U.S stock exchange is going to be interesting ??

[ebxr8240]

Alot of red there.. They are along way from being out of this mess !!
http://www.nasdaq.com/briefing/stock_summarynew.stm

Hope it doesn't effect us too much ??
Maybe prevent interest rates falling here. Due to funds to loan are harder to require..

[SB076]

yep - borrowing costs are increasing globally it will be interesting to find out how many Oz banks are exposure to Lehman Bros and what there exposure is..... Crystal ball would be really handy at the moment.

Cost of oil has dropped to below $100 US per barrel (a least thats a positive)

[blueoval]

Originally Posted by SB076

....Cost of oil has dropped to below $100 US per barrel (a least thats a positive)

Thats only a positive if the savings are passed onto the consumer.

[Russ]

Originally Posted by SB076

Cost of oil has dropped to below $100 US per barrel (a least thats a positive)

As others have said, it's just a pity the prices at the pumps didn't move down with it. : I think it's so sad that the poor ba$tards (oil companies) are only making a few billion $'s profit each month, how terrible that must be for them, Greedy Pr..ks !! :togo:

[Yellow_Festiva]

There are numerous youtube clips saying that the US Economy is due to collapse by the end of Sep, or at latest early 2009.

The clips have been there for a few months, and so far nothing has shown that they are going to be wrong it seems...

[Bluehoon]

What we see is only what we know. How many other companies were behind the financing and lending that are about to go down with them?

My fears this is the tip of the ice berg.

hint: sell shares and buy up property.


Cheers

[SB076]

10.05 All ords have dropped 58 points, interesting to see if the rally late today

[ebxr8240]

Some super funds and local gov have invested in these too ??

[SB076]

Originally Posted by ebxr8240

Some super funds and local gov have invested in these too ??

I have no doubt everyone will be working out what there exposure is at the moment. Could be a while before we all find out

It has been rumoured that the worlds largest insurer AIG, is caught up in all this and it may not even last this week (this could have greater ramifications than Lehman Bros filing for bankruptcy)

http://money.ninemsn.com.au/article.aspx?id=631951

Keep in mind it just someones opinion and it might not be 100% accurate, but it is interesting

[Fev]

and we're obviously still waiting.. i just wish our dollar went back to 98c/1US$

[JPFS1]

It was very brave for the US Fed to let Lehman's go down, but imho it was the right thing to do.

It just shows you how the ever increasing risk investors required, whether it be shares or property, is now coming to bite them.

So many dodgy financial tools were created by these investment banks for the sake of creating leverage has now gone too far and has crippled many investment organisations.

I believe this is all required to clean out the 'junk' before any semblance of a recovery is on the cards.

Property is not immune to any of this either. Not unless you can hold through it all, but that goes with shares too, if you don't have to sell, then it will come back, it always does.

But it seems, the massive bull markets that were experienced globally, is over for now.

My prediction though is this... the US will tank, the artificial strength in the US$ will be seen as just that, artificial, and it will also tank, investment will return to gold, and any other 'real' asset/commodity that will be revalued UP, because of the demise of the US currency!

[Fev]

god i wish i won that cancer charity lotto thing and got 80k worth of gold bullion.. There must be so many opportunities coming up with whats happening in the market at the moment.. you just gotta know where to look

Shares in any mining company which doesnt have a huge amount of debt i would be thinking will go up..

[SB076]

Originally Posted by Fev

Shares in any mining company which doesnt have a huge amount of debt i would be thinking will go up..

Not all miners are doing well, some have ceased production due to falling comodity prices (such as zinc etc)

[Fev]

Originally Posted by SB076

Not all miners are doing well, some have ceased production due to falling comodity prices (such as zinc etc)

I was just talking theoretically if there was a recession, people losing jobs etc etc then the government(s) will have to create jobs, they will(or should) start huge national infrastructure projects(highways, bridges, buildings airports etc) so that people will have a chance to get a job(albeit a trade). When those people start earning, they will start spending. thats what gets ya out of a recession.. money being spent(and other things of course).

So when these big projects start comin out of the US, europe, china and australia which depending on what happens to their economy, they may hit a recession - the price of metals coal, tar asphalt etc etc will go up due to a much higher demand.

but this is just my year 11 economics class talking and the economy may not even get to that point so feel free to teach me - always good to learn more about the economy and sharemarkets etc

[sandmanls1]

the US Feds ie Greenspan are partly to blame by makine the cash rates so low leverage was extremely cheap and every huckster that could came out to play. Private equity must be running scared, look at B&B, Allco etc.

[JPFS1]

Originally Posted by SB076

... it will be interesting to find out how many Oz banks are exposure to Lehman Bros and what there exposure is..... Crystal ball would be really handy at the moment

From what I know, apparently CBA has about 150 million worth, Westpac have around 10 million.

Don't know about others at the moment.

[SB076]

Originally Posted by JPFS1

From what I know, apparently CBA has about 150 million worth, Westpac have around 10 million.

Don't know about others at the moment.

NAB i think $25 million and ANZ $120 million

Originally Posted by FEV

I was just talking theoretically if there was a recession, people losing jobs etc etc then the government(s) will have to create jobs, they will(or should) start huge national infrastructure projects(highways, bridges, buildings airports etc) so that people will have a chance to get a job(albeit a trade). When those people start earning, they will start spending. thats what gets ya out of a recession.. money being spent(and other things of course).

So when these big projects start comin out of the US, europe, china and australia which depending on what happens to their economy, they may hit a recession - the price of metals coal, tar asphalt etc etc will go up due to a much higher demand.

but this is just my year 11 economics class talking and the economy may not even get to that point so feel free to teach me - always good to learn more about the economy and sharemarkets etc

I am just like everyone else - its a case of strap yourself in and lets see what happens - I m not a huge investor, will be good to get someone like Dukes opinion on this, as this is his bread and butter. The thing thats amazing is the size of these companies $650 billion odd for Lehman Bros, $1 tilltion for AIG.

[CSV_LS1]

Oil hits $92US yet i don't see petrol prices changing at all. Even 79US cents we should be getting reduced prices at the bowser.

[Fev]

what were the fuel prices back when oil was $92 a barrel?

[sleekism]

Originally Posted by Fev

I was just talking theoretically if there was a recession, people losing jobs etc etc then the government(s) will have to create jobs, they will(or should) start huge national infrastructure projects(highways, bridges, buildings airports etc) so that people will have a chance to get a job(albeit a trade). When those people start earning, they will start spending. thats what gets ya out of a recession.. money being spent(and other things of course).

So when these big projects start comin out of the US, europe, china and australia which depending on what happens to their economy, they may hit a recession - the price of metals coal, tar asphalt etc etc will go up due to a much higher demand.

but this is just my year 11 economics class talking and the economy may not even get to that point so feel free to teach me - always good to learn more about the economy and sharemarkets etc

I think you are referring to Keysian economics.

However what the 1970's taught us that this theory can also equal the horrific stagflation ie. high inflation and low growth.

I fear that massive-infastructure projects could simply fuel inflation given high commodoity prices and skills shortage.

[Fev]

hmm, makes sense - i moved schools and they didnt have economics so i missed out on the 2nd half of HSC part, that may have been in there somewhere.. still found the first half pretty interesting though

[DABOSS]

Markets are trading 4700 down 2% , alot of red out thats for sure. not a good day on the market today.

Most banks will finish in the red.

US market hasn't reallt affected us too much are market is trading ok atm, but the we will have to see in the next few months how it pans out.

[Fev]

absolutely SB.. i still cannot even fathom how a company can get into $613 BILLION dollars worth of debt..

[JPFS1]

Originally Posted by Fev

absolutely SB.. i still cannot even fathom how a company can get into $613 BILLION dollars worth of debt..

easy... they are all playing with derivative facilities for increased returns.

These companies employ some of the most strict risk policy measures that makes them feel they can leverage upto 100+ times above their capital holdings... now that is just crazy even if they think they have sufficient risk management in place... this proves that many don't.

[gcg2503]

Originally Posted by JPFS1

easy... they are all playing with derivative facilities for increased returns.

These companies employ some of the most strict risk policy measures that makes them feel they can leverage upto 100+ times above their capital holdings... now that is just crazy even if they think they have sufficient risk management in place... this proves that many don't.

not only for leveraging purposes

credit default swaps (CDS - a derivative product) can also be used for hedging pruposes and ;

also can be used to take on / offload risk to satify a firms risk appetitie/exposure

[Fev]

yeah i'd need my dad to come and explain that to me lol.. he works in the business now as a director of sales.. i sent him an sms askin how his day was goin with the sharemarket sh*/tting itself.. no reply lol

[SB076]

Made a mistake Lehman is $639 billion (not $650 - assets) To give you an idea Enron had assets worth $63 billion when it went down. I agree with JPFS1, something had to happen, the US Fed cant save them all.

http://money.ninemsn.com.au/article.aspx?id=632187 more info

[HUNTER8]

Originally Posted by ebxr8240

Hope it doesn't effect us too much ??
Maybe prevent interest rates falling here. Due to funds to loan are harder to require..

Our Banks are dropping fixed rates weekly at the moment. Westpac 7.99% fixed 3 years at the moment...............makes a real "mockery" of their global funding crisis!

[gcg2503]

I basically work at a rival investment bank under a minute walk from where Lehmans are based

Nice building by the way

They were all drowning their sorrows yesterday at the bars around here....was packed

WIll make the job market so much tougher around here with an extra 4500 CVs on the market

Everyone is cared - most firms are currently in a state of hiring freeze (but that is common around end of year where headcount always is an issue...)

[SB076]

US Fed has put $107 billion into AIG keeping it a float for now, the government put the money in as they didnt want to see a disorderly close of the business. The government now owns 80% of AIG (on paper not bad spend $107 gain 80% of a company with assets worth $1 trillion)