MoneyWeek RSS - Comments

Graham

Sat, 20 Mar 2010 08:19:07 GMT

Estate Agents simply haven't reaccepted or recognised the new economic reality, and what that means for credit availability and what that means for house prices (ie house prices will have to match the reality of credit availability and hence fall by at least 30%). The Banks are shouting it out at Estate Agents and the maj of the pop that are now on a Buyers Strike are shouting out at EA's but EA's remain deaf & in fantasy land.

Graham

Sat, 20 Mar 2010 08:13:46 GMT

ChrisL and John you sound like Estate Agents talking. There is plenty of finance/credit available .... but not for the boom time prices that Estate Agents are setting asking prices at (if there was the whole global economy wd go bust again). House prices nedd to/must reflect the amount of credit available - so 30% - 40% reductions are inevitable and the Buyers Strike will cont till then.

Dark Frat Boy

Fri, 19 Mar 2010 22:58:20 GMT

Just read this, so I guess I missed the boat :-)

Actually, none of this is new. The demerger has been the product of a very protracted process, and has been discussed in countless articles (pretty much all saying exactly the same as this one - Paul Hill commented on the stock, Shares discussed it several times, and I guess IC probably churned out the same story for their magazine). I suspect the reality is that analysts and fund managers are simply unimpressed with the growth prospects of the company (either as one entity or as two independent entities).

That said, it may be that the one side of the business will perform as a new stock on the basis of its independent appeal to managers (I'm guessing CWC, on the basis of its cashflow, and the possibility of a debt-financed public-private deal, rather than particular growth prospects), and that managers would simply prefer to cherry pick the better half without being stuck with its ugly brother.

Just a thought.

DFB

John

Fri, 19 Mar 2010 21:55:39 GMT

I agree with Chris regarding the issue of the inability to get finance on top of that you need to consider other influencing factors such as job security, prospects and the state of some of the pension schems not to mention the economy.
To my knowledge there's nothing that can identify a cyclical pattern in the housing market, wish there was, risk free investment!

OPT1

Fri, 19 Mar 2010 20:25:44 GMT

Every time the press writes about something I understand, without fail they get it wrong... ergo is it safe to asume that every time the press writes something they get it wrong?

Discuss......

Jeff

Fri, 19 Mar 2010 19:26:40 GMT

I'm reading the article for the first time at 19:26 on Friday evening. "Last chance "gone.

Mickey

Fri, 19 Mar 2010 17:29:05 GMT

Interest rates have only been 0.5% for the past year. House prices had already doubled before that. We had stupidly high prices even when rates were about average.
Houses are no more affordable now than when rates where 5%. Anyone who is buying a house because the repayments will be low at the moment is in serious trouble. Rates will not stay low. They can go up very rapidly without warning. If inflation gets out of control we could see rates of 15% again like the 90s.
If you are considering purchasing a home you need to consider if you can affor considerably higher rates of at least 6 %.
Low rates only benefit people who already have house and mortgages.

Orlando

Fri, 19 Mar 2010 17:18:43 GMT

at&t, vodafone, telefonica, etc are a mafias that controlled the telecomunications and send the high cost to the consumers

ste

Fri, 19 Mar 2010 16:55:03 GMT

not only was the allenby note valuing afc at £1.37 ... tom bulfords valuation was 50p short term and said it should be 10 times the share price at the time (15p) £1.50 over the course of the next year, and both of these were assuming afc took no further orders..
moneyweek.. check ur facts..

Craig

Fri, 19 Mar 2010 16:37:34 GMT

I feel that the constant references to prices reverting to "3-3.5 times income" are misleading. Surely prices reflect income AND interest rates. So whilst av. salaries have not trebled in the past 15 years, prevailing rates have approximately halved from circa 10% in 1980's to circa 4% in the last ten years (ignoring the farcically low current 0.5%); thus without any salary increase there has been a doubling in affordability in interest payment terms and hence a capacity for a houses doubling in price.
Repayment of capital ? - that's a different story, and we'll worry about that...later !

Max

Fri, 19 Mar 2010 16:37:30 GMT

You can see the broker note here:

http://www.afcenergy.com/wp-content/uploads/AFC-Energy-plc-AFC.L-Allenby-Capital-18-Mar-2010.pdf

JAW

Fri, 19 Mar 2010 16:30:30 GMT

Fuel cells can never be used economically for transport because they are too heavy. Transport noise in cities, as well as pollution, is the factor that causes quality of life degradation. Petrol, diesel, hydrogen etc are based on controlled explosions which is ridiculous as a 21st century method of propulsion. Sanity says it must be an all electric car system. Nuclear fuel unethically asks 200,000 years of unborn future generations to guard the waste at their own cost. Uranium is not long term, it will run out in a century. Wind power is too intermittent, solar power panels last only 20 years and will create mountains of crystal waste. The moon will be with us for millions of years so tidal barrage electricity generation (not wave) is the only solution. The £18 billions spent on the Olympics could have paid for a Severn Estuary barrage creating 18% of UK electricity. Our priorities are wrong.

OPT1

Fri, 19 Mar 2010 16:19:33 GMT

Allenby's target for AFC is actually £1.37. NOT 37p as printed here.

Pete D

Fri, 19 Mar 2010 16:12:03 GMT

Gents is July '09 not enough warning for you?

http://www.moneyweek.com/investment-advice/share-tip-of-the-week-internet-boom-will-benefit-telecoms-giant-44319.aspx

Furthermore Z-Scores are notoriously innacurate in the tech sector, you'd be better off reading tarot cards.

JGH

Fri, 19 Mar 2010 16:09:56 GMT

I agree with the comments of Bob and others.

Depending on how you draw your trend lines either the price broke above the downtrend line yesterday (if you use intraday highs to draw the trend line) or on Tuesday (if you use the days' closing prices to define the trend). To be constructive, perhaps the article could have been published earlier this week with the caveat that the trend line will be broken if the price breaks above 147.5 (or closes above 145).

To underline the point further, my ISA shares account is offering me a number of free trades if I top it up, but not until the day after doing so. If I had known of the need to buy shares by today, I could have added money to my account yesterday. I accept that paying one commission charge does not alter the case for buying the shares, but it would still have been preferable to buy a few extra shares or save the equivalent of 5 weeks of MoneyWeek magazine's cover price.

John

Lerenard

Fri, 19 Mar 2010 16:09:39 GMT

Japanese people are traditionally instintive savers and reluctant borrowers. Japan was at its peak when its economy was geared for exports and the Yen was cheap. The 'Iron Rice Bowl' worked very well socially and economically. Land speculation then started the downward slide together with other 'bad habits' acquired from the West and the US in particular. I have no doubt that Japan will rediscover its true self as depicted by Yukio Mishima and that its resilient people will rise to the challenges as they have done in the past.

Tony Akram

Fri, 19 Mar 2010 15:48:10 GMT

I agree with Bob would have been useful to have the " must buy" information a lot sooner.

Tony

ChrisL

Fri, 19 Mar 2010 15:36:36 GMT

Graham, are you sure there's a buyer's strike? Or is it simply inability to get finance? Bearing in mind that most families and individuals move to larger homes, this would imply higher prices and consequently a shortfall between sale price of current home and purchase price of new one. Normally, this would be funded via a mortgage, but as we know, there is little credit available for those who actually need it.

laehc

Fri, 19 Mar 2010 15:18:15 GMT

There's a scenario which concerns me, although I can't find the relevant facts so it's quite hypothetical. If Japanese government bonds go down, and firms with large pension liabilities hold them, that could be bad for investor confidence and the economy, and indirectly affect the price of small-caps.
I know that's a bit woolly but some of the cause and effect in the credit crunch was not widely predicted.

Roger theLodger

Fri, 19 Mar 2010 15:03:05 GMT

Couldn't agree more Bob