The Finance Thread

[Ramarena]

Baltic Dry Index is really struggling, it's now below 2008 levels. This is usually considered a bellwether for the global economy. 

 

[Shang]

Is there anything an everyday bloke can do about this?

[eddie]

5 minutes ago, Shang said:

Is there anything an everyday bloke can do about this?

Drink.

It helps the breweries.

[SillyBilly]

On 20/11/2015, 10:38:57, Shang said:

Is there anything an everyday bloke can do about this?

Yes and no, I am assuming you are young so it might be just about placing whatever means you do have in the right areas at the right time. But, my thoughts nonetheless:

Make sure your pension or any investment is nowhere near a bond or bond fund. Corporate bonds may be okay providing you've researched the companies - I wouldn't touch most as a lot of the big players in the funds "invest" big portions in inventory (record levels - sign of coming trouble) and stock buy backs. There a few companies who I'd gladly lend to though. Unless you like losing money with pitiful interest rates and devalued currencies then steer clear of ALL government debt. Example below:

30 year debt in the U.K is currently yielding 2.6%. So with that coupon rate on a £10 investment, there is a return of 26p a year or a cumulative £7.80 over 30 years. Combine the return of principal (£10) in 2045 with the interest paid then we have £17.80 for the £10 investment. Not bad?

£10 in 1985 adjusted for inflation 30 years later is £28.75 (in 2015). ASSUME that our money will become increasingly worthless at the same rate over the next 30 years (I would wager strongly on this being worse but anyway...).

So, our £10 in 2015 would be worth the same as £28.75 in 2045, we have £17.80 from the bond investment. In REAL TERMS the £10 investment put £6.19 back in the bank. Almost a 40% loss. And that is assuming that there is no currency or bond crisis in the next 30 years. Good luck if you want to do that is all I can say...

So, by starting to strip away at bonds would automatically put people ahead of the game.

The next thing is gold and silver. The buy point will come and trust me, it will take some balls to invest in it when its either at a low or looking to take another step down. Remember as people are piling into investments like BTL at record house prices and the likes you should be looking at doing the opposite, let them invest at a peak where future returns are suspect while you pick up the asset classes at a low. Nobody knows exactly when the market will turn (we all guess) but we know it will (most people don't) and it will happen so quick and so unexpectedly that if you're not in position already you're too late.

The next 2-3 years is going to be very confusing as we'll see a lot of contradictions, for instance the ECB doing more massive fiscal stimulus and negative interest rates in Scandinavia; this'll likely push European equities and European house prices higher. I am not too keen to buy a flat in Stockholm though or take on Spanish or Italian equities despite short term gains being on the table. I see this as the last push higher. I don't back myself to pick the high quite frankly, I'd rather be wrong on picking the absolute bottom on the unfancied assets because the medium to long term is much better. 

If you're young then you should be looking at the long game (you have that advantage), industrial metals etc. Pick a handful of markets or commodities which are on their arse at the moment (there are plenty) and track them (talking a few minutes each week to see the price). Pile in at the height of panic selling, you may be wrong for a couple of years as it goes down another 50% but its you who'll be laughing in 10 years time when you're up a few hundred %. The world will still need copper in 20 years time so the lower it goes the more interested you should become, remember this is an opportunity to you.

[SillyBilly]

Financial YTD Public Sector net borrowing = £54.3bn

George's target for the year = £69.5bn

On target for £80.3 bn

Nicely setting us up for the next target of £1.6 trillion total debt?

Autumn budget is going to be quite interesting, he has to somehow find £10bn and find it quickly if he wants to meet his "new" target. Huge deficit still being ran and quite frankly poor growth figures. No bang for the buck.

And these figures have been watered down, look at the projections below:

2015/2016 projected at less than £50 bn...(out by £30 bn). And note all of these assumptions rely on continual growth at or around.2.5% of GDP...so what happens if we have another recession? Why do they never account for reality? All government figures assume constant growth.

This is no different to the likes of Illinois recently "re-determining" the future investment returns of its public pensions to "strengthen" its balance sheet. Stating they'll achieve X%/annum indefinitely (pick any return you want and use that as base case in extrapolation) and then use it as proof of ongoing solvency...then use it to take on more liabilities... it would be criminal if it wasn't government making the rules up as it goes. Well, in the real world you won't achieve those made-up BS numbers so you are...bankrupt.

The reality is the deficit can't be cut without tackling housing benefit and TC's OR 5%+ GDP growth. I don't see that sort of growth looming..

My own personal view is that housing benefit is a benefit to the RICH, not to the poor. Housing benefit ends up in the pockets of those who own the housing stock and rent it out, not the poor bugger in receipt of it. Increasing housing benefit has a knock-on effect of increasing rent and therefore increasing house prices (yield tracks house price, more rent coming in, price goes up, yield returns to par - no net effect but a larger asset price and a larger rent required to keep the investor). Its a vicious circle and at no point does the person in receipt of the increased benefit become better off than before... except that their rent is now higher and they are at risk of being thrown out if it stops or decreases...see where this goes? The State should allow rents and prices to fall in line with wages (so wages can support families), not stupid props like housing benefit and help-to-buy. This is as a large contributory reason as to why they can't afford to live. The result is an ever bigger bill for the tax payer (which includes the poor bugger paying tax) to pay for the increased welfare bill which lines the pocket of the wealthy! And repeat the loop. Absolutely insane.

The issue is now cutting it will have horrible, horrible effects and once you start this **** its almost political suicide to stop it  - millions of people are left reliant on it. The market will not re-calibrate (either in wages or lower rents/house prices) as quickly as these folks will lose out (same with TCs) so they will be left worst off in the short term when these people barely can make ends meet as it is...The issue is not stopping it will push the cost of living ever higher, make the welfare bill ever bigger and make it even harder to eventually reverse it as it distorts the economy away from real wages for real jobs.

Important to realise in the global world we live in, we are not a low wage country, we are a high wage country with a cost of living crisis. There is a difference. See the chart, we earn just as much as Germans (and we're less productive so should count ourselves very fortunate) but have a higher cost of living! Pushing wages higher because the government can't stop itself from intervening in a ponzi market is a dangerous model to follow . International companies don't give a crap that it costs you £600 to rent a flat and £150/month to fuel your car while a German can do the same for £500, they'll want to offer the same wage for the same skill. So by sticking with housing benefit, not building enough houses, holding interest rates low, offering help-to-buy, printing money, we're effectively saying, as a nation, we're going to invest in making our costs of living HIGHER (can't let our housing market deflate at any cost) while we expect international companies to pay us higher wages to compensate for it. Have to be mad to think this will work! The whole lot needs to be reversed.

Think the below is quite old now as I seem to remember us overtaking Germany and basically being on a par with Sweden give or take a few pounds. The elephant in the room is we're not productive enough to increase wages without long-term consequence (look at France's average wage and they can take every Friday off and still get the same output as us) BUT we can tackle our living costs and therefore CAN raise our standard of living. All without earning an extra penny more.

 

 

[GboroRam]

50 minutes ago, SillyBilly said:

Financial YTD Public Sector net borrowing = £54.3bn

George's target for the year = £69.5bn

On target for £80.3 bn

Nicely setting us up for the next target of £1.6 trillion total debt?

Autumn budget is going to be quite interesting, he has to somehow find £10bn and find it quickly if he wants to meet his "new" target. Huge deficit still being ran and quite frankly poor growth figures. No bang for the buck.

And these figures have been watered down, look at the projections below:

2015/2016 projected at less than £50 bn...(out by £30 bn). And note all of these assumptions rely on continual growth at or around.2.5% of GDP...so what happens if we have another recession? Why do they never account for reality? All government figures assume constant growth.

This is no different to the likes of Illinois recently "re-determining" the future investment returns of its public pensions to "strengthen" its balance sheet. Stating they'll achieve X%/annum indefinitely (pick any return you want and use that as base case in extrapolation) and then use it as proof of ongoing solvency...then use it to take on more liabilities... it would be criminal if it wasn't government making the rules up as it goes. Well, in the real world you won't achieve those made-up BS numbers so you are...bankrupt.

The reality is the deficit can't be cut without tackling housing benefit and TC's OR 5%+ GDP growth. I don't see that sort of growth looming..

My own personal view is that housing benefit is a benefit to the RICH, not to the poor. Housing benefit ends up in the pockets of those who own the housing stock and rent it out, not the poor bugger in receipt of it. Increasing housing benefit has a knock-on effect of increasing rent and therefore increasing house prices (yield tracks house price, more rent coming in, price goes up, yield returns to par - no net effect but a larger asset price and a larger rent required to keep the investor). Its a vicious circle and at no point does the person in receipt of the increased benefit become better off than before... except that their rent is now higher and they are at risk of being thrown out if it stops or decreases...see where this goes? The State should allow rents and prices to fall in line with wages (so wages can support families), not stupid props like housing benefit and help-to-buy. This is as a large contributory reason as to why they can't afford to live. The result is an ever bigger bill for the tax payer (which includes the poor bugger paying tax) to pay for the increased welfare bill which lines the pocket of the wealthy! And repeat the loop. Absolutely insane.

The issue is now cutting it will have horrible, horrible effects and once you start this **** its almost political suicide to stop it  - millions of people are left reliant on it. The market will not re-calibrate (either in wages or lower rents/house prices) as quickly as these folks will lose out (same with TCs) so they will be left worst off in the short term when these people barely can make ends meet as it is...The issue is not stopping it will push the cost of living ever higher, make the welfare bill ever bigger and make it even harder to eventually reverse it as it distorts the economy away from real wages for real jobs.

Important to realise in the global world we live in, we are not a low wage country, we are a high wage country with a cost of living crisis. There is a difference. See the chart, we earn just as much as Germans (and we're less productive so should count ourselves very fortunate) but have a higher cost of living! Pushing wages higher because the government can't stop itself from intervening in a ponzi market is a dangerous model to follow . International companies don't give a crap that it costs you £600 to rent a flat and £150/month to fuel your car while a German can do the same for £500, they'll want to offer the same wage for the same skill. So by sticking with housing benefit, not building enough houses, holding interest rates low, offering help-to-buy, printing money, we're effectively saying, as a nation, we're going to invest in making our costs of living HIGHER (can't let our housing market deflate at any cost) while we expect international companies to pay us higher wages to compensate for it. Have to be mad to think this will work! The whole lot needs to be reversed.

Think the below is quite old now as I seem to remember us overtaking Germany and basically being on a par with Sweden give or take a few pounds. The elephant in the room is we're not productive enough to increase wages without long-term consequence (look at France's average wage and they can take every Friday off and still get the same output as us) BUT we can tackle our living costs and therefore CAN raise our standard of living. All without earning an extra penny more.

 

 

Not saying that you are wrong but what about the millions of unemployed - how will they live without housing benefit? Or the very low paid/part time? Single parents?

[LesterRam]

1 hour ago, SillyBilly said:

Financial YTD Public Sector net borrowing = £54.3bn

George's target for the year = £69.5bn

On target for £80.3 bn

Nicely setting us up for the next target of £1.6 trillion total debt?

Autumn budget is going to be quite interesting, he has to somehow find £10bn and find it quickly if he wants to meet his "new" target. Huge deficit still being ran and quite frankly poor growth figures. No bang for the buck.

And these figures have been watered down, look at the projections below:

2015/2016 projected at less than £50 bn...(out by £30 bn). And note all of these assumptions rely on continual growth at or around.2.5% of GDP...so what happens if we have another recession? Why do they never account for reality? All government figures assume constant growth.

This is no different to the likes of Illinois recently "re-determining" the future investment returns of its public pensions to "strengthen" its balance sheet. Stating they'll achieve X%/annum indefinitely (pick any return you want and use that as base case in extrapolation) and then use it as proof of ongoing solvency...then use it to take on more liabilities... it would be criminal if it wasn't government making the rules up as it goes. Well, in the real world you won't achieve those made-up BS numbers so you are...bankrupt.

The reality is the deficit can't be cut without tackling housing benefit and TC's OR 5%+ GDP growth. I don't see that sort of growth looming..

My own personal view is that housing benefit is a benefit to the RICH, not to the poor. Housing benefit ends up in the pockets of those who own the housing stock and rent it out, not the poor bugger in receipt of it. Increasing housing benefit has a knock-on effect of increasing rent and therefore increasing house prices (yield tracks house price, more rent coming in, price goes up, yield returns to par - no net effect but a larger asset price and a larger rent required to keep the investor). Its a vicious circle and at no point does the person in receipt of the increased benefit become better off than before... except that their rent is now higher and they are at risk of being thrown out if it stops or decreases...see where this goes? The State should allow rents and prices to fall in line with wages (so wages can support families), not stupid props like housing benefit and help-to-buy. This is as a large contributory reason as to why they can't afford to live. The result is an ever bigger bill for the tax payer (which includes the poor bugger paying tax) to pay for the increased welfare bill which lines the pocket of the wealthy! And repeat the loop. Absolutely insane.

The issue is now cutting it will have horrible, horrible effects and once you start this **** its almost political suicide to stop it  - millions of people are left reliant on it. The market will not re-calibrate (either in wages or lower rents/house prices) as quickly as these folks will lose out (same with TCs) so they will be left worst off in the short term when these people barely can make ends meet as it is...The issue is not stopping it will push the cost of living ever higher, make the welfare bill ever bigger and make it even harder to eventually reverse it as it distorts the economy away from real wages for real jobs.

Important to realise in the global world we live in, we are not a low wage country, we are a high wage country with a cost of living crisis. There is a difference. See the chart, we earn just as much as Germans (and we're less productive so should count ourselves very fortunate) but have a higher cost of living! Pushing wages higher because the government can't stop itself from intervening in a ponzi market is a dangerous model to follow . International companies don't give a crap that it costs you £600 to rent a flat and £150/month to fuel your car while a German can do the same for £500, they'll want to offer the same wage for the same skill. So by sticking with housing benefit, not building enough houses, holding interest rates low, offering help-to-buy, printing money, we're effectively saying, as a nation, we're going to invest in making our costs of living HIGHER (can't let our housing market deflate at any cost) while we expect international companies to pay us higher wages to compensate for it. Have to be mad to think this will work! The whole lot needs to be reversed.

Think the below is quite old now as I seem to remember us overtaking Germany and basically being on a par with Sweden give or take a few pounds. The elephant in the room is we're not productive enough to increase wages without long-term consequence (look at France's average wage and they can take every Friday off and still get the same output as us) BUT we can tackle our living costs and therefore CAN raise our standard of living. All without earning an extra penny more.

 

 

Very informative, lot of time and effort went into these posts, well done, sorry my windows enabled phone wouldn't post at the bottom.

1 hour ago, SillyBilly said:

Financial YTD Public Sector net borrowing = £54.3bn

George's target for the year = £69.5bn

On target for £80.3 bn

Nicely setting us up for the next target of £1.6 trillion total debt?

Autumn budget is going to be quite interesting, he has to somehow find £10bn and find it quickly if he wants to meet his "new" target. Huge deficit still being ran and quite frankly poor growth figures. No bang for the buck.

And these figures have been watered down, look at the projections below:

2015/2016 projected at less than £50 bn...(out by £30 bn). And note all of these assumptions rely on continual growth at or around.2.5% of GDP...so what happens if we have another recession? Why do they never account for reality? All government figures assume constant growth.

This is no different to the likes of Illinois recently "re-determining" the future investment returns of its public pensions to "strengthen" its balance sheet. Stating they'll achieve X%/annum indefinitely (pick any return you want and use that as base case in extrapolation) and then use it as proof of ongoing solvency...then use it to take on more liabilities... it would be criminal if it wasn't government making the rules up as it goes. Well, in the real world you won't achieve those made-up BS numbers so you are...bankrupt.

The reality is the deficit can't be cut without tackling housing benefit and TC's OR 5%+ GDP growth. I don't see that sort of growth looming..

My own personal view is that housing benefit is a benefit to the RICH, not to the poor. Housing benefit ends up in the pockets of those who own the housing stock and rent it out, not the poor bugger in receipt of it. Increasing housing benefit has a knock-on effect of increasing rent and therefore increasing house prices (yield tracks house price, more rent coming in, price goes up, yield returns to par - no net effect but a larger asset price and a larger rent required to keep the investor). Its a vicious circle and at no point does the person in receipt of the increased benefit become better off than before... except that their rent is now higher and they are at risk of being thrown out if it stops or decreases...see where this goes? The State should allow rents and prices to fall in line with wages (so wages can support families), not stupid props like housing benefit and help-to-buy. This is as a large contributory reason as to why they can't afford to live. The result is an ever bigger bill for the tax payer (which includes the poor bugger paying tax) to pay for the increased welfare bill which lines the pocket of the wealthy! And repeat the loop. Absolutely insane.

The issue is now cutting it will have horrible, horrible effects and once you start this **** its almost political suicide to stop it  - millions of people are left reliant on it. The market will not re-calibrate (either in wages or lower rents/house prices) as quickly as these folks will lose out (same with TCs) so they will be left worst off in the short term when these people barely can make ends meet as it is...The issue is not stopping it will push the cost of living ever higher, make the welfare bill ever bigger and make it even harder to eventually reverse it as it distorts the economy away from real wages for real jobs.

Important to realise in the global world we live in, we are not a low wage country, we are a high wage country with a cost of living crisis. There is a difference. See the chart, we earn just as much as Germans (and we're less productive so should count ourselves very fortunate) but have a higher cost of living! Pushing wages higher because the government can't stop itself from intervening in a ponzi market is a dangerous model to follow . International companies don't give a crap that it costs you £600 to rent a flat and £150/month to fuel your car while a German can do the same for £500, they'll want to offer the same wage for the same skill. So by sticking with housing benefit, not building enough houses, holding interest rates low, offering help-to-buy, printing money, we're effectively saying, as a nation, we're going to invest in making our costs of living HIGHER (can't let our housing market deflate at any cost) while we expect international companies to pay us higher wages to compensate for it. Have to be mad to think this will work! The whole lot needs to be reversed.

Think the below is quite old now as I seem to remember us overtaking Germany and basically being on a par with Sweden give or take a few pounds. The elephant in the room is we're not productive enough to increase wages without long-term consequence (look at France's average wage and they can take every Friday off and still get the same output as us) BUT we can tackle our living costs and therefore CAN raise our standard of living. All without earning an extra penny more.

 

 

 

[SillyBilly]

1 hour ago, GboroRam said:

Not saying that you are wrong but what about the millions of unemployed - how will they live without housing benefit? Or the very low paid/part time? Single parents?

How will they live or how will their landlord keep his portfolio above water, the landlord whose returns are a function of this ring-fenced income? Where does all this money go that we spend, to poor people? If I reduce an income they never see, I am reducing their ability for them to sustain their landlord to pay the mortgage he/she has taken on. Its a landlord subsidy. By reducing it we would be threatening the financial viability of the biggest growth "industry" since 2008 - "BTL". This action would more than likely precipitate a housing crash (over-leveraged at record prices reliant on public money sounds dodgy territory to me) - this would be terrible for these poor people, wouldn't it?! Or terrible for the <insert expletive> who bleeds them dry while we pay for it and at the same time enjoy huge capital gains? These poor people might have to buy cheaper property or rent at lower prices when the dust settles. We need to look at the bigger picture, not feeding ever more money in and wondering why people are still poor. Kicking the prop from underneath the UK property ladder would be the biggest help to these people (and of course building/not flogging public stock to house the people you mention). Google how many landlords there are in the houses of commons, I'd be voting for housing benefit increases if I was a landlord, wouldn't you? More money for me. I'll bunk the rent up and my house price will go up if another investor wants to buy it from me. All these benefits are private sector and rich people subsidies. People never associate decreasing wages and high asset prices with these benefits, do they? Keep the plebs in houses they can't afford with low wages and then give them money which they hand directly to us to pay for their keep. Sounds bloody feudal to me! Then, once they're convinced we're doing them a favour, we can threaten to reduce "their" subsidy so they'll be on the streets, keep them on their toes. This situation is tragic. Its not going to be easy to return to an age where having a job means you can afford a roof over your head but at least some of us have the ambition to think it can happen!

BTW, I'm not saying it should be scrapped, not at all, though it should be reduced gradually. My post was suggesting that the props under the market should be scrapped. If houses prices and rents halved, what would happen to housing benefit? So why does the government seek to prop up the housing market at all costs? Is it political suicide to do anything which could reduce the nation's perceived store of wealth?

http://www.cityam.com/229055/buy-to-let-is-booming-with-more-mortgage-deals-for-landlords-than-ever-but-osbornes-tax-changes-will-bite

 

[Zag zig]

6 hours ago, SillyBilly said:

Yes and no, I am assuming you are young so it might be just about placing whatever means you do have in the right areas at the right time. But, my thoughts nonetheless:

Make sure your pension or any investment is nowhere near a bond or bond fund. Corporate bonds may be okay providing you've researched the companies - I wouldn't touch most as a lot of the big players in the funds "invest" big portions in inventory (record levels - sign of coming trouble) and stock buy backs. There a few companies who I'd gladly lend to though. Unless you like losing money with pitiful interest rates and devalued currencies then steer clear of ALL government debt. Example below:

30 year debt in the U.K is currently yielding 2.6%. So with that coupon rate on a £10 investment, there is a return of 26p a year or a cumulative £7.80 over 30 years. Combine the return of principal (£10) in 2045 with the interest paid then we have £17.80 for the £10 investment. Not bad?

£10 in 1985 adjusted for inflation 30 years later is £28.75 (in 2015). ASSUME that our money will become increasingly worthless at the same rate over the next 30 years (I would wager strongly on this being worse but anyway...).

So, our £10 in 2015 would be worth the same as £28.75 in 2045, we have £17.80 from the bond investment. In REAL TERMS the £10 investment put £6.19 back in the bank. Almost a 40% loss. And that is assuming that there is no currency or bond crisis in the next 30 years. Good luck if you want to do that is all I can say...

So, by starting to strip away at bonds would automatically put people ahead of the game.

The next thing is gold and silver. The buy point will come and trust me, it will take some balls to invest in it when its either at a low or looking to take another step down. Remember as people are piling into investments like BTL at record house prices and the likes you should be looking at doing the opposite, let them invest at a peak where future returns are suspect while you pick up the asset classes at a low. Nobody knows exactly when the market will turn (we all guess) but we know it will (most people don't) and it will happen so quick and so unexpectedly that if you're not in position already you're too late.

The next 2-3 years is going to be very confusing as we'll see a lot of contradictions, for instance the ECB doing more massive fiscal stimulus and negative interest rates in Scandinavia; this'll likely push European equities and European house prices higher. I am not too keen to buy a flat in Stockholm though or take on Spanish or Italian equities despite short term gains being on the table. I see this as the last push higher. I don't back myself to pick the high quite frankly, I'd rather be wrong on picking the absolute bottom on the unfancied assets because the medium to long term is much better. 

If you're young then you should be looking at the long game (you have that advantage), industrial metals etc. Pick a handful of markets or commodities which are on their arse at the moment (there are plenty) and track them (talking a few minutes each week to see the price). Pile in at the height of panic selling, you may be wrong for a couple of years as it goes down another 50% but its you who'll be laughing in 10 years time when you're up a few hundred %. The world will still need copper in 20 years time so the lower it goes the more interested you should become, remember this is an opportunity to you.

All good stuff, but dumbing it down you could also add tackle personal debt. If you are in debt someone owns a part of you, the sooner you become debt free, the more in control of your destiny you become. Yeah I know there are Mortgage headaches, but that aside the only possible good debt is if it's used to form an investment, one that may even produce an income.

Just an additional thought to a top answer.

[SillyBilly]

2 hours ago, GboroRam said:

Not saying that you are wrong but what about the millions of unemployed - how will they live without housing benefit? Or the very low paid/part time? Single parents?

Should also add. A functioning market adapts to find the appropriate price level. 5 million people don't become homeless over night but it would have a huge, huge effect on property prices and rents. A downward effect. Rents would have to come down, mortgages would have to be defaulted on, its that simple. You can't replace the "demand" of these millions of people. If there is not enough demand for the property at current price points and landlords boot them out, who is replacing them? The reality is, what I'm suggesting in its purest form would be absolute carnage, its not doable and therefore its more a thought experiment. I realise the game can't be undone without serious damage and social consequences but I'm quite sick of hearing as if not cutting it is a right wing idea, its bloody not! Its as left as I go! We can take some small steps though and as I say its not difficult once this has been started.

[GboroRam]

32 minutes ago, SillyBilly said:

Should also add. A functioning market adapts to find the appropriate price level. 5 million people don't become homeless over night but it would have a huge, huge effect on property prices and rents. A downward effect. Rents would have to come down, mortgages would have to be defaulted on, its that simple. You can't replace the "demand" of these millions of people. If there is not enough demand for the property at current price points and landlords boot them out, who is replacing them? The reality is, what I'm suggesting in its purest form would be absolute carnage, its not doable and therefore its more a thought experiment. I realise the game can't be undone without serious damage and social consequences but I'm quite sick of hearing as if not cutting it is a right wing idea, its bloody not! Its as left as I go! We can take some small steps though and as I say its not difficult once this has been started.

I'd say to tackle the private landlord problem a swing back to council housing would be a big step in the right direction. The drive towards everyone owning their own house has precipitated the problems that we are seeing now.

[SillyBilly]

I'm going to make my trade on the USD next week, earlier than I anticipated but I'm going to start moving. I am confident we are heading to parity and soon. And when this kicks off I would be expecting to see the Euro at less than 80 cents on the dollar. I've seen enough now, sit and wait time. 2 year trade.

December may be the perfect storm, Fed lift off would strengthen USD and Dragi announcing more QE action at the December meeting is more commitment to destroy the Euro. I am increasingly thinking the ECB's game is to follow the BoJ's path into a death march of killing its currency to stave off deflation, its looking like that way to me. The Yen has lost 50% of its value since 2012 relative to the dollar. Euro stimulus likely not to be as big but a decent return is awaiting here IMO.

[Chris Mills]

Now I'm pretty new to this, haven't actually started trading yet other than a few bits and bobs I already had before taking a real interest, but Danaher (DHR) has caught my eye.

Lots of the company's focus seems to be on electrical technology/environment which are clearly going to be large markets going forwards and whilst you can't use past performance to indicate future performance it seems as though there has been a 10000% gain since the 80s when the company was formed.

I read however that the company is to be split into two next year. Not sure how this affects any investments? Can someone shed some light?

[Stive Pesley]

10 minutes ago, Chris Mills said:

I read however that the company is to be split into two next year. Not sure how this affects any investments? Can someone shed some light?

HP just split in two last month and  the share price essentially halved and anyone with shares was given equal number of shares in the two new companies, so it was $28ish and now there are two companies both with a share price of $14ish

[Chris Mills]

7 minutes ago, StivePesley said:

HP just split in two last month and  the share price essentially halved and anyone with shares was given equal number of shares in the two new companies, so it was $28ish and now there are two companies both with a share price of $14ish

So if you held 100 shares in DHR at 100.00 and it split into ABC and DEF you could expect to recieve 100 ABC shares at 50.00 and 100 DEF shares at 50.00 providing the same happened and it was exactly a 50/50 split on share price?

[Stive Pesley]

22 minutes ago, Chris Mills said:

So if you held 100 shares in DHR at 100.00 and it split into ABC and DEF you could expect to recieve 100 ABC shares at 50.00 and 100 DEF shares at 50.00 providing the same happened and it was exactly a 50/50 split on share price?

Yeah that's the principle, although there was some sort of shadow-trading before the split date that I don't profess to understand, so on the actual split day, the prices weren't exactly balanced, but they have evened out over the past month.

I guess that's the way they did it in HP as a Fortune 500 company - I can't promise that every company split would do it like that, but it seems like the simplest way

[Chris Mills]

I can dream...

[SillyBilly]

1 hour ago, Chris Mills said:

I can dream...

I used to dabble in penny shares a lot more than I should have where these sorts of returns come about (and the drops!). My best was £27k up in a week. Almost took a 5 figure loss on another so swings both ways. I had a separate trading account with Interactive Investor for pennies so I could see where I was (so not to get out of control), I was £70K up at one point, cashed out with about £17k a few months later I think. Not bad for saying I put in about £11k of my own money but the speed I was losing it after making it...I realised I was gambling and should stick to what I know before I end up with £0. Seen lots of people lose their shirts in the AIM market.

I owned REM (above) in 2013, had about £5k in it I think, think I sold with a £1k loss. A couple of weeks later the RNS dropped of its massive lithium asset (was a gamble if the drill results didn't come in), went from 0.05 to about 1.2p in a few days. AIM is dangerous, the prospect of a £120k return (or £250k+ for the mettle to stick out after the first sell-off) in a week - too addictive. I'm not really even a gambler, advise people to steer clear or put on only what you can afford to lose!

 

[Chris Mills]

1 hour ago, SillyBilly said:

I used to dabble in penny shares a lot more than I should have where these sorts of returns come about (and the drops!). My best was £27k up in a week. Almost took a 5 figure loss on another so swings both ways. I had a separate trading account with Interactive Investor for pennies so I could see where I was (so not to get out of control), I was £70K up at one point, cashed out with about £17k a few months later I think. Not bad for saying I put in about £11k of my own money but the speed I was losing it after making it...I realised I was gambling and should stick to what I know before I end up with £0. Seen lots of people lose their shirts in the AIM market.

I owned REM (above) in 2013, had about £5k in it I think, think I sold with a £1k loss. A couple of weeks later the RNS dropped of its massive lithium asset (was a gamble if the drill results didn't come in), went from 0.05 to about 1.2p in a few days. AIM is dangerous, the prospect of a £120k return (or £250k+ for the mettle to stick out after the first sell-off) in a week - too addictive. I'm not really even a gambler, advise people to steer clear or put on only what you can afford to lose!

 

Got to make it interesting somehow I guess! Anyone can plod along with a 7% return per annum and grow their money but I guess everyone dreams of hitting the big one! Good idea I agree would be to have a separate account with some money you don't mind losing as you did.

[Zag zig]

10 minutes ago, Chris Mills said:

Got to make it interesting somehow I guess! Anyone can plod along with a 7% return per annum and grow their money but I guess everyone dreams of hitting the big one! Good idea I agree would be to have a separate account with some money you don't mind losing as you did.

AIM is a casino, but you can find winners, I've hit a few, also had a fair few losers go to zero and learned a lot in my early days in the process. Remember AIM is the Wild West of the financial markets, lightly regulated, directors are like pigs in a trough, one minute a stock is doing well then boom along comes a placing, shareholders are canon fodder to market makers I such situations. It's not all about research no matter what anyone tells you, much of it is mental, by that market psychology, being able to ride the bumps, real big bumps and knowing when to take profits

Reality is for all its faults, it's no different to say the TSX-venture exchange in Canada, heard plenty moan about regulators and stitch ups there etc. Im not going to give examples of make stock suggestions, but let me make a practical suggestion, if you're serious about trading, set yourself a dummy account, have a practice and see how you get on.

Absolutely right about plodding on with 7% returns, some fund managers are lucky if they get that some years and anyone can make money in a bull market; the real trick/skill is doing it in volatile markets.

Hope you do well.