Insightful Insights
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Have mining investments passed their peak?
Russell Muldoon
April 15, 2013
For some time now, we have been cautious about the prospects for listed EPC (Engineering, Procurement and Construction) contractors (mining services). And neither the recent rebound in share prices, nor the following RBA announcement, made last week by Christopher Kent, have done much to impact this view.
continue…by Russell Muldoon Posted in Energy / Resources, Insightful Insights.
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Going to the dogs…debt free
Roger Montgomery
April 13, 2013
Is it a socialist philosophical legacy in our public education system that is thwarting Australia’s future?
If you have your kids in a public primary school, you might have observed that unless the school has the resources for a gifted/talented/enrichment program, everyone needs to wait until the slower students have ‘caught up’. I have heard many stories of the smartest and brightest kids being sent on errands for the teacher because they have already completed their work. In this, whether intended or not, there is an element of the socialist philosophy in the response and possibly the outcome.
continue…by Roger Montgomery Posted in Economics, Insightful Insights.
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The only way is down for the Chinese share market…?
David Buckland
April 12, 2013
As the US share market hits all-time highs, we are often asked why the Chinese share market, as measured by the Shanghai Composite Index, is 64 per cent below its October 2007 peak.
continue…by David Buckland Posted in Economics, Insightful Insights, Market Valuation.
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Does intellectual property have the value it once had?
Tim Kelley
April 10, 2013
A strong competitive “moat” is one of the features we value in a business. Moats can take many different forms, but one appealing type of moat is that provided by intellectual property, ideally protected by patents.
Companies like Cochlear, Resmed and Codan are good examples of businesses that owe part of their prosperity to technology that provides an edge over competitors. In many cases, this edge has been built and maintained over many years through substantial investments in R&D.
continue…by Tim Kelley Posted in Consumer discretionary, Insightful Insights, Technology & Telecommunications.
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The Eurozone… a safe place for deposits?
David Buckland
April 8, 2013
The 40% tax on uninsured deposits exceeding E100,000 within Cyprus’s banking system proves a Euro held in one of the seventeen Euro countries is not the same as a Euro held elsewhere.
by David Buckland Posted in Insightful Insights.
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An offshore Montgomery fund?
Roger Montgomery
April 6, 2013
“There is a tide in the affairs of men, which taken at the flood, leads on to fortune. Omitted, all the voyage of their life is bound in shallows and miseries. On such a full sea are we now afloat. And we must take the current when it serves, or lose our ventures.” William Shakespeare
At Montgomery we have received innumerable requests to launch an offshore fund. The Montgomery Global Fund, for example. This is something we have the capability to do.
by Roger Montgomery Posted in Insightful Insights, Skaffold.
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Trouble brewing? Coal seam gas and the water table (part 2)
David Buckland
April 5, 2013
Earlier this week, the Council of Australian Governments (COAG) Reform Council said that the Commonwealth had now set up the “Independent Expert Scientific Committee on Coal Seam Gas and Large Mining Development” (IESC). This will give governments solid scientific advice on the potential effects of CSG and large mining developments on water resources. In the five years to 2010/11, CSG has increased from 2% to 11% of Australia’s total gas production (read the media release).
continue…by David Buckland Posted in Energy / Resources, Insightful Insights.
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How to become poor
Roger Montgomery
April 4, 2013
Recently I have been ramping up the discussion about a serious fix we need for our business. The business of Australia requires motivated staff, great products and services, and a lid to be kept on costs.
Looking at our balance of payments however, you can see that we are a profligate country, spending more than we earn and selling off assets to pay for it. Keep going and eventually all our assets will be owned by foreigners from whom we will rent the properties, sending our income offshore at an even faster rate.
continue…by Roger Montgomery Posted in Economics, Insightful Insights.
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The RBA Tea Leaves
Roger Montgomery
April 4, 2013
For the 30 seconds before the Reserve Bank’s decision flashes across the RBATCTR page of trader’s Bloomberg terminals, silence descends on dealing room floors around the country. Someone then cries out; “up 25bips” or “no change” and mayhem ensues. As a young graduate in a dealing room it all seems very exciting and front line. But as a more seasoned observer and participant, one does wonder what all the fuss is about.
Investors can do much better investing in ‘businesses’ rather than trying to use interest rate changes as a predictor of stock prices. In any case, once you have predicted correctly whether interest rates will rise or fall, you then have to predict what the reaction will be by investors in each individual stock. And generally it is worth being reminded of the fact that economists have had a mixed track record over the long run at predicting rates in the first place.
continue…by Roger Montgomery Posted in Economics, Insightful Insights.
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Trouble brewing? Coal seam gas and the water table
David Buckland
April 3, 2013
I caught up with a few of my country friends over Easter. One conversation topic that kept coming up was the current approval process for the coal seam gas industry. To say that they are furious about it would be an understatement.
They quoted cases where bore water, which has been running for decades, has suddenly dried up within months of coal seam gas production commencing nearby. So what’s going on?
by David Buckland Posted in Energy / Resources, Insightful Insights.
