Good for a punt?, page-4

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ipv6ready

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25/05/22

13:58

Post #: 61613574
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Originally posted by iminvestor101: ↑

by historical measures, oil is cheap right now.

interest rates on 10 year yields have peaked imo.

the interest rate im currently getting is a one off 4.91%p.a. assuming the instrument i hold for my fixed income remains at the current price by end of year and then 2.25% running after that. i have no mortgage or rent costs.

the market has priced in too many rate hikes and thats why yields are falling and bonds are rising. they wont hit anywhere near the number hikes currently being predicted. as such interest rates should fall and a more healthy rate should be established.

the point is that yields imo have peaked. add in a china slow down and that should ease some inflationary pressures, at least in australia, being that over 50% of australian inflation is imported and i would guess the vast majority comes from china. so peaking bond rates and peaking oil prices could be in given that the current situation is pretty horrid as we speak. how much into the future is the current market priced? i think further than the recessionary possibility and too far into the future, hence perhaps last nights reversal in sp500 and also falling rates. the reserve banks can wipe off employment right now and focus on inflation by doing what they are doing. the market will take care of the rest as expectations adjust to the actual rate of hikes from fed. in other words, the fed underestimated inflation and until recently investors started overshooting inflation expectations.

the fed will likely allow for more inflation on opposed to a deceleration of the economy, given that they have few tools left to increase employment and inflation if they had to. if 2020 teaches us anything is that the central banks will do whatever it takes to support the labour market and thus the broader economy.

those are my musings anyways. i think things should take more time to see the actual deterioration that equity markets might be pricing in as after all, the stock markets are not the economy. the economy imo lags the stock market and i dont see things getting materially worse than they are right now. could mean upward surprises? too many variables to know exactly what is going on, hence why im taking a punt here.

my next order is in at .83 so we shall see. i dont have much allocated for zip, only two buys of 12.5k each.

strictly a punt.

gltah and dyor

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by historical measures, oil is cheap right now.... add in 2.3 millions barrels of oil china is not buying due to covid....
Without China lockdowns fair to oil will be $150, just depends who wants more....
US Gulf Hurricane season, imagine if some refineries in gulf shuts down oil at $250 with China out of lockdown?

Factor in Wheat has increased 70%
Fertilisers are up 80%

Anyway good luck. who knows you might be right

ZIP Price at posting: 83.5¢ Sentiment: None Disclosure: Not Held
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0 Great analysis

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