Market commentary
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Australia – the outlier with a highly levered consumer
David Buckland
March 27, 2023
Early in 2022, the official cash rates for most English-speaking developed economies were at or around zero. This historical low too often pushed many investors, for fear of missing out, into speculating on things they may now have preferred to avoid. continue…
by David Buckland Posted in Market commentary.
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USA – turning $1 into $70,000 over 123 years – that’s 9.5% p.a.
David Buckland
March 22, 2023
Cantering through the Credit Suisse Returns Yearbook 2023, released about one month ago by the now defunct 166 year old bank, I came across some interesting data I wanted to share with you. continue…
by David Buckland Posted in Market commentary.
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Volatility is the window to opportunity
Michael Gollagher
March 21, 2023
In the past fortnight we have seen the markets swing from a focus on interest rates and inflation, to the prospect of the stability of the Global Financial System post the failure of Silicon Valley and Signature Banks in the U.S. This has also made its way to Europe with turmoil surrounding Credit Suisse, and a subsequent financing package being supplied by the Swiss Central Bank to calm short term nerves around their stability and also a demonstration of Government’s willingness to act. continue…
by Michael Gollagher Posted in Market commentary.
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Cash-strapped borrowers are hammering the housing sector
Roger Montgomery
March 7, 2023
Rising interest rates are already having a major impact on the Australian housing sector. Dwelling approvals are down, an increasing number of off-the-plan buyers are trying to exit their purchases, and furniture and appliance sales are declining. If you’re looking to invest in companies exposed to housing, I’d suggest it’s a case of buyer beware. continue…
by Roger Montgomery Posted in Market commentary, Property.
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P/E multiple movements promote equity market volatility
David Buckland
March 6, 2023
When I joined the financial services industry nearly four decades ago, many high-quality industrial businesses were on a single digit P/E multiple. Interest rates and inflation were extremely high, and an old-timer in the office used to apply a rule that the P/E multiple plus inflationary expectations should approximate 20. continue…
by David Buckland Posted in Market commentary.
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Why you shouldn’t worry about ‘what comes next’
Roger Montgomery
February 28, 2023
Lately, I’ve seen a number of media reports pondering if world economies – and equity markets – are headed for a soft, hard or no landing. To me, this kind of talk is a bit of a distraction. Because, as a long-term investor, the objective is still the same: to buy quality companies at good prices. continue…
by Roger Montgomery Posted in Market commentary.
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I was late to the party, but “I’ve got to contain inflation”
David Buckland
February 22, 2023
“I’ve got to contain inflation. I’ve got to convince the community that we’re serious about that. That’s our job and its unpopular and I accept that”. Philip Lowe, Governor of the Reserve Bank of Australia. continue…
by David Buckland Posted in Market commentary.
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Why I don’t think this is a dead cat bounce
Roger Montgomery
February 20, 2023
With equity markets steaming ahead, there’s no shortage of people calling this a ‘dead cat bounce’ and, by implication, predicting another market correction. History, however, suggests that 2022 was simply an isolated poor year for markets, and that we have now returned to ‘normal programming’. If I’m right, then 2023 could be a good year for investors. continue…
by Roger Montgomery Posted in Market commentary.
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Is Europe heading for a recession?
Roger Montgomery
February 17, 2023
Our financial media focuses on Australia, the U.S. and China, and pays scant attention to Europe. But from the little we hear, Europe is doing it tough. Economic growth is anaemic, and then there’s the small matter of the Russian invasion of Ukraine and the impact on energy prices. continue…
by Roger Montgomery Posted in Market commentary.
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RBA raises interest rates again, to a 10-year high
David Buckland
February 7, 2023
All English-speaking Central Banks seem committed to higher official cash rates. This interest rate tightening cycle began in New Zealand on 6 October 2021, and six months later Australia was the last to blink, on 6 April 2022. continue…
by David Buckland Posted in Market commentary.
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