Yawn more nonsense about property. Quick go out and buy lots of paper equities cause then your diversified.:lol: When the Euro fails in March/April you can use it to wipe your backside in a diversified pattern. I'll plant some veggies on my properties if and when the financial markets collapse and wait until the red ink settles.That stack of bullion I have been building as a hedge may be the difference. Kind Regards non recourse
Thanks for your post. One of my favorite sayings is that we all have clay feet and as you correctly pointed out I was doom and gloom then. However in July 2008 I was warning anyone who would listen that the ASX would go below 3500 and the consensus was hell would freeze over first. Here is what someone else said about me and my reply; Originally Posted by jingo Nonrecourse, I have been following your posts with interest. You rightly predicted some time ago that the stock market would drop to 3500 - and it has dropped below this. Can I just ask why 30% gearing is ok, and not to even aim for a lower gearing level? Answer from Nonrecourse Because at 30% gearing if you have a 50% reduction of your LVR you still are within the banks solvency comfort zone. When every one else is bailing out of property you still are in the game and ready for the biggest firesale in living memory. The banks will be looking for someone to unload all the excess property at pennies to the dollar. Provided you have sufficient income that you have transfered into gold bullion you can be greedy when every one else is screaming the sky is falling.
This kind of talk starts making me even more paranoid :| My situation is I'm (relatively) young, single and don't own any property. My life savings are in the form of precious metals and cash in the bank. The split is currently 65% precious metals / 35% cash. The cash is spread around four banks in New Zealand and Australia. I've also got $2k cash "under the mattress" in case of a bank holiday. Actually, just typing this response to this thread helps put things back into perspective for me. If the big four aussie banks collapsed then I think the entire global financial system would be in a true SHTF scenario by then. Even a modest percentage of precious metals in your portfolio (10% ?) should compensate for the loss of your fiat as the purchasing power (not necessarily the price) would sky rocket. I've had this nagging thought recently that I should increase my PM/cash ratio even higher (75/25? 80/20?) to protect my wealth from further currency debasement, but I'm just not entirely comfortable with the idea. If there's one thing I've learnt over the past few years it's that the powers that be can kick the can down the road for much longer than probably any of us expected. The current fiat monetary system could collapse in a big steaming heap in just a few weeks or could continue to plod on for years. Who knows?
I have been preparing for the great collapse since 2008. Lately, I have had the feeling that it won't be one huge over night collapse but rather a slow motion drawn out train wreck . In saying this, I would still keep v little money in any bank......... Maybe I am just tired ! :/
As I've always said - in Oz it's much better - and your cash has better protection - if instead of putting money on term deposit you buy preference or even ordinary shares in the bank or a spread of banks concerned - that's a return of around 10% pa fully franked rather than 6% on deposit x
I don't plan on buying any bank shares, but am interested in how you arrive at the 10% figure. CBA last paid a dividend of $1.88 at a share price of $47.48.
your in a good position there id say, if the big 4 collapsed then all those messed up banks in Europe and America would have already collapsed most likely
Pretty sure he's taking into account the franking credits as part of the return. However, if we're considering actual income and not some tax offset it's closer to 6.4% It depends how you look at it. Money saved is money earned? Personally, I go for stocks that pay dividends of 10% or higher, regardless of franking credits. I prefer to counter the capital risk with higher div income.
A practical example: If I have to pay $5000 in tax, and I have $1000 franking credits, the total amount of tax I have to pay is $4000. If I have to pay $0 in tax, and I have $42 franking credits, then I will get paid $42 rather than have to pay it. A company will decide how many franking credits they give out per share. Sometimes, they only give a partial amount of franking credits. Wikipedia explains the mechanics of it nicely:
As discussed in another thread; Fractional Reserves. The banks don't even have 1/4 of your monies. :lol: I would not doubt 100 : 1 'reserve manipulation' (another W&W saying). CEOs before the rest. Nonetheless, the 'protection' is only for a 3 year period which had started on October 12, 2008 and expired on October 12, 2011. This 'protection' is no longer applicable as it was before. After reviewing and whining the Aussie Government extended this 'grace' till they see fit, but have lowered the guarantee to only cover $250,000 (with additional fine print). *Please see quote below Basically, I would like to hear/read from someone whom is well read up on the what the 'fine print' says about how many cents on the dollar will you be getting back et cetera? Some interesting read not really relevant to topic below: I read some interesting poison on Treasury.gov.au again: .
Re: Thread content Thanks for sharing rbaggio Love the replies from all members. So much good stuff in this thread worth while reading properly later tonight. Cheers. .
The point is that if a bank is wound up after it is bankrupt and it's assets liquidated the depositors get paid first. That doesn't mean the bank's assets sales will cover all the depositors deposits. Deposit insurance tries to cover this but brings in the moral hazard component, and is imo, a massive failure. No other business's creditors are backstopped by govt. I don't think CEO's get paid first, though I'm not entirely sure about this.
Sorry, only just seen this. See my answer above. Take necessary precautions certainly, I just don't feel this hysteria helps people. People need to look at it with cool heads and decide what needs to be done rather than panic. They need to look at what's happened elsewhere. Just mho. The thing about $50 per week is why I recommend people have some cash outside the system and of course Gold and Silver. I wouldn't be surprised if access to deposits was restricted. People should have caught on with a name of Pyramid lol.
Westpac slow to pass on rate cuts Michael Evans February 06, 2012 WESTPAC home loan customers are still waiting - some up to four months - for the bank to pass on two pre-Christmas interest rate cuts. The bank says it is ''an opportunity for the customer to get ahead by paying more than they need to''. Customers at Australia's second-biggest bank were told last month new lower repayments would start in March, well after the November 14 and December 19 dates on which the bank says its lower rates became effective. To pay the lower repayment before that date customers had to ring the bank and ask for it. A lag in passing on lower repayments allows the bank to raise money without having to borrow it from financial markets. Most economists expect a further 25 basis point cut when the RBA considers interest rates again tomorrow. Revelations about Westpac dragging its heels on reducing repayments will likely spark fresh calls for banks to pass on rate cuts in full. Despite record profitability, banks are expected to resist passing on future rate cuts in full given their increased cost of funding. The RBA twice cut rates in the lead-up to Christmas in a bid to boost faltering consumer confidence amid concerns over global fallout from the European debt crisis. The big four banks said they would pass on the savings to home loan customers within days or weeks. Some smaller banks promptly introduced the lower repayments. But Westpac's group executive of retail and business banking, Jason Yetton, wrote to customers on January 23, advising them of new repayment amounts, some starting on March 2, citing the RBA rate cut on November 1. ''This follows the recent adjustments in official cash rates by the Reserve Bank of Australia in November and December 2011 and other market conditions,'' Mr Yetton wrote. Src: http://m.smh.com.au/business/westpac-slow-to-pass-on-rate-cuts-20120205-1qzsm.html
