques, ie 10 day moving average, but i call it betting and use it in that regard with my spreadbetting account.

PS. I absolutely believe that some stocks are leading/lagging indicators of economic performance. Not surprised that BHP is the one superform uses, as it is necessary for future growth.
Just dont know that I would use it as a leading indicator. It should see revenue growth prior to most companies, but there would be some other more appropriate demand indicators, like commodity futures, or some of the construction indicators, etc...

Your spot on twat. The key is to use that info to your advantage and as long as you get in early as close to the turning points as possible then there will always be money to be made.

Most blue chip stocks that trade in bg volumes ten to have a large percentage of chart traders vs fundamental traders. I think it was something like 70% to %30 in some of the top 20 stocks.

My point being that if most every trader uses a similar trading strategy, then what you say will always hold true because they are looking at the same data, hence it becomes self prophesising. Only when heavy weights come in and buck the trend, do these high and low limits change. (eg the hedge funds that short sold the financial stocks)

correct.. its the principle of Fibonacci numbers.. i dont use them but they do sometimes work... (less and less as less and less people use them)

As a small time investor, it would be smarter for me to follow the masses and make some money

correct again

just remember dont try to pick tops and bottoms.. trade trends

and i only use BHP cause i have studied it intimately for a number of years and seen the way it reacts to global financial news

there are prol alot of shares you could use to follow the same trend

hey elliot wave worked fine for me. sold all my stocks at the peak and watched all the other suckers get annihilated.

If you are making so much money, why do you care about what a uni student thinks of you ?

I care terribly deeply what everyone thinks of me and I long also for your approval, Obes.

Most blue chip stocks that trade in bg volumes ten to have a large percentage of chart traders vs fundamental traders. I think it was something like 70% to %30 in some of the top 20 stocks.

Source please.

I recently researched thoroughly and created a fake portfolio of 17 companies I would invest in right at this moment for an investment of about $60k. This is what I came up with, just out of interest:

http://img23.imageshack.us/img23/776/56297277.jpg

But as you know, it's always nice doing fake porfolios. The reality is that to invest in shares you need expendable income. It's a better investment to put money on your mortgage to reduce your interest.

*Edit* I should clarify the aim of this portfolio is dividend income not capital gain - although I considered at this current time that capital gain could produce significant return over the next 2-3 years.

Personally I dont understand how things can turn around when all the yanks are doing is printing trillions of debt dollars.

But this is one subject that I'll be happy to be wrong about.

it won't. wait until the g20 fails miserably and confidence evaporates making way for the final wave of economic destruction.

this is a great watch:



last edited by infi at 12:13:47 31/Mar/09

it won't. wait until the g20 fails miserably and confidence evaporates making way for the final wave of economic destruction.

Looting will ensue, speculates this post-WWII poster well ahead of it's time.

http://img12.imageshack.us/img12/7946/looting.jpg

Faceman is the only smart one in this thread, if the end of the world doesn't come he gets to keep living it up as the consumer whore Westerner he really is, if it does he gets to say 'I told you so!'

Hey faceman, look!

I'm pretty sure that whether the world ends or not, there will still be plenty of alcohol, prostitutes and gambling, which is all us Aussies really need.

It's a better investment to put money on your mortgage to reduce your interest.

this is completly wrong.. when i get more time i'll explain why

also day 2 BHP another down day.. this is looking good..

its not down as much as i would like but its still down

this is actually the 2nd recommendation I have heard for BHP in the last few days

/takes notice

sell everything, pay off your debts, and party with blue chip hookers until it's all over.

It's a better investment to put money on your mortgage to reduce your interest.

this is completly wrong.. when i get more time i'll explain why

Yeh can you. I have been meaning to sit down and work it out properly but still haven't found time.

A lot of people finance their stocks hence why a lot of people are forced to put stop loss triggers on their stocks.

I have personally considered getting a loan to get stocks with but in these uncertain times I would rather gamble with money I do have instead of someone elses.

Sure paying off your mortgage is a safe way to save money. There is also no risk.
Is most cases the higher risk = the higher the potential payoff.

shares over the longer term have always outperformed property as in investment

borrowing money can be done for both shares and property

if your a pure investor its better to negotiate a lease at a fixed % of the property value (and not just be told what to pay)

i havnt done the maths for awhile but when i did it a few years ago i was basing rental prices at 7% of property value and interest rates were approx 5% on borrowings... is is obviously different now but the long term calculation is still sound

the trick is to keep investing... not into your mortgage but to invest the surplus into equities

so if your house gains 15% on capital over 1 years

however traditionally the stock market outperforms property

so over the same 12 months you invest and gain 25% capital

i'll keep it basic

borrowings were 100k

shares cost 5% (borrowings cost)
gained 25%
net increase 20%

house cost 5% (borrowings)
gained 15%
net increase 10%

now consider you rent at 7% of the property value
and invest the rest into shares or take a loan out and invest in shares

so house value 100k
paying lease 7%
borrow 100k @ 5% put in shares
so your costs are now 12%
but you make 25%
so your net gain is 13%

13% > 10%

therefore its better to be smart - negotiate a good lease and invest and borrow over the long term in equity markets

the trick is to be aware of the cyclic nature of property and shares and as an investment be agile in moving from one to the other so you are always on the positive growth side of the market

right now its a great time to be out of property and renting (housing and rental glut) secure a nice 5 year lease as low as you can and invest in shares...

(in 3-5 years be watching for an opportunity to move back into property)

now my figures are very basic but if you took real data you would find my results are the same

don't confuse your principal place of residence with an investment property.
it is always a very good idea to pour your money into your principal place of residence, so long as it doesn't have any major flaws.
that being said, i'd put my surplus cash into the sharemarket way before i'd put it into dirty residental property as an investment.

and yes thats a very good point... people buy houses for alot more reasons then to make money from it

having a home for your children > moving every few years to make some bux

Yeah, that's what I meant sorry, what MrHardware said.

My stance is I think it's better to pay off your principal place of residence with surplus than invest in ordinary shares. The aim is to reduce interest paid (loss) because you can't make more money to pay for interest AND still profit.

However, that might only hold in the early mortgage repayment period (up to say 5-7 years). Thereafter it might be better to put money into ordinary shares than into house. That's my theory anyway, without numbers. I will do numbers.

Yeah, you boys have the right way of thinking.
No 1 on my list is to provide for myself and my wife the best and nicest home I can afford, and cost myself the least borrowing costs possible.
Any surplus is pure money making for me, and seeing as i'm in for the long haul, shares it is.

last edited by MrHardware at 16:04:59 31/Mar/09

Well i think the point is that if you put extra money into paying of your mortgage, you are just saving yourself the interest (say 5-6% pa) of whatever you put in.

If however, you put your extra cash into stocks, the general return is around 10-12% pa or more which is obviously a superior return.

gross figures suck
net figures give you the real perspective.
suddenly your 10% return looks pretty s***house
and you would have saved yourself a lot of effort just pushing more into the mortgage

I've been investing in brothels. The only problem is when I have to go smack a bitch for not preforming as desired.

The only problem is when I have to go smack a bitch for not preforming as desired.

You could always treat them to some nuggets