During the recent stock and property bulls my local rag was full of trading educators and property gurus promoting their free ‘leverage your way to wealth’ seminars.
Seems that in tough times with declining asset prices, their long only strategies for the masses ain’t workin’ like they used to. They are noticeably absent from recent editions. Once again, where was the Plan B?
That they breed complacency in the bulls….complacency and laziness coupled with greed usually means that most bulls have bet the farm not near the bottom of the market when most are in disbelief that the bear has ended but at the top when forecasts are rosy and years of double digit returns have everyone thinking the market only ever goes one way.
This caught a fellow trader out badly. He watched local equities rise almost incessantly through the 90s while he sat in cash just waiting for the market to pull back to bargain basement levels so that the could get set. It never did, until the tech wreck of 2000 which saw a mini-crash and mild recessionary environment. Thinking that this was just another dip in the perma bull he bet the farm at what turned out to be near the top and lost the lot. By the time the market finally bottomed in March ‘03 in the prelude to the second Gulf War he had given up on equities and was wiped out! He missed the magnificent bull run that ran for over four years that ensued and the easy money that come with it.
Unsurprisingly, anecdotes are filtering through that “times are tough.” Many who had been betting the farm on speculative mining ventures and winning in the last few years have found themselves caught short. This is unsurprising, if you take a look at the charts of most equity markets throughout the world it would’ve been prudent to buy the dips in the ‘no-brainer, even a monkey could see it’ up-trend that has existed in the last few years. That trend is now over and those who were either fully leveraged at or near the top punting on a continuation of the good times or who had bought what they thought was a dip are toast. New resistance levels are now in place. Time will tell when these highs will be re-tested but i’m not betting on it being anytime soon.
My father once had a tenant who was a property manager and investors’ dream. Initially, he lived in the room he rented like any other tenant. After several months of tenancy he found a girlfriend and started spending time with her. As their relationship grew he eventually moved in with her yet still continued to rent his room at the full rate. He did this for several years and always met the rent increases to our utter amazement.
He would visit the premises once every few months to collect his mail and sometimes store things in the room but on the whole the room remained mostly empty and unused for the duration of his tenancy. I felt like having a trophy made up in his honour. Now, if I could just find more tenants like him, life would be perfect.
As I become older, more experienced and wiser my BS detector becomes more refined.
Since I was a young person I never had time for religion. I deduced that when push comes to shove it’s up to me to warp consciousness around myself - that is, we are all the masters of our own universes.
Marx is right, religion is the opiate of the masses and the masses have been deluding themselves all along. They’ve been searching for god when god was always within each and everyone of them all along. They have always been the masters of their own universes yet they never realised this. Organised religion has been happy to perpetuate the mass delusion in order to subjugate the masses for their own profit. The whole “do as we say to the letter or your soul will reside in hell for eternity” works pretty well on the young, gullible and ignorant.
Sadly, I tend to attract religious loonies to me. Several of my past employers have turned out to be full on religious nutjobs. One theme I have noticed over the years is that many people use religion as a cover to defraud the innocent of their hard earned. The number of con artists running the “it’s okay to trust me with your money because i’m a christian” is truly astounding.
And they’re not alone, entire churches and belief systems act as giant money siphoning machines decided to separate the ignorant and gullible from their hard earned. I avoid self-deluders like the plague.
Doing some out of the box thinking at the moment in preparation for my next big project.
Seems to me that the likelihood of a major global war breaking out is increasing. As resources such as food, water and oil become scarcer and the population becomes greater it wouldn’t surprise me to see countries eyeing off one anothers riches more suspiciously. The wonderful thing about capital markets is that such archaic behaviour can be averted with countries just stepping in and buying what it needs without having to shed a drop of blood. Witness the strategic stakes many Chinese government front companies are taking in resources firms throughout the world. I would much rather they buy me out than smoke me out of a foxhole with a flamethrower.
said Rich Dad and he was right too as far as i’m concerned.
Tenant at an IP. Earns a very modest wage as a mechanic, lives on two minute noodles and is very cost conscious when it comes to the daily cost of living. However, he owns three cars, once of which he has pumped around 80k into! It’s one of the most beautiful, tricked up customised BMWs I have ever seen but I can’t help but feel that he’s a little mad when he could’ve used the money on a deposit for at least one and possibly several properties instead.
The cultural focus on face over substance can perplex me at times. I grew up with a very eastern background and mindset. The focus was on the face or people’s perception of your wealth and standing in society being the most important thing over everything else. The older I got the more I realised how bollocks this was. This point really hit home when I splurged and bought an expensive sports car thanks to the proceeds of some tech boom trading profits when I was 21. It was a big deal at the time and I was a bit of a local hero, acquaintances still stop me in the street and ask me about the car many years after I had sold it such was the impression it made on many at the time. All I can think of is how I wish I had invested those funds into property instead!
I was discussing property investment with a chinese friend yesterday. His a single man of 26. When I told him that I thought it better for him to probably buy a PPOR first he said that “it didn’t matter.” He would live in a car and rent out his first property which I thought was quite dedicated. To stress the point he told me of an acquaintance who wanted to own a Porsche so badly that he poured all his money into the purchase of a Porsche Boxster. The Porsche purchase left him with no funds to buy or even rent a place so he just sleeps in it. The guy showers at friends’ places when he can and eats out a lot I guess!
I have been contacted by an associate who represents several leading Chinese steel mills. They are desperately seeking feedstock for their mills to the tune of several million tonnes worth of iron ore shipments per year.
If any readers know how I can secure a steady supply for the mills please contact me on malgordon at iinet dot net dot au
The earliest I have been able to secure supply is from mid 2009 so if you can secure shipments ASAP please let me know.
I used to watch a lot of TV. One night during my final year of high school I stayed up late to watch the end of a crappy film of minimal artistic merit and lacking in educational and even entertainment value. My body was telling me that I was tired and should go to sleep but I willed myself to stay up and see out the rest of the dud of a film.
I was tired all the next day and struggled through it. I had trouble concentrating and found it hard to take in any new information. I just wanted to go home and catch up on the sleep my body was so sorely missing. This event angered me, I had sacrificed a whole day because I had sacrificed sleep for something that I gained nothing from. In my final year of school the end of year tertiary entrance examinations made up half of all the years marks. Success in them was crucial yet here I was self-sabotaging myself early in the piece by staying up late to fill my head with drivel.
I reasoned that the only thing that mattered were exemplary results so that I could enter university which was my most important goal for that year. Anything that detracted from me achieving my goal had to go. So I stopped watching TV on weeknights for the remaining nine months of the year. Instead, I used the time to study or exercise or get to bed at a reasonable hour so that I would wake refreshed and make the most of the next day.
My results soared. The extra time I put into my own personal development saw me excel beyond my wildest dreams and I didn’t miss the drivel on the idiot box at all. I did make concessions by allowing myself to watch a little TV or videos on the weekend but I didn’t hang out for these precious moments and would often go weekends without when necessary.
The lesson I learnt at such a young age is to always keep the end in mind. The reason society chooses to distract itself with bubblegum for the mind is because it has no clear end goal in sight. Once you have a goal you desire with every fibre of your being it becomes a lot easier to remove the padding and wasteful distractions in your life and whole-heartedly go for gold.
In October last year I confronted a sports arbitrage scam artist on the phone, details here
ASIC has taken action (sort of) by basically saying “sports arbitraging is bad folks” here
The statement would’ve been more effective if they actually named the firms involved but perhaps they too are concerned with being sued?
Used to be inflation went up so rates go up to keep the situation under control. For reasons beyond our control and which I have stated before this is not the case this time and the system isn’t working like it used to.
Tweakage of the system is required so says Bernie Fraser here
As I said, stagflation will be the word du jour for ‘08 as the sweet spot where China was exporting her wage deflation for years has been passed. Now we are into the not so sweet spot where prices are rising globally which is crimping growth. This is a tough place to be for any economy.