Merged: Is the worst of the Global Financial Crisis behind us?
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Source is Bill Evans , senior westpac economist
guest speaker at a lunch in bne last week
Large financial houses / banks predicting aud to drop to low 80's for near term and then rise to mid 90's in 4th qtr.
Ferris, the English command criticized the Australian troops at Gallipoli, passing negative comment whilst hunkered down in their bunkers.
I cannot help but draw a parallel to your critiques ..... or you could state YOUR forecast for the aussie shingle and be held to account for your accuracy.
Nah, easier to provide black commentary from the sidelines eh ? (to be kind...sic)
guest speaker at a lunch in bne last week
Large financial houses / banks predicting aud to drop to low 80's for near term and then rise to mid 90's in 4th qtr.
Ferris, the English command criticized the Australian troops at Gallipoli, passing negative comment whilst hunkered down in their bunkers.
I cannot help but draw a parallel to your critiques ..... or you could state YOUR forecast for the aussie shingle and be held to account for your accuracy.
Nah, easier to provide black commentary from the sidelines eh ? (to be kind...sic)
Last edited by fire wall; 7th Feb 2010 at 20:59.
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Firewall- more than happy to get you up to speed, since you are too lazy to read the thread.
As previously stated, the reason for the AUDs apparent bouyancy is the amount of quantitive easing being undertaken by the yanks. They are printing money hand over fist, putting record amounts to market in an avalanche of issue. Very, very hard for the USD to appreciate in those circumstances.
As to 4PWs ideas about the USD strengthening due to increased demand "because the world's debt is denominated in USD".........
Let's say that a country has to buy some stuff, and the person that they trade with wants oranges as payment. We go to the market, and find that 1 AUD buys one orange. We borrow an orange, and exchange it for the goods. At some time in the future, we will have to buy an orange, plus another orange as interest, and give those two oranges back to the party we borrowed them from. In the mean time, the orange grower (paying no heed to demand) dumps crates and crates of oranges on the market. When our loan falls due, we go to the market and find 1 AUD buys 4 oranges. We repay the loan of an orange, plus the interest of an orange, and expend only .50 AU cents.
Is the fault in his logic evident? The market is influenced by many factors- not just debt. In the present circumstances, the supply of money is large, so large that the market cannot absorb it (to the point that one arm of the US govt is buying treasuries issued by another, in order to prevent a collapse in value).
As far as my personal forcast for currencies- see naked-recommiting's post.
As previously stated, the reason for the AUDs apparent bouyancy is the amount of quantitive easing being undertaken by the yanks. They are printing money hand over fist, putting record amounts to market in an avalanche of issue. Very, very hard for the USD to appreciate in those circumstances.
As to 4PWs ideas about the USD strengthening due to increased demand "because the world's debt is denominated in USD".........
Let's say that a country has to buy some stuff, and the person that they trade with wants oranges as payment. We go to the market, and find that 1 AUD buys one orange. We borrow an orange, and exchange it for the goods. At some time in the future, we will have to buy an orange, plus another orange as interest, and give those two oranges back to the party we borrowed them from. In the mean time, the orange grower (paying no heed to demand) dumps crates and crates of oranges on the market. When our loan falls due, we go to the market and find 1 AUD buys 4 oranges. We repay the loan of an orange, plus the interest of an orange, and expend only .50 AU cents.
Is the fault in his logic evident? The market is influenced by many factors- not just debt. In the present circumstances, the supply of money is large, so large that the market cannot absorb it (to the point that one arm of the US govt is buying treasuries issued by another, in order to prevent a collapse in value).
As far as my personal forcast for currencies- see naked-recommiting's post.
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Ferris, lazy is not a term I would imagine those that know me would use. Have you ever thought you come across a bit punchy? Is this how you conduct yourself when discussing face to face?
Having re-read the entire thread I find the only time you have stated any direction is on page 9 :
" I set up a hedge fund because I work overseas and thought the USD had to tank, given the amount of money they were/are printing. Yet even the RBA seemed to think that .84 was the top. Does have me worried (and detracting from my desire to continue earning USD!)."
Apart from above, you loosely tie your argument to that of "Chimbu" and "naked" but at no time do you have the courage of your convictions to state a numerical value in aud v usd terms. Yet you feel free to use strong language against those who hold a contrary view and it is to this that I make comment. At no time did I state that that I agreed with 4PW's views, (I too earn in a currency that is pegged to the usd and concur with the general argument re usd depreciation) but I do agree with his right to espouse them without belittling cheap shots for which you have become known.
ps. the "oranges" scenario is a very well explained analogy and one to which I agree.
Having re-read the entire thread I find the only time you have stated any direction is on page 9 :
" I set up a hedge fund because I work overseas and thought the USD had to tank, given the amount of money they were/are printing. Yet even the RBA seemed to think that .84 was the top. Does have me worried (and detracting from my desire to continue earning USD!)."
Apart from above, you loosely tie your argument to that of "Chimbu" and "naked" but at no time do you have the courage of your convictions to state a numerical value in aud v usd terms. Yet you feel free to use strong language against those who hold a contrary view and it is to this that I make comment. At no time did I state that that I agreed with 4PW's views, (I too earn in a currency that is pegged to the usd and concur with the general argument re usd depreciation) but I do agree with his right to espouse them without belittling cheap shots for which you have become known.
ps. the "oranges" scenario is a very well explained analogy and one to which I agree.
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Firewall. A bit "punchy". It's an internet forum, for god's sake! 
As to
What part about my fervently agreeing with
don't you understand? You said it yourself- I stated what direction I thought things would go.
4PWs made some bare posts claiming the USD was entering a bull-run (6 months ago). He was challenged on that. In the last few days, he has put up his reasoning. I believe I have answered that. Methinks- a little too precious, Firewall? Furthermore, what has actually happened, both in the currency and other markets over the life of this thread, would tend to bear out that 4PWs has no idea. As to what will happen in the future- see again naked's post. The courage of my convictions will be borne out in the real world- via my hedge fund.
As to
but at no time do you have the courage of your convictions to state a numerical value in aud v usd terms.
4. Avoid predicting currencies and forecasting index levels on public forums - you look like an arse.
4PWs made some bare posts claiming the USD was entering a bull-run (6 months ago). He was challenged on that. In the last few days, he has put up his reasoning. I believe I have answered that. Methinks- a little too precious, Firewall? Furthermore, what has actually happened, both in the currency and other markets over the life of this thread, would tend to bear out that 4PWs has no idea. As to what will happen in the future- see again naked's post. The courage of my convictions will be borne out in the real world- via my hedge fund.
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Barnaby's got Balls
BJ knows WTF is happening.
Countries on the verge of default!
Once again he's been told to pull his head in.
The title of this subject has got to change.
"The Worst of the Global Financial Crisis is in front of us."
Forget currency X, forget profiteering.
Now's the time to preserve your wealth.
Get yourself out of debt.
Countries on the verge of default!
Once again he's been told to pull his head in.
The title of this subject has got to change.
"The Worst of the Global Financial Crisis is in front of us."
Forget currency X, forget profiteering.
Now's the time to preserve your wealth.
Get yourself out of debt.
Get yourself out of debt?
Debt can be very good if it generates income streams.
Get yourself out of debt and into cash? What if we end up in an high inflation environment?
Debt can be very good if it generates income streams.
Get yourself out of debt and into cash? What if we end up in an high inflation environment?
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If you are talking about long term appreciation, I would suggest the year 2018 onwards if you are serious.
Check this out (yes again)... HS Dent | Economic Research, Trends, Forecast, Asset Protection
Here is a few loosely demographic truths about Australia (this thread is in the DG&P right?)
- Significant populations increase and long term trend (births and immigration). More people, more housing, food and services required.
- Resource rich soil.
5. Go Australia
Perhaps I could call this the 'Naked Method'. Would get more google hits than Dent.
Last edited by Naked_recommiting; 14th Feb 2010 at 00:14.
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Originally Posted by Gnadenburg
What if we end up in an high inflation environment?
Having said that, if you pick (incorrectly) hyperinflation & use leverage, there is a much larger risk of going bust in a deflationary environment that having parked cash in an inflationary world.
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Hiring for some airlines is reaching fever pitch again...and
Global Financial Crisis is 'over' - Treasury boss Ken Henry | News.com.au
Global Financial Crisis is 'over' - Treasury boss Ken Henry | News.com.au
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Phil Williams - economist who picked the Global Financial Crisis 6
months before it happened - interviewed this week on ABC radio.
http://blogs.abc.net.au/files/the-co...williams-1.mp3
months before it happened - interviewed this week on ABC radio.
http://blogs.abc.net.au/files/the-co...williams-1.mp3
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As for the rest of the world, it is far worse than it looks.
Last night the Societe Generale economics research team put out a frightening estimate of the real liabilities of western governments – including off balance sheet debts.
In every case the off-balance sheet numbers – including unfunded pension fund liabilities – dwarf the official debt position.
Greece is by far the worst because of what Otmar Issing, the German former chief economist of the European Central Bank, described yesterday as “one of the most luxurious pension systems in the world”. Its total net liabilities are about 800 per cent of GDP – eight times the official position.
Here are Soc Gen’s figures for the others (per cent of GDP): US 550, UK 400, Germany 400, France 550, Italy 350 and Spain 250.
In other words, the entire western world is insolvent and each country is facing its own day of reckoning – starting, appropriately enough, in Greece, the place where western civilization itself began.
Last night the Societe Generale economics research team put out a frightening estimate of the real liabilities of western governments – including off balance sheet debts.
In every case the off-balance sheet numbers – including unfunded pension fund liabilities – dwarf the official debt position.
Greece is by far the worst because of what Otmar Issing, the German former chief economist of the European Central Bank, described yesterday as “one of the most luxurious pension systems in the world”. Its total net liabilities are about 800 per cent of GDP – eight times the official position.
Here are Soc Gen’s figures for the others (per cent of GDP): US 550, UK 400, Germany 400, France 550, Italy 350 and Spain 250.
In other words, the entire western world is insolvent and each country is facing its own day of reckoning – starting, appropriately enough, in Greece, the place where western civilization itself began.
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Subject: So what have we learned in 2,064 years ?
The budget should be balanced, the Treasury should be refilled, public debt should be reduced, the arrogance of officialdom should be tempered and controlled, and the assistance to foreign lands should be curtailed lest Rome become bankrupt. People must again learn to work, instead of living on public assistance."
- Cicero - 55 BC
Evidently nothing
The budget should be balanced, the Treasury should be refilled, public debt should be reduced, the arrogance of officialdom should be tempered and controlled, and the assistance to foreign lands should be curtailed lest Rome become bankrupt. People must again learn to work, instead of living on public assistance."
- Cicero - 55 BC
Evidently nothing
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4PW's....I'm with you brother, I also think the worst is yet to come, but I am interested in why or at least what makes you think it will be this week..?
Cash will soon be king....
Cash will soon be king....
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PS Wow, emoticons. Where have I been?
I may be wrong. Often I am.
I'm with you brother
I'm not here to win a popularity contest
Most people aim to provide a balanced point of view - that is one that has foundation and reason. It doesnt mean its right, just credible. I wasn't having a go at you 4's, but seeing you disaprove of my attire I took the time reread your posts/predictions - you must be well and truly down at the moment, should you be putting $ towards your predictions.
See point 4.
Last edited by Naked_recommiting; 13th Feb 2010 at 13:39.
I think, for the medium term anyway, China's attempt to contain asset bubbles will be good for the Australian economy. Making recovery more sustainable.
Australia is beautifully positioned in Asia. I've been long on the $AUD on pprune when the doomsayers were banging on of under 50 cents 12-18 months ago. Every chance I had in the last 12+ months I structured debt or bought the Aussie under 75 cents. And reversed, squared up and profited.
If you are long on Asian growth go long on the Aussie. And of course it is vulnerable to any double dip scenario. Which is very hard to hedge against as a PAYE citizen of Australia.
Cash is not King. Cash flow is king. I see guys cash out of the markets or real estate and then do nothing. Re-entering the market at dubious times. Whereas guys with a lot of cash flow tend to build on their income streams and have more creative nouse or financial fluency.
Australia is beautifully positioned in Asia. I've been long on the $AUD on pprune when the doomsayers were banging on of under 50 cents 12-18 months ago. Every chance I had in the last 12+ months I structured debt or bought the Aussie under 75 cents. And reversed, squared up and profited.
If you are long on Asian growth go long on the Aussie. And of course it is vulnerable to any double dip scenario. Which is very hard to hedge against as a PAYE citizen of Australia.
Cash is not King. Cash flow is king. I see guys cash out of the markets or real estate and then do nothing. Re-entering the market at dubious times. Whereas guys with a lot of cash flow tend to build on their income streams and have more creative nouse or financial fluency.
Last edited by Gnadenburg; 15th Feb 2010 at 13:00.
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The Aussie is pretty much set to collapse this coming week. I may be wrong. Often I am.
So much for the collapse.
Now what was that comment about making predictions, and looking like an arse? Anyone else still on the 4PW's bandwagon?*My sources tell me that despite the increasing carry trade, everyone trying to keep ahead of the game may begin to unwind soon. The Fed is starting to look at it's quantitative easing, which to me is the one big impediment to the USD improving against the aussie. Might be time to take a step back and watch for a bit. Forget about the alleged 'tightening'- a bit of slight of hand to try and stoke confidence.
Once again, I am getting mixed messages from oz- some saying things are grim, job losses etc, others (and the official unemployment numbers etc) saying the opposite. What do others 'feel'?
*So long and thanks for all the fish, 4PW's
Currently at .9080
So much for the collapse. Now what was that comment about making predictions, and looking like an arse? Anyone else still on the 4PW's bandwagon?*
My sources tell me that despite the increasing carry trade, everyone trying to keep ahead of the game may begin to unwind soon. The Fed is starting to look at it's quantitative easing, which to me is the one big impediment to the USD improving against the aussie. Might be time to take a step back and watch for a bit. Forget about the alleged 'tightening'- a bit of slight of hand to try and stoke confidence.
Once again, I am getting mixed messages from oz- some saying things are grim, job losses etc, others (and the official unemployment numbers etc) saying the opposite. What do others 'feel'?
So much for the collapse. Now what was that comment about making predictions, and looking like an arse? Anyone else still on the 4PW's bandwagon?*
My sources tell me that despite the increasing carry trade, everyone trying to keep ahead of the game may begin to unwind soon. The Fed is starting to look at it's quantitative easing, which to me is the one big impediment to the USD improving against the aussie. Might be time to take a step back and watch for a bit. Forget about the alleged 'tightening'- a bit of slight of hand to try and stoke confidence.
Once again, I am getting mixed messages from oz- some saying things are grim, job losses etc, others (and the official unemployment numbers etc) saying the opposite. What do others 'feel'?
Tsk I don't think the cards will fall this way. Best be well away from the US dollar.
I think in the next couple of months or so the focus will move up the food chain. First it was greece, spain, ireland with their debt. Now it seems to be questions about the Uk. Soon it will be the big daddy, the USA.
If it come to pass that the focus increases on the US gov debt, which is HUGE, I think the US treasury's will be worthless. So if this happens, the cash will run out for the US government.
So what happens next you ask. They have 2 choices. They can shut down the social system, eg health care, pensions, everything, and pay down the debt by cutting spending, or they can print money (monetize the debt). You have to remember that the US gov ha huge unfunded liabilities, eg social care, freddie and fanny.
Seeing what they have done so far, I think when everyone stops buying the US debt as they know they will never pay it back, there is a good chance Benny will roll out the printing press and destroy the US dollar.
When this occurs, I think there will be a flood to every other currency that is stable, eg AU, CAD, YEN, EUR. There will be a good chance that the US dollar will be replaced as the global currency and I think most liukely this will be the Euro, as nobody wants the chinese to control the markets.
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Seeing what they have done so far, I think when everyone stops buying the US debt as they know they will never pay it back, there is a good chance Benny will roll out the printing press and destroy the US dollar.
When this occurs, I think there will be a flood to every other currency that is stable, eg AU, CAD, YEN, EUR. There will be a good chance that the US dollar will be replaced as the global currency and I think most liukely this will be the Euro, as nobody wants the chinese to control the markets.
When this occurs, I think there will be a flood to every other currency that is stable, eg AU, CAD, YEN, EUR. There will be a good chance that the US dollar will be replaced as the global currency and I think most liukely this will be the Euro, as nobody wants the chinese to control the markets.