PAN (ASX) Ann: Quarterly Activities Report

Originally posted by Hingdog: ↑

Since it's a rainy Saturday, here's a little more rambling ...

I view the markets as one big game where one small group of players are aiming to take the money of the majority. Most stocks are trash, they get run up to silly prices by the large players for the sole purpose of selling them to the public. If you haven't read Reminiscences of a Stock Operator by Edwin LeFevre I strongly suggest you should, it was written 100 years ago and is still the bible for how the market really works - it's an easy fun read regardless of the educational value

Why did the market go vertical coming out of covid? Did the instos really think all those loss making tech companies were going to be big success stories? Or did they really just see that the public had large cash balances thanks to covid payments and stuff and that money was there for the taking? In my view, they simply saw that cash sitting in peoples pockets and they understand the game, run stocks up in a feverish buying frenzy and all those people sitting at home watching the market with cash to burn soon enough can't help themselves and start buying, the stories were there for these companies to suck the public in and the instos sold them to them at hugely inflated valuations ... from Reminiscences "the best advertising medium for selling stocks is the tape"(paraphrased), people see others making windfall gains and need to be a part of it.

The current market is very different, it's highly selective in what stocks are being bought up. why? In my view, it's because the instos know most people got wrecked in the markets and have no risk appetite, there's also very little new money to come in from the public as people are battling with high cost of living and there's risk free bank interest to compete with for the available cash. So they know if they send up the prices on a bunch of trash stocks, they won't have a market to unload on and they'll be the ones getting rinsed rather than the dumb public.

It's one big game!!!

Nasdaq into 2021 top below

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The XAO into the 1987 crash

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The same game plays out over and over and over again. Some people will look at the XAO and say but the market recovered and went on to make even more spectacular gains into the 2007 top, it's very true, but I'll bet you most people who didn't sell before the 87 crash never recovered, because the stocks that lead one bull market very rarely lead the next. So unless you were holding true investment grade stocks(these are maybe 1% of the market), you got wrecked in 87 and the stocks you held never recovered.

Be dumb, follow price (stealing that line from Tom Canfield, a US trader who used to tweet a bit)

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Thanks HD, for taking the time to post

Here - have read "the Australian stockmarket - a guide for players, planners and procrastinators" by Ron Bennetts, also highly recommend it
Will add, reading this (and referred to many times - after reading 12+ years ago), took away that the Aussie financial system is built on the same values as the rest of the country, of a fair go and decency (despite much dodgyness and perhaps even some corrupt possibilities). One small example personally experienced was the collapse of a type of bank with money invested. It was a drawn out situation, but in the end 85 or even 90% of money's have been returned to investors - would this happen in other countries? Some maybe, many nothing. Anyway getting off topic, and will look at suggested for a Chrissy read, thanks

Agree with what your saying re cycles and instos etc. Trying to read/track these. Think my theories are pretty good on these, for me it's better implementation really. Recently up 50% on portfolio and did the right thing and sold a fair bit. But went wrong in buying back in way too early - including PAN SPP. Oh well you live and learn (hopefully) - that's one of the reasons for hitting you up on how you go about it, again thanks

Am basically fully invested now, so a wait to see if the market floats up, with the tide. Mostly in lithium n sure you know whats going on there.
Wouldn't have picked the Li price hitting this low. Honestly think it's BS, the whole transition to electric relies on a steady supply of Lithium (+other metals). Current and lower prices may result in many mines closing & failing to go ahead and a massive disruption = even greater price peak to come

Anyways have a good weekend - it's windy as here, little rain though

All the best