consolidation, page-30

yanlin,
Firstly what is the strategic importance of railways. could it be
(a) in an environment of high oil prices railways have a competitive advantage over trucking. If there is peak oil, then the days of cheap petrol are over.
(b) when the US recovers activity will pick up. So buying the railways as a cyclical low makes sense. But (a) above is the 'economic moat' and its increasing, not decreasing.

In regards to retail, of course there will be retail. But the environment is changing. How retail will look at the end of this structural change, nobody knows.

Buying a tradionally good business like JBH based on historical performance is risky given the change in the structural environment.

If JBH's share price drops far enough then i will start to become interested, because i will have sufficient margin of safety.

I will probably start to become interested in JBH under $10. At a price under $10 i dont need JBH's profits to grow much, i just need them to be stable.

So we are getting close now with a current share price of $11, but not yet. Hence i am still on the sidelines.

If the share price doesnt reach $10 or below, then its ok for me, i dont need to swing my bat, there have been plenty of other opportunities in the Australian market.