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2 June 2018 (AFR) – Ten years on from the GFC, what happened to the once mighty Babcock & Brown?

(2 June 2018, AFR, p15, by Su-Lin Tan) ‘June 12 2008 is a date seared into the memory of everyone who worked at Babcock & Brown, a financial wizard that operated across the globe, buying up high end assets; wind farms, power companies and a lot of real estate. B&B’s share price, that had soared … Continue reading

2 June 2018 (AFR) – Could the GFC happen again? These guys should know

(2 June 2018, AFR, p9, by Su-Lin Tan) ’10 years after the GFC’ ‘Conservative bank lending, low interest rates, and tighter access to credit have carved a very different debt landscape to that of the global financial crisis 10 years ago, but there is a risk of complacency around the rise in interest rates, former … Continue reading

30 May 2018 (AFR) – Got less than $1m in assets? Forget a self-managed super fund

[COMMENT: Bah!! Humbug!!    We’ve heard a lot about superannuation and the Productivity Commission report, in recent days, including the so-called performance of funds, and fund performance comparisons. HOWEVER, there seems to be one key flaw in this reporting. The fund performance comparisons appear to be over a 10-year period – from 2009, the end of … Continue reading

17 May 2018 (AFR) – PwC, Deloitte, KPMG, EY face UK break-up call amid Carillion demise

(17 May 2018, AFR, p25, by Gill Plimmer) ‘British MPs have demanded the UK’s big four accountancy firms be referred to competition authorities for potential break-up following the collapse of government contractor Carillion, calling them a “cosy club incapable of providing the degree of independent challenge needed”. The recommendation by members of two powerful parliamentary … Continue reading

14 May 2018 (AFR) – Tassos Stassopoulos: The fund manager immersed in emerging market Millennials

[COMMENT: Now this is very interesting. An experienced funds manager being told by an ethnographer that his research methods are all wrong. This supports the views that many chartists and technical analysts have about the methods for selecting investment candidates in the financial markets – that the methods of the majority of professionals in the … Continue reading

14 May 2018 (AFR) – People are fed up with capitalism

(14 May 2018, AFR, p19, by John Authers) ‘ “The facts are clear: all the evidence is that process-driven CEOs are prioritising the bottom line and treating earnings as a key metric. That’s capitalism.” These lines are a summary of the news from the corporate sector in the past few weeks. Yet they will read … Continue reading

11 May 2018 (AFR) – ASR strategist Ian Harnett cautious on global stocks

(11 May 2018, AFR, p31, by Jonathan Shapiro) ‘Top London-based analyst firm Absolute Strategy Research says the equity market rally is at risk from a slowdown in China and further tightening of monetary policy by central banks. “If you’re looking for that last hurrah it could happen, but you’re dependent on policymakers getting it right,” ASR’s … Continue reading

25 Apr 2018 (TheAge) – One move that would go a long way to fixing financial advice

(25 April 2018, The Age, Money supplement, p1, John Collett) ‘There are no quick fixes to curb recurrences of the shocking revelations at the banking royal commission concerning financial advice. But there is a move you’d think would be obvious: licence planners individually.’ <snipped…> ‘… I recall the experience of a 61-year-old cancer patient. She showed me her … Continue reading

20 Apr 2018 (AFR) – CBA charging dead customers for advice, banking royal commission hears

(20 April 2018, AFR, p9, by James Frost) ‘A group of planners from Count Financial were charging customers for advice fees after they had died with one planner charging a dead customer almost $1000 a year for advice for more than a decade. The problems at Commonwealth Bank subsidiary Count Financial have been revealed at … Continue reading

17 Apr 2018 (AFR) – Regulators turned a blind eye to ‘inherent conflict’ for two decades

[COMMENT: This news article talks about the now infamous ‘fee for no service’ that was recently brought to light by the banking royal commission, but also includes a good history of the banks’ purchases of wealth management businesses over recent years.] (17 April 2018, AFR, p26, by Karen Maley) ‘In the late 1990s, it was … Continue reading

17 Apr 2018 (AFR) – Banking royal commission: AMP under attack – admits to lying to ASIC

[COMMENT: Ok, so what’s worse? Lying to the regulator? or ripping off customers? But how prevalent is this activity?] (17 April 2018, AFR, p1, by James Frost) ‘AMP copped the full force of the Hayne royal commission’s probe into the provision of financial advice with the company exposed for a policy of charging customers for … Continue reading

14 Apr 2018 (AFR) – CBA cops ASIC penalty for ‘fee for no advice’ scandal

(14 April 2018, AFR, p22, by James Frost) ‘Commonwealth Bank will cough up $3 million and submit to regular and independent third-party reviews of its financial planning arm as part of an enforceable undertaking reached with the Australian Securities and Investments Commission. The agreement relates to 31,500 customers of CBA subsidiaries Commonwealth Bank Financial Planning … Continue reading

13 Apr 2018 (TheAge) – Behind Spaceship’s ASIC fine: drama, tension and false funding news

[COMMENT: This is a good case study example of ASIC getting involved with the issues of running listed companies.] (13 April 2018, The Age, Business, p20, By John McDuling) ‘Fines from regulators. Funding rounds, and false reports of funding rounds, involving powerful investors. Founder departures. Staffing changes. Shareholder tensions. Welcome to the wild ride that … Continue reading

28 Mar 2018 (AFR) – Day trading not the way towards riches – A lot to be said for buy-and-hold strategies

[COMMENT: I have to comment on this article – in my own humble opinion, it is mostly bunkum – based on the so-called classical investing theory, which many shorter-term nimble investors do not believe in. In the minds of many people, the old ‘buy-and-hold’ strategy is as useful as some people make it out to … Continue reading

24 Mar 2018 (AFR) – Inside Otsana Capital’s fight for Esense Lab

[COMMENT: Here is a good case study of some of the issues that can take place with small cap stocks. Good lessons for the investors in such stocks.] (24 March 2018, AFR, p25, by: Jemima Whyte, Jonathan Shapiro) ‘Otsana Capital, a Perth stockbroker that rates its employees as either “lone wolf” or “good wolf”, is attempting … Continue reading

13 Feb 2018 (AFR) – New payment platform live as banks pressured to open up access

(13 February 2018, AFR, p23, by James Eyers) ‘Banks are under pressure to open up access to a new national payments platform that will embrace the mobile era and finally allow payments to be instantly cleared. In a landmark innovation for the payments industry, the banks will begin to bring customers on to the “new … Continue reading

7 Feb 2018 (AFR) – Wall St’s VelocityShares ETF crashes 80 per cent as volatility strikes back

[COMMENT: Here is one good example of the sorts of things that can catch the uninitiated and unwary when playing in the financial markets.] (7 February 2018, AFR, p25, by Patrick Commins) ‘The rapid unwinding of complacent markets may have claimed its first victim after a Wall St exchange-traded fund which gains from falling volatility crashed … Continue reading

6 Feb 2018 (AFR) – Westpac used bonuses, sophisticated sales techniques for super switch campaign

[COMMENT: This alleged behaviour indicates some of the tactics that some organisations might be employing in order to rake in profits for the company, and not in the best interests of the customers or investors.] (6 February 2018, AFR, p3, by Misa Han) ‘Westpac and its wealth division, BT, used bonuses and highly sophisticated sales … Continue reading

2 Feb 2018 (AFR) – Xerox, an innovator hit by digital revolution, cedes control to Fujifilm

[COMMENT: Over the years, as technology develops, some major companies fail to keep up with technology and come across tough times. This happened to Kodak in recent years – a company well known to many people around the world, but not perhaps amongst the younger generations. Now it is Xerox’s turn. This can be a … Continue reading

31 Jan 2018 (AFR) – Why blockchain and bitcoin will never keep the promises they make

(31 January 2018, p43, by Nouriel Roubini) ‘The financial services industry has been undergoing a revolution. But the driving force is not overhyped blockchain applications such as bitcoin. It is a revolution built on artificial intelligence, big data, and the Internet of Things.’ <snipped…> ‘Worse, cryptocurrencies in general are based on a false premise. According … Continue reading

23 Jan 2018 (AFR) – US hedge fund Glaucus blasts tax breaks for MIS after Quintis joins failures

(23 January 2018, AFR, p13, by Vesna Poljak) ‘The hedge fund that brought down listed sandalwood grower Quintis has urged Australian policymakers to rethink tax incentives for managed investment scheme investors after the former TFS Corp became the latest failure in a long line of forestry-linked collapses. Quintis appointed administrators on Saturday, ending a months-long … Continue reading

9 Jan 2018 (AFR) – Is the next financial crisis looming: Ross Barry

(9 January 2018, AFR, p26, by Ross Barry) ‘The strong performance of many share markets around the world has led many to speculate that another major correction may not be too far away. History has shown us, over the past 300 years or so, that major corrections have occurred every nine to 10 years, on … Continue reading

2 Jan 2018 (AFR) – Last year’s losers, this year’s stars? – Why one of 2017’s ASX dogs will howl in 2018

[COMMENT: This is an interesting insight into some real life studies of the “Dogs of the Dow” approach and the Australian share market.] (2 January 2018, AFR, p30, by James Thomson) ‘Could sifting through this year’s ASX 100 dogs unearth next year’s gems? That’s the question posed by Hugh Dive from Atlas Funds Management, who … Continue reading

22 Dec 2017 (AFR) – Lesson for investors: don’t count just on market returns to boost your portfolio

[COMMENT: This article touches on some of the cognitive biases that can play havoc with the way that investors think, and which influence investment decision making. It is very useful for investors to understand much more about cognitive biases.] (22 December 2017, AFR, p49, by Patrick Commins) ‘The year 2017 for investors is one of … Continue reading

21 Dec 2017 (AFR) – KPMG partners face court contempt over China audit

[COMMENT: This news story highlights some of the risks involved with international trade.] (21 December 2017, AFR, p10, by Matthew Miller) ‘Several current and former KPMG partners are facing contempt proceedings in a Hong Kong court, as liquidators for a failed US-listed Chinese company step up their action against the auditor over its refusal to … Continue reading

11 Dec 2017 (AFR) – The 10 fund managers who made $300m profits this year

[COMMENT: I don’t comment on fund managers very often, because many cannot make consistent profits for their clients from year to year. However, this story suggests otherwise for some managers.] (11 December 2017, AFR, p1, by John Stensholt) ‘Australia’s most successful boutique active fund managers have recorded huge profits this year and paid themselves big … Continue reading

Short position reporting to ASIC

(23 August 2017) – Following up on a news story in today’s AFR about reporting of short positions (stocks that are sold short), for the investors and traders who are interested in seeing a list of shorted stocks, ASIC maintains a daily list of this information as reported to it by the sellers. (Thank you … Continue reading

2 Aug 2017 (AFR) – Apple, Google take down binary options apps at ASIC’s request

[COMMENT: Now this is an interesting article for retail investors who might want to trade in such financial instruments. (2 August 2017, AFR, p17, by James Eyers) ‘Australia’s corporate regulator says it has convinced two of the world’s largest technology companies, Apple and Google, to remove applications that offer unlicensed financial products to customers from their … Continue reading

29 July 2017 (AFR) – Compare how your superannuation fund performed

[COMMENT: As I always do when posting things like this funds performance table, I warn that past performance is no guarantee of future results. It is merely an interesting observation of the past performance of some funds and their own strategies which may change from time to time.] (29 July 2017, AFR, p27, by Sally … Continue reading

18 July 2017 (AFR) – ASIC’s Greg Medcraft warns hybrids are ‘ridiculous’ for retail investors

(18 July 2017, AFR, p1, by Tony Boyd) ‘Billions of dollars of hybrid securities issued to retail investors by the major banks will eventually cause problems for the financial system, according to outgoing chairman of the Australian Securities and Investments Commission Greg Medcraft. In an interview with The Australian Financial Review to mark his six-and-a-half … Continue reading

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