Black Monday

[Biscuit]

........ today might have been blessed as the day to sell at pretty good prices before the down turn actually starts.......

Blessed Wednesday

[Joshuatree]

Yes maybe a gift to get some more cash out/ rebalance/ review etc and be more cautious and change ones mindset from bullish to cautious and cap preservation.
Re the ASX a friend just texted me ( havnt verified this)that the DOW is up 70% since the GFC but the aus all ords are down 15% since the GFC making their sell off rather irrational yest.

[couta1]

Hey winner, down 20-30% is a crash, not a correction. Regarding PE ratios, unlike the US a lot of our good companies are sitting on reasonable ratios well under 20, so not sure of the need for compression.

[Balance]

Exactly, when you take a look at the "Wall of Worry"chart since 2009 and all the reasons to sell along the way, yet the market has gone up hugely since then, the worry dips were big time news while the gradual improvements go unnoticed, but end up being massive.

Let the headlines of 'Bloodbath', 'Bloodletting' and 'Crash' be your friends.

The media in NZ really are very helpful in that respect.

[Beagle]

Hey winner, down 20-30% is a crash, not a correction. Regarding PE ratios, unlike the US a lot of our good companies are sitting on reasonable ratios well under 20, so not sure of the need for compression.

10 year average PE on the NZX is 16, currently about 21-22 depending upon who one listens too. I don't think there's a need, its just market sentiment mate. if the DOW puts in a real shocker like a 3000 point drop in one day I wouldn't rule out a reversion to the 10 year average PE for our market over time and probably just a few months which would mean high PE stocks getting a serious reality check despite very strong growth.
PE compression can be a real tough thing to stomach too. Notice how SUM's SP was $5.60 September 2016 and earnings have grown well over 50% since then and the SP is now lower. Market overall has well and truly outpaced SUM over the last 16-17 months so PE compression can REALLY hurt !
I think if sentiment changes the tide will affect most companies and only those like SUM and a few others with sound growth prospects and low PE with a resilient business model like OCA would be better positioned than others to withstand the outflowing tide.

[artemis]

On THE Black Monday in 1987 I happened to be staying in New York not far from Wall Street. I didn't immediately realise what had happened but it was obvious something had. There were all these knots of men in suits standing around on the streets talking soberly and not looking at all happy.

The media, such as it was back then, had one topic only for most of the week.

[Biscuit]

On THE Black Monday in 1987 I happened to be staying in New York not far from Wall Street. I didn't immediately realise what had happened but it was obvious something had. There were all these knots of men in suits standing around on the streets talking soberly and not looking at all happy.....

Yes, tense knots of sad men in suits interspersed with the terminal thuds of high-rise be-suited jumpers is always the first sign of good buying ahead.

[QOH]

Unfortunately, some of us are old enough to remember back over successive cycles back to the eighties - and remember all the good companies that had been making good profits that ended up going to the wall or hitting up shareholders for more funding.

Yes those of us who remember 1987 are more wary. 30 years ago we had time to make up our losses, not enough time left now.
Before 1987 crash, I was making so much, I’d think “what am I am going to do with my money if I take it out of share market” kind of like now, who wants to settle for 3% interest.
I learnt from 1987 that it wasn’t a one day crash, it went on for months and I lost about 75% of my capital.

[Joshuatree]

I remember when i saw Brierleys s/p drop i rushed to the ph and yelled at m"Investment adviser "buy more ",totally ignoring, not allowing his almost protesting advice not too. Months of numbness after.

[Biscuit]

I remember when i saw Brierleys s/p drop i rushed to the ph and yelled at m"Investment adviser "buy more ",totally ignoring, not allowing his almost protesting advice not too. Months of numbness after.

I remember my sharebroker recommending BIL over the phone just before that. That was when I learned not to trust anyone's advice.