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Showing posts from 2013

"You Can Keep Your Existing Health Insurance"

I wondered about this statement at the time Obama made it.  Clearly, by changing all the rules of health care insurance and mandating conformity, it was unlikely that the vast majority of Americans would not find themselves forced by 'The Affordable Care Act' to have to deal with a completely different health insurance plan and completely different set of health care providers.

I now understand what Obama meant.   He was speaking to his immediate family and (politician) friends.  They are exempt from the "Affordable Care Act."  Clearly what he meant to say was: "if you are exempt from Obamacare, like me and my family, you can keep your existing health insurance."  He never meant to mislead.

Things We Now Know

The poor are losing ground in the new Obama world.  The facts are showing up even in the halls of collectivist extremes like the New York Times.  The rich are getting richer and poor are being locked in place.  Big government is throttling the economy and the hopes and dreams of lower and middle class Americans.

Today's Wall Street Journal's article by Simon Constable lays out some of the simple and obvious facts of the Obama era: "The richest 20% of households account for 38% of spending, according to government data for 2011, the latest available.  Compare that with 2003 when the top earners spent 26% of the total."  The article goes on to say..."it could get even worse."  It will.

Who really benefits when the regulators strangle the banks?  Do banks really need to get much more conservative in their lending practices?  Why does the government know best?  How far can you stretch the FDIC guarantees before American banking is simply a subsidiary of the US go…

5 Unusual Tricks to Help you Save Up

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Saving money is not always as easy as it first seems, and all those good intentions and budgets can fly out of the window without you even noticing – so why not try some more unusual money saving tips? Here are five of our best tips to help you save up!

Never pay with coins
That’s right, take out all those coins weighing down your purse or wallet and put them in a piggy bank or jar instead. That 10 Sen coin isn't worth much on its own, but once you start saving up all your coins, it can add up to a considerable sum. Avoid the temptation of dipping into your coin fund by storing in it a tin with just a coin slot at the top. If you have to get out a can opener to access those coins, you’re more likely to wait until it’s full before you open it!
Never say NO to a freebie
Whether it’s free shampoo and soap from a hotel or free condiments from a restaurant, stock up! These free products are just as good, but with the added bonus that they cost you nothing. It also means that you get better…

Poor Policies; Poor Predictions

The Obama Administration and the Federal Reserve have consistently over-estimated the strength of the US economy.  The Fed has, on no occasion since 2009, had a remotely accurate prediction, constantly and consistently over-estimating economic growth by well over 40 percent on average.  With that record, one wonders why anyone cares what the Fed thinks about the future.  (The Wall Street Journal on Thursday reported, in a graphic, the predictions that the Fed had made over recent years).

Now, economists like Laura d'Andrea Tyson, a Clinton economic advisor, wonders why the poor are getting poorer in the Obama non-recovery since 2009.  After five years of government expansiveness and a Federal Reserve out-of-control, the rich are getting richer and the poor and middle class are losing ground.

Strangely, these results were perfectly predictable.  They follow from the Obama policies.  We have implemented in detail what David Stockman, in his recent book "The Great Deformation,&quo…

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A Rose By Any Other Name

The Fed announced today that it would continue it's bond buying binge to the tune of $ 85 billion monthly, a policy that has been in place since the 2008 financial collapse.  This has expanded the once miniscule Fed balance sheet to over $ 4 trillion. 

The Fed, of course, can create money digitally.  That's what it uses to buy the bonds.  It just says:  "let there be money" and there is money.   This massive expansion in the monetary base has created huge excess reserves in the nation's commercial banking system.  Why doesn't anyone loan this money out?

The pitiful loan activity is a result of two factors.  Dodd-Frank and activism in the Justice Department and others has made it a criminal activity to loan money to anyone who doesn't have the very, very best credit.  And people with that kind of credit have lost interest in borrowing to build businesses in the new Obama world of massive regulation and impending soaring health care costs.  So, not too many l…

Why Gold and Silver? Why Online Store?

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Are you first time gold and silver buyers? Why don't you invest in these popular metals? If you did so, you have had a wonderful investing experience after 2008 global financial crisis. But, do you really understand these metals? Were they really precious (especially now)?

Traditionally, gold and silver were one form of exchange. Because of the invention of fiat money, they were being turned into some short of "back-up" currency, in case our fiat money system go burst. It's natural when things go wrong, gold and silver tends to appreciate in value. In other words, people hold precious metals to preserve the value of their assets.
3 Reasons Why Gold and Silver...
Still hot in demand, especially by emerging affluent Chinese. Traditionally, Chinese loves gold. They bought it for events such as new born baby, new year, wedding and even funeral ceremony.Strengthening USD ??? Yes. It's a correct reason also. Why? Because of news that US going to stop QE3, USD is strengthe…

Inequality and the Poverty of Economics

The Journal of Economic Perspectives is an academic journal that summarizes the state of research in various fields of Economics.  Perusing this journal shows the extreme political bias of much of modern day economic research.  The Summer 2013 issue was devoted to "income inequality."  The main theme was that rich folks are getting richer, but, of course, the facts actually show just the opposite.  Not deterred by the facts, the various economists that opine in this edition blithely parrot absurdities such as wealthholders ability to "sustain their preeminence.

What is the analysis?  Imagine that you wanted to know if baseball teams created dynasties and "perpetuate" their dominance of baseball.  What facts would you want to assemble to prove this?

Here's the way economists think:  collect data that shows that back in the old days, the baseball teams that won the pennant won 65 percent of their games each year.  Then show that, today, the teams that win the …

3 Tighter Rules for Property Sector? (Sept 2013)

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Prior to Budget 2014 (to be tabled next month), speculation has rift up on a few proposal to tighten the rules, especially on property sector. Following the outcry from public stating the alarming high property prices, measure should be taken to tackle the issue before bubble was formed.

The Bubbling Biz...
Among the measures being proposed were:
Non-other than Real Property Gain Tax (RPGT)

Higher Stamp Duty: ~ 5% of purchase price for 3rd property ~ 7.5% for 4th property ~ 10% for 5th property onward
Loan-to-Value ratio reduce to 60% for 3rd property onward

While the above info need to be ascertained further, some banks already implemented their in-house ruling. What's that? It was to limit the maximum term for refinancing of property to 10 years. Yes. Sooner or later, all of the banks will follow.
* Please note that the above 3 rules need to be ascertained further. Stay tune!

College Grads and Jobs

There is a growing discussion about whether or not college graduates are generally prepared for the workforce.  This is a very interesting (and revealing) discussion.

This is not so much about GPA as it is about more fundamental problems -- attitude tops the list.  Far too many college graduates think that they have 'paid their dues' by attending college and collecting a degree.  Many seem to think that joining the work force is akin to joining a fraternity or sorority.  They seem disappointed that employers' have high work expectations and are in no hurry to provide massive benefits and a club-med work environment to a rookie employee.

What every employer wants is someone committed to work hard, to learn new skills, and to already possess basic writing and mathematics skills.  The vast majority of college graduates, measured against these expectations of business do not measure up. 

That's the sad truth about higher education.  We don't insist that our graduates have…

Work Ethic of 70s, 80s, 90s

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Different generations have their own view on working. You like it or not, working is part of our live. No work = No life. However, this equation has since changed to "Working = No life". Do you agree?

Generally, those born in 70s were perceived to be loving their job. They work hard mainly because of 3 meals/day. For them, a secured life means having a stable job with stable income. They believe that with every efforts you put in, that will reward you back later. As such, over time (OT) is nothing for them.
As a responsible 70s, losing their job is a serious matter they tend to avoid. That's why they usually found another job first, before resigning.
How about 80s? Other than chasing for stable income, those 80s working adults will also look into the job scope, opportunity for promotion, or working environment. They will take initiative to find for better job. Hence, job hopping is very common for them.


Notably, 80s are reluctant to sacrifice their quality of life because of …

How Much You Need To Save If You Ever Want To See Your Kids Graduate?

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In an age where the common degree has become a pre-requisite and not so much an advantage, ensuring that you have enough to see your children through a reputable university has inadvertently become one of the most important responsibilities you’ll face as a parent.
Unfortunately, knowing how much to save for your kids’ tertiary education is not an easy question to answer.  In fact, it is downright complex in view of the vast differences in costs from degree to degree, university to university, and country to country.  And even for those who do have a number in mind, there is still the question of when you should start saving, using which savings / investment vehicle.
If you have been wondering about your financial capabilities to finance your kids’ tertiary education, or you have been seeking a workable method to save a sizable study fund for your children; allow iMoney to shed some light on this matter with their latest infographic:

Courtesy of iMoney.my

Lesser Amount can be Withdrawn for EPF Members Investment Scheme effective January 2014

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Are you an EPF member who withdraw money out for investment scheme? Then, this is a very important news to you.

Effective January 2014, the minimum basic savings required in Account 1 was revised upward. This will affect all of YOU who withdrawn certain amount from EPF account 1 for eligible investment purpose. Higher limit means lesser money you can withdraw from EPF in the future.
How much will be increased? Based on the chart below, the percentage increased can be as high as 64%. Generally, the increasing amount was at least 50% once you're age 27 onward.


How to calculate how much can I withdrawn from EPF account 1?
What's the different or impact? Depending on your age and how much savings in account 1, the impact varies by members. For better explanation, please see example below:


Finance Malaysia hopes this post can enlighten you on EPF members investment scheme withdrawal. You may share this to your friends. Thanks.

The Nasdaq Flap

The Nasdaq halted trading today and was down for a couple of hours.  Listening to the financial media (CNBC, Larry Kudlow, etc.), you would have thought a great crime had occurred.  99 percent of the investing public had no idea and could care less, me included.

What serious investor could possibly be harmed by a two hour shutdown of the Nasdaq?  Are these pundits serious?  If there was ever an 'inside baseball' issue, this is it.  Only manic traders and hedge funds could possibly care one way or another about the Nasdaq shutdown.

No portfolio of any serious investor could possibly be damaged by a temporary shutdown of a stock exchange.  This is a ridiculous tempest in a teapot.

Obama and Higher Education

Just what we need, the Obama tenacles reaching into higher education.  In typical style, Obama points to a problem -- the high cost of higher education -- and proposes a solution that has nothing to do with the problem and actually will likely make the problem far, far worse than it is now.  This has been the pattern with the economic rescue plan, with the 'affordable' health care act, with wind and solar initiatives, and on and on.  Every problem that Obama has inherited has become a much bigger problem under his leadership.

What is wrong with higher education?  Mainly the government, as in most other things.  Federal funding for research grants and student loans has made higher ed less interested in scholarly pursuits and more interested in the pursuit of federal largesse.  Students are borrowing huge amounts of money to maintain a college lifestyle that for prior generations was simply unavailable.  Who could spend that kind of money on beer and fitness centers in the good o…

Media Misleads Once Again

Reuters has a story today about the jobless claims number that is completely absurd.  According to Reuters, "...then new claims... rose...but...gave a positive signal for hiring during the month."  This conclusion is based upon absolutely nothing. 

What the data, in fact, shows is that jobless claims rose last week and rose more than the market expected -- not good news at all.  Worse, the numbers are barely (five percent on average) lower than the numbers in the early part of the year.  Given that revisions are typically well above five percent, a drop of five percent is statistically irrelevant.

The real truth is that the economy is not producing enough jobs and the few that are produced are mostly part-time, low wage jobs.  Not surprising, given the Obama economic program, which guarantees economic stagnation as far as the eye can see.

The media has made a habit of consistently distorting the truth about the American economy in their cheerleading effort to defend failed poli…

Read David Stockman

A new book by David Stockman, "The Great Deformation," challenges the current orthodoxy of financial market regulation.

This book is a great read.  Don't expect a calm and collected analysis.  This book is definitely not calm and collected.  Stockman takes on all comers and his style is blatantly polemical.  He aims his brickbats at the right and the left as he excoriates the rise of indebtedness, public and private, since the 1960s.

Don't think conservatives get a free ride in this book.  They don't.  Ronald Reagan and Milton Friedman are targets of Stockman.  Indeed, Stockman sees Reagan and Friedman as major culprits in the incredible growth of America's financial liabilities.  Some of this is, no doubt, sour grapes for his well-publicized split with the Reagan Administration in the 1980s when Stockman was Director of the Bureau of the Budget.  He resigned that post in a feud with the Reagan folks over their unwillingness to support spending reductions to ac…

Should or Would Government Privatizing MAS? (Aug 2013)

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Both of our ex & current Prime Minister already voiced their views regarding this matter. Yesterday, our ex-PM said Government should SELL MAS if it can be run more effectively by private sector. Meanwhile, when asked, our current PM said there was no plan to privatize MAS now because it was on track to its turn around plan under the helm of new management. So?

In fact, this was like a million ringgit question for many speculative investors. Maybe, they or YOU were hoping for the deal to materialize if you bought the shares just recently. Anyway, it won't be as easy as you might think.
MAS is a national carrier. It carries the national flag wherever it goes. (Some more, national day is approaching now) How much to privatized? Especially for a still loss-making company... Definitely, Government won't get much if MAS being privatized now.
However, everything is possible given the facts below:
National company is just a company anyway. We have just witnessed the privatization of K…

Time to Buy Emerging Markets?

Emerging market stocks have been hammered this year as the US and Europe have enjoyed one of the best stock markets in history.  Why?  What happened to the argument that slow (GDP) growth in the developed world and much higher (GDP) growth in the emerging economies argued in favor of a heavy commitment of investment funds to emerging market?

As it turns out, emerging market economic growth has, indeed, been much, much higher than economic growth in the Western nations.  So, why did their stock markets put in such a pitiful performance thus far this year?  A similar pattern occurred in US history when foreign investors, mostly British and Russian investors, lost bucketloads of money betting on growth in the US economy in the 19th century.  This is not the first time that dramatic GDP growth failed to help investors in public stocks.

Many of the most vibrant companies in the countries that fall into the 'emerging market' category are not public companies.  They are privately owned…

European Recovery -- Seriously?

The news services are abuzz this morning with the "news" that Europe has finally turned the corner with an economic rebound in the 2nd quarter of this year.  Underneath the headline is the dismal number of an annualized 0.3 percent estimated growth rate for the 2nd quarter.  Whoop-to-doo!  This is a recovery.  This number is not significantly different from a negative number, given the pattern of revisions.  Meanwhile, unemployment in Europe remains above 12 percent and sovereign debt is soaring on to new highs.

There are further stories that Greece is on the road to recovery.  What are their current statistics?  GDP only dropped an annualized four percent in the first half of this year.  Wow!  That's really something to write home about.  Combined with almost 28 percent unemployment overall and nearly 70 percent unemployment among youth, it sure sounds like Greece is just humming along.

Wonder what the statistics would show if Europe was doing poorly?

Some Good News for the US

Steve Moore's column today in the Wall Street Journal is worth a read.  The sequester, according to Moore, has worked.  Total federal spending has been slowed, even reversed, in the past two years, according to Moore.  This is, indeed, good news.  Let's hope it continues.

Moore notes that all it takes to continue to hold federal spending in line is to not undo the budget deal that led to the sequester in the first place.  It will be interesting to see if politicians can stick with the plan by doing nothing.

Update on Greece

Now, after five years of European Union policies, how do things look in Greece.  The headline today on Yahoo looks encouraging: "Greece Beats January-July Budget Target."  In fact, Greece did not do any such thing.  More bailout funds from the EU, though, made it look that way. 

Here is what the EU has done for Greece:  GDP today is 20 percent lower than it was in 2008, when the EU bailouts began.  Unemployment is at a record pace, pushing toward 30 percent.  These numbers are not very different from where the US was in 1933 at the lowest point of the Great Depression.

Meanwhile, civil order is breaking down in Greece.  Crime is rife and the only things growing are the nation's indebtedness and the black market.   Political discourse is moving to the extremes as the center breaks down.

Finally the debt to GDP ratio is rapidly climbing to 200 percent.  The EU has made a small problem into a large problem and has obligated the entire European continent to back a bailout that …

The Changing Face of the American Workplace

The US economy was once the envy of the world.  From 1865 to 1965, the US economy grew faster than any large economy in the world.  The great American middle class came into prominence during this period and American income and wealth had no rivals anywhere in the world.  For most of these years, there was no Federal Reserve or central bank in the United States, though central banks had a long history in every other large country in the world.  For most of these years, there was little business regulation and no income tax.  The Federal Reserve and the Federal income tax came into existence in 1913, coming on the heels of the best 60 years of economic growth in the history of the US.

Not that everything was rosy.  Financial panics and the great depression occurred during this 100 year span.  Unemployment rose and fell.  Markets rose and fell.  The dynamics of American growth were chaotic, though powerful.  But, with all of the chaos and panic, the American pie grew at an unprecedented …

Another "European" Jobs Number

162,000 new jobs in July.  Not only is that an absurdly low number for an economy as large as the US, the job numbers for both May and June were revised downward as well.  No one is much interested in hiring anyone.  That's the main message of this report.

A subtext is reflected in the unemployment rate, which fell to 7.4 %.  How, if a pitifully low number of jobs are created each month, is the unemployment rate falling?  When people give up looking, they aren't counted anymore and more than 6 million have given up looking. Unemployment could get down to 1 percent if almost everyone just gave up and went on public assistance.  Is this the Obama plan?

The White House is succeeding in getting the economy that they have wanted -- the European economy -- no growth, no opportunity for the young and ever rising debt levels that have no conceivable way of being repaid.  This is the liberal dream.

Interviewing 非常好歌 Superstar - Quek Shio Yee

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Learned piano and violin since young, started writing songs when in high school. This is the background of new born superstar - Quek Shio Yee. After wining the BEST SONG with Lexi Chan, Finance Malaysia blog managed to grab the opportunity to know her better.

When asked about her future direction, the UCSI undergraduate yet to plan for it. Hmmm... I guess her fans out there for sure would loved to see her on stage again. Right?
Full Interview here: When did you realized that you're in love --- with music? How did it started? I started my music lessons since I was 4 years old. Since then I've always been musically active. It has been important to me. My parents led me into the world of music. 
On the BEST SONG you won with Lexi, what goes into your mind when she find you to sing in the first place? I was introduced to the program by my friend and auditioned. The producer gave me a few demo songs to try, and I was chosen to sing Lexi’s Mission Incomplete. I was happy to sing it becaus…

Big Companies More Valuable Than Small Companies

So what explains the surging stock market, when the fundaments of the economy remain weak?  Again, micro-factors favor large companies with access to government.  This is true for banks as well as for non-financials.  Smaller companies are getting hammered by higher tax rates, more mandates, and looming ObamaCare.  Large businesses, with some exceptions like coal, can deal with all the bureaucratic regulatory stuff because they have so much scale.  Not true for smaller businesses.

So what you're seeing is a change in the playing field.  The big guys are doing relatively well and small business is in the doldrums.  That is keeping with the Obama playbook of the grand corporate-government teamwork.  Obama can relate to big giant companies, because they are so much like the government and, in some ways, indistinguishable.  But small business is an annoyance in the Obama scheme.

The problem is: small business produces the new jobs for the economy; big business is a stagnant employer in …

Urban Renewal -- The Big Government Way

Having spent the past four days wandering the neighborhoods of Washington DC, it is clear that this city is a prosperous, booming area.  Wonder what business enterprises are sparking this growth?  Big government.

Years ago, when I was a newbie intern for the US Treasury, walking a couple of blocks from One Washington Circle (where I lived back when it was an apartment complex) was a dangerous undertaking.  No More.  For miles around, there are now leafy suburbs with casually dressed joggers and dog walkers.  The homes are well maintained and coiffed and the comfortable residents seems at ease with their plush surroundings.

Who lives here?  The new "protected" class.

These are the people that work for the federal government or the numerous so-called private businesses that devote their endeavors to providing services to government or lobbying to gain a share of government largesse.  These are the folks that view people outside the beltway as moronic environment-destroyers and ho…

Understanding the Habits of the Rich

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Fancy getting rich? Here are the rich man’s habits.

Seminars, webinars, Social events/ gatherings, book launches... These right here are some of the main events circled on the rich people’s calendars!
Ever wonder why? At one of the many book launches I have been to I had a chance to chat up the local best-selling author Azizi Ali, brilliant mind I must say. He told me that the number of books published in a country mutually relates to the wealth of the citizens.His explanation therefore was the more publications per annum, the more the development countrywide hence increase in the wealth of the individuals.

Not so long ago while I was at a luncheon with this brilliant friend of mine, he mentioned that “rich people seldom eat alone”. I was quite ecstatic because this is a habit that I unknowingly practiced for quite a while now. What he said is totally true come to think about it. Its quite funny that there is an entire book dedicated to this subject “Never Eat Alone”. If you read this boo…

Guilty Until Proven Innocent

I carry no brief for people that break laws, but, in the securities industry, indictments destroy businesses and innocent shareholders are usually left picking up the tab.  That was the result when Drexel Burnham was indicted in 1988.  Many of Drexel employees who trudged silently in the back office found their retirement hopes and dreams destroyed when Rudolph Guliani's over-zealous indictment caused Drexel to go bankrupt overnight -- long before anyone produced any evidence to a judge or jury to peruse.  Most of the folks who lost their life savings by the indictment of Drexel were innocent and had no knowledge of any wrongdoing.  That's what happens when you indict corporations, as opposed to individuals.

This same theme plays out in the litigation and settlement arena.  Pension funds who trumpet their lawsuits against corporations are really only suing themselves and enriching the legal profession.  The wrongdoers go unscathed, while innocent shareholders get hammered.  Thi…

How to Become a Financial Planner?

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After the two series of article on Financial Planning and Financial Planner. Some of you may asked: "Is it difficult to become a Financial Planner? What's the requirement needed?"

Hmmm... Good news is it is not difficult, but the bad news is it's not easy either and the requirements for sure will be raised in the future.
So, how? In Malaysia, those who practice as Financial Planner must pass any one of below examinations: Registered Financial Planners (RFP) issued by Malaysia Financial Planning Council (MFPC)Certified Financial Planners (CFP) issued by Financial Planning Association of Malaysia (FPAM)
After you have passed the said examination, it doesn't mean that you're a Licensed Financial Planner straight away. Why? It's just serves you an entry passport only. Once you have accredited the qualification, you must apply the required licenses with Bank Negara Malaysia (BNM) and Securities Commission (SC) before you can carry out financial planning activities.

New Fund: Kenanga Asia Pacific Total Return

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After merging with ING Funds Berhad, Kenanga Investors Berhad launched its first new fund of the enlarged family. In this uncertain global economic environment, how much return can a fund generated was the main concern for many investors. Want to get higher return? Then, we cannot runaway from higher volatility! Are there any balance in between?

Yes. To cater for such investors, this new fund aims to provide a compounded rate of return of at least 10% per annum over market cycle (5 years) by investing in a diversified portfolio of Asia Pacific equities.

3 Reasons WHY it benefits you:

Well... Unlike others, this fund DO NOT has any benchmark constraint. This allows flexibility in identifying and implementing the most optimum investment strategy. Picture below shows the differences between Absolute and Relative return:
Still not yet convinced? How about the proven track record?

Click here to download prospectus
Source: Kenanga Investors Bhd