No Minister

SOMETHINGS GOTTA GIVE

with 7 comments

Everyone knows the housing market is out of wack … the share-market too. When my own very modest portfolio can increase in value by $2,789 since Monday you know somethings wrong.

Am I selling? No, because I bought my shares very early on at a third of the price they’re now being quoted at. I guess I can afford to take any hit. But sommin for nuffin … when the hit comes it ain’t gonna be pretty … for both the country and investors alike.

Written by The Veteran

December 9, 2020 at 7:33 pm

Posted in New Zealand

7 Responses

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  1. The NZX-50 bottomed out on 24 March at 8,499 with Covid fears. Yesterday reached an all time record of 12,889. It’s not really a sensible cherry-picked measure bit that’s an annualised 73% growth… makes the few percent of dividend yield insignificant.

    The sharemarket easily outperforms property. If not trading/speculating, that growth is tax free.

    John JohnO

    December 10, 2020 at 7:36 am

  2. Also of interest, the pre-Covid NZX-50 peak in NZ was 12,073 on 21 Feb… since then the index has gained 6% or an annualised 7.5%. Add in the NZX-50 average after tax dividend yield 2.4% and you are running a 10% return in an economic catastrophe.

    The ASX index hasn’t recovered to its pre-Covid peak. The Dow has, barely, but the FTSE is still miles down.

    Strange times….

    John JohnO

    December 10, 2020 at 7:46 am

  3. Agreed, but twenty years ago my beloved wife was encouraging to buy more property in Auckland and I refused on the basis that we had enough, I didn’t want more debt and …… things just could not go on this way.!!!!

    And here we are.

    And it’s not just Auckland. A mate’s girlfriend is about to buy a near new house in Te Awamutu for $700,000.

    Te Awamutu FFS.

    Tom Hunter

    December 10, 2020 at 8:00 am

  4. A number of my younger relatives this year invested in the sharemarket for the first time. If that is a national trend could explain the unusual activity.
    Asked son a couple of days how his were going. Said he had sold his Air NZ shares and was happy with his return given the short time invested.

    Noel

    December 10, 2020 at 8:15 am

    • The likes of Sharesies have made the market more accessible than ever, along with near zero interest rates and the $100,000 entry barrier to the housing market explain a lot of this..

      But at the end of the day you can get still get 3-6% dividends out of utility grade stocks… difficult to argue against that.

      John JohnO

      December 10, 2020 at 8:42 am

  5. Just across the road from us in Paihia we have a couple in a house with a great view. They are returning to Oz in May to live (she’s Australian) and are in the process of purchasing a property in Cairns (FFS). They marketed their property and set a high end price they were prepared to negotiate on. Lady investor from Akl rang them and bought the property sight unseen (promotional blurb excepted) for substantially more than the top end price they were hoping for.

    I agree with Tom. This is scary stuff.

    The Veteran

    December 10, 2020 at 8:38 am

  6. I’ve been expecting the ecomony to crash since the first of the lockdowns, yet somehow, everything is sailing along fine, apart from a shortage of houses and other investments.
    This is despite Government debt is going up at an unsustainable rate.

    uncoffined

    December 10, 2020 at 11:48 am


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