FMG (ASX) Investors move to mining capital growth?

Originally posted by asx_dude ↑

Investors move to mining capital growth?

All in opinion:
At a time when the world has gone troppo over biomeds and techstocks which have been going up at alarming heights over the last decade, considering the last tech crash in 2000 investors must question where the next big capital growth sectors will emerge. Especially the ones which over many years have been shorted heavily to the point where nothing is left to short. Eg Miners.

The signs are there and it seems pretty obvious urbanisation and infrastructure will drive growth and boom commodities globally. Remember poor old commodities and Aussie mining stocks have been shorted to oblivion for several cyclic years to the bottom where now many are well undervalued and shorts have left surviving stocks on the canvas. So what drives markets to 'believe' that this situation is the norm and doom can last forever? This opens an enormous opportunity for investors to get in early and to question agendas.

In Australia over the last decade/s our property market has increased to unsustainable levels when comparing to GDP, household incomes and while household debt is skyrocketing. Rates are near all time lows and as banks do it tough attempting to keep shareholders pleased Aussie property 'moguls' lathered in debt holding on to an 'empire' of negatively geared pyramid properties will be hit hardest.

Aussie miners will be the saving grace for Australias growth with their mega profits now the investment boom is over and the profit boom is here.....

My prediction of what is to come over the next few years in Australia and the ASX:
1. Australian property (just peaked) will fall 25%+ over the next 4-5 years with downside peaking at 2022. Prices have peaked and sales are dwindling in Melbourne and Sydney which will no doubt filter through to other states as it has ALWAYS done historically.
2. Banks who are exposed to the Aussie bubble will be hit and those hits eg rate rises may be passed on to mums and dads who will struggle to pay off increasing debt borrowed.
3. Rates will rise causing Aussies to bail out of the property 'dream' and to consolidate back to reality leaving an influx of supply while demand and sediment remains at lows.
4. As rates rise, the Aussie dollar may fall.
5. Investors who move money out of property will invest into booming sectors looking for new avenues for capital gains eg Mining Stocks.
6. As US $ rises (infrastructure and steady growth on the back of GFC) Aussie miners will benefit further from lower AUD.
7. Miners will skyrocket over the next few years reminicient of 2008 as now investors not only have a steady resurging mining industry but also motivation to move into a sector which has the potential for massive capital growth.

Just my thoughts. This has been a long time coming. I believe we're at the crossroads of a major shift of share investment back into the mining sector hence the accumulation phase of mining stocks after far too many years being at absolute lows. Its only a matter of time until the general investment community catches on to the opportunity which presents itself.

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Great post ASX my thoughts exactly. Most market participants are bearish mining coal and oil stocks not realising that they actually bottomed in early 2016. This is just a higher low. Cyclically the banks and property funds are done. In fact the big four topped in mid 2015, all the banks except Macquarie have bucked this trend.

Expect the Aud however to rally along with commodities. This will crush Australian tourism and Airbnb providers, and begin the Sydney property market downturn.

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(20min delay)
Last $21.63		Change -0.040(0.18%)		Mkt cap ! $66.59B

Open	High	Low	Value	Volume
$21.48	$21.63	$21.02	$156.6M	7.309M

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