The Credit Crisis Financial Stocks Short Journal

As an Aussie I can confirm Keen's findings.

Australia has largely avoided the fallout of the "financial crisis" in the last 30 months. One of the reasons for this is that property prices have not (yet) fallen by a lot.

This is largely the result of two factors:

(1) Govt bribes for home purchases (about to decrease on 31 December)

(2) Low amounts of land available for new houses to be built.

2010 should be interesting due to (1) above.

However unlike the US, very little of the housing debt in Australia in the past few years / decades has been for new homes. Although it may sound like I am making convenient excuses, land supply is an issue here.

Having said that, the median price of a home in the big capital cities is very high when compared to median incomes.

I agree with Keen that the Australian debt bubble will burst, however it still may take some time.

Quote from ralph00:

Australian households are even more highly leveraged than Americans.

http://www.debtdeflation.com/blogs/2009/12/29/it’s-debt-debt-debt-for-australia/

I'm assuming daal is on vacation. Let's hope he hasn't had his account blown out during this Xmas/New Years eurodollar/fed funds massacre.:cool:
More...
 
Might not the sharp rise in interest rates be what it takes to prick the bubble?

Perhaps you could recommend a broker that deals with products on the SFE, specifically the 90 day bill rate, since IB does not.
 
Holiday season has been brutal for fixed income. 2 year yield now around 1.10.:eek:

Another terrific buying opportunity could be upon us ... or not. No need to do anything before next Friday, when we're sure to get a positive print in the NFP numbers.
 
Strike that. 2 year at 1.20%.:D

The move in December looks like the kind of move that's been discussed a bit on this thread - a tightening scare where eurodollars shed 100 points in the blink of an eye. The move started almost to the day after that Thanksgiving Dubai scare - giving truth to the maxim that bull markets (or bull moves) end on good news.

I am expecting more of the same next week and will reasses after the NFP report. It'll be interesting to see the reaction of 2 years after what is sure to be a positive report. If bull moves end on good news, then bear moves end on bad news.:)
 
Yes but our cash rate was at 7.25% (currently 3.75%) in March 2008. So compared to early 2008, current interest rates are still low.

Good starting point for SFE brokers could be:

http://www.asx.com.au/resources/brokers/index.htm

Quote from ralph00:

Might not the sharp rise in interest rates be what it takes to prick the bubble?

Perhaps you could recommend a broker that deals with products on the SFE, specifically the 90 day bill rate, since IB does not.
More...
 
Back from vacation. McTeer must have had too much wine at christmas. A hike by Jun?He is claming considerable = extended
 
Quote from ralph00:

Welcome back. Pricing on the GE options is basically back at June levels. Looks like you've got another shot at an all-in bet.:)
More...

Not looking to increase the bet. Where I want to go all-in, ZQ in the 6-8 month to exp range, there havent been significant declines, so I will just keep riding. I'm back and the front end is soaring again, coincidence?
 
http://www.bloomberg.com/apps/news?pid=20601068&sid=apmj_BGpJjgc

"The standard Taylor Rule would have recommended that the Fed raise the rate to a range of 7 percent to 8 percent through the first three quarters of 2008, 'a policy decision that probably would not have garnered much support among monetary specialists,' Bernanke said. A variation of the rule used by the Fed focused on anticipated rates of inflation, not actual rates, he said. "

Looking at the fed own inflation forecast, they all seem to expect inflation to stay low in 2010. So I stand firmly behind the bet, there is no reason for the fed to raise rates this year as they can talk hawkish and do reverse repos/deposit facilities to control inflation expectations(that are arising due the bloated balance sheet)
 
You must log in or register to reply here.
Back
Top