rightcoastconservative

For the past few weeks, Equities Market around the world had rally 20% in average. Will it be sustainable? Question in most of the investor's mind could be: Was Recession Ending? Should I Accumulate or Take-profit now? Then, what should I do instead? And, I would say that: "Watch-out for the next few weeks!!!" Reasons: Beware of Corporate Earnings. (Q1) / (FY08) - further write-down from banks/financial institutions - lower sales volume (etc. electronics, automobile, housing...) Beware of Deflation - high base effect set in 2008 - lower CPI due to lower oil, commodities prices - deflation could happened in Q2/Q3 2009 Beware of GDP contraction - not only no GROWTH, but Contraction "Again" Anyway, Do Not be so disappointed with the facts. The good news is this could be the last correction before pathing the way for recovery. In other meaning, this could be the last chance for investor to accumulate shares at the most attractive price.

After some massive layoff of workers around the world, especially in the manufacturing, banking, automobile sector, the pain of economy seems unstopable. This could continue for weeks or months - hopefully not years. As a "cure", governments around the world had come out with some brilliant ideas - though effectiveness still waiting - to combat the crisis. From bank bailouts, numerous stimulate programs, lowering interest rate, to share market stabilization/rescue plan. However, does this really works? Let's take a look at the basic fundamentals of real economy. What I'm saying here is the Demand-Supply. Please do not forget, economy indicator like Gross Domestic Product (GDP) measures the national income and output. Take note: Output. What we are preventing now is the contraction or decresing GDP. For your information, U.S and EU consumes > 50% of world's GDP growth. Since U.S and EU are facing wealth destruction problems, how are we going to prevent GDP contr...

Normally, Gold prices will advance whenever USD weaken. However, the scenario is different for the past one month. And, WHY ? As we all know, USD had weaken for the past one month due to lost of confidence arising from the credibility of U.S governement to revive their economy. Thus, questions on the ability of highly-debted U.S to trim down deficit in the medium-term arosed. Even though, President Obama's assurance to China that their investment in U.S treasuries papers are secured, people around the world seems had lost faith in USD for the short-term (if not long-term). Instead of preserving their wealth by investing in gold, people are taking a higher degree of risks now. They are moving out from gold investment into equities around the world, especially Asia-Pacific. This could be proved by the evidence that gold spot price had fallen to around $870 from over $920 a month ago. And, in the same time, MSCI Asia Pacific Index had increased 23%. So, should you invest in Gold or Eq...

03-April-09 US are haunting us with its unemployment rate for March-09. Guess, Guess, Guess... Its 8.5% !!! Guess what??? This is not the end of the story, because April most likely would be the same (if not worse). Anyway, this is not suprise for us as an investor. Even after annoucement, Wall Street still holding very well (for the time-being). For the past one week, Wall Street had shoot up 10% due to over-optimism on G20 summit. However, I would like to remind everyone here. The 8.5% is meant for unemployment rate, not GDP growth (hahaha). Thats why nothing to celebrate. To make thing worse, we expect that US 1Q09 GDP growth would be in the red too. Take care !!!

Finally, the Obama administration unveiled its long-awaited plan to remove toxic assets from the books of the nation's banks. And the next question would be: Does this works? The $1 Trillion announced was not a small amount. If this measure failed, then, the whole of US sure would go into deep trouble (although now US is boiling the water over 100 Celsius). This is because, US largest creditor - China - would be more concerned about their investment in US treasuries of over a trillions. China had voiced out their concerned lately. And, US re-assured to the world regarding their sound economic conditions. Then, USD had started to weaken against major currencies in the world. I would rather asked: How safe was my investment in US treasuries? If i get back my money with much less value, there is no point investing my money there !!! Anyway, one thing is for sure. This $1 Trillion plan to remove toxic assets from banking system is the way forward to rescue banks from further write-dow...

YES... Attention to all working adults in Singapore, especially Malaysians. Now, im writting this in March 2009, and if this is true, it would be bad news for Malaysians in Singapore. Bad news 1: Singapore in recession since 2008 Bad news 2: Retrenchment and salary-cut is going and on... Bad news 3: Our hard earned $$$ are becoming lesser against USD Below is the facts: 1. Singapore main revenue (export market) had fallen on a double-digit basis 2. Singapore government most likely will further lower already low interest rate to spur economy. In other meaning, not attactive to hold SGD. 3. Cost of pump-primming projects would widening the figure of budget deficit, which needs several years to recover. Now, the FX rate is SGD 1 = RM 2.4, which is a good rate to convert it into RM. So, it is time to move your SGD now. Proven: http://biz.thestar.com.my/news/story.asp?file=/2009/4/7/business/3643051&sec=business Please take note of the DATE !!!

As expected, we say GoodBye to our beloved Lehman Brothers, instead of "GoodBuy" rated by many before. In fact, this is just the beginning. Although investor want to put a dot to all these bad news, things would not end so easily once the fire had started. After Lehman, AIG could be the next potential victim. Do not stop yet, and it's still counting... Japanese Banks, Goldman Sachs, Merill Lynch, UBS, Barclays, RBS, and so on... As to date, AIG have been fallen by more than 90%. Its market capitalisation hovering about $8billion only. Now, AIG is seeking a 'rescue tube', in orger to rides through this tough financial wave. Potential outcome: Yet, Fed come-in for another financial institution. (Boring, Dear Fed) Sold its valuable assets, e.g. insurance arm (can live few more days) Again, Say GoodBye After all, we could declare - Economy's World War III