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Boom or Bust?

michael_selway

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Boom or Bust?

http://sixtyminutes.ninemsn.com.au/sixtyminutes/stories/2006_07_16/story_1705.asp

Boomtime
July 16, 2006
Reporter: Ross Greenwood Producer: Nick Greenaway

Mining

This is as good as it gets. We're filthy rich. As fast as we can dig it up ”” iron ore, gold, nickel ”” you name it, we're selling it.

The figures are just staggering. This boom is making $1000 a second.

What's the secret of our success? Quite simply, China and its wild rush to capitalism.

For us, this is the promised land, where the newly-rich middle class numbers 250 million. That's right, 250 million and they want to spend like mad. So, what's in it for you and me?

After a mind-boggling journey through China and the far north-west of Australia, the Nine Network's financial editor Ross Greenwood has the answer.

mms://netshow.ninemsn.com.au/60_min/2006/060717_60_boomtime.wmv



OR still 1 more up leg left?

Look at 1987 that little volatile bit, we are there atm?

Then one more leg up for about 6-12 months, then crash?

So looks like crash in 2007, what do u guys think?

Cant believe the guy below is right? how do we prove him wrong?

http://www.depression2007.com

thx

MS
 

mit

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Michael,

The recent bull market looks impresssive in absolute terms but the pre-1987 runnup was much more impressive in percentage terms. Change the scale to a log graph to get what the proportions look like.

MIT
 

Realist

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This is ridiculous tripe designed to scare amateurs.

First of all he said "I predicted this, I predicted that" Where are the facts he predcited this and that exactly?

Any idiot can tell you house prices will go up soon, and the sharemarket will correct itself soon. They always do and always will!!

Anyone who thinks we'll be in depression in 2007 needs their head read!!

As the CEO of Bluescope said, in 1890 Europeans were telling everyone that the new world's growth, i.e. the USA, was just a one off trend that would never last. Europe is where it is at financially and it'll always be that way.

Of course now the USA is more powerful than the whole of Europe combined.

That trend lasted over 100 years and is still going.

Anyone who thinks China's demand for resources is a 3 year trend is dreaming, they could quite easily be growing for the next 150 years along with India.

Where will the 2.5 billion Indians and Chinese get their resources to build buildings, power plants, jewellery, computer parts etc?

Well they'll get alot of them off 20 million Aussies.

Depression my ass!! It's boom times for the rest of our lives possibly! :D
 

wayneL

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Realist said:
This is ridiculous tripe designed to scare amateurs.

First of all he said "I predicted this, I predicted that" Where are the facts he predcited this and that exactly?

Any idiot can tell you house prices will go up soon, and the sharemarket will correct itself soon. They always do and always will!!

Anyone who thinks we'll be in depression in 2007 needs their head read!!

As the CEO of Bluescope said, in 1890 Europeans were telling everyone that the new world's growth, i.e. the USA, was just a one off trend that would never last. Europe is where it is at financially and it'll always be that way.

Of course now the USA is more powerful than the whole of Europe combined.

That trend lasted over 100 years and is still going.

Anyone who thinks China's demand for resources is a 3 year trend is dreaming, they could quite easily be growing for the next 150 years along with India.

Where will the 2.5 billion Indians and Chinese get their resources to build buildings, power plants, jewellery, computer parts etc?

Well they'll get alot of them off 20 million Aussies.

Depression my ass!! It's boom times for the rest of our lives possibly! :D
....says the most experienced investor of our time! Why, you know more than even George Soros! :banghead:

By commentary such as that above you show your inexperience.

Cheers
 

Realist

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wayneL said:
....says the most experienced investor of our time! Why, you know more than even George Soros! :banghead:

By commentary such as that above you show your inexperience.

Cheers

Wayne, you are like chicken little, "the sky is falling, the sky is falling."

In no way is it ridiculous to assume that Australia and Australians will only get wealthier over time.

It has happend for the past 70 years, why would it not continue to happen for many more years?

Sure there'll be minor corrections and minor booms. But over time people will get richer in Australia - there is no doubt about it.

What trends, facts or fundamentals are you basing this "sky is falling" theory on?

My facts are there for all to see. The average Aussie is way way richer than they were 30 years ago. What makes you think things will change? And when will things change exactly?
 
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Well the way I read that article he has got 5 things correct... out of how many I wonder :evilburn:

But this guy lost me at the end when he said :

"You are going to learn that income tax (and the iniquitous GST) is neither legal nor necessary nor moral. The "tax cheats" are not those who try and hang on to the fruits of their own labour, as is their God-given right, "protected" by the "constitution" in most countries. The real "tax cheats" are the ones who impose it dishonestly and collect it and call Aussie Battlers "tax cheats.""


To tell the truth I have no idea who this guy is, but after reading this tripe, geez I wouldnt waste my money subscribing. There is just so much wrong with it.
 

wayneL

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Realist said:
Wayne, you are like chicken little, "the sky is falling, the sky is falling."

In no way is it ridiculous to assume that Australia and Australians will only get wealthier over time.

It has happend for the past 70 years, why would it not continue to happen for many more years?

Sure there'll be minor corrections and minor booms. But over time people will get richer in Australia - there is no doubt about it.

What trends, facts or fundamentals are you basing this "sky is falling" theory on?

My facts are there for all to see. The average Aussie is way way richer than they were 30 years ago. What makes you think things will change? And when will things change exactly?
Realist,

I find your username quite ironic. Your style of debating does not display any rational thought, analysis, or the ability to see things other than what you want to believe. Trotting out the "chicken little" analogy confirms a closed mind.

Therefore I will not indulge in an exercize in futility. Do your own research.

Cheesr
 

Realist

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wayneL said:
Therefore I will not indulge in an exercize in futility.
I didn't think you would respond Wayne.

In poker terms, I raised you, and you folded.


You have no facts on why Australia would face a depression in the near future because quite simply there aren't any.


You bluffed, and you got called - simple as that.
 

wayneL

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Realist said:
I didn't think you would respond Wayne.

In poker terms, I raised you, and you folded.


You have no facts on why Australia would face a depression in the near future because quite simply there aren't any.


You bluffed, and you got called - simple as that.
ROFL You remind me of "chemical" Ali.

No, it simply profits me not to argue. Why do I need to convince you against your will? I don't; no profit in that. Just had to point out the silliness of your statement above.

Professionals hedge. Amateurs hope.
 

Realist

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Well, we'll have to agee to disagree. No probs. ;)

But I am interested in when and why there will be a bust - not (just) to argue, but on the chance you are right I'd like to know.
 
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A phsical shortage of oil would virtually guarantee a worldwide economic bust. It is not simply a case of having to pay higher prices, in the event of serious shortage it is a case of having to use less, possibly quite a lot less if events in the Middle East turn nasty. Since practically all economic activity consumes energy and virtually all transport relies on oil, that means lower production of goods and services - the very definition of a recession (or depression if it's serious).

What are the chances of this? Next few years it's anyone's guess. Look ahead 10 or 20 years and it's highly unlikely that China can grow its oil consumption without a corresponding fall elsewhere (most notably in the USA). The supply simply isn't there to back up rising demand and, so far at least, is not being built on anywhere near a sufficient scale.

A risk that is difficult to quantify but a real one nonetheless. Never before has the world faced a serious, prolonged energy constraint - with the combined effects of 43 years of declining oil discoveries (trend terms) and climate change, we seem likely to be in truly uncharted waters in the years ahead. :2twocents
 

Realist

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Well price does come into it. Oil from the middle east is cheap but Canada has so much oil shale it could run the world itself for quite a while, even coal can be turned into diesel, and there is one hell of alot of oil elsewhere.

I can not see there being a "huge" oil shortage. It may get very expensive, we wont run out of it though.
 
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Realist said:
Well price does come into it. Oil from the middle east is cheap but Canada has so much oil shale it could run the world itself for quite a while, even coal can be turned into diesel, and there is one hell of alot of oil elsewhere.

I can not see there being a "huge" oil shortage. It may get very expensive, we wont run out of it though.
He's right, at prices above $55 US bl Canadian Tar Sands, US Shale Oil and Coal to Oil Conversions are all economic and effcient,

Why hasn't it happened yet? Why hasn't the world startd scrambling for these alternatives? Because the world thinks $55 + prices aren't here for long, they think long term Oil prices will drop below $50 a bl, so once the world accepts its fate we'll see a race to develop these new sources
 
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Realist said:
You have no facts on why Australia would face a depression in the near future because quite simply there aren't any.
There are no facts. It's based on a relatively new study. Up to you if you want to research it or not.
 
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All it takes is one war that blocks exports via sea from the Middle East and there's your oil shortage. Quite possible given the tensions there.

Oil prices are up 600% from their lows so far and still rising. What happens if we go up another 600% from where we are now? :eek:

I suppose we could all borrow money on the basis of the growing equity in the tank... :rolleyes: :D

I'm not saying that there WILL be a major oil shortage but the fundamentals of resource availability are far more supportive of a boom in oil prices than they are of a boom in the price of zinc, houses, coal, iron ore etc. With all those it is just a matter of building more or opening more mines whereas conventional oil production is limited by the lack of large undeveloped known resources. :2twocents
 

CanOz

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The only problem is that events of this nature also scare away investors....so until they come back, share prices suffer. I think the general outlook for oil will be bullish until we run out, but the geopolitical spikes won't always result in share price gains. In a way your right about the 'tank'. If you could buy oil, or better if you buy and trade oil futures, you could make some money.
 

wayneL

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The thing is, permabulls suffer in recessions, because they fail to recognise the possibility of anything but rampant growth.

This is why Wall St bankers jumped out of windows in 1929.

These days the retail traders has enourmous capacity to hedge their investments and even take advantage of downside.

It's true I am very bearish on the world economy, but I would be stupid in the extreme to discount the possibility of further upside.

Bulls should have the same attitude. To discount the possibility of a recession/depression.... well, need I say more?

Many people prosper in recessions. It is those who are prepared, that do so.

Cheers
 
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I personally have no idea if the forecast of a coming depression will be proven correct. But to discount it as being a virtual impossibility is none too bright.
Oil prices are a concern.....some forecasts suggest that petrol will go to $5 or $6 a litre in the next two or three years. If this proves to be correct, that alone would clearly have a serious effect on world economies.

In the roaring 20's nobody thought a depression was just around the corner in the 1930's.
We're now in another roaring 20's situation, at least in Australia. Only a fool would think it can last indefinitely.

I really have no idea if we'll be in recession or depression this time next year. I'm just damn pleased I had considerable practise in shorting the market in 2002. I'll do the same again next time around, in fact I'm already doing it.

Recessions/depressions and bear markets can provide abundant opportunites for profiting from the financial markets.

Bunyip
 

CanOz

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So are you shorting stocks, CFDs or trading options?
 

Realist

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wayneL said:
To discount the possibility of a recession/depression.... well, need I say more?
It is like a car driver discounting the possibility of dying in a car accident. It is of course very possible, statistics prove that. But worrying about it is utterly pointless. Even preparing for it by wearing a crash helmet, flame proof suit and driving at 20km/ph in a large bus so you are safer is ridiculous. If it happens to you so be it.

Live for the moment, and enjoy the moment!! There's only one certainty in life, and that is you wont be around forever, and forever worrying about what might possibly happen in the future will spoil the good times you have now.
 

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