Sunday, June 5, 2011

TV3 60 Minutes Interview with Paul Henry - 5 June 2011

The TV3 60 Minutes Interview with Paul Henry & Melanie Reid - 5 June 2011

Paul Henry @ Political Animal

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c Darren Rickard 2011

Saturday, June 4, 2011

Guest Post: Wall Street Journal's Brett Arends - Why Housing is in a Depression

My interest was in this topic piqued by a story on late night TV last night when a story broadcast by the ABC Network mentioned that in the United States around one quarter of home owners had negative equity in their homes.

This led me to doing a little googling this morning where I found the following story on Marketwatch about the sorry state of housing in the US.

I have to state I had no idea that this many people had negative equity, I thought it was just under 10%.

Shame on me.

Now I know little about real estate but what I do know is that this is a very serious situation, for the US and the rest of the world, in terms of the economic fallout, given the sheer number of people in negative equity.

Remember it is what tipped us up in 2008 in the first place and it will continue to drag on the global economy no matter how much printed money the Fed throws at us.

Read on dear readers:

June 1, 2011, 12:01 a.m. EDT

BOSTON (MarketWatch) — It’s official. The house price collapse is now worse than it was during the Great Depression.

That astonishing piece of information comes from the researchers at the think tank Capital Economics.

It follows Tuesday’s news from Case-Shiller that house prices fell again in March, as the double dip gets worse.

Writes Capital Economics’ senior economist Paul Dales, “On the Case-Shiller measure, prices are now 33% below the 2006 peak and are back at a level last seen in the third quarter of 2002. This means that prices have now fallen by more than the 31% decline endured during the Great Depression.”

Hmmm. Recovery? What recovery?

It’s yet more proof that the nationwide financial bust is far worse than Wall Street is pretending, and it may be getting worse instead of better.

But try telling that to the Dow Jones Industrial Average DJIA -0.74% , high as a kite — in more ways than one — above 12,000. What is Wall Street smoking?

Capital Economics says the latest double-dip in housing should come as no surprise. It’s very much following a pattern seen in the early 30s, when a brief recovery also petered out. The same has also happened in other big housing busts around the world, the think-tank says. It believes prices are going to fall even further before we hit rock bottom, maybe sometime next year.

The double-dip in housing, which has left nearly 30% of homeowners in negative equity, increases the chances that the Fed may resort to Quantitative Easing III — although they will probably call it something else, if only to save their blushes.

In some ways, the collapse in house prices is even deeper than Case-Shiller is telling you.

After all, the official data take no account of inflation. During the Depression we had deflation — so while your home was worth fewer dollars, each dollar was more valuable.

Today we have (modest) inflation. If Fed chairman Ben Bernanke gets his way, we’ll get a lot more. We probably need it. Compared to wages, housing is now back to levels last seen in the late 1990s (see chart).

And the Case-Shiller data masks huge variations in housing markets. Prices have collapsed many suburbs, exurbs, rural areas, and in well-known disaster sites like Miami, Las Vegas and Phoenix. Meanwhile the declines have been much milder in places like Manhattan or Boston. Some high-end real estate is actually selling well. The buyers have money.

Is there a silver lining to this? Well, maybe.

If you can get the financing, housing is now cheap. Really cheap. Capital Economics reckons housing is now 24% undervalued, and is the cheapest it’s been in thirty-five years.

With mortgages rates on the floor, and inflation surely brewing down the road, housing in many parts of the country looks like a good deal. But you’ll have to be patient to see the biggest rewards. Capital Economics says, back in the Depression, it took 19 years for house prices to recover to their previous peaks.

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Friday, June 3, 2011

Share Investor Portfolio: Value @ 3 June 2011

The Share Investor Portfolio was down in the first week of June, the second time in 2 consecutive weeks. The portfolio was down by 1.55% or $4183.34 on the May 27 update . For the first 21 weeks of 2011 the portfolio has increased by 13.46 % or $34324.33 . This weeks drop was due, primarily, to a 12c drop in SKC. There were a number of smaller falls and rises in other stocks but if not for a rally of 8c for WHS the portfolio would have been down over $1000.00 more than it was.

The total of unspent dividends and interest in the bank as at 26 May from the 2010 - 2011 earnings years is $25382.95 at close of reporting season for 2010 and at the end of the 2011 1st half reporting year. There are also approx $55000.00 in tax credits earned from the portfolio since it began in late 2002.

The Share Investor Portfolio has increased in value by 18.25% or $48081.58 since I began tracking it for this blog on October 11 2010.

Share Investor Portfolio as at 17:30:00, Friday 03 June, 2011 (NZT)

Stock

Quantity

Cost price

Total cost

Market price

Market value

Change

AIA

2,000

$1.700

$3,400.00

$2.295

$4,590.00

$1,190.00

35.00%

AIA

2,000

$1.510

$3,020.00

$2.295

$4,590.00

$1,570.00

51.99%

AIA

558

$0.000

$0.00

$2.295

$1,280.61

AIA

754

$2.150

$1,621.10

$2.295

$1,730.43

$109.33

6.74%

ASBPB

3,109

$0.000

$0.00

$0.685

$2,129.67

ASBPB

6,891

$1.000

$6,891.00

$0.685

$4,720.34

$2,170.67

31.50%

BGR

619

$0.000

$0.00

$1.450

$897.55

BGR

2,381

$0.990

$2,357.19

$1.450

$3,452.45

$1,095.26

46.46%

FBU

284

$0.000

$0.00

$8.870

$2,519.08

FBU

830

$9.750

$8,092.50

$8.870

$7,362.10

$730.40

9.03%

FPH

3,000

$2.350

$7,050.00

$2.960

$8,880.00

$1,830.00

25.96%

FPH

1,365

$3.720

$5,077.80

$2.960

$4,040.40

$1,037.40

20.43%

FPH

635

$0.000

$0.00

$2.960

$1,879.60

FRE

2,054

$0.000

$0.00

$3.260

$6,696.04

FRE

6,577

$3.630

$23,874.51

$3.260

$21,441.02

$2,433.49

10.19%

GFF

586

$0.000

$0.00

$1.350

$791.10

GFF

1,414

$2.330

$3,294.62

$1.350

$1,908.90

$1,385.72

42.06%

HLG

299

$0.000

$0.00

$3.720

$1,112.28

HLG

701

$2.530

$1,773.53

$3.720

$2,607.72

$834.19

47.04%

KIP

763

$1.480

$1,129.24

$1.030

$785.89

$343.35

30.41%

KIP

237

$0.000

$0.00

$1.030

$244.11

MFT

1,000

$7.960

$7,960.00

$9.880

$9,880.00

$1,920.00

24.12%

MFT

1,838

$8.000

$14,704.00

$9.880

$18,159.44

$3,455.44

23.50%

MFT

1,375

$4.200

$5,775.00

$9.880

$13,585.00

$7,810.00

135.24%

MFT

787

$0.000

$0.00

$9.880

$7,775.56

MHI

1,646

$0.860

$1,415.56

$0.930

$1,530.78

$115.22

8.14%

MHI

7,000

$0.630

$4,410.00

$0.930

$6,510.00

$2,100.00

47.62%

MHI

494

$1.050

$518.70

$0.930

$459.42

$59.28

11.43%

MHI

860

$0.000

$0.00

$0.930

$799.80

PPG

$0.000

$0.00

$0.260

$8.06

PPG

1,500

$0.440

$660.00

$0.260

$390.00

$270.00

40.91%

PPG

1,004

$0.800

$803.20

$0.260

$261.04

$542.16

67.50%

PPL

1,000

$3.090

$3,090.00

$1.150

$1,150.00

$1,940.00

62.78%

PPL

1,000

$2.870

$2,870.00

$1.150

$1,150.00

$1,720.00

59.93%

PPL

939

$4.200

$3,943.80

$1.150

$1,079.85

$2,863.95

72.62%

PPL

975

$0.000

$0.00

$1.150

$1,121.25

PPL

1,086

$1.530

$1,661.58

$1.150

$1,248.90

$412.68

24.84%

RYM

555

$0.000

$0.00

$2.710

$1,504.05

RYM

4,445

$1.970

$8,756.65

$2.710

$12,045.95

$3,289.30

37.56%

SKC

5,750

$7.430

$42,722.50

$3.580

$20,585.00

$22,137.50

51.82%

SKC

1,000

$7.600

$7,600.00

$3.580

$3,580.00

$4,020.00

52.89%

SKC

2,750

$7.700

$21,175.00

$3.580

$9,845.00

$11,330.00

53.51%

SKC

1,431

$8.750

$12,521.25

$3.580

$5,122.98

$7,398.27

59.09%

SKC

272

$4.720

$1,283.84

$3.580

$973.76

$310.08

24.15%

SKC

25,712

$0.000

$0.00

$3.580

$92,048.96

STU

$0.000

$0.00

$2.700

$210.60

STU

303

$4.740

$1,436.22

$2.700

$818.10

$618.12

43.04%

WHS

4,500

$3.730

$16,785.00

$3.680

$16,560.00

$225.00

1.34%

WHS

6,979

$6.000

$41,874.00

$3.680

$25,682.72

$16,191.28

38.67%

WHS

$3.710

$55.65

$3.680

$55.20

$0.45

0.81%

WHS

3,506

$0.000

$0.00

$3.680

$12,902.08

30.08%

	Total cost	Market value	Change
	$269,603.44	$350,702.78	$81,099.34

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c Share Investor 2011

Share Investor

Sunday, June 5, 2011

TV3 60 Minutes Interview with Paul Henry - 5 June 2011

The TV3 60 Minutes Interview with Paul Henry & Melanie Reid - 5 June 2011

Saturday, June 4, 2011

Guest Post: Wall Street Journal's Brett Arends - Why Housing is in a Depression

Friday, June 3, 2011

Share Investor Portfolio: Value @ 3 June 2011

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