Category Archives: Oliver Updates


2019 – a list of lists regarding the macro investment outlook

15

Jan 2019

2019 – a list of lists regarding the macro investment outlook

2017 was a great year for well diversified investors – returns were solid (balanced super funds returned around 10%) and volatility was low. So optimism was high going into 2018 but it turned out to be anything but great for investors who saw poor returns (average balanced super funds look to have lost around 1-2%) and volatile markets. As a result, and in contrast to…

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The Fed and market turmoil – the Fed turns a bit dovish but not enough (yet)

20

Dec 2018

The Fed and market turmoil – the Fed turns a bit dovish but not enough (yet)

Three years after it first started raising interest rates in this cycle the Fed has increased rates for the ninth time, raising the Fed Funds rate another 0.25% to a target range of 2.25-2.5%. While this was largely anticipated by markets, the Fed was less dovish than expected and so shares sold off in response. That said it does appear that the Fed has got…

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The Australian economy in 2019 – house prices, growth and interest rates – another cycle extension

12

Dec 2018

The Australian economy in 2019 – house prices, growth and interest rates – another cycle extension

2019 is likely to be an interesting year for the Australian economy. Some of the big drags of recent years are receding but housing is turning down, uncertainty is high around the global outlook and it’s an election year, which will add to uncertainty. This note looks at the main issues around the housing downturn and what it means for the economy and investors. Australian…

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Review of 2018, outlook for 2019 – another cycle extension

07

Dec 2018

Review of 2018, outlook for 2019 – another cycle extension

2018 – a lot weaker than expected After the relatively low volatility and solid returns of 2017, the past year has seen almost the complete opposite with high volatility and poor returns. It started strongly in January but started to get messy from February. At a big picture level things were fine: global growth looks to have held solid at around 3.7%, inflation rose in…

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Corrections, gummy bears and grizzly bears in shares

23

Nov 2018

Corrections, gummy bears and grizzly bears in shares

While global and Australian shares had a nice bounce from their late October lows – rallying about 5%, partly reversing their 10% or so top to bottom fall, they have since fallen back to their lows as the worries about US rates, bond yields, trade, tech stocks, etc, have morphed into broader concerns about global growth and profits. Fears of a credit crunch and falling…

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13 common sense tips to help manage your finances

15

Nov 2018

13 common sense tips to help manage your finances

A few months ago Reserve Bank Governor Phillip Lowe provided four common sense points we should all keep in mind regarding borrowing to finance a home. (The Governor’s speech can be found here). I thought they made sense and so summarised them in a tweet to which someone replied that every checkout operator knows them. Which got me thinking that maybe many do know them,…

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Rising US interest rates, trade wars, the US midterm election results, etc – should investors be worried?

08

Nov 2018

Rising US interest rates, trade wars, the US midterm election results, etc – should investors be worried?

October was a bad month for shares with global shares losing 6.8% in local currency terms and Australian shares losing 6.1%. It’s possible that following top to bottom falls of 9% for global shares, 11% for Australian shares, 21% in emerging markets and 31% in Chinese shares we have now seen the low in the share market rout. Shares were due a bounce and from…

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Are shares expensive?

24

Oct 2018

Are shares expensive?

Introduction Some commentators claim shares are way overvalued and so a crash is inevitable. As always, it’s a lot more complicated, but given the current turbulence in share markets it’s worth having a look at whether share markets are expensive or not as a guide to how vulnerable we are to further falls. More broadly, valuation measures provide a guide to future return potential. Why…

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Boom turns to bust – falling Australian home prices. How far and for how long and what’s the impact on the economy?

18

Oct 2018

Boom turns to bust – falling Australian home prices. How far and for how long and what’s the impact on the economy?

Australian capital city home prices have fallen for 12 months in a row and are down 4% from their peak. Most of the weakness relates to the previous boom time cities of Sydney and Melbourne but prices are continuing to fall in Perth and Darwin. Source: CoreLogic, AMP Capital This begs the questions: how far will prices drop? and what will it mean for the…

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The pullback in shares – seven things investors need to keep in mind

12

Oct 2018

The pullback in shares – seven things investors need to keep in mind

Introduction Every so often shares go through rough patches. We saw this most recently around February on the back of US inflation and interest rate concerns and the start of US tariffs which saw US shares and global shares fall roughly 10% and Australian shares fall 6%. Shares mostly recovered – even getting through the seasonally weak months of August and September surprisingly well –…

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