Down Under report.
Well, I've been away from the board for quite a few months now. I think the market must have been affecting my psyche so I have been playing a lot more guitar and doing a music reading course recently.
I've still been AIMing stocks but at the moment it is a thankless task.
The strange thing is that although all these problems emanated from Wall Street it seems that Australia has been whacked quite severely in the financial area.
We still have near record employment levels but this is starting to change, the company I work for made 10% of the workforce redundant and I have heard similar tales from others.
The Australian stock market hit a high point of 6873 back on 1st Nov 2007, it is now sitting at 3483 which is close to a fall of 50% which makes this 12 months worse than the 1987 crash probably worse than 1974.
My AIM cash was depleted at about the 30% fall level so the basic strategy then was to sell off over valued stock and plough this back into undervalued companies using buy SAFE values at about 30%, this has now been upped to 50%.
All buy signals in the speculative end have been stopped except for some green energy related stocks such as the geothermal company Geodynamics who will be generating their first power in about 3 months.
I did actually manage to sell off some gold holdings when the gold price was still high but the A$ began to slide but that is the only AIM sale I have had in about 6 months.
Investment bank Macquarie Group have been beaten up. They traded as high as $98 last year. I purchased a small amount at $67 initially and made a last purchase of $20 earlier in the week.
It came out with a report to crush speculation about it's financial position which is still very strong. I am looking forward to the dividend that now is at 15% tax free!
The mining stocks have been battered by fears of recession and commodity prices falling, BHP and RIO are at half the levels they were a year ago.
I began buying BHP at a point at some 40% below it's peak and am due to buy some more at around $20.
Gee, I would feel sorry for anyone AIMing any of the automobile stocks over there, they look pretty sick.
Funny thing about all this debacle is that it was just over a year ago when I was reading the book Liars Poker about a graduate who began working at Salomon Brothers at the time they invented securitisation of mortgages, little did I know that just after finishing that book the meltdown would begin.
Regards
Neil
