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Sunday, 19 October 2008 |
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 You have to kinda wonder just how low the Australian share market can go. The litlle graph on the left isn't broken, the value of my portfolio really has dropped that low. If you look at the starting point and then look at where it's at now you can see that I've lost quite a bit of value. I used to worry every time there was a bit of a dip, but now that it's plummeted I just think it's funny. I don't actually loose any money unless I sell, and I have no intention of selling right now. I know I've mentioned this stuff before, but I'm holding shares in Brockman (BRM) at the moment. They are an Iron Ore mining startup with 1.6 Billion tons of iron ore in the ground in the Pilbara region of Western Australia. They havn't started to dig the stuff up yet, but they do have over 1 Billion tons of iron ore in the ground, and 110 Million dollars in the bank. The weird thing is that their share price has followed the Australian market down the gurgler to the point where the company is now worth only 65 Million dollars. That means that if someone had a spare 65 odd Million dollars available and they could convince enough people to sell their shares at the current price then they would end up buying 110 Million dollars for the bargain basement price of 65 Million dollars (that's an instant profit of 45 Million dollars) and then have over one Billion tons of iron ore to on sell to someone else. That's why I'm not too worried. Sanity has to return to the market at some stage.
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