Please Note: Some email programs may experience strange formatting of this email. Our email template is currently causing us a little trouble. If you find any formatting problems, we encourage you to please view the online version by clicking the link on the right-hand menu. Our apologies for this temporary fault.
Good Evening Reader,
There are certain historical events and moments in life that you want to be able to say I was fortunate to have lived through and there are some that you may want to say thank God I was not there.
Being parents and members of families, the most significant global events we want to avoid are wars and natural disasters. We want to protect our children and families from the potential harm of such disasters.
Global financial disasters have the potential to fit as one of these 'major' events. They can ruin some nations, businesses and families and make others very wealthy.
We have all witnessed and are still living through a once in 100 years' global financial event that is still actively outworking itself.
For some people this will be a disaster and for others it represents opportunity. To put your head in the sand and hope it does not come near you is foolish, because at some stage you will be confronted with changes and/or decisions that need to be made as a result of this event.
Money can play a strong role in social standing and one's ability to make choices in life - that is why events like this can have such an impact. In fact I will go further and say the ability to access credit has been for many what makes these choices possible.
You could be forgiven for asking if this is a Wealth Report or a Dr Phil report, but be patient. The investment and financial choices you make in the face of these events can make life altering diferences to your weath for the future.
A number of clients over the past weeks have reminded us of the times Eden has warned of the inflated asset prices in equities & property caused by access to cheap finance. In fact looking over the Wealth Report several years ago you would be forgiven for thinking that the information was written in the context of the past month as it relates to current events.
We have been diligent in warning of the excesses that were building up in world markets, and in coaching clients to patiently hold-back on the amount of new capital invested over the last two years - but could never have forseen the subsequent actions and dramatic events that have since unfolded.
Many investment veterans that we admire for their years (decades in some cases) of successful money management have commented that they have never witnessed a market like this. This is without doubt one of the worst financial disasters in history.
Those investors that took on significant leverage (borrowed money) to enter the market over the last two years are likely to take many more years to restore their capital. We are comforted by the fact that over the last two years we have advised clients to limit their new investments, use surplus cash to reduce debt, and accumulate surplus funds in cash reserves.
We believe that with this turning point will come oportunity to make good decisions that will benefit you and your family now and in the years to come. It also represents the opportunity to reinforce sound decisions and investment principles with the hindsight of one of the worst financial disasters in history.
Robert Palma - Eden Wealth Management
A quick review of the critical path that led markets from extreme Greed to extreme Fear.
In the words of Michael Corleone from the Godfather, "Just when we thought we were out ...."
With many pinning their hopes on a monetary-stimulus-led market recovery, attention is now turning to the real economy.
Have we conquered one beast only to be attacked by another?
Pessimism and volatility have been extreme, and nearly everyone is scared to commit new capital to the market. With that, any financial risk has been priced ridiculously low.
These are often the factors that coincide with the bottom of an equity market.
However is it a time to be bold or to be cautious?
Contact Us
Newsletter