That sounds pretty dire. Jim Rogers, founder of the Quantum Fund. At 75, Rogers has seen a lot of market turmoil, including the financial crisis of 10 years ago, the dot-com debacle of and the crash.
He told Bloomberg News in February that high debt will harm the economy. Certainly, these pessimistic views are hardly gospel.
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And some of these gentlemen have been wrong before. If you listened to him then and exited stocks, you would rue your decision: The market had a fabulous run for the next four years. Rogers is a perma-bear about domestic stocks, who has been downbeat since the s he is famously enthusiastic about emerging markets, though.
As advisor Reppond pointed out, in all likelihood a slump is coming within two years. After all, this recovery and rising market are getting old.
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Good investing ideas, often contrarian, constitute my brief, here at Forbes. Key to that is helping you to build a solid financial future. Ultimately it is about sacrifice; you can't have your cake and eat it too. How long we have before we face the next crash is anyone's guess.
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The other, a turnaround in the record influx of migrants -- which, history suggests, won't last. Gaynor remembers exactly where he was when the sharemarket came crashing done in On a Friday, some US trade figures were released that wouldn't normally have caused a ripple.
On Saturday in New Zealand, he and his broking colleagues were at a workmate's wedding. Finance Minister Bill English is on a mission to pay down government debt. Critics say that is overly conservative, given that the cost of borrowing is at historic lows and there is a case for spending more now to stimulate the economy. New Zealand's public debt was increased to get through the global financial crisis and the Christchurch quakes. Treasury secretary Gabriel Makhlouf agrees that New Zealand's public debt looks low -- but given our soaring private debt, he says, it really needs to be.
The US can sustain per cent of gross government debt to GDP because it is a super-economy, it's got the world's reserve currency.. NZ could not sustain those sorts of debt levels. It's hardly surprising Makhlouf backs English's stance on low public debt -- he and his Treasury team advise the Government on appropriate debt levels.
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So does New Zealand's high level of private debt affect that advice? The fact that we used to have very low rates of net debt helped us get through the earthquakes and GFC, unlike some European countries which already had high levels of debt. Countries like Greece were forced to run austerity programmes when they got into trouble.
They found themselves cutting spending when they needed to be stimulating the economy, Makhlouf says. Sign into your NZ Herald. He had expected a drop in the value of the dollar due to an international tiff with the other G7 nations over the dollar's value, but the seemingly worldwide financial meltdown came as an unpleasant surprise that Monday. Exchanges also were busy trying to lock out program trading orders.
The idea of using computer systems to engage in large-scale trading strategies was still relatively new to Wall Street and the consequences of a system capable of placing thousands of orders during a crash never had been tested. These computer programs automatically began to liquidate stocks as certain loss targets were hit, pushing prices lower. To the dismay of the exchanges, program trading led to a domino effect as the falling markets triggered more stop-loss orders. The frantic selling activated yet another round of stop-loss orders, which dragged markets into a downward spiral.
Since the same programs also automatically turned off all buying, bids vanished all around the stock market at basically the same time. There were some warning signs of excesses that were similar to excesses at previous inflection points. Hi Dave, great article! I too have enjoyed the article from motley fool. Like you were saying above, the trouble with Australia is the interconnectedness between property possible bubble and the other main market sector financial services and banks in particular and, on the other side, the resource sector highly cyclical.
Cheers Jak. Yeah definitely, always good to step back and think about the long-term. Ignoring the media helps a lot with that I find, most of what gets churned out is short-term mostly irrelevant rubbish. The best protection against our specific issues in Australia if someone is particularly worried, is international shares.
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I would always have at least a third of my equity investments in global or international corporations and bonds. The way the world is linked together now it may not really matter. Interesting post! More diversification tends to be better than less. Australia is just hard to resist for dividends and tax credits. International shares will be part of our portfolio later on. Haha those bloody zombies. Great article!
I am 27 and am building my second investment property in Perth, but being cash flow positive with houses seems harder than i first expected. Will keep reading, thank you! Cashflow from capital city property is generally about as good as interest from a bank…not very.
Definitely more costly to hold and maintain than most people appreciate that included me. Which figures are correct as these two links differ? Just got myself confused…. That will be the difference. Cycles vary even though the pattern roughly repeats. The domestic v overseas allocation decision can be a personal one. A key point is whatever you choose just to be well prepared and researched about that path. I can tell you have read plenty about the pros and cons with this piece.
Then you will stick with the strategy. Being a rational optimist makes sense I think. If you do run into issues one day I am sure you could slip back into the work force easily enough. An underappreciated fact is that Oz and the U. If a random person was dropped into the world in a fair chance they would not have picked these markets.
Maybe UK or Germany would feature where returns are quite a bit less. Or others that have done even worse. But be careful what the retirement police may say about that! You highlight some great points. Haha yes the retirement police would already be up in arms — my partner and I have found ourselves earning income after just 1 year away from work.