Dow May Crash to 7,500 If 10,600 Not Breached

Attached Files

Dow May Crash to 7500.doc (98.5 KB)

I have a young friend soon to start his first job. What options does he have after he has saved $2000.00. Where should he go?





Thanks,
Johny.

Hey everyone,I am glad to be part of this forum,I take this moment to introduce myself to the rest of the board members,My name is Wystan..I would love to share information with all you.
Thanks

Hi there,

Question !

Did you take into account the fact that he has been working for the company 11.5 years therefoer his ETP will be added to his assessable income as it is post 1993?

Question 2

For Question 2 did you have to work out future and present value?

did you add her shares and New Car ect in the calc for the future need or did you just use the liquid funds?

Also did you work out their life expectancy as per the Australian life table and got an av of 21 years?

Tiger Club's U.S. Millionaires Pounce on Berkshire's 19% Return
Tiger Club's U.S. Millionaires Pounce on Berkshire's 19% Return - Bloomberg

Hi,

I have two trusts, one a Family Trust and the other a Hybrid Trust(Asset Protection Trust).
They were set up on the advice of an accountant with the purpose of purchasing property about 8 years ago. This cost me approximately $3,500 in accountant and solicitor fees.

The trusts have never been used and have no assets in them.

I am now approaching retirement age and cannot ever see the trusts being used.

My accountant is charging me $100 per annum per trust to lodge a tax return for these trusts (he says this has to be done) i.e. a cost to me of $200 for something which is sitting there doing nothing.

I told him that I did not want this ongoing cost and to "wind up" the trusts.

He now tells me that :
"The cost of lodging CU forms per trust is $99 and the cost to deregister and close the trustee companies with ASIC is $250 per trustee company."

This is a cost to me of $700.

On top of this he now says :

That this only the cost of closing down the trustee company and on top of this there is the requirements for closing the trusts down.

In relation to closing down the trusts, we will need to have the solicitors prepare the necessary deeds to vest the trusts.

The solicitors have advised that providing the trusts have no assets other than the settled sum, the cost of Vesting the trusts will be $1090 (inc GST) each.

So the upshot of this is that this excercise of closing down these 2 trusts is going to cost me $2,880 for something that I have never used. :mad:

HELP - is there anybody out there who can advise a more cost effective method of doing this.

I am in Perth and would be more than happy to move to another accountant who could make this a cheaper excercise.
Or can anybody suggest a more palatable alternative.

Regards,
Cymru

Provide a brief description of the numerical rating system used by underwriters when assessing insurance applications. Identify the factors that are taken into account when determining mortality. Provide two examples to illustrate both the process and the evaluation of relevant factors by underwriters.

Hi everyone
I have answered the first two components of the question, but I am uncertain as to how to illustrate both the process and evauation of relevant factors by underwriters. Do I address the underwriting process? Any suggestions would be appreciated.

Thanks

Hi All, I’m a good saver but don’t have a financial education so haven’t invested at all before and am quite naive. I’ve been reading the very informative forums here (thanks everyone!) and am ready to invest, but not quite sure where to start.

I’m 30, stable income $85k, no debts, no assets other than $100k in a USaver account. I can save $1500 per month. My investment goal is simply to maximise wealth over the long term (10 years plus). I need to keep $20k at call for future expenses. So with the rest of the money I’m considering either:

1) investing it all in a portfolio of ETFs or index funds in one hit and keep the $20k at call in the USaver.

2) dollar cost averaging into a portfolio of ETFs or index funds over a period of time and keep the $20k in the USaver.

3) buying a home, then I can keep the $20k at call in an offset account to avoid tax, and invest the balance (if any) in a portfolio of ETFs or index funds.

4) buying an IP, then I can keep the $20k in an offset account to avoid tax, and invest the balance (if any) in a portfolio of ETFs or index funds.

I’m also concerned about what I’ve read here and elsewhere about Aus property bubble, broader economic concerns and risk of double-dip recession etc. Is it better to just ‘stay out of the market’ altogether for now?

Sorry it's long. Would appreciate any advice/opinions/criticism/alternative suggestions etc.

Hi all, first time on chatroom.
Just wondering if anyone has there own smsf and could recommend the company.
I would like to start up my own and invest it in GOLD, as most super fund will not offer this option 100% investment.

Strong returns: Goodbye to all that

"PORTFOLIO POINT:
The days of 20%-plus returns are over. Now investors are facing lower real returns and higher risks.

Australia's CPI for the June quarter is due out on Wednesday and will probably show that inflation is still around 3% – maybe 2.9, perhaps 3.1. Call it 3.

That means unless you're getting a 5% return before tax for your retirement savings, you're going backwards in real terms.

For a while now it has seemed that one of the benefits of living and investing in Australia is that you can get a pretty good return from relatively safe assets, whereas in other countries – especially the US, Europe and Japan – where the yields from safe cash and bonds are, technically speaking, bugger all.

But things have changed. Real returns are lower here and globally, and risks are higher. The golden days of 20%-plus returns for taking a mild, if not one-way, risk and 10% for safety are over; even the Speculator, David Haselhurst, is struggling.

This has very important implications for your investment portfolio. If you absolutely can't afford to lose money over the next few years, then you need to rethink whether you should be in the stockmarket at all, because the risks of loss are definitely higher than usual; if you have a disciplined long-term approach to investing that involves a good well-diversified portfolio, and you don't need cash in a hurry, then you should stick with it.

Either way, you must expect low real returns for safety and rapidly escalating risk as returns increase.

But I'm not saying the extremists are right: that the market is due for the mother of all crashes, or that the ASX/S&P 200 is going to be 5500 by the end of the year, as most local strategists apparently still believe.

There's a "new normal" you need to be aware of.
Now when I hear people talk about the "new normal" I usually think: ‘Yeah, yeah, sure. Things are always new; change is the only normal.’


And then I speak to someone like NAB's head of business banking, Joseph Healy, who I interviewed on Inside Business yesterday, and I think: ‘Hmm, maybe there is something large and lasting going on.’

Healy has exposed the lack of bank lending to small and medium businesses, and the institutional preference for residential mortgages among the banks. Ten years ago it was dollar for dollar between home mortgages and SMEs; now only $60 gets lent to business for every $100 that goes to housing.

This has not been caused by the global financial crisis (although that didn't help), but the new Basel II capital rules for all global banks, which place a much lower risk weighting on real estate than on businesses.

The result is that the return on risk-weighted capital for a home loan is about 40%, and less than half that for a business loan. No wonder banks prefer bricks and mortar: bank capital is precious and in many countries is simply being used to buy risk-free government bonds.
The bank stress test results released in Europe on Friday showed that most banks have enough capital … as long as they don't take any risks with it.

So the credit starvation of business that Joseph Healy identified in Australia is a global phenomenon: there IS a new normal for the funding of businesses. It's equity or nothing, more or less.

One of the main promoters of "new normal" thinking has been the US bond trading house Pimco, which has been promoting the idea of a world in which deleveraging and regulation will lead to low growth for a long time to come.

Basel II has added to the underlying climate of deleveraging and tightened financial regulation coming out of the GFC and is producing a permanent, regulated, change in the way capitalism works.
Nothing is permanent in business, of course, so let's just call it a long time instead.

The reason company shares perform better than fixed interest over the long term is that you get the effect of economic growth and population growth on sales, plus productivity growth from new technology and leverage from gearing the balance sheet with debt.

As long as the company's equity capital is conserved and not wasted, you should get a double "landlord effect". That effect occurs when a rising income stream is applied to a stable capital base over a long period; eventually annual income outgrows original capital outlay and equals great happiness.


The reason the landlord effect can be leveraged through investing in a company is that the company invests in assets that produce an income stream, using part-debt and part-equity, and you invest in the company for a dividend stream.

Leverage is not dead, but it's in a straitjacket of bank caution. At the same time, economic growth is constrained by sovereign debt and central bank impotence. In some countries, including Australia and the UK, the problem is inflation.

Access Economics today predicts that interest rates in Australia are likely to keep rising for at least 18 months, to 6% in 2012, as the RBA fights inflation. In other words it will ensure that growth here does not get too high.

Productivity growth in Australia has been weak or negative for years, and with both political parties promising no further industrial relations reforms, there is no reason to think that is going to change.

Commodity prices look set to go backwards for the next year or so as well. As discussed, debt levels are low, so there is not much leverage.

In short, there is no reason to expect more than moderate growth in profits or share prices over the next few years. On top of that there remain some big risks – not certainties, just risks. But then again, nothing is ever certain".

Hi guys,
I'm new here. I'm newly married and have had some luck with land and now own a block outright and have 40k in the bank. I don't have any debt what so ever.
My wife isn't working at the moment so I am supporting us both.

I'm totally happy with getting this far, but I'll need to turn everything into a house somehow over the next five years.

Any ideas for strategies? I'm not feeling very confident about the real estate market at the moment, and shares are a bit volatile and - I just don't know enough about them yet. So while I'm sitting idle I have put the 40k into a Usaver account.

We're renting at the moment but the rent is VERY cheap (we've been lucky). There really is no rush to buy a house.

Anyway...I'd love to hear some thoughts... What would you do in this situation?

Hope you're all having a nice one!
\
H.

Hey everyone,

One of my friends is a contractor. her employer withheld a certain amount out of her total service fee. the employer said that amount was for GST.

Anyone has an idea as to why the payment was withheld? (I think that's ridiculous as my friend didn't register for GST).

Thanks for your help.

Hi All,

I am about to place an offer on a property in Melbourne which looks good to subdivide and wanted to get some basic costings from ppl who have done this before.

My plan is to buy (price is 402k), subdivide the block into 2 (673 sqm, rectangular in shape, easement along back fence line) and sell the back parcel with a plan & permit (approx 320sqm). Building 3 br unit appears to offer no more margin, especially when you factor in concrete driveway and carports for both dwellings.

This is my first time so I am being cautious with my calculations to make sure I don't end up in the red!!

Calculations:
Plan, permit & surveying: -35k
Miscellaneous costs: -7k
Utilities Connection: -10k
Fence -3k
Hold Costs-12 mths -29,355k
Lost value to front house due to smaller block -20,000k
(+ 12 months capital growth)

TOTAL COSTS: 104,355k

Sell Land Parcel +140k
+ Rent (existing house) +17,680k
TOTAL INCOME: 157,680k

TOTAL PROFIT = $53,325 - Capital Gains

I know my numbers are a bit rich in some areas, can anyone give me an indication regarding what it will cost to subdivide in melb?? 4 houses in the street have put a unit at the back so there should not be too many curve balls in getting approval. I had the initial consultation with council today which confirmed that there are no covenants, restrictions etc.

If I can fine tune my costs I think there may be more $$ in this deal. :cool:

Cheers,

Mike.

RICH PICKINGS: Rainy-day investments

During the GFC, the idea that rich people had a lot of money 'sitting on the sidelines' became very popular with wealth managers – it was partly a good excuse for the fact the sector wasn’t growing, and partly a good way of saying that there would be better times ahead.
However, while many commentators have questioned whether this sideline cash ever really existed, a new report from London-based consulting firm Scorpio Partnerships suggests that the wealth managers and private bankers weren’t telling fibs.
The report, which examines the state of the global wealth management industry, says the world’s HNWIs have $US16.5 trillion invested with private banks and wealth-management firms, which has actually climbed quite nicely from $US14.5 trillion at the end of 2008.
However, Scorpio argues these investors actually have assets worth $US26 trillion, so they are keeping a large amount out of the hands of the wealth management crowd.
“This implies there is approximately $US10 trillion of high-net-worth assets that could be advised by banks,” the firm says. “Capturing these assets is the real answer for industry recovery.”
While we don’t really have an idea of how this awfully large amount of money is actually being deployed – given how smart the rich are, it’s probably not just sitting in bank vaults – the research does suggest that the rich are still taking a very cautious approach to investing, and particularly investing through wealth managers.
Given the recent volatility on global sharemarkets and lingering concerns about the strength of economic recoveries in North America, Europe and Asia, the hoarding of cash is not surprising.
However, not every wealth entrepreneur has gone into their shell and more than a few of the richest people in the world are still busy looking for opportunities.
But there are no boring investment strategies here – racetracks, vaccines, gold mines and cocoa beans are just some of the asset classes attracting these billionaires.

Andrew Forrest
The bruising battle of the resources tax might have taken up a lot of Twiggy Forrest’s time in the last few months, but he has found time to branch out beyond mining. Forrest currently owns just over 45 per cent of Perth-based Allied Medical, and is also a director of the company, which was spun out of Fortescue in 2005.
The company, which has focused on building a distribution business to sell medical devices (such as catheters and pain management devices) to Australian hospitals, has just launched a capital raising seeking $4.4 million to start investing in biotech and life-science companies. About $3 million of the capital will be used to buy a large stake in a Brisbane-based company called Coridon, which focuses on developing DNA therapies and vaccines for the treatment of a variety of diseases, with a particular focus on cancer.
The company is chaired by Gardasil developer and former Australian of the Year Professor Ian Frazer, so Twiggy and his team are at least backing an expert with good form. Could this be the first step in Forrest’s path to becoming a key angel investor in the Australian biotech sector?
Philip Falcone

US Billionaire Philip Falcone is best known as one of the world’s top hedge-fund managers, but among his other privately held interests is a budding wireless network company known as LightSquared.
This week, the company announced its plans to invest $US7 billion over the next eight years to build wireless 4G network infrastructure to compete with incumbent market leaders Sprint Nextel, AT&T and Verizon Wireless.
Falcone’s hedge fund Harbinger has already contributed $US2.9 billion for the venture and wants to develop a nationwide network that will cover at least 260 million people in the next five years. But the estimated cost – a whopping $US10 billion – means the billionaire will need to tap public markets if he wants to pull his plan off.

David and Simon Reuben
Billionaire British brothers David and Simon Reuben are rumoured to be looking at potential investments in Australia’s highly leveraged unlisted property funds, but made headlines at home last week when they spent around $20 million buying 30 million shares in Arena Leisure, which operates seven racecourses around the UK. The brothers increased their stake in their company from 26 per cent to 28 per cent.
The brothers traditionally focus on property, so the investment might look a bit unusual. However, three years ago they bought another racecourse operator, Northern Racing for £90m, so there has been speculation they may launch a takeover for Arena and merge the two businesses.
But it’s also worth remembering that racecourses are basically big patches of land with grass on them. Could today’s racetrack be tomorrow’s property development?

Carlos Slim
Mexican billionaire Carlos Slim, who was earlier this year named the richest person in the world, has a diverse range of interests including telecommunications and media. Last week he emerged as the buyer of a gold mining project in Mexico, which was sold by Canadian company Goldgroup Mining. Slim paid $25 million for the mine.

The Pratt family
Alex Waislitz, the son-in-law of the late Richard Pratt, runs and owns the family’s investment vehicle, Thorney Holdings. The company (and its subsidiary Tiga) trades very actively, and one of its most recent investments was a $5 million punt on listed small cap Coote Industrial. The buy took Thorney’s stake from 5.18 per cent to 8.46 per cent.
Waislitz will be looking for a strong turnaround from Coote, which currently trades at below 20 cents, but has fallen by 45 per cent over the last 12 months.

Anthony Ward
You’ve probably never heard of Anthony Ward, a 50-year-old hedge fund trader from Britain. And he’s not exactly a billionaire, with a fortune estimated by the Britain’s Telegraph newspaper at about £36 million.
But Ward is responsible for one of the biggest bets of the year by buying $US1 billion worth of cocoa beans, or 241,000 tonnes. According to reports, it’s enough to manufacture 5.3 billion quarter-pound chocolate bars.
Ward, made the purchase through his hedge fund Armajaro Holdings, has earned the nickname 'Chocolate Fingers' for his exploits in the cocoa and coffee markets. In 2002 he made £40 million in two months after buying 204,000 tonnes of cocoa when supply from West Africa fell due to poor harvests and political instability.
Ward’s latest trade pushed cocoa prices rose to their highest level since 1977.
James Thomson