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View Poll Results: Will the Bear come here ?

Voters
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  • Bears can't swim too far so we are safe

    5 11.11%
  • The existing bears at Zoo's might claw us

    11 24.44%
  • Existing bears at Zoo's will escape and do some damage

    20 44.44%
  • Bears will arrive on ships and take over the country

    9 20.00%
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  1. #1
    ShareTrader Legend Beagle's Avatar
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    Default Will the Bear come here ?

    So seeing as the poll of how serious is the bear is split almost exactly 50/50 in terms of its seriousness or not and seeing as the NZX is one of the few markets in the world to be up for 2018, (apparently up 3.8% and being a gross index it should be noted that without the dividends it would be down very slightly) and seeing that the American markets for the first time ever recorded fell more than 1% on Christmas eve, actually more than 2% and several of their indices are now officially in bear market territory I thought a new poll would be appropriate, Will the bear come here ?
    Now we know from Wikipedia that Bears reside only in North and South America, Europe and Asia https://en.wikipedia.org/wiki/Bear and so it seems with their share markets too, thus far, (although Australia is down a fair bit in 2018)
    You'd almost be forgiven for thinking with our border control and isolation that Bears can't immigrate here...but seriously...might the chilling effects of bears elsewhere make their presence felt on our share market in 2019 or will our high dividend yield or some other factors shield the NZX from the worst ?
    Please forgive the metaphorical nature of the poll questions, hopefully each slection and its implications are clear enough.
    Not in the poll but if we do go into a full blown bear market (poll selection 4) how long do you think it will last ?

    I will opine early on this one. I don't think you need to wait for the market to fall by the classic 20% to officially be in a bear market.
    Business and consumer confidence is fragile and certainly not helped by an inexperienced government with a vast array of future policy currently in a state of flux in dozens and dozens of working groups. Business doesn't like uncertainty and that's exactly what we have going into 2019.
    Some experts believe the forward PE on the NZX is still above 20 and is for example well ahead of the 14.5 of the S&P 500 in the US.
    I think the potential for PE contraction remains very real for 2019 and we could see companies grow earnings but still make no difference to their share prices.
    My focus is mainly on defensive dividend yield companies and I expect most of my return for 2019 to come from dividends.
    To a large extent what happens to our markets will be determined by what happens overseas, (I know I am stating the obvious here but "bear" with me). RBNZ does have some room to move with the official cash rate and bank requirements and I expect they will need to dip into their toolbox at least once in 2019, probably twice or maybe three times. I ticked option 3 as I expect bearish tendencies next year even if we don't get to a full scale bear arrival.
    Last edited by Beagle; 25-12-2018 at 04:58 PM.
    No butts, hold no mutts, (unless they're the furry variety).

  2. #2
    Ignorant. Just ignorant.
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    Default

    Opinion unsubstantiated by facts or numbers. . .

    A long slow downtrend over a number of years (probably about 5 or so), with the occasional burst of irrational exuberance to leaven the mix.

    It will take a while for the downside of passive,. indexed-based investment to sink in, but sink in it eventually will. Sadly, those who are slow to recognize it won't be capable of implementing the granularity needed for such an environment.

    So, just as in the aftermath of 1987, a generation of Kiwis will be frightened off the sharemarket for life.
    Last edited by GTM 3442; 26-12-2018 at 09:43 PM.

  3. #3
    ShareTrader Legend Beagle's Avatar
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    Big boxing day for retailers. http://www.sharechat.co.nz/article/6...ay-bonanzahtml Good sign or wait for the hangover from the party when January's credit card bills arrive and then see the lie of the land ?
    Last edited by Beagle; 27-12-2018 at 12:55 PM.
    No butts, hold no mutts, (unless they're the furry variety).

  4. #4
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    Last time around, NZ was protected to some extent by China's demand for commodities and consequently by Australia. This time around this risks being a genuine global crisis IMO. China is weakened and is in a partial trade war with the USA. The USA has done quite well climbing out of the GFC and put in place sensible banking reforms. Now though they have a Government in disarray and a President who does not act responsibly and who has re-weakened the financial system and looks like a one-man bear who could exit the circus ring at anytime, leap into the audience and start shredding randomly. The USA and Europe climbed out of the GFC by printing money and providing stimulus through low interest rates. This means that this time around, debt is again very high, there is over-capacity and with global low interest rates we are not in a sensible place to re-stimulate. What we need is a good recession to clear away the over-capacity but politicians hate that so they will push for stimulation if they can - printing more money, pushing up asset prices and stoking overcapacity and further reducing returns on investment. I don't think they can pull this trick twice and I voted #4 in this poll.

  5. #5
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    Will the bear come here? Yes, of course. It's part of the economic cycle/order of things that hasn't been repealed!

    The real question is - When?
    Last edited by macduffy; 28-12-2018 at 09:23 AM.

  6. #6
    The past is practise. Vaygor1's Avatar
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    Quote Originally Posted by macduffy View Post
    Will the bear come here? Yes, of course. It's part of the economic cycle/order of things that hasn't been repealed!

    The real question is - When?
    2 or 3 months ago as far as I can tell.

  7. #7
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    Quote Originally Posted by Vaygor1 View Post
    2 or 3 months ago as far as I can tell.

    ..or about this time last year. A lot of discussion on here then

    Bears just don’t happen ....they grind you down slowly
    “In a roaring bull market, knowledge is superfluous and experience is a handicap.”

    –Benjamin Graham”

  8. #8
    ShareTrader Legend Beagle's Avatar
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    Quote Originally Posted by Vaygor1 View Post
    2 or 3 months ago as far as I can tell.
    Yeap, I reckon most people have felt the bears claws already and have been busy positioning themselves so they avoid its teeth !
    NZX50 ended the year up 4.6%, one of the few markets in the world to be in the green for the year.
    NZ investors in effect were handed a "get out of jail free card" in 2018...what they do with that in 2019 is up to them.
    Last edited by Beagle; 02-01-2019 at 09:56 AM.
    No butts, hold no mutts, (unless they're the furry variety).

  9. #9
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    Yep I agree, the Bear is here. Howeva, my theory is that NZ is better placed than many economies to weather the Bear.
    Last edited by Left field; 02-01-2019 at 10:06 AM.

  10. #10
    ShareTrader Legend Beagle's Avatar
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    I agree. We have one of the highest dividend yields in the world and tourism and agriculture are our two biggest export earners are still very much in vogue, (people have to eat and experiences rather than things are very much on trend). I like your analogy of riding the bear... Pick stocks that will perform regardless of economic conditions and be positioned to bag some real bargains later this year if the ride gets really bumpy.

    2019 and 2020 could see very modest returns from the NZX. Sustainable dividend yield is my focus. Cash doesn't look too bad as an asset class either.
    Last edited by Beagle; 02-01-2019 at 10:08 AM.
    No butts, hold no mutts, (unless they're the furry variety).

  11. #11
    An Awesome Cool Cat winner69's Avatar
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    Quote Originally Posted by Beagle View Post

    NZX50 ended the year up 4.6%, one of the few markets in the world to be in the green for the year.
    NZ investors in effect were handed a "get out of jail free card" in 2018...what they do with that in 2019 is up to them.
    Just as well it’s a gross index with dividends (reinvested as well) counted

    NZX50Capital up 1% last year but 8% off its August highs
    “In a roaring bull market, knowledge is superfluous and experience is a handicap.”

    –Benjamin Graham”

  12. #12
    percy
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    Some headlines.
    ANZ expect cash rate to fall.
    NZ's unemployment rate declined to 3.9% in the third quarter of 2018.
    Christmas retail bonanza .
    Maybe this Bear is Cookie Bear?

  13. #13
    Trying to get outta here
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    Quote Originally Posted by percy View Post
    Some headlines.
    ANZ expect cash rate to fall.
    NZ's unemployment rate declined to 3.9% in the third quarter of 2018.
    Christmas retail bonanza .
    Maybe this Bear is Cookie Bear?
    I Love all kinds of Bears including Cookie Bear of course.PS-Every man should own at least one Bear.

  14. #14
    An Awesome Cool Cat winner69's Avatar
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    Quote Originally Posted by percy View Post
    Some headlines.
    ANZ expect cash rate to fall.
    NZ's unemployment rate declined to 3.9% in the third quarter of 2018.
    Christmas retail bonanza .
    Maybe this Bear is Cookie Bear?
    Slowing economic growth and a very low unemployment generally leads to a bust ....but thats a big problem for 2020

    At 3.9% the unemployment rate is well below 4.6% RB economists estimate to be consistent with low inflation

    RBNZ leading us to not so good times .....and ANZ have ulterior motives for ‘forecasting’ lower interest rates
    “In a roaring bull market, knowledge is superfluous and experience is a handicap.”

    –Benjamin Graham”

  15. #15
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    I agree . It is a stock pickers market.Have been hit with HGH but donot sell . Will buy at the bottom. have a lot

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