Bob McGregor

6 Comments

    • Does Al Gore Finally Get It? [view article]
      Fireball, Being a Scientist in an earlier life I understand facts about ice and volume loss when it changes state. It's the melting of ice on land that the alarmists say will ultimately cause sea levels to rise. Very few who own beachside real estate are embracing such thoughts even though it is exploited ad nauseum by the "greenies" for their own political motives.

      Re Silex Systems Limited [SLX] - I have to be honest - I don't know anything about it except for that available on the Australian Securities Exchange website. Herewith link to SLX:

      www.asx.com.au/asx/res...

      Thought our All Ordinaries Index bottomed on July 16 but how SLX fits into that cycle I have no thoughts. Good luck.


      Jul 22 11:13 AM
    • Does Al Gore Finally Get It? [view article]
      Thought provoking but far from convincing.

      Re forecast shortages of oil. Reminds me of my University Lecturer on the topic of Corrosion early 1960 - "if the world doesn't control corrosion of iron products the world will run out of iron before the end of the century". Over the next 5 years enough iron ore was found in western Australian alone to supply the world for hundreds of years. Much more has been found in the same State over the past 40 years. When oil explorers are freed from the shackles imposed by Governments I have no doubts additional large fields will be found. Emotive responses have sidelined uranium from discussion over past 40 years. It's time for it to return to the mainstream of debate.

      Far from the earth heating up, facts from the past 10 years show otherwise, it's been cooling! Like everything to do with the Universe cycles exist everywhere, even in climate. Old Testament book - Ecclesiastes speaks about the seasons and the times to sow, reap and cast out etc and concludes: "there is nothing new under the sun". Quite clear - it's all happened before. Lets face it, man wasn't cause of the previous cycles so what was? Methinks political spin is being used for ulterior motives.

      I live is Sydney, Australia and much of OZ has long coastal foreshores. If sea levels were going to rise, due to icecap melting in the near term, then we could expect an exodus to higher ground. Strange, no ones selling - in fact prices continue to rise [not sea levels], so punters believe otherwise. I think the punters are on the ball and far from convinced.
      Jul 21 02:00 PM
    • Federal Reserve, Tend to Your Own House [view article]
      Thanks David for another insightful article. Reading and observing all things to do with USA markets since the mid 1960's - from afar in Australia - I am convinced various USA Presidents have made monumental mistakes over the past 100 years that have contributed to this current monetary disaster.

      For starters, the creation of the Federal Reserve Act in 1913, a privately owned entity given special privileges to create and issue money and answerable only to themselves. It should be abolished forthwith and replaced by an entity owned, controlled and answerable to its owners - the citizens of the USA. The new currency would be better accepted world wide provided gold/silver was remonetarised same time so the currency was likewise convertible - provided of course the USA Government actually owns the Gold in Fort Knox. If they don’t and are only acting as a repository for the actual owners, then the USA is in much worse shape than I could visualise.

      Secondly, confiscation of citizen's gold in 1931 - paid for by "overvalued" USA dollars which where then devalued by the Federal Reserve [a private body] by revaluing gold up from $20.68 to S31/fine oz. It was the biggest con job of all time.

      Next, Federal Reserve bank notes were made convertible against gold, at least until 1971 when President Nixon unhinged convertibility and let gold float free. Since then nothing has backed the mighty USA Dollar. It is not surprising that the USA Dollar has continued to fall against most if not all paper currencies - except the Zimbabwean dollar. Provided the status quo continues, we can expect continuing weakness of the USA dollar.

      Finally, the SEC action that created so much wealth destruction over the past year, namely, the removal of the USA SEC Short Selling [SS] up-tick rule in July 2007. This allowed a SS “free for all” that destroyed stock price values FASTER than at anytime since the1929/34 crash [SS didn’t exist then either]. This allowed the "insiders" of such knowledge – late 1929 - to make MASSIVE profits on the short side AFTER the Federal Reserve decided to tighten liquidity sharply, mindful the Federal Reserve had fuelled the 1924/9 bull market earlier by opening the liquidity flood gates. They have a lot to answer to.

      So what can we draw from the above? Don’t trust the actions and deeds of both Politicians and those they grant special favours to. Either way you - Johnny Citizen - will end up being screwed!
      Jul 15 06:29 AM
    • How Much Can We Blame the Uptick Rule? [view article]
      SHORT SELLING BUBBLE NEEDS TO BE “PRICKED” TO “BALANCE” STOCK PRICES.



      Scrip borrowed and naked short selling [SS], without observance of the up-tick rule, has help destroy world wide markets ever since the USA SEC removed the up-tick rule early July 2007. It's more than coincidence that the majority of World Exchange Indexes were sold off in 2 major down waves shortly thereafter; namely July to August 07 and Oct/Nov07 to present date. The excuse the SEC gave for removing it was a study done over the prior 3 years from which they concluded it would not deleteriously affect the USA markets if removed. It had been in place since 1938 because a study following the 1929/1933 crash concluded the extent and speed of the fall was directly related to the fact an up-tick rule was not in use within USA stock markets. It was further concluded, correctly, that the introduction of an up-tick rule would create a fairer and more transparent environment in which to trade stocks. Such was the case until it was withdrawn early July last year.



      Of course the SEC study on which their recent conclusion was based was FLAWED, as it was carried out during a major worldwide bull market. No doubt greedy brokers and very sophisticated traders such as hedge funds - were agitating the SEC to have it removed as they realised trading NIRVANA would be at hand should they succeed. One only has to observe the carnage since it’s removal to realise the SEC made a MAJOR mistake.



      This was particularly so in Australia where scrip borrowed short selling was not "subject" to the up-tick rule even though naked short selling was. In reality, legal opinion surrounding scrip borrowed SS concluded it did not have to be reported, as that opinion suggested that upon borrowing stock, legal title passed from the lender to the borrower. Consequently the stock could then be sold anyway the NEW “owner” deemed and certainly not by observing the up-tick rule, as their prime intention was to destroy the price and possibly the company as well.



      If ALL short selling was made transparent [reported daily] and observed the up-tick rule, the TRUE EXTENT OF SHORT SELLING WOULD BE known. It is grossly understated in the major Anglo Saxon markets and caused the extent of the falls in Australian financial stocks.



      What makes the whole SS exercise highly desirable in Australia is fact that profits from scrip borrowed short selling were not subjected to TAX, as an anomaly exists in the Australian Tax Act, when altered in 1987, to help offset the delay in delivering scrip when the Australian system changed from a paper to an electronic settlement - using a new system called CHESS. This coincided with the introduction of screen trading in 1987 [end of floor trading]. It has not been revisited since, with cataclysmic consequences for Australia as overseas HF’s decimated the stock market over the past year.



      A further variation on the SS theme is “pairing” where quant analysts determine the strength or weakness of stocks and elect to buy the strong, simultaneously SS weak stocks to various designated formulas. It can be instituted for a very low cost – around 50 basis points to borrow the weak stocks - and the sale proceeds of the SS leg are used to buy the strong stocks. Such pairing saw financial stocks being SS while Resource based stocks were purchased – all for a cost of 50 basis points. Spreading false rumours was also part of the game to maximise profits. This creates massive gearing and is the next major bubble to be pricked. Consequently, a SS cap of say15% per company stock should also be put in place otherwise massive dislocations could result in the markets.



      Indeed, trading NIRVANA has existed since the SEC removed the SS up-tick rule, which had served world markets effectively for the past 69 years. It should be reintroduced immediately, accompanied by daily reporting of all short positions current in each stock. Transparency must be demanded of all participants and a SS cap created to limit the short interest in designated stocks to say 15%. The World SS BUBBLE would be pricked and stock prices would return to realistic levels.

      Jul 14 07:56 AM
    • Will 'Dark Pools' Be the Capital Markets' Next Black Holes? [view article]
      Forgot to mention earlier that a consortia comprising GS, MER, CS, MS in concert with 2 Australian Brokers COMMSEC and Macquarie Securities [subsidiaries of CBA and MQG respectively] own 50% of a dark pool - AXE - in conjunction with NZX [New Zealand's listed Exchange]. They currently have an application before the Australian Government to be issued a Licence to create a trading platform to trade in competition with the Australian Securities Exchange. Other dark pool applicants are Liquidnet and Chi-X.

      Hopefully the Australian Government will reject such overtures and enforce the status quo - of restricting trading in Australian listed securities to the sovereign exchange on which they are listed.
      Jul 13 08:14 AM
    • Will 'Dark Pools' Be the Capital Markets' Next Black Holes? [view article]
      Apart from Dark Pools there is every reason for trading to revert to ONE centalised platform and that is the one that LISTS the Company. Siphoning off liquidity is at the expense of not only liquidity but also transparency.

      Of further concern is the current push by USA Treasury and the USA Federal Reserve to pressure Congress to GRANT them more powers in Regulating USA markets - read that to "mean" Regulate World markets by default!

      Strange, I thought they CAUSED the malaise in the first place. Additional powers would be like pouring more fuel on the fire.

      PS Which of the two "entities" mentioned above is OWNED by the USA people? Who owns the other?

      Jul 13 01:22 AM
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