Shares gain ahead of break

Posted to The Age (23/12/2011) on 23/12/2011 at 3:08 PM
Commenting on "Markets Live: Shares gain ahead of break"
http://www.theage.com.au/business/markets/markets-live-shares-gain-ahead-of-break-20111223-1p7pn.html

Who are pushing up the share prices? If the market is so healthy, why do we see the line shoots up sharply, and then comes up again, after which the line fluctuates erratically?

Unless you are a day trader wanting to make a killing in just few hours, the medium to long term outlook cannot justify rising markets around the world.

How can the US unemployment rate dropped and confidence returned for no logical reasons? The payroll tax cut and the removal of long term unemployment benefit that expire at the end of the year, plus the soldiers returning from the withdrawal are likely to reverse the unemployment rate in months to come. The possible visible light at the end of the tunnel is the rise in arm sales of the refurbished military weapons to Iraq and surrounding countries; a move that will really upset the Russians.

It is plausible that the initial drop in healthcare spending was a sacrifice in order to pay for other daily essential expenses and save up for rainy days, viz. loss of employment. The subsequent rise was likely due to deterioration of medical condition for those who have suspended their visit to medical practitioners and on medication. The Christmas stress can only worsen the situation.

To everyone, have a joyous and safe Christmas and happy new year.

Julia Gillard: not becalmed, just calm (Post 3 of 3)

Posted to The Age (18/12/2011) on 18/12/2011 at 12:53 PM
Commenting on "Julia Gillard: not becalmed, just calm"
http://www.theage.com.au/national/julia-gillard-not-becalmed-just-calm-20111217-1p04p.html

Christmas is just round the corner. How about give Julia Gillard a big surprised present? Give her a one-way ticket to Christmas Island.

Pushing bricks and mortar

Posted to The Age (13/12/2010) on 14/12/2010 at 3:36 PM

Commenting on “Pushing bricks and mortar”

http://theage.domain.com.au/home-investor-centre/pushing-bricks-and-mortar-20101213-18ull.html

1. Economy is not as robust as what ABS reckoned, and the real unemployment rate is much higher than reported. Many people face financial trouble in meeting mortgage payment, and more mortgagee auctions will take place;
2. Closing the loophole of allowing the foreign investors to invest in secondhand properties without FIRB approval results in the collapse in sale price in many suburbs due to lack of competition;
3. Change of government policies in international education results in drastic drop in international students coming to Australia, thus kills off student accommodation rental demand. Many properties used for such purpose will be forced to sell;
4. Change of policies also results in closure of international colleges, which normally lease commercial buildings used as classrooms. Many of such buildings will be vacant;
5. 2010 Christmas retail sales will be below previous years', threatening the survival of some small businesses. Unemployment will shoot up beyond many economists' forecast in Jan and Feb 2011. Businesses for sale will be increased;
6. The median price across the board in Melbourne will decline to around $550,000 by June 2011;
7. In general, there will more listings than sales from December onwards;
8. 2011 is not a year for the rookies - only the experienced survive

ASX index will be below 5000 points for another few more months, likely up till March

Pushing bricks and mortar

Posted to The Age (13/12/2010) on 14/12/2010 at 3:36 PM

Commenting on “Pushing bricks and mortar”

http://theage.domain.com.au/home-investor-centre/pushing-bricks-and-mortar-20101213-18ull.html

1. Economy is not as robust as what ABS reckoned, and the real unemployment rate is much higher than reported. Many people face financial trouble in meeting mortgage payment, and more mortgagee auctions will take place;
2. Closing the loophole of allowing the foreign investors to invest in secondhand properties without FIRB approval results in the collapse in sale price in many suburbs due to lack of competition;
3. Change of government policies in international education results in drastic drop in international students coming to Australia, thus kills off student accommodation rental demand. Many properties used for such purpose will be forced to sell;
4. Change of policies also results in closure of international colleges, which normally lease commercial buildings used as classrooms. Many of such buildings will be vacant;
5. 2010 Christmas retail sales will be below previous years', threatening the survival of some small businesses. Unemployment will shoot up beyond many economists' forecast in Jan and Feb 2011. Businesses for sale will be increased;
6. The median price across the board in Melbourne will decline to around $550,000 by June 2011;
7. In general, there will more listings than sales from December onwards;
8. 2011 is not a year for the rookies - only the experienced survive

ASX index will be below 5000 points for another few more months, likely up till March

Retail sales in surprise fall

Posted to The Age on 4/2/2010 (not published)

Commenting on “Retail sales in surprise fall”

http://www.theage.com.au/business/retail-sales-in-surprise-fall-20100204-nepc.html

The RBA Governor, statisticians, economies and bankers alike should go back to school to learn critical thinking and mathematical analysis. The December 09 retail sales are indeed better than forecast, and NOT as bad as these ignorant people try to make us believe.

Many departmental stores and non-food outlets were concerned about the economic downturn, and attempted to have Sales before Christmas. As a result, the item unit prices were lowered, and therefore more sales volumes must be generated to compensate the eventual sales value.

For example, if a $100-item is sold at 20% discount, it is required to sell 1.25 (i.e. $100/$80) items to achieve $100, or an increase of 25% sales volume. With only 0.7% drop in sales value, or $99.93, the number of units sold is 1.2496 (i.e. $99.93/$80), or close to 25% increase in volume.

In general, cafes, and food outlets don’t drop prices, and that explains the increase in sales revenue. If the retailers in question were game enough not to drop their pries during the peak season, they would have made hefty profits.

In short, these gurus’ interpretations are just nonsensical!