The Americans have overspent! They are now between the devils and the deep blue sea. What's going to happen next? So many countries are now in recession. Singapore has retrenched 500,000 Malaysians according to one Chinese newspaper. Where can these people go? Can you imagine the pain, agony and desperation for one to lose his job when his monthly installments for his house and car are already in arrears?
Pakistan, Ukraine, Argentina, Iceland, New Zealand, Australia, Hungary, Japan, Germany and England are all in financial crisis. The global financial meltdown has clearly shown that demand for everything has dwindled. Crude oil had tumbled from $147 to $50 per barrel. Palm oil dropped from RM4486 to RM1450 per metric ton. Landed properties are sure to follow the downward path.
Now is the time to be ultra-cautious with your money. All unnecessary expenses must be hived off. Cash will become more and more valuable. Not long from now, you are likely to have the opportunity to have some real-cheap buys, not only in the stock market but in real estates as well.
Some governments will cut interest rates to spur spending. This may work in the short term, but over time, the cure will be more deadly than the disease.
Obama is said to be in favor of an alternate fuel. If he is successful even to a certain extent, crude oil has no way to find its way back to its glorious days. Already demand for the product has dropped as reflected in its price. Brazil, Russia, India and China are said to be strong enough to weather the American crisis. This assumption may not hold water now. In the foreseeable future, deflation is sure to set in. The days when you are able to buy very much more than what is offered now may become a reality in the not too distant future.
Hold on to your cash. You will have a better tomorrow....... for your buying.
Cheers and Happy Waiting!