Forum Archive Index - August 2000

["Warner Lamb" <cloud9@i4free.co.nz>]

Brian, I agree with everything you say and are two very important subjects.
The sharemarket of 87 is one that I on a daily basis try to put in
perpective for others. Its stigma remains yet the NZ market dropped 18% that
day (and corrected 30% over the year)which took alot of $ with it, yet back
in April this year..had you been involved in the same sort of hyped up
shares as ITC and AQL etc you would have lost more than that..but jo public
wouldn't have a clue ITC dropped 70+ %. The 18% drop in 87 was obviously
supported by solid co.s (just like April this year...some get a haircut but
others just a trim...some were already bald!)because the sky high "loved"
ones of the day corrected just like ITC and some were wiped of the board. I
have read and studied it alot so can get some figures if you like but I
recall 18% FOR NZ which was smaller than US (22%) and 30% for year..I will
check. It is my pet hate to hear "but what about the crash" being the first
reply to your investing in stocks.....what about it? ....usually there is no
answer to back up the now overdone cliche..no knowledge..no substance. I
believe the greatest thing the NZSE could do for our market is debunk the
crash stigma with an education program in NZ.(even before market depth!)
Your post on Divis I agree and I did note you said growth co.s and agree
once their is no economic benefit to expansion or margins (ie mature co) and
management can't grow your wealth further a div may be ok. I also believe it
to be poor to pay too much back to holders..I like reinvestment programs and
did very well from this in Qantas a few years back when they listed.
Reinvestment plans rather than pure handouts seem to make more sense to me.
I think it was Wilson Niel who said they expect to pay a div...What! surely
a turnaround co. like that can do better things than hand it back already. I
was surprised but it does seem to be the mentallity here..You wonder why the
US see it differently...Better management I say
Thanks Brian
R
Warner


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