shocker wednesday, page-33

every man and his dog has an opinion. the trend is your friend right now for the market. it is down until the return compensates for the risk of investing in the market. Right now the risk free rate is 7.75% (online term deposits i can get). So stock(risky assets) has to beat well in excess of that return including yields. So if CBA , banks are yielding only 8-8.5% grossed up that is frankly not good enough to compensate for risk. Similarly mining stock (e.g. iron ore, BHP or RIO, EQN, BMN, other iron ores like BRM,BCI,FMG) must offer a 20-30% return(from these low levels) to compensate.