Economics

Share correction insights

Well before the latest Australian share market peak and correction, serious market analysts were predicting a major reversal. So as corrections go this one should not have come as a surprise. It has been widely anticipated and the genuinely smart trading money has been well prepared through strategies like regularly taking profits or setting stop…

Famous forecaster predicts bear market before year end 2009

Before the end of 2009, shares should succumb to the great bear market worldwide, and a major bottom is scheduled for 2014-2016. “I expect it to be very much like 1929-1932, a relentless fall within a deflationary environment,” says Bob Prechter, president of Elliott Wave International. CompareShares readers should remember our story back in October…

5 Experts’ 1-5 year outlook for the Aussie sharemarket

Should you be buying shares on the cheap as the market tumbles, or selling out and stashing your funds in cash? Will this market volatility subside – and the peaceful days of gently advancing share prices return? It hinges on the long-term outlook for the Aussie market and expected returns over the next one to…

Why inflation is bad for your wealth

When the RBA hikes rates due to inflationary pressures, many investors – particularly homeowners – shake their heads in confusion; at the end of the day, what’s really so bad about inflation? On the surface, rising interest rates seem far worse than rising inflation. But inflation is the true enemy of building wealth and investors…

Why do investment cycles occur?

The All Ordinaries Index started its life at 500 on 31 December 1979. Earlier this year the index was over 6000. However, it did not increase over this period in a neat straight line – there were many fluctuations in share prices on the way. It is possible to look at a high point of…

When and where will the rate hikes stop

You can hear it. The economy is slowing. You can hear it as business people sit around cafes comparing notes, tallying up ways their companies can make cut backs: air fares, new stgelopments, expansion plans… even stationery. At home, families are looking at areas to slash household spending: entertainment, petrol, holidays, whitegoods, utilities, groceries… The…

Sub-prime what?

Few would have predicted the tidal wave that hit markets globally last week, sending global indices and currencies – like a scattergun – in unpredictable directions. The eye of the storm was US sub-prime mortgages, an area of the market that, until recently, few investors in Australia even knew existed. Spooked by fear of a…