Archive through April 03, 2008

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mrlunch

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Post Number: 305
Registered: 09-2006

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Wednesday, April 02, 2008 - 10:42 am:

Dug - is there a link to a specific article listing the affected companies?

There could well be opportunities created by it all

And does this mean a whole lot of CEOs just got a whole lot poorer? I'm seeing some that appear to have the vast bulk of their wealth in their own company - now belonging to someone else... that's gotta hurt

I wonder how that will affect morale

dug

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Post Number: 3022
Registered: 07-2005

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Wednesday, April 02, 2008 - 11:07 am:

mr lunch,
go to the business page of the herald sun and there's a specific link to the list.Opes Prime story about 3 down.
sorry,i can't cut'n'paste.
From watching DYE I've got an impression that d'Dump has been going on for weeks not days.there was real strange trading in options going on.see dye thread in long term.

i'm trying to get info on what d'blazes is happening but,of course,the newspapers are mostly concerned with Blue Chips and don't have or give a clue about micros and ramifications.

so i don't think trading opportunities are arising in the named shares.
if ANZ and Merrill get Court cases going against them and it's found that there was month+ prior knowledge?well,it'll be murky.
bleeding Tricom is ANZ as well and there's cross holdings with Opes and ANZ is doing off market transfers to WHO?
so one little pilgrim like u&i,mr lunch haven't got an In to any Action maybe yet.

ya have to ponder that if Founding Directors of Companies are being Sold Out of their Substantial Holdings?well do you want to buy into such a scenario?Isn't it just a variation on a Falling Knife Grab?

but as I say.I haven't got d'Gist or a Handle on What's Happening re all of this so I'm sidelined but still Holding.

cheers.
ps CNM is not on the list and oh only MAKO not MAK figures.

pps-the list does NOT give Number of Shares Involved..yet.

Even 'til Jaded.

Dig for the sake of it.

moldy

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Post Number: 59
Registered: 11-2004

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Wednesday, April 02, 2008 - 11:27 am:

http://www.news.com.au/heraldsun/story/0,21985,23468119-664,00.html

Try This

Moldy

cat_lady

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Post Number: 435
Registered: 10-2006

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Wednesday, April 02, 2008 - 12:25 pm:

Dug
I can't get my head around all the opes affair - but it's got more going for it then your average Dallas episode.

On TOX

it was in a real death spiral over the last couple a months, but I couldn't resist buying some more after Pengana announced it had taken up another chunk. Now I'm not sure about capping and funds driving down prices to get in lower, but if TOX is any indication one could be suspicious. It's gone from about $1.50 to just on $2.00 since the announcement. Not complaining of course but it makes one wonder.

cat lady

Without my morning coffee I might as well be a dog

cat_lady

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Post Number: 436
Registered: 10-2006

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Wednesday, April 02, 2008 - 12:32 pm:

Business Spectator have compiled a nice list on
Opes

http://www.businessspectator.com.au/bs.nsf/Article/More-firms-reveal-Opes-Prime- exposure-D9UCX?OpenDocument

one of our clients told us today that a friend of his - 50 years old, has lost family home, entire investment portfolio, beach house, 3 investment properties as a result of Opes. Was going to retire next month, and travel the world. some pretty sad stories out there.

cat lady

Without my morning coffee I might as well be a dog

ody

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Post Number: 2277
Registered: 10-2006

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Wednesday, April 02, 2008 - 12:35 pm:

MARKET CHANGING?

Eugenio, I didn't say that the market would not go UP: only that the level of participation (total amount of money active in the market) is far removed from what it should be. I shall admit, however, that today the market looks good, which would be due to (a) US investors having decided that happy times are here again, and (b) our interest rates not only staying stable, but the RB sounding less than hawkish. (For participation to be really strong we need, at the end of the day, a figure more than double of where it is just now, but that may well be reached, of course.)

At the same time, I see the position essentially as follows:
--------------------------------------------------------
Although the two-year-old US housing downtown is showing scant signs of stabilising and many economists believe the economy has fallen into a recession, some investors are hopeful that the worst may soon be over particularly as the Federal Reserve has slashed three percentage points off interest rates in recent months.
----------------------------------------------------------

In other words, I think there IS - definitely - a change in sentiment, but it is far more doubtful that there is any fundamental change. Without a fundamental change, the change in sentiment cannot, by itself, continue to push the market up. It was over-confident sentiment that drove up the market at the end of last year, but inevitably reality caught up with it, and thus the bear market followed.

It is very common for rallies to occur during bear markets: there was a HUGE one during the 1987-91 period, of much the same motivation as what we are seeing just now. So it is certainly a very real possibility that a significant rise will occur, and if you move in and out fast enough you'd do just fine. However, on that occasion many people overstayed, because they confused a bear rally with a bull market. Losses incurred were often colossal, with many going virtually, or totally, bankrupt.

At all events, we are skating on thin ice. All that we know of by way of "improvement" is that in the US the Fed and others have thrown a lot of money at a real problem, which by itself has not been solved. What IS possible, of course, is that money will start to flow more freely again: no doubt the Fed's purpose. But that does not mean that we'd have any new discipline, that debt has suddenly disappeared, etc.

For a safer basis for investment it would be well worthwhile to keep watching the fundamentals. For example: the decline in housing prices in the US, the number of workers hired, consumer confidence, consumer spending, companies having to announce they are in trouble, etc. Similar fundamentals should also be watched here, and several of them show an economy clearly weakening, while the national debt is increasing.

In a post above I think Hilarius was clearly right in what he mentioned as problems for the Australian economy: over-reliance on resources and housing, too little productivity (especially too little diversification and planning), over-spending, etc. There is definitely a good deal that is precarious. Debt is a VERY serious problem in Australia just now, and many of the facts about it - and people's inability to handle it - are only just emerging. In that respect we are simply behind the US in time, but will see many similar revelations. Not only about companies, but also about large numbers of people not being able to hold on to their houses etc.

So, Eugenio: you may certainly be able to make money out of this rally, and I do not imply it will not occur (it IS doing so) or not be significant. But I do think that, from a slightly longer-term perspective, it is premature if people feel that the worst economic/financial problems are behind us - EXCEPT that money may flow more freely, which is just what we need to set us up for the next asset bubble, as Greenspan so brilliantly demonstrated when in 2003-4 he cut interest rates too far, thus creating the opportunity so eagerly seized on by the Wall Street buccaneers.

ody

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Post Number: 2278
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Wednesday, April 02, 2008 - 12:41 pm:

SOMETHING TO BE WATCHED

http://au.finance.yahoo.com/advances

This is the market here as it is moving just now. Obviously a good many shares are up, and up volume is stronger than down volume. Even so, very few stocks are reaching a new high, and many a lower low (a bear market phenomenon). The total volume figure at the bottom needs to start with a "2", at the end of trading, for it to be comparable with strong days in a bull market.

In general, the money flow is one of the most important figures to watch to size up the REAL strength of the rally.

At the same time, the graph of the AXS in recent days does, of course, show a market rallying.

ody

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Post Number: 2279
Registered: 10-2006

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Wednesday, April 02, 2008 - 12:57 pm:

CAT LADY: OPES

Sad information about that particular person. And what an interesting list of shares. Moldy's helpful encyclopedic entry shows how many other companies are involved - staggering.

It is likely enough, if I compare 1987, that this will not be the only scandal of this type. At that time we had Bond Corporation, Industrial Equity, Adelaide Steamship, etc. - all paper shufflers, and frequently dishonest to boot. The NUMBER of companies that were actually NOT companies in any real sense was staggering, and I think several of this kind are probably still to emerge on this occasion. They will not all be listed companies, either.

The property trusts at that time were also something unbelievable, like Austrust, which ended up worth zilch, as it had plenty of gearing but no real substance. As a company like that looked "safe" (property! - so it must be!), vast amounts of money were lost by people who thought they were investing.

If property comes to pose any REAL trouble this time, watch out: usually that makes matters far worse, and would only mean further trouble for the share market as well. At the moment there is an unbelievably large number of people who think of themselves as millionaires because of the money they have borrowed to buy houses: I think that whole scene is a potential time-bomb.

dug

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Post Number: 3023
Registered: 07-2005

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Wednesday, April 02, 2008 - 01:13 pm:

yes cat_lady it's a really complex plot.I'm really not the one to try and unravel it so if you find some article on it to clarify,it'd be much appreciated but to me it's like this-
Director with a 20% Holding in a Micro puts up the stake as collateral for a 30% Value Loan.[ie he/she has 20mil# shares trading at $1 so gets a $6mil Loan]
However Opes ceases trading and the Bank that Lent against the 20mil shares Gets/GRABS the Lot.
There doesn't seem to be any asking of the client/director if the $6mil can be repaid,refinanced whatever No it's just the Bank snaffling the Lot [ie 20mil shares].

Oh the plot thickens,cat lady when you find out that the Opes MD,Enimis whatever is ex-ANZ dealer with a personal relationship with Current ANZ dealers who are currently "stood down".Our mate ctindale,cat lady is all over this at Warm Pig General

but still there's all these side issues I think most Importantly around who WHO gets the off market cut price Transfers.
Like is Solly Lew lined up for the JUST chop?

Look up PLV's announcement to the Market where the chop got given to long term existing holding institutions and such.
There's going to come out of all this at least an indication of the canny/saviness of Micro Company Management.How much these have the shareholders interests at heart compared to just sitting round playing Big Boys with our money!!

anyhow,wouldn't be dead for Quids while such a plot unfolds.
cheers.

Even 'til Jaded.

Dig for the sake of it.

eblode

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Post Number: 727
Registered: 11-2002

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Wednesday, April 02, 2008 - 01:52 pm:

Ody,
The fact that Lehman Bros had a $3bn capital raising that was extended to $4bn because of oversubscriptions suggest that we are nearer the bottom of sentiment in financial's that we thought. Why else would institutions be prepared to spend solid cash on these stocks at these prices...unless they thought it was the bottom.

Eugenio

sway

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Post Number: 199
Registered: 12-2005

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Wednesday, April 02, 2008 - 01:55 pm:

hilarius wrote on Wednesday, April 02, 2008 - 09:52 am:
I invited people several times to contribute their own numerical forecasts but no one did, apart from ....

I've been having a go at estimating the Dow in this thread http://forum.incrediblecharts.com/messages/6/1405685.html#POST133888

This analysis is specific to the Dow, but the XAO tracks the Dow +/-10% over the short-medium term anyway, so the comparison is still reasonably valid. In any case, my "forecast" at the end of January was for almost no change by end of June.

Sway

ody

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Post Number: 2280
Registered: 10-2006

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Wednesday, April 02, 2008 - 02:56 pm:

EUGENIO: SENTIMENT

Hi Eugenio,

The key word in your post is SENTIMENT. That there has been a change in that is undeniable, from the figures. But that is not to say that that sentiment derives from anything truly substantial, or cannot be changed, or that those who want to base their judgement on something substantial should act simply because others are doing so. For myself, I think that this change in sentiment is based on sheer ignorance. We saw that with Bear Stearns, where values were held to fluctuate wildly, and we see it again with Lehman. People don't KNOW how much real money is there or will be there, so that they are just having wild shots at it. As time passes, more people come to assume at some point that "this must be the bottom". The judgement is not based on any real knowledge of the company, but on pure conjecture - or, even more accurately, pure "sentiment", your own word. It is sentiment because they WANT it to be the bottom and therefore persuade themselves that it is.

In truth, most of these financials are incapable of being rated, because we don't know enough of what happens within them, or what financial reality lies behind the paper that they hold. When a number of people start investing in them others think "there must be something in it", and just follow suit.

(Message edited by ody on April 02, 2008)

ody

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Post Number: 2281
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Wednesday, April 02, 2008 - 03:07 pm:

SOME MORE OPES NEWS

This is reasonably clear, and certainly interesting (from today's The Australian):

http://www.theaustralian.news.com.au/story/0,24897,23469315-643,00.html

rdumas

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Registered: 11-2006

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