Hi all, I have to present a debate for the following topic in a few weeks as a part of my uni studies:
DCF analysis is only as useful as our prediction is accurate of future inflation and interest rates.
I am on the negative team, hence i am arguing that our prediction of future inflation and interest rates is at best flawed and cannot be undertaken with any measure of certainty, therefore DCF analysis is only as useful as our prediction is accurate of future inflation and interest rates, and accuracy cannot be assured.
Can you guys help me with some good point to make to prove this point of view. I am bit stuck and would greatly appreciate any help you can provide me.
All the Best
NickCom
Can anyone help me?
I agree.
The best formula is useless against world events and natural disasters as we have seen time after time.
THEY are out there controlling events and world structure as we speak. Unless you are one of THEM you will never know what structure the economy or world events will take. Therefore It is immeasurable.
One things for certain, THEY are involed in the money buisness and steadily low inflation and low intrest rates are not good for THEM.
Keep in mind almost all of the OPEC nations are Islamic, they were squeduled to trade their oil in Euro just like Iraq had already done. This would devalue the $us to an almost depressive state. Wasn’t it handy for the American Gov that Islamic fundamentalists raked havic on them and threatened the western world. So to defend us they invade Afganistan and Iraq. Take control of the Iraqi currency, once they have that it doesn’t matter how the rest of the country is divided up. Now the US have set themselves nice in the heart of Isalmic land, they can go about blackmailing the rest of OPEC. As far as humanity goes its a dissaster, as far as buisiness goes its bloody brilliant. As far as our methods for predicting economic patterns, as long as there is a monopoly of social structure and a monopoly of currency by THEM, that measurment becomes impossible.
aluminatiok i got lost in all that.
gee maybe i could direct you to hedging? what about options?
Well let me think, cant help you really cause the paragraph up the top just lost me and its late and i cant think. Now you could use derivatives for oil prices. you can even use currencies to hedge, so if one goes down the other might go up?
sorry im off topic, but no one has a crystal ball and you can track historical data and so on til the cows come home in order to try and figure out what the future might predict, but as with anything in the past, there is no guarantee of success in the future.
interest rates are a measure to control many things, and like in aust the RB kinda controls things so we dont get too ahead of ourselves, too involved for me. we noticed a month or two back people on this forum trying to guess if teh rates will go up or stay as they are…now we werent privy to the machinations of the gov as such and their hidden agendas, we do know however that the boom in the property market had to be halted for many reasons bummer dude! higher rates helped the economy….not me.
cheers
does that help?” a blind man may see what a sighted man may not”
What is DCF Analysis?
kay henry
Hi Kay,
DCF = Derek’s Cash Flow
Sorry can’t help – but I couldn’t resist [biggrin]
Derek
[email protected]Read my comments? Think I can help you? PM or email me.
Thanks for that Derek! [rolleyesanim] [tongue]
kay henry
NickCom,
Here’s some arguments:
Unpredictable events such as terrorist activity, natural disasters & other abrupt shifts – whether social, economic, political, ethical or otherwise mean that predictions of economic indicators are not useful beyond a few months into the future.
The way inflation and other economic indicators are measured is modified regularly by governments to present the best face on the figures. As such distilling past figures into trends is fallacious as the measurement of the indicator is constantly varying. Equally you cannot reliably use this information to map future trends.
Hope this helps
Cheers,
Aceyducey
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