Forum Archive Index - January 2002

["tennyson@caverock.net.nz" <tennyson@caverock.net.nz>]

Hi capitalist, or should that be Gareth ;-),
 
>With regard to savings, this from Gareth Morgan

>
>"Of course it's chicken and egg. If Kiwis make poor investment
>decisions - like housing, forests, some farm types, uncompetitive
>corporates - then personally they'll reap poor returns and overall 
>the performance of the economy will suffer."
>
>

There are plenty of places on the NZSE where you don't have to invest 
in forestry or 'commodity type farm linked' investments.   It is 
foolish to invest in 'the economy' (like an index fund) when you can 
choose to only invest in the best parts of the economy.

>
>
>"you might more rationally move your savings somewhere a bit less
>risky. For your own sake and for the good of the country do the
>latter. "
>
>

Isn't this the same advice Morgan and others offered last year, which 
saw thousands of kiwis move their money 'off shore' only to be 
pummelled by the US market collapse and the associated fall out which 
swept much of the rest of the world?

The current trend in the $NZ sees it rising. So it looks like 
those who invest overseas have not only the volatility of markets 
under the cloud of further financial uncertainty in Japan and the USA 
but also a very real currency risk to contend with.   I don't think 
Morgan has done his risk assessment properly. SNOOPY





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