rightcoastconservative

Public mutual is launching a new fund, Public Indonesia Select Fund on 1 st September 2010. The fund invests in a diversified portfolio of blue chips, index stocks and growth stocks primarily in the Indonesian market, with up to 30% of its net asset value invested in the Malaysian and other global markets. Public Mutual’s CEO said Indonesia , which has the largest economy in South East Asia , is poised to be one of the fastest growing economies in Asia after China and India . Key selling points: Huge domestic base, being the 4 th most populated country in the world. Rich in resources Improved fiscal position in recent years The fund would focus on sectors which include banking & finance, commodities, building materials and consumers. The fund is a niche product suitable for aggressive investors who wish to capitalize on the long-term growth prospects of Indonesian market. Offer period              ...

President Obama talked about the economy yesterday, punctuating the end of "recovery summer." According to the President, the weakening economy is all the fault of stubborn Republicans who refuse to endorse the so-called "small business tax break" bill. This bill is another "targeted" tax break bill that is easily gamed and will contribute nothing to economic recovery. Republicans are correct to oppose this wasteful bill. The President has no new ideas. His agenda is mostly a redistributive agenda with job-killing rules, regulations, taxes. The lack of job creation and the stultifying impact of Obama policies are a big surprise only to the President and his Congressional allies. I wonder if this President will ever understand how jobs get created in the private sector? So far, Obama just keeps whistling the same discredited message of tax and spend. Fortunately, the Congress will have no more of this and November 2nd is fast approaching.

According to real estate players, Bank Negara Malaysia (BNM) may impose a lower mortgage Loan-to-Value (LVR) ratio soon. How soon? What is the rationale? As reported in all dailies recently, property prices in Malaysia have been escalating since last year. No doubt, many people made handsome profit even in this down time through properties. Even though BNM has upped the base lending rate (BLR) 3 times so far this year, demand for properties seems unaffected, especially for high-end properties. According to Bernama, Bank Negara is reported to have written to financial institutions to secure feedback on the possibility of capping the LVR for mortgages at 80% to avert the risk of a potential property bubble. Recalled, government had imposed a 5% real property gain tax (RPGT) during Budget 2010 to curb the speculative buying of properties. So, it’s not surprise that BNM will implement the 80% cap on mortgage LVR, or at least for properties of more than RM500k. Currently, banks can usua...

How do you restart the economy? At this point, every government policy prescription has been tried. The net result: zero. The economy is struggling and some even expect the economy to show negative growth in the second half. That's unlikely, but certainly possible. Maybe, just maybe, government policy is the problem, not the solution. The economy, had there been no TARP, no bailouts, no credit and debit card reform, no Obamacare, no demonizing rhetoric from the President, may have been well on the road to recovery by now. The government could well be the problem. Macroeconomics is no science. When you ask an economist whether he favors spending or tax cuts, his answer tells you whether he is a Republican or Democrat? What kind of science is that? The cold, hard truth is that economists don't know what to do. Obama is now learning that truth to his chagrin. Obama thought this would all be easy. With folks like Larry Summers, Tim Geithner, and Christina Romer telling h...

Don't let the national political scene get you down. Things are actually beginning to look up. November 2nd is the big day and no matter the result, there is an almost certain feeling that the political environment will get better for business. Post November 2nd, Obama might change course. Not likely, though, as he seems to have his playbook memorized and can live with declining public approval. More likely, Republicans will block any new anti-jobs legislation that Obama and the Democrats can dream up. Moreover, there seems to real hope of gutting ObamaCare and shifting the health care discussion to a more rational plane. Progress can be made on repealing much of the finreg fiasco. Congresional committees can expose the enormous graft and corruption of the Obama Administration and their Congressional allies. So, things will be changing for the better by late Fall and I would expect a very different public dialogue in 2011. All in all, I expect a better political environmen...

The past two months have seen a slew of activities within the Genting group. Other than the spectacular result shown by Genting Singapore (GENS), Genting seems to be treating unfairly to another son – Genting Malaysia (GENM). 1 st , GENM to buy Genting UK from GENS for £426m or RM 2.1 bn. (See figure 1) 2 nd , GENM has won a bid to develop and operate Aqueduct racino in New York City . (See figure 2) Well, the Aqueduct deal appears promising, with its key appeal being its strategic location just two subway stops from the New York subway. However, the UK assets seem to be too expensive for GENM to swallow. According to CIMB research, the acquisition price seems slightly high at 1.2x price/book value. Recall GENS originally bought these assets back in 2006 for £ 699 m and three impairment charges taken since then have reduced the book value to the current £ 289 m. No wonder minority shareholders are against the deal. Surprisingly, the proposed acquisition gets the go-ahead signal ...

The latest craze among stock market pessimists is the "Hindenburg Omen.". If you subscribe to this view, you will sell everything you own and retreat to a cave somewhere....immediately. According to "HO," the stock market will get crushed in September and October -- maybe to 5,000 on the Dow, maybe to 1,000! Don't listen to this silliness. The stock market is cheap and serious Investors should be fully invested. There will soon be an "end-of-Obama" rally, as the enormous political sea-change that will take place on November 2nd gets factored in. There is a real chance of sweeping political change that will bring capitalism back to the US. There are good signs in Europe that even Europe realizes the welfare state must be dismantled. Things can turn around and it looks more and more like that is where we are headed. So, put on your optimist hat, buy stocks, and enjoy the coming rally.