Comments on: Stock Market Collapse Can Be Explained By Panicked Forced Selling

By: AU Stock Marketing Expert

AU Stock Marketing Expert — Wed, 17 Dec 2008 01:57:32 +0000

It's all very simple. When you panic you can't think straight. Now you just lost.

By: Pete

Pete — Mon, 15 Dec 2008 12:45:04 +0000

Good point UT, thank you

By: Pat Donnelly

Pat Donnelly — Mon, 15 Dec 2008 06:41:48 +0000

Fundamentally: we will all die. Try not to die without the necessities of life: adoring and grieving descendants and a long line of disappointed creditors.....
Trying to get ahead of a game that others invented and play well is a waste of the one asset we are all born with: time.
Make proper use of that and all else will fall into place!
Don't expect any advice to make you happy. Find out what you need and satisfy that. Invest time and money in creditors and descendants....

By: Unpopular Truth

Unpopular Truth — Mon, 15 Dec 2008 04:42:55 +0000

The AUD got smashed because all the people who do carry trades to do with the difference in interest rates between currency values, decided it was no longer a good deal.

When the AU interest rate goes down, watch the AUD go down with it.
Same with reverse.

The currency market prices in future movement almost instantly, and they're expecting the AU interest rate to drop another 1% next year (and have priced this in accordingly).

If you want a more in depth explanation, google 'carry trades FX'. Just don't buy any books on the subject whatever you do. They're all out of date long before they're printed

By: Greg Atkinson

Greg Atkinson — Fri, 12 Dec 2008 07:19:30 +0000

One reason we cannot compare the current stock market rout in Australia to previous routs is due to the impact of margin lending. In the dark days post 9/11 back in 2001 for example stocks may have taken a beating, but there was nowhere near the level of margin lending in play and thus less panicked selling. We can only hope that when confidence returns the market will rally up nicely and some of our losses recovered.

As for the Australian economy I must say I am a bit of a long term bear. The Australian economy may look good looking out, but as an Australian living overseas I must say I feel like I am going back ten years as soon as I touch down in Sydney for a holiday. If you take out mining and farming Australia does not have much left to offer that is truly competitive on a global level.

By: Pete

Pete — Fri, 12 Dec 2008 06:12:15 +0000

Nick: the Australian economy relies just a bit too heavily on Chinese imports of resources. Our AUD has often been called a 'commodity currency' (eg it goes up and down with the price of commodities, which are currently quite low). Our economy is at the top of the slippery slope downwards. The USA has a head start on us, but you just watch us catch up. Don't believe what you hear from the banks and the pollies! They are doing their best to keep 'confidence' high. You don't keep confidence high by being a nay-sayer.

By: Nick

Nick — Fri, 12 Dec 2008 02:37:44 +0000

Dear Sir/Madame , I was wondering if anyone can explain to me why Aussie dollar keeps going done with respect to USA dollar?. I was under impression that Australian economy is in a lot better shape than USA.

By: Robert

Robert — Fri, 12 Dec 2008 01:11:03 +0000

The sale of coles was to unlock value in the combined group, my coles shares were $15.00 and exchanged for westfarmers at $42 they are now worth $15 again. I should have cashed out. This is the worst result in my portfolio The westfarmers bit is effectively free.