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165 Pages«<163164165
Elliott Wave Analysis Of The NSE 20
whiteowl
#3281 Posted : Tuesday, February 04, 2020 6:00:16 PM
Rank: Veteran


Joined: 4/16/2014
Posts: 1,391
Location: Bohemian Grove
wukan wrote:
I think NSE fate lies with CBK. There is a negative feedback loop in the real estate which leading to lower bid prices akin to what happened to NSE from around 2014. That damages a lot of balance sheets which were already damaged from the fall in equities. A downward correction in real estate will hurt a lot more of the wenyenchi balance sheets than equities did. I would expect more pressure on MPC to be more aggressive in the rate cuts or do localized QE.


Similar sentiments expressed here
https://www.standardmedi...-an-economy-in-distress


Quote:
Research shows that house prices are indicators of changes in the economy. In other words, the change in house prices passes information about the pending state of the economy.
The value of a house depends on the rent that the tenant pays to the landlord.
In finance, we discount rent in house values, such that when rent increases, the value of the house must also increase because additional income is being generated and vice versa.
This means that it is only in unsound economies that tenants are unable to pay rent thus opening a window for the decline in house prices.


Quote:
Simply put, if a mortgage is for Sh10 million, but the house has declined in value to say Sh7 million, the logical thing to do is to default.
The default will lead to more losses in asset values and low-quality financial institutions.
This explains why debt is largely an option. The debate then is between the interest rate and collateral rates - the rate at which houses are financed with debt - which is the most important to the economy?


QE is a zero sum game when you have dollar denominated loans. It spurs growth but will balloon the debt when the value of the shilling falls. This is the same reason the world bank has accused CBK of artificially propping up the value of the shilling but I don't trust those loan sharks one bit.
Ericsson
#3282 Posted : Wednesday, February 05, 2020 9:36:42 AM
Rank: Elder


Joined: 12/4/2009
Posts: 8,019
Location: NAIROBI
whiteowl wrote:
wukan wrote:
I think NSE fate lies with CBK. There is a negative feedback loop in the real estate which leading to lower bid prices akin to what happened to NSE from around 2014. That damages a lot of balance sheets which were already damaged from the fall in equities. A downward correction in real estate will hurt a lot more of the wenyenchi balance sheets than equities did. I would expect more pressure on MPC to be more aggressive in the rate cuts or do localized QE.


Similar sentiments expressed here
https://www.standardmedi...-an-economy-in-distress


Quote:
Research shows that house prices are indicators of changes in the economy. In other words, the change in house prices passes information about the pending state of the economy.
The value of a house depends on the rent that the tenant pays to the landlord.
In finance, we discount rent in house values, such that when rent increases, the value of the house must also increase because additional income is being generated and vice versa.
This means that it is only in unsound economies that tenants are unable to pay rent thus opening a window for the decline in house prices.


Quote:
Simply put, if a mortgage is for Sh10 million, but the house has declined in value to say Sh7 million, the logical thing to do is to default.
The default will lead to more losses in asset values and low-quality financial institutions.
This explains why debt is largely an option. The debate then is between the interest rate and collateral rates - the rate at which houses are financed with debt - which is the most important to the economy?


QE is a zero sum game when you have dollar denominated loans. It spurs growth but will balloon the debt when the value of the shilling falls. This is the same reason the world bank has accused CBK of artificially propping up the value of the shilling but I don't trust those loan sharks one bit.


Dollar denominated loans and a big chunk is commercial loans which come with tough conditions when you want to renegotiate.

Mainat
#3283 Posted : Wednesday, February 05, 2020 10:08:52 AM
Rank: Veteran


Joined: 11/21/2006
Posts: 1,586
Highly doubt cbk has the withwal to do balance sheet management.
Our economy has one real weak pillar which must be resolved before we see growth.
Government domestic debt.

wukan wrote:
I think NSE fate lies with CBK. There is a negative feedback loop in the real estate which leading to lower bid prices akin to what happened to NSE from around 2014. That damages a lot of balance sheets which were already damaged from the fall in equities. A downward correction in real estate will hurt a lot more of the wenyenchi balance sheets than equities did. I would expect more pressure on MPC to be more aggressive in the rate cuts or do localized QE.


Similar sentiments expressed here
https://www.standardmedi...-an-economy-in-distress


Quote:
Research shows that house prices are indicators of changes in the economy. In other words, the change in house prices passes information about the pending state of the economy.
The value of a house depends on the rent that the tenant pays to the landlord.
In finance, we discount rent in house values, such that when rent increases, the value of the house must also increase because additional income is being generated and vice versa.
This means that it is only in unsound economies that tenants are unable to pay rent thus opening a window for the decline in house prices.


Quote:
Simply put, if a mortgage is for Sh10 million, but the house has declined in value to say Sh7 million, the logical thing to do is to default.
The default will lead to more losses in asset values and low-quality financial institutions.
This explains why debt is largely an option. The debate then is between the interest rate and collateral rates - the rate at which houses are financed with debt - which is the most important to the economy?

Sehemu ndio nyumba
Ericsson
#3284 Posted : Thursday, February 06, 2020 10:52:30 AM
Rank: Elder


Joined: 12/4/2009
Posts: 8,019
Location: NAIROBI
lochaz-index wrote:
mnandii wrote:
EQUITY HOLDING GROUP



Equity appears to be on the verge of a collapse to below 33.00.

On the far right we have what appears to be a completed blue wave 1. I expect a small rally to complete wave 2 then a continuation down. The red line at 55.56 is, as always with Elliott Waves, a key resistance which should not be penetrated to the UP side.

NB: There is some price point (not shown) which suggest that Equity traded at around 400. I unfortunately could not manage to plot all that data since the program was not responsive. However the data we have above is still sufficient to make an Elliott Wave forecast which I have endeavored to do above.


Thanks. My target on this one is around 28 thereabouts then I will review it for a long play.


Equity bank is holding above ksh.50
Ericsson
#3285 Posted : Thursday, February 06, 2020 10:59:58 AM
Rank: Elder


Joined: 12/4/2009
Posts: 8,019
Location: NAIROBI
mnandii wrote:
lochaz-index wrote:
mnandii wrote:


Remember our 36/- target on Safaricom. Be ready to SHORT then.

Watching this one closely.


Safcom may have topped out at 33.50.

A move below 25.00 will be conformation that a top is set at 33.50. If that happens then expect Safcom to fall much further to at least 14.00.


Safaricom is holding above 30.
Ericsson
#3286 Posted : Thursday, February 06, 2020 11:01:32 AM
Rank: Elder


Joined: 12/4/2009
Posts: 8,019
Location: NAIROBI
mnandii wrote:
KCB



KCB BANK GROUP fell from 184.53 to 44.11 to complete wave (A). Afterwards it has been consolidation in a likely triangle pattern (the converging trend lines) of wave (B).

I expect KCB to resume its drop to below 22.00




Holding above 51
mlennyma
#3287 Posted : Thursday, February 06, 2020 7:23:01 PM
Rank: Elder


Joined: 7/21/2010
Posts: 6,001
Location: nairobi
Ericsson wrote:
mnandii wrote:
KCB



KCB BANK GROUP fell from 184.53 to 44.11 to complete wave (A). Afterwards it has been consolidation in a likely triangle pattern (the converging trend lines) of wave (B).

I expect KCB to resume its drop to below 22.00




Holding above 51

what can make Kcb trade at below 22?a split/rights/economy collapse or what ??? let me say miracles do happen
"Don't let the fear of losing be greater than the excitement of winning."
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