How much further for the FTSE to fall?

Discussion in 'Current Affairs, News and Analysis' started by Rodney2q, Mar 5, 2009.

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  1. I have noticed in the past that there a few members of Arrse who seem to have some knowledge of the stock exchange and things economic in general.

    My question to them is:

    "Given that every time Brown and his cronies, or the Bank of England, make public statements about the economic situation (particularly those which refer to improving the situation or stimulating the economy), the FTSE index falls, how much further do you think it will drop?"

    :?

    Rodney2q

    FWIW My understanding of the situation at the moment is that simply printing extra cash will lead to rampant inflation, which just goes to show that Brown and his ilk have no understaning of history and will simply repeat the mistakes...
     
  2. Rampant inflation! Great! Perhaps I can pay off my mortgage after all!
     
  3. In terms of a ten-year investment plan, the FTSE is massivly undervalued. Keep in mind that most of the companies in it are blue-chips stock like Tescos that aren't going under short of a nuclear war. Whatever dips they have now will be more then compensated for in the upturn, even if the market has another 200+ points to fall.
     
  4. As long as my mortgage keeps falling,I don't really care.
     
  5. I've seen figures of the FTSE falling to 2000 being banded about. I bought BP a few weeks ago and since then the arrse has been falling out of them, beginning to think I should stay away from the markets, but hey, where the hell can you put your money these days anyway :?
     
  6. It is anybody's guess.

    However, there are some good companies going for a song because sentiment is against them.

    If you don't have the cash to lose, walk away now.

    If you are an experienced investor, you should be investing now with a 5-10 year view. Swallow hard and buy on bad days. Take any losses on the chin, review your decisions and start again.

    If you are a novice and have surplus cash and don't need it for 5 years, then start reading about investing or drip-feed your money into an ISA over the year. I think you are allowed a £7k ISA each year. That could be £600+ per month going into something like Perpetual High Growth or M&G Recovery. Drip-feeding money into the market means that you are less likely to invest at the wrong time and if the market falls, your monthly payments buy more shares.

    If you have the cash and can think in pension terms, then now is a wonderful time to be buying!

    Warning: Get it wrong and you will burn your fingers!

    Litotes

    ouch, blow, blow, blow.... :oops: :cry:
     
  7. Hey that was some quiet takeover, you must have got a real bargain.
    :wink:
     
  8. It will likely recover the dividend yield for the index is somewhere around 7-8%. Whether this happens by the index falling, or dividends going up (due to newly printed money getting into circulation and revenues going up), or more likely a mix of the two, is something I cannot predict. But the dividend yield is one of the main things to watch when deciding whether to buy in or not.
     
  9. BP was given a thumb-up from Questor in the Telegraph today at 421p and spent the whole day in the red! They closed @ 413p where they yield 9.5%. The dividend is well covered (that is, they can afford to pay it without impacting on their capital investment) so should be maintained. So, the question of whether to invest in them (or hang on) is whether you think they can make a profit out of oil at $40/bbl. I think they can and I also think that the price of oil will probably stabilise around $40/bbl before strengthening over the next few years. BP is on my list with a 5 to 10 year viewpoint.

    Litotes
     
  10. I'm looking at a 5 year viewpoint myself, re-investing my dividends. Seems a better place to put my money given the interest rates on savings accounts/cash ISA's at the moment.

    Then again, I'm maybe not the best person for making financial decisions.....a guy I work with was looking for a good savings account last year and I recommended the Icelandic banks. I don't think he'll be asking me for financial advice again!
     
  11. History is not always a reliable guide, but if this is worse than the mid ‘70s when the FTSE fell from about 650 to about 150, then in proportion one should expect about 1500 as the most recent high was about 6500.

    However, being an optimist I reckon 2200.
     
  12. mercurydancer

    mercurydancer LE Book Reviewer

    litotes... got 14 grand in the savings pot... ISAs for me. No risk. I think its sensible but will be reassured that my hard earned wont go down. May not earn much but wont be lost.
     
  13. mercurydancer

    mercurydancer LE Book Reviewer

    Steph anie Flanders said today thta Japan tried QE with mixed results when they were in the brown stuff. Not sure I feel confident about Booon and his crew handling this very volatile measure with a degree of competence.
     
  14. The history books do seem to be going out of the window at the moment - even the statistics seem to somewhat all over the place. What I find most confusing is the fact that no-one seems to agree on anything and all the "experts" seem to contradict each other.

    FWIW me and the Doris have our cash spread through several banks, and a mix of ISAs and shares. Unfortunately the HBOS shares don't seem to be doing very well.

    I like the idea of taking some cash from the savings and putting it into shares. Allthat I have read say that now is the time to buy but I don't know if I have the bottle to risk the cash at the moment, particularly if the markets fall any further.

    Rodney2q
     
  15. I know how some on here will feel, I have shares in BT, Tesco and BP to name a few and I'm still buying even though they are falling, I think there will be some good dividends and things will go up...eventually.

    I am spreading my risks and balancing my investments, including some savings.