Agreed - but they are all probably too big to be allowed to fail. I have seen no change in appetite from government to intervene in the same way they did with South Canterbury Finance should an event occur.
Their distaste for excursions into corporate welfare resulted in the OBR - which can result in depositors taking a haircut.
Sorry had to edit as I actually read the OBR link from Peat, instead of asking silly questions.
My funds are so low they might all remain unfrozen. Maybe I should split some with a Heartland Bank deposit account.
Unlikely that banks will fail??? 2007 was the last time and potentially that was a lot of banks globally what has changed other than ultra loose central bank policy.
I think todays economists must have studied under the John Law school of economics. I can't see a lot of difference between today and the Mississippi bubble.
For those of us who loaded up in the market a few years ago,as well as enjoying the market being too expensive, we are very relaxed with the increasing dividends.
I have ~ 38% of my portfolio allocated to cash at this point which demonstrates the degree of caution I have to where the markets are at present. I confess this sized cash allocation has felt a little too conservative at times this summer with the market roaring away like the bit fat fairly mature Bull it is some days...I guess after a stellar 2017 I am content to rest on my laurels a little this quarter and see how things unfold through to 31 March and go from there. This feels about right to me and passes the "sleep test" so I'll just follow my gut instinct and stick with that cash allocation in the short term. The key risk I find with sitting on a sizeable cash allocation is resisting the temptation to spend it
I know exactly how you feel but if and when the market turns I think you'll find it quite nice having that cash sitting around to scoop up some bargains. That's when you'll be glad you resisted temptation. I admit it is tough though. I cashed up a business last August and have been a little unsure what to do with a lot of the proceeds, because the market does seem pretty stretched. It pains me to say a lot of it is still sitting in an on call account with Westpac earning a measly 2.1%. I must find the time to do something about that!
I know exactly how you feel but if and when the market turns I think you'll find it quite nice having that cash sitting around to scoop up some bargains. That's when you'll be glad you resisted temptation. I admit it is tough though. I cashed up a business last August and have been a little unsure what to do with a lot of the proceeds, because the market does seem pretty stretched. It pains me to say a lot of it is still sitting in an on call account with Westpac earning a measly 2.1%. I must find the time to do something about that!
Good thread and great thoughts. Keep 'em coming!
All manner of different sorts of temptations on Trade me that need to be carefully navigated around too
Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.”
Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine
If NZ equities were too expensive yesterday, they certainly headed out of the ballpark today!
For me it was a strange day - but a learning day (stop watching share transactions during the day!). Portfolio#2 went down to 8.2% profit during the morning but closed the day at 10.8% profit.
Originally Posted by minimoke
Reply With Quote
Bookmarks