House price doomsayers: Will housing prices really fall by 20 percent?
Will house prices fall by 20% or more, as many pundits are predicting? Those predictions go against the historical record and against economic reasoning. It is more likely that house prices will suffer single digit percentage falls, and then remain flat (in real terms) for an extended period of a decade or more.
Superannuation: Why illiquid assets are in super members’ best interests
Investment by super funds in high quality private assets, such as infrastructure and private equity, creates large benefits for their members, along with some problems. Unfortunately, recent commentary by Richard Holden (Opinion Nov 10 & 23) and others has overstated those problems and largely ignored the very substantial benefits of super fund investment in private assets.
Inflation winners and losers
Which asset classes are generally most resilient to rising inflation? Is it shares? property? bonds? infrastructure? If we put aside (for now) the possible unwinding of QE, then I have infrastructure and negatively geared property at the top of my list. There are many considerations in regard to inflation resilience, but here I emphasise two in particular. First, the […]
Get your fixed
Fixed mortgage rates will rise when the RBA’s Term Funding Facility (TFF) ends in a few weeks time, on 25 June. The introduction of the TFF in March of 2020 sent fixed rates tumbling and created the best opportunity ever for Australian homeowners and investors to lock in low-cost financing for the medium term. Fixed rates […]
Global economy: Melt up and take my money
Expectations for the global economy have turned very sour in the last nine months and especially these past two months. Growth forecasts are down and expected inflation is way down. The same is true for the Australian economy. Does that mean investors should wind back their allocation to global shares, Australian shares and other risky […]
Global tax rate winners and losers
Should we cut Australia’s corporate tax rate to 15% and eliminate dividend imputation? That question arises again now that the G7 countries have agreed, in principal, to a global minimum corporate tax rate of 15%. There would be winners and losers in such a change and the losers have a lot more political influence than the winners, […]
Personal investing: Cats and CoCos
Bank hybrid notes are great defensive investments with yields that more than compensate for their risk. NAB\’s new $1.65 billion hybrid issue is an example. But they don\’t suit all investors, and they are complex, which is why I have written about them twice already in this newsletter, here and here. This third article compares the hybrid notes […]
Active vs Passive Investing Part 1: A role for both
Stock market investors have to decide whether they will be \’active\’ or \’passive\’ investors. The fundamental ideas that frame this choice are poorly understood, even by many investment professionals. So, when I heard (on 16 January) of the passing of the great Jack Bogle – the foremost exponent of passive stock market investing, and the […]
Personal Investing: Important but not Urgent
A key issue for personal investors is that many investment tasks are \’important but not urgent\’, so they are put off indefinitely even though the investor could be far better off over time if action was taken. Changing superannuation fund falls into this category.
Personal Investing: Money out
Most investors don\’t have a clue how much they pay across all the different types of investment fees they are charged. There are fees for advice, administration, investment management, tax planning, and more. The examples below are intended to help you better understand these fees and roughly calculate how much you pay in total. Many […]