The Stock Market

[BlackJack]

100%

look at rare earths

[Abrak]

So who is buying? US corporates have announced share buybacks of US$258bn in the first 9 months of this year compared to just US$52bn in the first nine months of last year.

http://www.bloomberg.com/news/2010-09-19/stock-buybacks-surge-as-companies-borrow-cheaper-debt-for-share-purchases.html

[flying]

So who is buying? US corporates have announced share buybacks of US$258bn in the first 9 months of this year compared to just US$52bn in the first nine months of last year.

Record-low interest rates are stoking the biggest increase in U.S. share buybacks ever.

“It’s so cheap to do it now in the bond market: issue debt, fix their cost of capital, then shrink the number of shares outstanding,” said James Swanson, chief investment strategist at Boston-based MFS Investment Management, which oversees about $197 billion. “The markets are almost calling for them to do it.”

Well at least they have gotten some to start borrowing again eh?

[badge]

Been focusing on possible sell signals in shares last few days; FTSE 5700/10 looks likely, with perhaps just shy of the previous YTD high thereafter.

I wonder if it has the legs however, as volume and breadth are diverging, momentum is diverging and sentiment is already very elevated.

[Abrak]

With 10 year USTs yielding 2.6%, I decided to run off a filter of S&P500 companies on the basis of..

1) Minimum yield 3.0%

2) 25 years of unbroken dividend growth (increased or maintained)

3) Dividend 'increased' in everyone of the last 10 years including 2010

I came up with...

ABT 3.2%

CINF 6.0% (230% payout)

KO 3.2%

XOM 3.0%

TEG 5.6%

PEP 3.0%

PG 3.3%

PPG 3.4%

PBI 7.6% (118% payout)

There were 4 who dont declare until 4Q

ADP 3.2%

LEG 5.7%

MCD 3.0%

VFC 3.3%

The S&P500 is currently on 2.1% yield compared to an average of 2.08% over the last 20 years (10 bull, 10 bear). The 10 year UST is currently yielding 2.6% against its 20 year average of 5.0%.

The average payout ratio of these stocks is about 50%. I didnt put a payout limit because dividends are supposed to reflect long term earnings potential. Cinf for instance has increased its dividend every single year in the last 49, just increased its dividend last month and bought back US$10m of stock last quarter.

Unfortunately I dont follow US stocks but I am very tempted to buy one. If anyone looks at charts on a six month view and something looks interesting let me know and I will take a look.

[badge]

Interesting food for thought Ab'ers.

[badge]

The FI/Stock dichotomy still perseveres with 2Y yields hitting an all time low y'day. 5Ys are breaking down too.

Who gives?

5Y v SPX

http://bigcharts.mar...5638&mocktick=1

[Abrak]

The FI/Stock dichotomy still perseveres with 2Y yields hitting an all time low y'day. 5Ys are breaking down too.

Who gives?

5Y v SPX

http://bigcharts.mar...5638&mocktick=1

Badge,

You know that is absolutely one of the most MISLEADING charts of all time. Your chart goes back 10 years and shows a very strong correlation. If you take it back another 20 years, the previous 20 years will show a very strong reverse correlation. In fact, Badge, I think you will find it quite extraordinary in that I have never seen a chart which essentially shows a long period of correlation and a long period of reverse correlation which essentially implies no correlation.

Simply put UST yields have been falling consistently for 30 years. For the first 20 years until 2000 equities were on a BULL run with yields consistently falling until they reached 1.1% in 2000. Since 2000 equities have been in a BEAR market and the yield has risen to 2.1% while UST yields have gone from 6.0% to 2.6%.

What you see in your chart the divergence at the end. It is not a divergence it is the start of a new trend. As I will explain equities are going to outperform bonds consistently over the next 10 years because they will outperform whether long term rates go up or down (unless 10 yr rates rise above 12% or inflation turns more than -5%).

And Badge the power in this argument is that chart is so beautifully deceptive. When bond yields go down it implies slower growth and inflation so lower EPS/DPS. But in the previous 20 years they used to argue that yields of different assets ought to trend in the same direction.

Lets take Johnson and Johnson (JNJ). 25 years years unbroken dividend growth. Raised its dividend 10% in 2010. It is over 2x covered.

Its stock yield is 3.48%

It issued a 10 year bond at 2.95%

Now consider what your chart is implying - it is actually saying that if the bond yield goes down the stock yield will go up. Bear in mind that on average over the last 50 years the earnings yield of S&P average 6% has been about the same as the 10 year UST (currently 2.6%). JNJ's is 7.3%.

If you start with the assumption that the 10 year rate is unchanged in 10 years time, so USTs yield 2.6%. On average the S&P yield is half USTs so 1.3%. Assume JNJ does not increase its dividend which it has done for 25 years and assume its yield is double the S&P500 and you still get a yield gain and capital appreciation. And here is where the bond guys get it wrong because even in a zero growth FCF environment JNJ will still increase its dividend 5% per annum at current rates because it will buy back stock to increase EPS or simply up its payout ratio if it is not expanding.

That last point is very important because even in a very low growth, low inflation environment the dividend will rise. I assume its FCF is not about to halve because it has just increased its dividend 10% and it is a triple AAA rated company but even if it did it could maintain the dividend.

If we take the minimum dividend growth rate over the last 10 years 8% and halve it going forward you are looking at 4% growth and an implied perpetual bond yield of 11.3%. Pencil in any assumption you like and you cannot argue that if UST yields fall the equity yield should rise. In fact falling UST yields which imply lower inflation and lower growth just means that the yield has further to fall (but dividend growth will be lower.) To be honest, I dont think I have ever seen an equity yielding more than its bond, it is such a totally ridiculous concept.

As I say on average the UST yield is at least 2x S&P500. Lets assume JNJ yield is the same as the 10 year UST in 10 years time. If rates fall to 1.5% (no growth, no inflation) the stock has both a yield gain and doubles. If the 10 year rate is 5% that would imply faster growth and inflation say 8% and even on a 5% yield you have a massive yield gain and capital appreciation.

I know nothing about bonds but I will guarantee you that JNJ's bond will yield 2.95% in terms of return over the next 10 years.

Relative to that bond JNJ shares are about 100% undervalued. Now the bond market is totally manipulated by the Fed and I suspect that JNJ's triple AAA rating means it doesnt count as a risk asset or something.

Its basically the same for others. But the key points are this.

1) Loads of people look at that chart (including me) see that tight correlation see the divergence and think that equities are overbought relative. But that correlation is a total illusion that you will see if you simply take it back another 10 years. That divergence is the beginning of a new trend which means equity yields have to halve or 10 year UST yields double to get back to the 20 year average.

2) The fundamental argument is totally overwhelming, you simply cannot justify with say JNJ bond yields going down and the equity yield going up. In fact it is impossible to justify the equity yield being higher than the bond yield. And you have to admit, the timing is perfect on the basis that retail have been selling equities for however many weeks and piling into bonds. I know nothing about JNJ but any fund manager that buys the bond over the equity ought to be sacked.

3) If 10 year yields go up, I guess it might imply stronger growth and be ok for equities but if the UST yield goes down, equities like JNJ can have a very big move up. If you knocked 50 basis points off the 10 year UST with QE, I think you will see as much as 150 basis points off the equity yield. It really is almost inconceivable that JNJ can maintain an equity yield above its bond yield.

4) This is a very Bernanke scenario whereby he will know that another round of QE might reduce longer rates but increase inflation expectations which is just perfect for a big run in the market

Look I know nothing about US stocks or JNJ for that matter, but Badge's chart is a classic. It tells you something that is totally and utterly wrong but eventually created a self-fulfilling trend. And sometimes not knowing anything gives you a different view. But I have looked at a few stocks and they giving a very powerful message. It is not one about absolute value - everything is about average in that regard - it is relative value to bonds. While Badge's chart implies 30% downside if rates fall 50 basis points I think you might get 50% upside in quality yielders.

Unfortunately I looked at those stocks I filtered and then realized it was a pretty silly filter and that I needed to think a bit differently. More like a bond guy. MCD is probably the only interesting one there. I like MCD because it just announced its dividend and came in 1 cent above expectations. Actually I dont give a flying fuc_k about yield but you see last year they increased their dividend 5 cents or 10% and a 5 cent increase this year would have been 9% but they increased it 6 cents which is 11% to make a point - they have just done 88 consecutive months of sales growth. Totally mispriced against its bond.

But I hate bonds, they are bloody boring. I mean I hope I never have to sit next to someone at a dinner party who buys JNJ 2.95% 10 y bonds and it is a bit pathetic getting excited over a 1 cent extra increase in a dividend. I also find the whole thing rather amusing because everyone is piling into these bonds which look to me like internet stocks - I simply cant understand the mad rush into guaranteed 3% 10 y returns especially as the last stock thing was a mad rush into a hope of infinite returns.

If Badge reads this far I hope he can post a longer dated chart.

[badge]

Thanks for the snipet at the end, as I gave up reading a little earlier. Apologies Abs.

I dont have a longer graph, perhaps Lanna could provide one?

I was actually looking at 2Y yields, but couldnt find a graph with SPX of even 5 years .

In anycase, the observation is that over the past decade short yields and shares have moved with a with significant correlation(70%-80% on 2YUSTs), and that has been diverging for several months. So either this time its different and the corrolary of the past decade is over(the point your making point Abrak?), or one market should eventually reverse?

I personally think USTs will reverse, but whether that correlates to shares also reversing, or the correlation over the past decade coming to an end should be the real question for here.

[Abrak]

Badge,

If I offered you a stock with a 3.48% yield that had just increased its dividend 10% had grown its dividend consistently for 25 years and its dividend was over 2x covered by earnings.....

Or a bond with a yield of 2.95% for 10 years....

Which would you choose?

If you choose the bond let me know because I have a house I want to talk to you about.

If you choose the equity you will realize that the correlation is an illusion that eventually fed on its self rather like an internet that has gone 20x and is 3x overvalued but still doubles.

If UST rates reverse it will be because the economy is stronger than we think which is possible but it wont do anything much to the market. I am rather hoping that rates fall 50 basis points following QE2 in which case the market will rise 20% and the correlation will be firmly broken.

[badge]

Fair enough. I must admit that whilst I appreciate the theory Im not too concerned with effect and cause.

The only time I buy a share for a dividend thesedays is to arb it, and I dont do that anymore, much.

[flying]

Oil just cleared $80 here

[BlackJack]

some funds in THailand are paying nearly 60% per year

anyone had any experience with them

[flying]

.....moved to financial crisis

[siamamerican]

You can see this in a different way with Vodafone - yield of 4.4% - that is selling assets to create proceeds to buyback stock (presumably because it already has sufficient leverage). Or by the pick up in debt financed acquisitions whereby bond yields are so low it makes sense to buy equity. At the end of the day, given current bond/equity yields noone needs Joe punter to buy equities because you simply issue corporate bonds and buy equities yourself. Look at the pick up in M&A.

Ok and then the likes of CNBC and Bloomberg will no longer need to look at trying to suck in the dumb money

When are you going to realize that you just don't get it when it comes to economics and investing? You're a classic example of why the Buffetts of the world make money investing in equities. This economic cycle will end just as the others before it have with investors that ignored the fear mongers, making nice returns. Just think of the opportunity lost if someone followed your advice in late 2008. Look at your post back then and for that matter, all your posts.

Last month, an investor in US and EU equities could easily put together a well diversified portfolio of stock with trailing PE's of less than 12 and yields over 3%. Will the market go south next month or the next 6 months - you nor I really don't know is the reality.

You keep asking questions about who is buying stocks, Thai exports... No conspiracy here and easy to answer. Companies and people are buying just like always. Better question, who do you think is buying?

[midas]

You can see this in a different way with Vodafone - yield of 4.4% - that is selling assets to create proceeds to buyback stock (presumably because it already has sufficient leverage). Or by the pick up in debt financed acquisitions whereby bond yields are so low it makes sense to buy equity. At the end of the day, given current bond/equity yields noone needs Joe punter to buy equities because you simply issue corporate bonds and buy equities yourself. Look at the pick up in M&A.

Ok and then the likes of CNBC and Bloomberg will no longer need to look at trying to suck in the dumb money

When are you going to realize that you just don't get it when it comes to economics and investing? You're a classic example of why the Buffetts of the world make money investing in equities. This economic cycle will end just as the others before it have with investors that ignored the fear mongers, making nice returns. Just think of the opportunity lost if someone followed your advice in late 2008. Look at your post back then and for that matter, all your posts.

Last month, an investor in US and EU equities could easily put together a well diversified portfolio of stock with trailing PE's of less than 12 and yields over 3%. Will the market go south next month or the next 6 months - you nor I really don't know is the reality.

You keep asking questions about who is buying stocks, Thai exports... No conspiracy here and easy to answer. Companies and people are buying just like always. Better question, who do you think is buying?

is that what you call this - " economics and investing " ?

I prefer to call it a Ponzi scheme

Anyway nothing wrong with asking questions and what is wrong with this picture ?

" Insider Selling To Buying: 2,341 To 1 "

And by the way..........that is without any forthcoming fallout from " Foreclosuregate "

[siamamerican]

You can see this in a different way with Vodafone - yield of 4.4% - that is selling assets to create proceeds to buyback stock (presumably because it already has sufficient leverage). Or by the pick up in debt financed acquisitions whereby bond yields are so low it makes sense to buy equity. At the end of the day, given current bond/equity yields noone needs Joe punter to buy equities because you simply issue corporate bonds and buy equities yourself. Look at the pick up in M&A.

Ok and then the likes of CNBC and Bloomberg will no longer need to look at trying to suck in the dumb money

When are you going to realize that you just don't get it when it comes to economics and investing? You're a classic example of why the Buffetts of the world make money investing in equities. This economic cycle will end just as the others before it have with investors that ignored the fear mongers, making nice returns. Just think of the opportunity lost if someone followed your advice in late 2008. Look at your post back then and for that matter, all your posts.

Last month, an investor in US and EU equities could easily put together a well diversified portfolio of stock with trailing PE's of less than 12 and yields over 3%. Will the market go south next month or the next 6 months - you nor I really don't know is the reality.

You keep asking questions about who is buying stocks, Thai exports... No conspiracy here and easy to answer. Companies and people are buying just like always. Better question, who do you think is buying?

is that what you call this - " economics and investing " ?

I prefer to call it a Ponzi scheme

Anyway nothing wrong with asking questions and what is wrong with this picture ?

" Insider Selling To Buying: 2,341 To 1 "

And by the way..........that is without any forthcoming fallout from " Foreclosuregate "

Wow, you are determined to forecast the doom of western civilization through copying and pasting. I could find thousands of articles forecasting market rallies but what is the point. When things are near the bottom most the experts are forecasting doom and when markets are good, well you get the point. History will tell that this is very very very very likely just another cycle.

As for your chart. Hmmm, what would it look like if you went back another 18 months. From the graph you sent there is little to no correlation to the price of equities. Look at the period between Jan-Feb and it tells a different story and go back another year and again there is no correlation. Money has been flowing out since the flash crash in May and going into bonds. The flash crash scared investors in my opinion and it will take time for them to reenter.

You are determined! Please read your post going back 2 years and realize that forecasting is not your strength. Also, the world doesn't revolve around the USA anymore and you need to come to grips with this fact. There are other engines of economic growth.

[BlackJack]

Just watched a doco called Mind over Money and it is worth watching if you can see it on cable or online

It was on Australia Network today

It does say that when you can predict the markets pigs will fly and that investing is mostly about vanity and ego

It has some experiments done by noted Universities and when you see how dumb some people can be you realise why we had the GFC and why we will continue to have more bubbles to burst

good luck all

[midas]

Wow, you are determined to forecast the doom of western civilization through copying and pasting. I could find thousands of articles forecasting market rallies but what is the point. When things are near the bottom most the experts are forecasting doom and when markets are good, well you get the point. History will tell that this is very very very very likely just another cycle.

As for your chart. Hmmm, what would it look like if you went back another 18 months. From the graph you sent there is little to no correlation to the price of equities. Look at the period between Jan-Feb and it tells a different story and go back another year and again there is no correlation. Money has been flowing out since the flash crash in May and going into bonds. The flash crash scared investors in my opinion and it will take time for them to reenter.

You are determined! Please read your post going back 2 years and realize that forecasting is not your strength. Also, the world doesn't revolve around the USA anymore and you need to come to grips with this fact. There are other engines of economic growth.

Well if you are so keen to read my posts from 2 years ago.........

please answer a question that i raised back then......?

How and when are they going to pay off the debts in USA, Japan and Europe ?

I am not " forecasting the doom of western civilization " ........I am just waiting

for the " reset " button to be pressed as opposed to kicking the can down the road.

And after that i will be as enthusiastic as you ( maybe even more so )

when we can get back to reality i.e. money is earned through effort as opposed

to getting it off the printing press.

[siamamerican]

Well if you are so keen to read my posts from 2 years ago.........

please answer a question that i raised back then......?

How and when are they going to pay off the debts in USA, Japan and Europe ?

I am not " forecasting the doom of western civilization " ........I am just waiting

for the " reset " button to be pressed as opposed to kicking the can down the road.

And after that i will be as enthusiastic as you ( maybe even more so )

when we can get back to reality i.e. money is earned through effort as opposed

to getting it off the printing press.

Well, they will never payoff all debt. They will continue to service those debts and are in the process of coming to the realization that the current debt accumulation is unsustainable. I'm not minimizing the debt issues the citizens of the US and Europe have created for themselves. It is going to be painful and in the end the world as a whole will recover from the financial crisis. Other countries have recovered form much more severe debt issues and are doing fine today.

You claim to have an open mind and tell those that ridicule some of your posts as not being capable of considering different views. Ironic though, you have only expressed doom and gloom as if it is the only outcome.

You are correct in stating that I'm enthusiastic. As you worried about the demise of western civilization as we know it ( I'll supply some embarrassing posts between you and your pals ( Alex, Flying...) if you need a reminder, I was content believing we were just in a bad economic cycle.

What the h@ll,, here are a few of you posts calling people with different views sheeple, stupid, schizophrenics... Oddly enough the fools were correct and the open minded Midas was wrong:

** How can you infer these discussions as being " paranoia " when the financial crisis could well develop into a war and even a famine ? What I'm finding extremely irritating beyond all words now is the continual references in the mainstream media to this being a " recession " -defined as two quarters of GDP negative growth " - almost implying " normal services will be resumed as quickly as possible " -it's a joke. We all know now this goes far beyond a recession and I just wish they had the balls to tell the sheeple what the hel_l is really going on

** For example- it looks like Russia is heading for a meltdown so who will be there this time around TO PAY FOR security of the nuclear arsenal in that country ?

** Another hilarious prediction by Midas on 4/21/09(beginning of probably largest market rally ever): What a bunch of schizophrenics these people are that are fuelling this stock market rally ! So yet again some amateur small time investors are going to get squashed like flies.

** 05/02/2009 post: couldn't believe the stupidity on CNBC today. Three suits all saying.................Yes looks like what ever we have done is working....Yes we may see another healthy little pull back but that is normal.

[Paulo1]

You can see this in a different way with Vodafone - yield of 4.4% - that is selling assets to create proceeds to buyback stock (presumably because it already has sufficient leverage). Or by the pick up in debt financed acquisitions whereby bond yields are so low it makes sense to buy equity. At the end of the day, given current bond/equity yields noone needs Joe punter to buy equities because you simply issue corporate bonds and buy equities yourself. Look at the pick up in M&A.

Ok and then the likes of CNBC and Bloomberg will no longer need to look at trying to suck in the dumb money

When are you going to realize that you just don't get it when it comes to economics and investing? You're a classic example of why the Buffetts of the world make money investing in equities. This economic cycle will end just as the others before it have with investors that ignored the fear mongers, making nice returns. Just think of the opportunity lost if someone followed your advice in late 2008. Look at your post back then and for that matter, all your posts.

Last month, an investor in US and EU equities could easily put together a well diversified portfolio of stock with trailing PE's of less than 12 and yields over 3%. Will the market go south next month or the next 6 months - you nor I really don't know is the reality.

You keep asking questions about who is buying stocks, Thai exports... No conspiracy here and easy to answer. Companies and people are buying just like always. Better question, who do you think is buying?

Abrak will ask questions and throw fundamental theory at anything for reaction, not that there is anything wrong with this, just like a broken record stuck on the same fundamentalist’s song. Have a read of my posts in regard to buying sugar contracts about 18 months ago. Went on and on and on. In the end look what happened..LOL

Analyzing any market carries a complex set of scenario’s and the theory of probability. At present the global economies are present historical zones. Sentiment is a huge factor in this, and how one measures’ it. So until that can be changed at the street level the song remains the same. Gold, AUD, Commodities, Equities. Not to forget global population expansion and lack of food. So farm land is going to become a sort after resource. Any land near large populations will be even better than Countries such as New Zealand due to the fact of transport cost and labour costs. NZl minimum wage $12.75 nzl.

Although a number of Chinese companies have been purchasing large land mass in NZ. The government has recently passed ne foreign ownership laws.

Who knows what the FED etc is thinking. Do They? I know they are putting pressure on other countries to devalue their own currencies in order to try and prop up the USD (whilst printing money.) LOL. Example Yuan, Chf, Yen.

I believe Thailand’s economy is strong, Baht strong, due to the fact it has foreign currency clause where it can only trade 250 million per day before trading is ceased. Don’t quote me on that fully as I that was the case a few years ago and have not researched current Thai Baht Policy. That is why it is stable against other currencies..

This coming week is going to be huge, so expect some massive movements coming October ends and will see a positive move in equites. I prefer ASX listed companies due to the fact I have over 25yrs experience trading ASX . And of course I like India, Thai, Korea markets too. Limited experience in these exchanges.

Good Luck and may profits flow into your accounts.

[midas]

Well if you are so keen to read my posts from 2 years ago.........

please answer a question that i raised back then......?

How and when are they going to pay off the debts in USA, Japan and Europe ?

I am not " forecasting the doom of western civilization " ........I am just waiting

for the " reset " button to be pressed as opposed to kicking the can down the road.

And after that i will be as enthusiastic as you ( maybe even more so )

when we can get back to reality i.e. money is earned through effort as opposed

to getting it off the printing press.

Well, they will never payoff all debt. They will continue to service those debts and are in the process of coming to the realization that the current debt accumulation is unsustainable. I'm not minimizing the debt issues the citizens of the US and Europe have created for themselves. It is going to be painful and in the end the world as a whole will recover from the financial crisis. Other countries have recovered form much more severe debt issues and are doing fine today.

You claim to have an open mind and tell those that ridicule some of your posts as not being capable of considering different views. Ironic though, you have only expressed doom and gloom as if it is the only outcome.

You are correct in stating that I'm enthusiastic. As you worried about the demise of western civilization as we know it ( I'll supply some embarrassing posts between you and your pals ( Alex, Flying...) if you need a reminder, I was content believing we were just in a bad economic cycle.

What the h@ll,, here are a few of you posts calling people with different views sheeple, stupid, schizophrenics... Oddly enough the fools were correct and the open minded Midas was wrong:

** How can you infer these discussions as being " paranoia " when the financial crisis could well develop into a war and even a famine ? What I'm finding extremely irritating beyond all words now is the continual references in the mainstream media to this being a " recession " -defined as two quarters of GDP negative growth " - almost implying " normal services will be resumed as quickly as possible " -it's a joke. We all know now this goes far beyond a recession and I just wish they had the balls to tell the sheeple what the hel_l is really going on

** For example- it looks like Russia is heading for a meltdown so who will be there this time around TO PAY FOR security of the nuclear arsenal in that country ? 

** Another hilarious prediction by Midas on 4/21/09(beginning of probably largest market rally ever): What a bunch of schizophrenics these people are that are fuelling this stock market rally ! So yet again some amateur small time investors are going to get squashed like flies.

**  05/02/2009 post: couldn't believe the stupidity on CNBC today. Three suits all saying.................Yes looks like what ever we have done is working....Yes we may see another healthy little pull back but that is normal.

Erm.........

I have only expressed what you yourself have just said in this post......i.e. " It is going to be painful "

and when you say " They will continue to service those debts and are in the process of coming to the realization that the current debt accumulation is unsustainable " - no that is simply untrue in the case of USA and Japan ( the biggest and second biggest economies ) because their debts are getting bigger every second but no one has mentioned how to pay it back ?

[flying]

Other countries have recovered form much more severe debt issues and are doing fine today.

Erm.........

I have only expressed what you yourself have just said in this post......i.e. " It is going to be painful "

and when you say " They will continue to service those debts and are in the process of coming to the realization that the current debt accumulation is unsustainable "

Siam I would love to hear who these "Other Countries" are that have recovered from much more severe debt issues are. Not debt compared to GDP but external debt outright.

I have not heard of anyone trumping our 13 trillion....yet...Because after all we are #1

GNOE as Naam says :lol:

As such none can say others have recovered from worse.

Hey Siam you were doing pretty good after your vacation....

Pretty mellow like the rest did you good.

Now your back to slinging mud at midas & your old name calling.

Maybe time for a Singha eh?

[midas]

Other countries have recovered form much more severe debt issues and are doing fine today.

Erm.........

I have only expressed what you yourself have just said in this post......i.e. " It is going to be painful "

and when you say " They will continue to service those debts and are in the process of coming to the realization that the current debt accumulation is unsustainable "

Siam I would love to hear who these "Other Countries" are that have recovered from much more severe debt issues are. Not debt compared to GDP but external debt outright.

I have not heard of anyone trumping our 13 trillion....yet...Because after all we are #1

GNOE as Naam says :lol:

As such none can say others have recovered from worse.

Hey Siam you were doing pretty good after your vacation....

Pretty mellow like the rest did you good.

Now your back to slinging mud at midas & your old name calling.

Maybe time for a Singha eh?

Hi flying

You know actually Japan is also looking serious because of their awful

demographics and because their savings rate has virtually dwindled to nothing

In fact saw these two quotes :-

" As far as I know, Japan’s debt burden is unprecedented for a country in peacetime. The UK’s debt exceeded 200% of GDP during World War II, but that was exceptional, and Britain had much more favourable demographics, with the population enjoying a post-war boom. Even when one calculates Japan’s net debt, this is still nearing 100% of GDP."

and " Japan’s Debt: Argentina Times One Hundred!"

[flying]

Hi flying

You know actually Japan is also looking serious because of their awful

demographics and because their savings rate has virtually dwindled to nothing

In fact saw these two quotes :-

" As far as I know, Japan’s debt burden is unprecedented for a country in peacetime. The UK’s debt exceeded 200% of GDP during World War II, but that was exceptional, and Britain had much more favorable demographics, with the population enjoying a post-war boom. Even when one calculates Japan’s net debt, this is still nearing 100% of GDP."

and " Japan’s Debt: Argentina Times One Hundred!"

Hey Midas.....Yeah Japan is another in line.

Actually down the line a ways in pure external debt....I think 9th or 10th

I dont look too hard at the debt % of GDP especially now when there is such a state of flux.

The external debt is basic & easy to see & then consider the interest servicing.

Interesting times as always eh Midas?

[siamamerican]

Other countries have recovered form much more severe debt issues and are doing fine today.

Erm.........

I have only expressed what you yourself have just said in this post......i.e. " It is going to be painful "

and when you say " They will continue to service those debts and are in the process of coming to the realization that the current debt accumulation is unsustainable "

Siam I would love to hear who these "Other Countries" are that have recovered from much more severe debt issues are. Not debt compared to GDP but external debt outright.

I have not heard of anyone trumping our 13 trillion....yet...Because after all we are #1

GNOE as Naam says :lol:

As such none can say others have recovered from worse.

Hey Siam you were doing pretty good after your vacation....

Pretty mellow like the rest did you good.

Now your back to slinging mud at midas & your old name calling.

Maybe time for a Singha eh?

Just laughing at the doomers that called it all wrong. if I remember right you lead the brigade. You all have tunnel vision and forget the name calling (numerous cases where you guys labeled us optimists as basically morons) and stubborn persistence that we were doomed. H@LL, silly posts of US citizens stockpiling guns and ready to revolt.

The hostility on this thread is on both sides and I'm one of the idiots. The problem with losers and complainers is that they always blame others and never seem to grasp different views. If others disagree or evidence comes to the forefront that contradicts their beliefs, the doomers just scream the evidence is flawed and the other are fools. Read the thread and you will see many references to us non doomers that aren't kind.

As for countries with worse debt issues in the past. Google "past crisis". These also spelled the end of the world to some doomers. I'll point you in the right direction: Asian Crisis (1997), latin America's crisis in the 90's... Oddly enough countries with excessive debt such as Thailand and Brazil seem extremely healthy today.

Hey Flying you seem to be a nice guy and if the pessimism works for you then have at it. Why I'm so vested in proofing you doomers wrong is a mystery to me. I think it a genetic flaw I inherited. Thought it was funny how some always have to win and now look at me doing the same thing.

On topic about the markets. Investing is ultimately a casino game with odds in your favor if you hold longterm. The odds seem to get better when you start playing when markets are shaking. I believed there was value in the market early 2009 and still today. Earnings are strong and PE's are manageable. The value investor that believes the world will recover from this last recession and future recession will do fine.

[flying]

Just laughing at the doomers that called it all wrong. if I remember right you lead the brigade.

Why I'm so vested in proofing you doomers wrong is a mystery to me

Jai yen yen Siam....I said one beer you sound like you have had a keg ...proofing?

You have me confused with another as I am not a doomer. A disgusted citizen perhaps but not a doomer.

Now jai yen yen dont be so moho/ gnood nid

Good luck in the markets....I mean that. I left in 2000 but never asked any to follow me. To each their own.

[siamamerican]

Siam I would love to hear who these "Other Countries" are that have recovered from much more severe debt issues are. Not debt compared to GDP but external debt outright.

Hmm, I'll be nice and refrain from my usual. We are largest country in the world and have debt. Following your logic, Iceland, Spain, Portegul, Greece are healthy economies.

Play fare and don't make posts that will excite your pals. It is hard to argue logically after posts like the above but you know that.

[siamamerican]

Jai yen yen Siam....I said one beer you sound like you have had a keg ...proofing?

No, never been able to spell. I actually thought it looked funny but went with it.

[midas]

Just laughing at the doomers that called it all wrong. if I remember right you lead the brigade. You all have tunnel vision and forget the name calling (numerous cases where you guys labeled us optimists as basically morons) and stubborn persistence that we were doomed. H@LL, silly posts of US citizens stockpiling guns and ready to revolt.

The hostility on this thread is on both sides and I'm one of the idiots. The problem with losers and complainers is that they always blame others and never seem to grasp different views. If others disagree or evidence comes to the forefront that contradicts their beliefs, the doomers just scream the evidence is flawed and the other are fools. Read the thread and you will see many references to us non doomers that aren't kind.

As for countries with worse debt issues in the past. Google "past crisis". These also spelled the end of the world to some doomers. I'll point you in the right direction: Asian Crisis (1997), latin America's crisis in the 90's... Oddly enough countries with excessive debt such as Thailand and Brazil seem extremely healthy today.

Hey Flying you seem to be a nice guy and if the pessimism works for you then have at it. Why I'm so vested in proofing you doomers wrong is a mystery to me. I think it a genetic flaw I inherited. Thought it was funny how some always have to win and now look at me doing the same thing.

On topic about the markets. Investing is ultimately a casino game with odds in your favor if you hold longterm. The odds seem to get better when you start playing when markets are shaking. I believed there was value in the market early 2009 and still today. Earnings are strong and PE's are manageable. The value investor that believes the world will recover from this last recession and future recession will do fine.

When i was in Tokyo in March 1990, Mr Yamomoto told me exactly the same as you

And to top it all off Mr Lim in Shanghai said the same to me in July 2009