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Fund Managers: The Double Dip Is On!

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http://uk.finance.yahoo.com/news/investors-get-set-for-the-double-dip-recession-ride-tele-7942181121f5.html?x=0

Investors: get set for the double dip recession ride
Paul Farrow, Personal Finance Editor, 8:29, Monday 20 September 2010
Fund managers are buying defensive shares to counter a downturn.
Fund managers are building up defensive positions in their investment portfolios because of fears of a double-dip recession in many economies.
According to the latest Bank of America Merrill Lynch survey, professional investors have returned from their summer breaks in a less than buoyant mood. Many are approaching the fourth quarter with a heightened sense of caution, increasing their cash positions and buying shares that have defensive characteristics.
The survey coincides with pessimistic views from Neil Woodford, one of the most listened-to fund managers in Britain. He said life was going to be very tough and that the chances of the country falling back into recession next year had increased.
FTSE 100 5543.96+0.64%

With the fund managers going bearish it seems that the stock markets are prioving to be immune to any kind of news but it must be getting to the point where there is so much bad news that those with stocks will start to quietly unload in order to miss out on the rush to sell. For now, pessimism from those who actually move the market (the big funds) stocks may have a way to go up yet. For me, I got out months ago.

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although i know f*** all

i would expect the FTSE to do quite well, and any falls would only be into the 4900

becuase most will start buying shares, as they see the housing market to be dead and not worth investing,

so , shares will rise, economy will do better, houses will fall to all time lows, prices back to 2002 levels

:)

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The market peaked at end April and is - slowly - heading all the way down. In a bear market, rallies are short and sharp - as last 2 weeks. Sell today. Go short. You will not regret it.

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Hold everything, the double dip has been CANCELLED--Fund managers will be buying stocks again:

http://www.bloomberg.com/news/2010-09-19/europe-debt-crisis-abating-as-government-traders-see-yield-spreads-narrow.html

Europe Debt Crisis Abates as Traders See Yield Spreads Narrow
By Matthew Brown and Paul Dobson - Sep 20, 2010 12:23 PM GMT+0100
Four months after a European Union- led bailout, Germanys biggest bond dealers say the worst is over for the regions most-indebted nations.
Yields on government bonds of Greece, Spain, Ireland and Portugal will fall to within 2.2 percentage points of benchmark German bunds on average in the next two years from 4.61 percentage points last week, according to a Bloomberg News survey of 15 banks that trade directly with Germanys debt agency. HSBC Holdings Plc, Europes largest bank by market value, Goldman Sachs Group Inc. and Societe Generale SA advise buying securities sold by Greece
_____________

http://www.bloomberg.com/news/2010-09-19/bank-of-england-says-pound-rally-may-reflect-confidence-in-u-k-outlook.html' rel="external nofollow">
Pound Rally May Reflect Confidence in U.K. Outlook, BOE Says
By Jennifer "Jenny" Ryan and Scott Hamilton - Sep 20, 2010 11:31 AM GMT+0100
A rally in the pound in the past three months may reflect improved investor confidence in the outlook for the U.K. public finances, the Bank of England said.
The 5.6 percent increase in the pound’s effective exchange rate may reflect the coalition government’s plan to tackle the record budget deficit as the dollar weakened on “worries” about the U.S. economy, the London-based central bank said in its quarterly bulletin today.

All over, and such little pain.

Edited by Realistbear

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Double dip is confirmed as cancelled (today):

FTSE 100 5594.81+1.57%

Unless the market is reacting to crashing house prices, falling retail sales and job losses? Nothing like bad news to get the punters investing in stocks DESPITE the fund managers cry of "Wolf." I think the fund managers were fibbing so we all sold our stocks and they buy them up cheaper. Well the sheeple have outfoxed the fund managers and are in a buying frenzy.

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Well, Moody's has come out and told us that UK's credit rating is safe and then it's announced that the US has officially exited recession (happened in June, but official exit had to be agreed on by a panel of some sort). Hey, spin is alive and well, no doubt coordinated by the powers that be. :lol:

A good news day - 2 successful pieces of spinning and hey presto!

Hey, I loved that second Bloomberg article - again, little substance but lots of spin as old Merv supports the government's proposed cuts programme at a very awkward moment for old Cleggie. Who'd've thought it :lol:

Edited by gruffydd

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http://uk.finance.yahoo.com/news/investors-get-set-for-the-double-dip-recession-ride-tele-7942181121f5.html?x=0

Investors: get set for the double dip recession ride
Paul Farrow, Personal Finance Editor, 8:29, Monday 20 September 2010
Fund managers are buying defensive shares to counter a downturn.
Fund managers are building up defensive positions in their investment portfolios because of fears of a double-dip recession in many economies.
According to the latest Bank of America Merrill Lynch survey, professional investors have returned from their summer breaks in a less than buoyant mood. Many are approaching the fourth quarter with a heightened sense of caution, increasing their cash positions and buying shares that have defensive characteristics.
The survey coincides with pessimistic views from Neil Woodford, one of the most listened-to fund managers in Britain. He said life was going to be very tough and that the chances of the country falling back into recession next year had increased.
FTSE 100 5543.96+0.64%

With the fund managers going bearish it seems that the stock markets are prioving to be immune to any kind of news but it must be getting to the point where there is so much bad news that those with stocks will start to quietly unload in order to miss out on the rush to sell. For now, pessimism from those who actually move the market (the big funds) stocks may have a way to go up yet. For me, I got out months ago.

so you have missed out on the recent run then......

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Been defensive for some time. Neil Woodford is one of the few managers worth his salt who has been defensive.

Rather than wildly knocking the market without any real justification, why not learn about the historical and emperical cycles?

http://www.gannglobal.com/ppf-nl/2010/09/ppf-u10.html

This market is going up...

If you go light on the US you can build a value portfolio that will yield around 4.5% now. It will be heavy on pharma and oil but a 4.5% yield looks very attractive compared to government bonds.

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Been defensive for some time. Neil Woodford is one of the few managers worth his salt who has been defensive.

Rather than wildly knocking the market without any real justification, why not learn about the historical and emperical cycles?

http://www.gannglobal.com/ppf-nl/2010/09/ppf-u10.html

This market is going up...

Er... do you not realise that the 20s was when they had the massive build up of debt, just like our 2000s. Then they had the 30s...

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Er... do you not realise that the 20s was when they had the massive build up of debt, just like our 2000s. Then they had the 30s...

Part of the reason why the market is rising and will rise. When governments become indebted, equities are one of the few places to protect oneself.

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If you go light on the US you can build a value portfolio that will yield around 4.5% now. It will be heavy on pharma and oil but a 4.5% yield looks very attractive compared to government bonds.

Totally agree. I am not a big fan of the US market. P/Es higher, yields lower. Probably some value in the likes of IBM, Microsoft, Phizer, J&J etc. grantham reckons these will be the place to be the next decade.

Think better value in UK defensives. Also don't want to go long the dollar.

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Someone posted in the Telegraph comments today that "I am sure central banks are fixing stock markets. They are supporting the ftse at 5000 and the Dow at 10000". I am inclined to agree.

Also, the big players want to be in the market on the day QE2 is announced... for obvious reasons. ;)

Edited by Constable

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it takes two sides to make a market,I'm with Kyle Bass,Harry Dent,KD,Bob Precther etc etc

http://www.zerohedge.com/article/must-watch-kyle-bass-interview-there-no-way-i-can-be-long-stocks

I'm with the Marc Faber school of thought; that when you have currency devaluations, huge debt, inflation then equities usually hold up well in real terms.

Occcassionally stocks fall below the rate of inflation but over the longer term they hold their own particularly against worthless IOUs.

http://www.arabianmoney.net/gold-silver/2010/08/08/marc-faber-lectures-abu-dhabi-on-asset-allocation/

He drew an interesting parallel with the fate of the Mexican Peso in the 1980s and how the value of that currency was destroyed, while equities priced in Pesos at least held their value in real terms because they represented real assets. Bond and cash holders in Mexico lost almost everything.

Therefore he advises long-term investors – and he is still talking well within his own lifetime and he is 63 years old – to buy gold and equities, and particularly gold and resource stocks, although the timing to do so may not be exactly right now, and to do so on a globally diversified basis.

Edited by ringledman

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think it really depends whther you're inflationista or deflationista.if I were the foremr,I'd side with you.for now I'm the latter.

I think its worth being diversified as no one really knows. Faber's recent note says he is heavily in bonds and cash.

These will be Asian governments and corporate. Certainly not Western.

Defensive High yielding Western stocks (as cheaper than EM) / precious metals / Asian currencies / Asian bonds. That is the asset mix IMO for safety.

The perceived 'safety' of the dollar and Western Government bonds/cash will wear off with time. Eventually these will be the risky trade.

Edited by ringledman

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Totally agree. I am not a big fan of the US market. P/Es higher, yields lower. Probably some value in the likes of IBM, Microsoft, Phizer, J&J etc. grantham reckons these will be the place to be the next decade.

Fascinating, would like to understand the reasoning. Do you have a link?

I'm puzzled as to how such mature companies, suffocating under the weight of their bureaucracy, will generate growth superior to companies in emerging markets.

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Fascinating, would like to understand the reasoning. Do you have a link?

I'm puzzled as to how such mature companies, suffocating under the weight of their bureaucracy, will generate growth superior to companies in emerging markets.

They don't have to generate as much growth because they are priced more cheaply than at any time since the 1980s. Those companies that ringledman listed have PEs around 10 to 12.

On the other hand you would have to believe that Apple, Google and especially Netflix are going to grow at impressive rates for many years to come to justify their price.

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Fascinating, would like to understand the reasoning. Do you have a link?

I'm puzzled as to how such mature companies, suffocating under the weight of their bureaucracy, will generate growth superior to companies in emerging markets.

I am a huge fan of emerging markets but the problem is that they are generally more expensive to buy than the Western large caps at present (Russia being the exception).

The starting point interms of valuation affects returns as much as growth potential. Some commentators think that the worse the economic growth the better the return for the stock market.

Academic studies have shown there is no positive correlation between GDP growth and stock market returns – if anything the correlation is slightly negative

http://www.ft.com/cms/s/0/09d46286-fec3-11de-91d7-00144feab49a.html

Large caps cheapest since 1951 -

http://www.tradersnarrative.com/large-caps-cheapest-since-1951-4471.html

http://www.ft.com/cms/s/0/40d69234-b518-11df-9af8-00144feabdc0.html

Grantham's well worth reading views-

http://www.marketfolly.com/2010/08/jeremy-grantham-favors-high-quality-us.html

Emerging markets are great as long as you don't overpay for them. Can't see too much value at present. Much more value in the UK and Japanese markets IMO.

Edited by ringledman

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  • 146 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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