Standing up for Teachers.

kippy

kangaroo wrote: »

(This is talking about shares/share-holders - might not be of interest to many)

What about having the option of selling shares? There is a difference with owning a house - you need to live somewhere and would have to pay rent if one didn't have a mortgage. One doesn't "need" bank shares. They are like a "high risk" form of saving that can be turned into money quickly. But if the shareholders try to access the money any time soon will be a fraction of what they invested so they will take a hit. (I'm not saying that home owners haven't taken a hit because in a way they have).

As I said, I've no problem with you saying the government shouldn't bail out the banks for whatever reason. I just think it is incorrect to say the bank shareholders haven't taken a hit/had no punishment because you think they will get to the future values (there presumably aren't many who believe that or the values wouldn't be at the value there are at now). Many will die before the values reach previous levels (note again, I realise that was the gamble they took, I'm just arguing with the logic).

Even if it was 50/50 that AIB (say) would be totally nationalised, it would still be worth your while buying their shares if you are really convinced that, if they aren't nationalised, they will get to their previous levels in the coming years as the increase would be so huge E(x)=p1.x1+p2.x2=0.5*€0+0.5*€15.30 (say the value went back to €15.30)=€7.65 is the expected value (i.e. 5 times the current value - not sure what the time frame is. Say you think it'd get there in 4 years, it would be equivalent of a yield 49% per year [from 5^(1/4)] on the expected value so better than pretty much anything else - but it would require a 77.8% [from 10^(1/4)] increase each and every year). However, other people in the market clearly aren't as convinced.

Again,
Firstly, No where have I said anything about getting back to their previous values.
Secondly, owning shares is NOT a form of saving (in my book anyway).
Thirdly, They still have an asset and until they try and sell that asset they havent made a loss. If they hadnt sold that asset when the share price began to fall - and the signs were there. the fall wasnt THAT fast, they wouldnt be looking at losses at all. NAMA has given them a chance to see a return on their initial investment at some stage in the future.



Again, no hit taken until the bank is nationalised.
And again, are you a shareholder in one of the banks? I amnt.

kangaroo

kippy wrote: »

Again,
Firstly, No where have I said anything about getting back to their previous values..

If you are saying they aren't taking a hit, then that is what you are saying (for anybody who bought them at above €15, which is the value I was mentioning).

Also, €15 isn't their peak, €24.40 was the AIB peak.
€1.53 is 6.27% of that.

kippy wrote: »

Secondly, owning shares is NOT a form of saving (in my book anyway).

We are going to have to exclude most people's assets if we are going to define it they way you seem to define savings it seems.

The pension reserve fund and most people's pensions wouldn't for example qualify as savings for the future.

kippy wrote: »

Thirdly, They still have an asset and until they try and sell that asset they havent made a loss. If they hadnt sold that asset when the share price began to fall - and the signs were there. the fall wasnt THAT fast, they wouldnt be looking at losses at all. NAMA has given them a chance to see a return on their initial investment at some stage in the future.

The market goes up and down. In hindsight, I'm sure everyone wishes they had got out. But if you sell shares everytime they drop below the value you paid for them, it's the one sure way to lose money.

A chance the value getting up to the value the share was bought at isn't the same thing as it actually happening. A lottery ticket with a few lines on it could be worth millions; but if you try to sell it before the lottery somebody will only give you a few Euro for it as that's its value.
And with shares, there is virtually no chance of the values getting up their values anytime soon.

So I think you should take satisfaction that the shareholders have taken a hit in their investments.

Anyway I don't think I'm going to waste more time with your weird way of viewing share values and what qualifies as a hit.

kippy

kangaroo wrote: »

If you are saying they aren't taking a hit, then that is what you are saying (for anybody who bought them at those prices).

Also, €15 isn't their peak, €24.40 was the AIB peak.
€1.53 is 6.27% of that.


We are going to have to exclude most people's assets if we are going to define it they way you seem to define savings it seems.

The pension reserve fund and most people's pensions wouldn't for example qualify as savings for the future.

The market goes up and down. In hindsight, I'm sure everyone wishes they had got out. But if you sell shares everytime they drop below the value you paid for them, it's the one sure way to lose money.

I don't know how you would define shareholders taking a hit if share values of 6.27% of a peak and around 10% of the value they were at for a few (?) years doesn't count as a hit. A chance of getting up the value isn't the same thing as it actually happening. And the money is tied up in the mean time.

So I think you should take satisfaction that the shareholders have taken a hit in their investments.

Anyway I don't think I'm going to waste more time with your weird way of viewing share values and what qualifies as a hit.

1. Every shareholder in the banks didnt necessarily buy in at the top price of the shares. They had plenty opportunity to get out as the value dropped. Simple as.
2. Shares are NOT a form of savings, to treat them as such is probably WHY a lot of people get caught out with them.
3. MOST people dont directly own shares of any type.
4. The NPR is (in my opinion) pretty poorly managed and less of it should be invested in shares. I am not privvy as to how the NPR is invested however, if it is invested in shares its not that stable, as we've seen.

I dont take satisfaction from others misfortune, especially the "regular" guy on the street who may have been hoodwinked into believe something that was not true.

kangaroo

kippy wrote: »

1. Every shareholder in the banks didnt necessarily buy in at the top price of the shares. They had plenty opportunity to get out as the value dropped. Simple as.

No, it is not as simple as that. Who knows what is the correct time to get out? Some people go out when the shares were in the low two digits (i.e. less than a Euro).
As I pointed out but you seem to be in denial over, if you sell shares every time they drop below the value you paid for them, you will lose money. It's basic maths. It's the one strategy that is guaranteed not to work.

kippy wrote: »

4. The NPR is (in my opinion) pretty poorly managed and less of it should be invested in shares. I am not privvy as to how the NPR is invested however, if it is invested in shares its not that stable, as we've seen.

It dropped by something like 30% in 2008 as I recall. So it would qualify as not savings by your definition.

kippy

kangaroo wrote: »

No, it is not as simple as that. Who knows what is the correct time to get out? Some people go out when the shares were in the low two digits (i.e. less than a Euro).
As I pointed out but you seem to be in denial over, if you sell shares every time they drop below the value you paid for them, you will lose money. It's basic maths.

It dropped by something like 30% in 2008 as I recall. So it would qualify as not savings by your definition.

If you are into buying shares and you dont know when to get out you shouldn't be in shares......I think thats one of the basic rules........

It not qualify as savings if it was invest in shares...........


Anyway, you're right and I am wrong.
We're all getting shafted either way, even the shareholders though increased taxation etc.

Nice chatting with ya.

K4t

Ste.phen wrote: »

Saw this quote on thepropertypin, not sure who it was by:

Public sector workers saying they shouldn't have pay cuts or tax increases because they 'didn't cause the recession' is like the first class passengers on the titanic saying they shouldn't have to man the lifeboats because they 'didn't hit the iceberg'

I can only assume they were too embarassed to put their name to it. Terrible analogy.

CityCentreMan

kangaroo wrote: »

(This is talking about shares/share-holders - might not be of interest to many)

I find it hard to understand how the conversation on this page between (S) Kippy & the Kangaroo about Bank Shares got into this thread - Is this a side effect from last weeks hacking episode or is it related to "standing up for teachers" in some way that has gone over my head?

kangaroo

CityCentreMan wrote: »

I find it hard to understand how the conversation on this page between (S) Kippy & the Kangaroo about Bank Shares got into this thread - Is this a side effect from last weeks hacking episode or is it related to "standing up for teachers" in some way that has gone over my head?

Kippy wrote this message: http://www.boards.ie/vbulletin/showpost.php?p=64012431&postcount=203 (see bit about shareholders) and the discussion went from there. It was nothing to do with hacking.