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Offline M500

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A little birdie told me that MQG has some very significant loans which become due withing the next 12-months that they are struggling to refinance at favorable rates... outlook may not be that good for MQG?

As far as property is concerned, I am of the belief that commercial yeilds north of 10% will become more readily available. Luxury residential will take a hit, as will lower "mortgage belt" stock, however mid-range residential will stay in reasonable demand.

Just my 2c worth

Offline AshSimmonds

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I am selling one of my US based assets (final price haggling happening right now). Since the negotiations began, I am $400k+ better off simply due to the exchange rate. I am on a high! :D

Ash, more motivation for you? :p

Crazy stuff - right now I'm just glad to see almost first-hand that it's not only possible but do-able - gotta get me some of that pie...

Offline flamestone

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I am $400k+ better off simply due to the exchange rate. I am on a high! :D

Now that's the kind of money you want for doing absolutely nothing extra!

Offline AshSimmonds

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I don't really know what it's on about - I just clicked it because it mentioned Wall St and Gordon Gekko :D


Rudd's dealing are an echo of Gekko

IT will take more than the Reserve Bank¿s 1 per cent rate cut to shore up confidence in the Australian economy.
It will require a shift in the Rudd Labor Government’s thinking.

International markets believe Australia is fundamentally safe - because the Howard Government paid off the underlying public debt - though Prime Minister Kevin Rudd and his economic ministers fail to give John Howard and former treasurer Peter Costello due credit.

They are not reassured by Rudd’s shaky grasp of global economics.

In a revealing address last Friday, he told a Sydney audience that the 1987 Hollywood blockbuster Wall Street held the key to understanding the current global financial crisis.

The climate of investment exemplified by the film’s anti-hero Gordon Gekko, who championed the “greed is good” creed, triggered the 1987 stock market collapse, according to Rudd.

We did not learn the full lessons of the “greed is good” ideology he said.

“Today, we are still cleaning up the mess of the 21st century children of Gordon Gekko.”

“We’ve seen the triumph of greed over integrity, the triumph of speculation over value creation; the triumph of the short-term over long-term, sustainable growth,” he said.

But it isn’t that simple, and Rudd should know that.

The subprime mortgage market the collapse of which triggered the current financial meltdown was not a creature of Wall Street, it was a creation of the US Congress, and of Democrat congressmen in particular.

Democrats are the closest things that Americans have to Labor supporters.

Subprime mortgage loans, loans to those who would normally have had their applications rejected because they lacked credit records or the means to meet their loan repayments, were created to provide “affordable” housing for those who didn’t otherwise have the means to purchase their own homes.

Tackling housing “affordability” was one of the promises that Rudd Labor used in its successful election campaign last year, along with cheaper petrol, a lower rate of inflation, cheaper groceries and so on.

The Democrats who made it easier for lenders to give loans to those who had no hope of meeting their payments did so in the name of assisting the causes of equity and diversity - code for giving money to those who cannot afford them, the indigent, largely immigrant, minorities.

Democrats, and Labor apparatchiks squeal ecstatically when they are told they are meeting equity and diversity targets, no matter what the cost and in this case the impost was trillions too much.

Blaming the bonuses paid to Wall Street brokers and bankers for the economic collapse as Rudd did is facile.

It was not, as Rudd claims, “extreme capitalism” that brought the global market place to a halt, it was half-baked notions of social engineering of the sort that Rudd and his Government champion.

If Rudd wishes to examine greed, he could look to his own family’s record.

There is the Brisbane family home he purchased in late 1994 at a reduced price from two business figures who were coincidentally directors of a key Labor Party company which controlled party assets and fundraising.

Rudd and wife, businesswoman Therese Rein, paid just $384,000 for the property seven months after it had been purchased by a Labor company, Texberg, for $500,000.

Property prices in Norman Park were growing when the Rudd’s found a property that was selling about 25 per cent below value.

According to a report in The Australian newspaper: “Property sources say that such a significant loss at that time was inexplicable unless the vendors were inexperienced or had paid far too much in the first place. (Vendors) Larry Moses and Nick Kassos, the two former Texberg directors, were experienced investors in businesses and real estate.”

The report said that the $116,000 loss incurred by Moses and Kassos came as the Rudd’s made a windfall profit by selling another property in the area after owning it briefly.

Rudd was then the most senior public servant in Queensland, as Director-General of the Cabinet Office in the state Labor Government of then premier Wayne Goss.

A Liberal Party investigation of Rudd’s finances last year also revealed that he belatedly paid stamp duty on an investment property that he had bought for $240,000 in June 1994 and sold for $287,000 in December 1994.

Last year, it was inconveniently revealed that one of Rein’s companies had underpaid staff on common-law contracts for nearly six months.

Tt was also inconveniently revealed that her company, WorkDirections Australia, dumped some 350-to-400 employees after an independent audit found the firm was not providing services of the desired quality WorkDirections was contracted to assist some of the most disadvantaged Australians find jobs.

The negative evaluation was a damning indictment of its practices but let no one say the huge profits enjoyed by the Rudds were due in any way to “extreme capitalism”.

Offline leburpor

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Offline AshSimmonds

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Ferrari go as high-flyers feel crunch

Luxury car dealer Normal Elkordi has never seen it this bad - financial high-flyers feeling the pinch of the global economic meltdown scrambling to sell their Ferraris for a loss.

"We're not talking Holdens or Fords here, we're talking Aston Martins, we're talking Ferraris," he said. "I've never seen it like this before."

As anxiety grips world financial markets and stock prices crash, the Sydney-based dealer is seeing increasing numbers of young executives come into his showroom, hoping to offload their near-new prestige autos.

"These blokes have probably lost a lot of money in shares, their bonuses come on shares. Their expenses are through the roof," Elkordi said.

"A lot of them are upfront. I'm not saying they can't make the repayments and they are going to get repossessed, it's just they have to get rid of that debt."

Indications are that the mood will also infect Asia, a significant market for luxury cars, as the full impact of the financial turmoil stemming from the United States is felt.

"I would say it (the crisis) has not reached Asia... as it has reached America or Europe, but it will," a figure in the regional luxury car industry, who asked not to be named, said in Singapore.

"The question is: will it be as big here?"

Luxury makes have been targeting Chinese customers both in Hong Kong and mainland China over the past few years with spectacular results, but there are signs the crisis is beginning to bite.

Hong Kong has more Rolls-Royce cars per capita than anywhere else in the world, but the super-rich have stayed away in the past few weeks, a period which is normally busy for the famous marque.

"Our customers aren't so much directly affected by the economic downturn but they are putting on hold luxury items like seven million Hong Kong dollar ($A1.32 million) cars," Leon Roy, the general manager of Rolls-Royce Motor Cars Hong Kong, told the South China Morning Post.

However, a spokesman for Ferrari in the Asia-Pacific region said they expected sales growth to remain strong in China.

"As our president said at the launch of the California model recently, ours is a niche brand and if you are the type of person who can afford to wait 10-15 months for a car, you can still afford it," the spokesman said.

He said they expected some of the long waiting lists for the cars to be trimmed during the crisis, but do not see sales dipping.

Audi Singapore managing director Reinhold Carl, however, told the Straits Times: "2009 will be a tough year for the car industry and the speed of growth for Audi in Singapore will be affected somewhat."

William Choo, commercial director for Lexus at Borneo Motors in Singapore, was quoted as saying buyers might switch to smaller, cheaper models next year.

But Simon Rock, managing director of BMW agent Performance Motors, said: "We expect to sell more cars on the whole next year."

Sydney's Elkordi said cars are more easily dispensed with than other items and sellers are willing to give them up despite the likelihood of loss.

In the last month he has taken on six or seven cars from sellers in this situation and turned away three or four more, he said.

"You can imagine a gentleman has bought a new Ferrari at $A507,000. If he was to sell that car to me today, I would be paying probably $A370,000 to $A380,000 for that car if it's 12 months old, only because... who am I going to sell them to? That's the problem.

"That's why at the moment, I've got over five million dollars sitting on the floor and we're not selling any cars of our own."

The dealer, who has worked the market for 17 years, said the credit crunch had crippled the luxury sector - from property to cars and boats - and he was now catering to more people buying cars for $A150,000 rather than the $A250,000 of a year ago.

Sydney's principal Ferrari and Maserati dealer Tony Graziani agreed it was now a "buyer's market" for prestige autos but said he had received no cancelled orders for his luxury Italian motors.

Speaking from a showroom floor filled with gleaming cars, Graziani said the mood of the times was uncertainty and some buyers admitted the situation was very different from two years ago.

"We're not happy, we would like it not to happen," he said of the deepening global financial crisis. "But overall we're not too bad."

Andrew McKellar, head of Australia's Federal Chamber of Automotive Industries, said a sense of caution was pervading the industry after a record 2007 in which one million new vehicles were sold Down Under for the first time.

"We are certainly no exception to other sectors in the economy," he said. "If asset prices suffer, if growth in the economy slows, if there are concerns about employment then clearly that will have an impact in the market place."

As the Australian International Motor Show opened in Sydney this month without high-end brands Audi, BMW and Mercedes Benz, Elkordi said he didn't expect the market to improve anytime soon.

"I've been told it's going to be worse. Everyone that you're talking to, no one is positive, there's only negative," he said.


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Offline mondi

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Hmmmm, wondering if this will last.  :?

There has been a massive rebound on Wall Street, with the Dow Jones Industrial Average posting a record one-day points gain after governments around the world unveiled bank rescue packages.

Investors enthusiastically embraced a US Government plan to buy ownership stakes in struggling American banks, with the Dow Jones index closing up 936 points higher, or more than 11 per cent.

The surge was the single biggest point gain on the New York Stock Exchange and erased more than two thirds of the losses suffered last week.

Investors are now hoping the comeback can be sustained as the various financial rescue measures take effect.

In Europe, markets surged up to 11 per cent after Eurozone countries announced details of their huge bank rescue plan.

Germany committed $1 trillion and France $700 billion to the bank rescue package.

That boosted confidence in the markets, with the German DAX surging 11 per cent to 5,034. Markets in France showed simliar gains.

The London stock market closed higher after the British Government sealed a deal with three of the country's biggest banks.

Taxpayers will spend $95 billion buying a 60 per cent stake in the Royal Bank of Scotland and a 40 per cent share in HBOS.

The news lifted UK shares, with the main FTSE 100 index closing up 8.3 per cent.

But shares in the three banks ended down heavily, with HBOS losing 28 per cent.

In futures trade locally the Share Price Index 200 has increased by 6.6 per cent, or 280 points, to 4,474.

The Australian dollar is higher against the US currency, buying around 69.4 US cents.

In Washington President Bush said the European moves would complement the five-point plan drawn up by the G7 group of the world's leading economies.

"We welcome the bold and specific follow up actions by European nations to pursue the G7 action plan," he said.

"And the United States is also acting, and we will continue to implement measures consistent with the G7 action plan to help banks gain access to capital, to strengthen the financial system, and to unfreeze credit markets and restore confidence in our financial system. "

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