Monday, December 22, 2008

A Financial Wizard

It's incredible how a financial scandal of this magnitude can go undetected for so many years. US$50 billion by any standard is not a small sum. Bernard L Madoff is easily the greatest con man of the century. I rate him a genius and a rare financial wizard.

Jews are popularity known to be astute and shrewd. Yet the majority of investors in the Madoff's Ponzi scheme are none other than Jews. These investors are really fattened for the slaughter house by their own breed. What a calamity! What an embarrassment!

For those who can ill afford the lost, the pain will last them a life time. When you wake up one morning and suddenly find that you are completely wiped out, the emotional distress is likely to be too much to bear. So far I have not read or heard of anyone who has a heart attack or has committed suicide as a result of the debacle. I take this to mean that all these very rich men or women are really those who can afford to lose. The pain may not be that excruciating after all.

What can we learn from this financial fiasco? The first is that what appears to be the safest may actually be the most dangerous.
The second is that no matter how careful you care, you can be taken for a ride. The sensible thing to do is therefore to diversify, not putting all eggs in one basket and to remember that there is no such thing as completely risk-free.


Sunday, December 21, 2008

Quotable Quotes

I am an optimist. It does not seem to be much use being anything else.
Winston Churchill

Markets come back strongly after crashes. That was the case in 1932, 1937,1962, 1974/1975, 1980/1982, 1987, & 2001/2002.
So, why not 2007/2008?
Marty Whitman

When the majority of investors believe something, it's never long before they are proven wrong.
Robert Torray

When Bufett was young, he asked his mentor Benjamin Graham what would happen if after a crash, the market never came back.
Graham just shrugged his shoulder and said, "Don't worry, it is sure to come back."

So guys, don't worry, we are sure to see the light at the end of every tunnel.

Best wishes.

Wednesday, December 10, 2008

Zero Interest Rate

Are you prepared to put your money in the banks if they pay you no interest or even charge you a small fee for taking care of your deposits? In the US, Treasury bills are now sold at zero interest and there's great demand for them. People there are now willing to sacrifice interest income for safety of their money.

"And when investors traded their T-bills with each other, the yield sometimes went negative. That's how extreme the market anxiety is: Some are willing to give up a little of their money just to park it in a relatively safe place." Yes. that's what is reported in the New York (AP).

Here, in Malaysia, we are still getting not less than 3% p.a. for our fixed deposits. And the grand thing is that these deposits are guaranteed by our government. In our stock market, many worthwhile investing counters are now at realistic levels yielding more than 5% returns. It is not difficult to find out what these counters are. At JupiterOnLine, the price earnings ratio for each counter is shown in the trading screen. What should be of concern to you is whether the earnings can be sustained and dividend payments maintained. For you to figure these out, you need to take into consideration the core business of the company and the integrity & skill of the management. Pay extra concern to plantation companies. The high earnings for the previous quarters will definitely not be repeated going forward as the price of palm oil has gone down substantially. Steel counters are in the same boat.

Interest rate will soften; the price of real estates will soften as well. Inflation will moderate and consumer goods will become less expensive. Take care of your money and they will take care of you.

Cheers and good luck.

Tuesday, December 09, 2008

By 2012, America will become the first undeveloped country

Gerald Celente Predicts Tax Revolution,Riots,Rebellion -

"Gerald Celente, the CEO of Trends Research Institute, is renowned for his accuracy in predicting future world and economic events, which will send a chill down your spine considering what he told Fox News this week."

He claims by 2012 America will become the first "undeveloped country"....
Christmas will finally mean putting food on your table...

here is the video
YouTube - Fox Business: Gerald Celente Predicts Revolution 11/10/08

these are testimonies for his accuracy from many networks

"When CNN wants to know about the Top Trends, we ask Gerald Celente."
— CNN Headline News

"A network of 25 experts whose range of specialties would rival many university faculties."
— The Economist

"Gerald Celente has a knack for getting the zeitgeist right."
— USA Today

"There’s not a better trend forecaster than Gerald Celente. The man knows what he’s talking about."

"Those who take their predictions seriously ... consider the Trends Research Institute."
— The Wall Street Journal

"Gerald Celente is always ahead of the curve on trends and uncannily on the mark ... he's one of the most accurate forecasters around."
— The Atlanta Journal-Constitution

"Mr. Celente tracks the world’s social, economic and business trends for corporate clients."
— The New York Times

"Mr. Celente is a very intelligent guy. We are able to learn about trends from an authority."
— 48 Hours, CBS News

"Gerald Celente has a solid track record. He has predicted everything from the 1987 stock market crash and the demise of the Soviet Union to green marketing and corporate downsizing."
— The Detroit News

"Gerald Celente forecast the 1987 stock market crash, ‘green marketing,’ and the boom in gourmet coffees."
— Chicago Tribune

"The Trends Research Institute is the Standard and Poors of Popular Culture."
— The Los Angeles Times

"If Nostradamus were alive today, he'd have a hard time keeping up with Gerald Celente."
— New York Post

AND NOW HES PREDICTING REVOLUTION. The least worst thing you all could do is stay aware, not panic and stay close with your families as we pull together.

Has anybody saw this in there heads? i know i have and its mindblowing knowing we are actually going to be pushed that much more then the great depression. i gtg though stay safe everybody and i hope there can be some discussion on this.

Monday, December 08, 2008

One for your portfolio

"YTL Cement Berhad achieved a 30.9% increase in net profit to RM157.9 million (US$48.6 mil) for the 9 months ended 31 March 2008, compared to RM120.6 million (US$37.1 mil) for the previous corresponding 9 months ended 31 March 2007.

Revenue grew 21.4% to RM1,012.4 million (US$311.5 mil) this year, compared to RM833.8 million (US$256.6 mil) last year. The growth in revenue and profit arose mainly from higher demand for cement in the construction industry, improved operational efficiencies and better selling prices during the period."

One way to gain exposure to the Chinese market is to buy shares in YTL Cement. The company has announced an interim dividend of 5 sen of which 3 sen are tax free. For entitlement of the dividend you must buy before 31.12.08. If you trust my judgement, adopt a buy-and-hold strategy for this counter. The more you buy, the more you will pick up in the years ahead.
YTL Cement closed at RM2.30 last Friday.

One thing to remember is that in the stock market, there is no such thing as a certainty. You always buy at your own risk.

Cheers! and good luck.

American Depression and Recession

According to Anthony Karydatis, a US economist, the Great Depression of 1929 lasted 43 months from August 1929 to March 1933. Gross domestic product contracted by 28% between 1930 and 1932. Unemployment rate surged to 25%.

In the 1973 to 1975 recession, the unemployment rate went up to 9%. This recession lasted 16 months.

In the 1981/1982 recession, the unemployment rate was 10.8% at its high. This one lasted 16 months. Interested rate was sky-high at ........(not sure how high it was).

In the 1990/1991 & 2001, the recessions were short-lived, about 6 months.

The present recession started in December 2007. Unemployment rate presently is at 6.7%.

I understand that interest rate is now at 0.5% and heading lower. It may go down to zero.

How much longer will this recession last? If you have any opinion, you are welcome to have your say.