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Justice

Shares Decline

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Looks like a lot of people are doing some “Profit Taking” as share decline and across the world in India the SE was closed after it dropped 10% with some people doing a little “Profit Giving” and apparently a few Indian brokers are now on the suicide watch list.

But this is not good for us HPC believers because lower commodity prices will lead to lower inflation and that helps keep interest rates low and also, some of the cash may find it’s way back into property market which will help slow the decline in house prices, money always needs a home and few would want to keep it in US PertoDollars

“The EU is Russia's main trading partner. More than two thirds of Russia's oil and gas is exported to the EU. That makes Russia a strong candidate to become the first major oil exporter to start trading in euros. Such a scenario, in recent years, has become theoretically possible. But now, with these latest comments, Kudrin has thrust that possibility into the open.”

Whilst commodities and oil prices was going up we were told that inflation was at two percent :) if you believe that rubbish but this helps as Gordon Stupid Brown would not dare try to make us swallow that inflation goes negative as the commodities market continues to collapse.

The world is chanhing fast !

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Last time the stock market crashed, property prices were low. They aren't now.

So even more reason to hitch your cart to the property bandwagon. Look at any market. The masses are attracted by HIGH prices NOT LOW. Your argument is just that. I can formulate an equally forceful counter argument as I did yesterday and Justice has above. What you seek is a change in sentiment in PROPERTY not shares. Don't conflate and confuse the two.

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So even more reason to hitch your cart to the property bandwagon. Look at any market. The masses are attracted by HIGH prices NOT LOW. Your argument is just that. I can formulate an equally forceful counter argument as I did yesterday and Justice has above. What you seek is a change in sentiment in PROPERTY not shares. Don't conflate and confuse the two.

"The masses are attracted by HIGH prices NOT LOW"

No. I don't believe the masses are attracted by high prices, which is why this very web site exists. Hardly attracted to high priced property are we?

I believe the SMART money is attracted by low prices + opportunity, and then everyone else gradually notices where the smart money went as the prices go up. Property has just done this. Stocks have just done this. So we're all out of juice.

Cue Dr Bubb popping up ...

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Some investors will likely short the stock market when its falling.

Money can still be made from a crashing stock market!

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"The masses are attracted by HIGH prices NOT LOW"

No. I don't believe the masses are attracted by high prices, which is why this very web site exists. Hardly attracted to high priced property are we?

I believe the SMART money is attracted by low prices + opportunity, and then everyone else gradually notices where the smart money went as the prices go up. Property has just done this. Stocks have just done this. So we're all out of juice.

Cue Dr Bubb popping up ...

Wrong. Fund managers are bloody sheep, so how you expect the average punter to be an expert contrarian I don't know. People buy at the peak because they fear they will miss out on future gains and get greedy. They do not buy at the trough because it is unfashionable.

Perhaps the weight of numbers on this site is an indication that we are not in a property bubble... lots of people ready to buy if only the price would fall a bit?

Prices of shares and property are not closely correlated. Part of the appeal of property is that it is not affected by share prices (or not much). It does do badly in recessions though so if these share prices are a harbinger of recession property could be in trouble in a couple of years.

Also, think of a potential STRer or BTLer who is considering selling up. Two weeks ago he had a booming stock market to tempt him to sell... now he's sitting their thinking "I might lose money if I miss selling at the peak, but then again house prices might not fall. And anyway, if I buy shares instead then I'll probably lose money on them anyway".

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From what I read and hear the volatility in the stock markets is being driven by the fear of inflation , higher interest rates and consequently crashing property markets - globally, but especially in the US. The consequences for the world economy will not be pretty. The markets are right to be afraid, if just a little behind the game ( should have monitored HPC). The fall in stock markets indicates a massive fall in confidence in the global economy and a change in sentiment from Bull to Bear , I think this will spill over into the property markets very soon. Todays rally is nowt but a suckers rally - just like we have experienced in the property market.

The UK economy proved itself incapable of coping with rates at a paltry 4.75% due to our massive indebtedness, since then we've accrued even more debt and rates are heading back to 4.75% and probably beyond very soon god help us and goodbye HPI.

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  • 301 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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