Sunday, December 27, 2009

Gold - the ultimate Currency

Man has an affinity for gold. Since time immemorial, gold has been a much sought-after metal. It is a symbol of wealth and power. People of all ages treat it as precious. The price of gold was about US$35 per ounce in 1946. As of Dec 24, 2009, it was traded at US$1,105.20 per ounce. For comparison, a shop house in 1946 that costs Malayan dollars 20,000 is worth about RM500,000 now.

In the past, the price of gold has been rather slow. But in the last 10 years, it has taken a turn for the better. From below US$300 per ounce it has fairly quickly reached US1,227.50 per ounce. This is highest price of gold so far.

Gold and the US$ do not go the same way. When the US$ appreciates, the price of gold drops. This is evident in the last 3 weeks. Gold was last traded at US$1,105.20 per ounce on Dec 24, 2009. From its peak, it has dropped about 9.979%. Many analysts call it a correction. Is it a correction, and how much will it correct? From my reading of the chart, I would say that it is a correction and it is likely to come down to about US$1000 per ounce before trending up further. So watch it carefully, if you want to invest in gold.

China is now crazy for gold. Until a few years ago, the Chinese in China are not allowed to invest in gold. Now, it's the other way round. The Chinese government wants their citizens to buy and hoard gold. China has a population of 1.3 billion. Imagine how much impact the price of gold will be affected if this group of 1.3 billion people became interested in gold and started to buy and store gold. The recent increase in the demand of gold could be due to this change of heart in China.

Gold has many uses. Chief of which are for jewelry, coinage, dentistry and for the electronic industries. Our ever-upgrading use of technology has actually been a major factor in the recent increases in the demand for gold.

The paper currency everyone uses now is called fiat currency which is sure to devalue over time. Gold on the hand is sure to appreciate.

How do I invest in gold? The fastest and easiest way is to buy jewelry. However, this is not a smart way. Because when you buy jewelry, a certain amount of fees for handling and craftsmanship has been added to the price. This means when you later sell back the jewelry to the shop, you will have to sell it at a discount. Besides this, jewelry also attracts robbers and thieves who may attack you when you least expect it.

Buying bullion or gold bars also carries the same problem of risk. Perhaps opening a Gold Account at Maybank maybe the answer. If you wish to find out more, just give them a ring.

Another way to invest in gold is to buy gold mining stocks. At the New York Stock Exchange, there are many gold mining stocks you can buy. Some of these mining stocks are: Goldcorp Inc. (GG), Eldorado Gold (EGO) and Barrick Gold Corp (ABX).

Silver normally goes hand in hand with gold. Thus, if you believe in gold, you should also consider investing in silver. One silver stock that I like is SilverCorp (SVM) now selling at under US$7. I have bought 1000 shares at 6.46 per share.

Disclaimer: Whatever action you take as a result of reading this article is your own responsibility. You buy or sell at your own risk.

Happy New Year and may 2010 be a Golden Year.

Sunday, September 13, 2009

The Biggest Stock Scams Of All Time

by Investopedia Staff, (

It is unfortunate, but words often associated with money and fortune are "cheat," "steal," and "lie." Who among us hasn't "accidentally" taken two $500 bills from the Monopoly bank, or forgotten at least once to pay $5 back to a friend? Chances are you were never called on it because your friends trusted you. Just as we trust our friends, we put faith in the investing world. Investing in a stock takes a lot of research, but it also requires us to make a lot of assumptions. For example, we assume reported earnings and revenue figures are correct, and that management is competent and honest. But these assumptions can be disastrous.

IN PICTURES: Stock Scams Slideshow

Understanding how disasters happened in the past can help investors avoid them in the future. With that in mind, we'll look at some of the all-time greatest cases of companies betraying their investors. Some of these cases are truly amazing; try to look at them from a shareholder's standpoint. Unfortunately, these shareholders had no way of knowing what was really happening as they were being tricked into investing.

ZZZZ Best Inc., 1986 - Barry Minkow, the owner of this business, posited that this carpet cleaning company of the 1980s would become the "General Motors of carpet cleaning". Minkow appeared to be building a multi-million dollar corporation, but he did so through forgery and theft. He created more than 10,000 phony documents and sales receipts without anybody suspecting anything. Although his business was a complete fraud designed to deceive auditors and investors, Minkow shelled out more than $4 million to lease and renovate an office building in San Diego. ZZZZ Best went public in December of 1986, eventually reaching a market capitalization of more than $200 million. Amazingly, Barry Minkow was only a teenager at the time! He was sentenced to 25 years in prison.

Centennial Technologies Inc., 1996 - In December 1996, Emanuel Pinez, the CEO of Centennial Technologies, and his management recorded that the company made $2 million in revenue from PC memory cards - the company was really shipping fruit baskets to customers. But the employees then created fake documents to appear as though they were recording sales. Centennial's stock rose 451% to $55.50 per share on the New York Stock Exchange (NYSE). According to the Securities and Exchange Commission (SEC), between April 1994 and December 1996, Centennial overstated its earnings by about $40 million. Amazingly, the company reported profits of $12 million when it really lost about $28 million! The stock plunged to less than $3. Over 20,000 investors lost almost all of their investment in a company that was once considered a Wall Street darling.

Bre-X Minerals, 1997 - This Canadian company was involved in one of the largest stock swindles in history. Its Indonesian gold property, which was reported to contain more than 200 million ounces, was said to be the richest gold mine ever. The stock price for Bre-X skyrocketed to a high of $280 (split adjusted), making millionaires out of ordinary people overnight. At its peak, Bre-X had a market capitalization of US$4.4 billion. But the party ended on March 19, 1997, when the gold mine proved to be fraudulent, and the stock tumbled to pennies shortly after. The major losers were the Quebec public sector pension fund, which lost $70 million; the Ontario Teachers' Pension Plan, which lost $100 million and the Ontario Municipal Employees' Retirement Board, which lost $45 million.
Enron, 2001 – Prior to this debacle, Enron, a Houston-based energy trading company was, based on revenue, the seventh largest company in the U.S. Through some fairly complicated accounting practices that involved the use of shell companies, Enron was able to keep hundreds of millions worth of debt off its books. Doing so fooled investors and analysts into thinking this company was more fundamentally stable than it actually was. Additionally, the shell companies, run by Enron executives, recorded fictitious revenues, essentially recording one dollar of revenue multiple times, thus creating the appearance of incredible earnings figures. Eventually, the complex web of deceit unraveled, and the share price dove from over $90 to less than $0.70. As Enron fell, it took down with it Arthur Andersen, the fifth leading accounting firm in the world at the time. Andersen, Enron's auditor, basically imploded after David Duncan, Enron's chief auditor, ordered the shredding of thousands of documents. The fiasco at Enron made the phrase "cook the books" a household term once again.

WorldCom, 2002 - Not long after the collapse of Enron, the equities market was rocked by another billion-dollar accounting scandal. Telecommunications giant WorldCom came under intense scrutiny after yet another instance of some serious "book cooking". WorldCom recorded operating expenses as investments. Apparently, the company felt that office pens, pencils and paper were an investment in the future of the company and therefore expensed (or capitalized) the cost of these items over a number of years. In total $3.8 billion (yes, with a 'b') worth of normal operating expenses - which should all be recorded as expenses for the fiscal year in which they were incurred - were treated as investments and were recorded over a number of years. This little accounting trick grossly exaggerated profits for the year the expenses were incurred; in 2001, WorldCom reported profits of around $1.3 billion. In fact, its business was becoming increasingly unprofitable. Who suffered the most in this deal? The employees - tens of thousands of them lost their jobs. The next ones to feel the betrayal were the investors who had to watch the gut-wrenching downfall of WorldCom's stock price, as it plummeted from more than $60 to less than $0.20.

Tyco International (NYSE: TYC), 2002 - With WorldCom having already shaken investor confidence, the executives at Tyco ensured that 2002 would be an unforgettable year for stocks. Before the scandal, Tyco was considered a safe blue chip investment, manufacturing electronic components, healthcare and safety equipment. During his reign as CEO, Dennis Kozlowski, who was reported as one of the top 25 corporate managers by BusinessWeek, siphoned hordes of money from Tyco in the form of unapproved loans and fraudulent stock sales. Along with CFO Mark Swartz and CLO Mark Belnick, Kozlowski received $170 million in low-to-no interest loans, without shareholder approval. Kozlowski and Belnick arranged to sell 7.5 million shares of unauthorized Tyco stock for a reported $450 million. These funds were smuggled out of the company, usually disguised as executive bonuses or benefits. Kozlowski used the funds to further his lavish lifestyle, which included handfuls of houses, an infamous $6,000 shower curtain and a $2 million birthday party for his wife. In early 2002, the scandal slowly began to unravel and Tyco's share price plummeted nearly 80% in a six-week period. The executives escaped their first hearing due to a mistrial, but were eventually convicted and sentenced to 25 years in jail.
HealthSouth (NYSE: HLS), 2003 - Accounting for large corporations can be a difficult task especially when your boss instructs you to falsify earnings reports. In the late 1990s, CEO and founder Richard Scrushy began instructing employees to inflate revenues and overstate HealthSouth's net income. At the time, the company was one of America's largest healthcare service providers, experiencing rapid growth and acquiring a number of other healthcare related firms. The first sign of trouble surfaced in late 2002, when Scrushy reportedly sold HealthSouth shares worth $75 million, prior to releasing an earnings loss. An independent law firm concluded the sale was not directly related to the loss, but investors should have taken the warning. The scandal unfolded in March, 2003, when the SEC announced that HealthSouth exaggerated revenues by $1.4 billion. The information came to light when CFO William Owens, working with the FBI, taped caught Scrushy talking about the fraud. The repercussions were swift, as the stock fell from a high of $20 to a close of $0.45 in a single day. Amazingly, the CEO was acquitted of 36 counts of fraud, but was later convicted on charges of bribery. Apparently, Scrushy arranged political contributions of $500,000, allowing him to ensure a seat on the hospital regulatory board.
The worst thing about these scams is that you never know until it's too late. Those convicted of fraud might serve several years in prison, which in turn costs investors/taxpayers even more money. These scammers can pick a lifetime's worth of garbage and not even come close to repaying those who lost their fortunes. The SEC works hard to prevent such scams from happening, but with thousands of public companies in North America, it is nearly impossible to ensure that disaster never strikes again.

Is there a moral to this story? Sure. Always invest with care and diversify, diversify, diversify. Maintaining a well-diversified portfolio will ensure that occurrences like these don't run you off the road, but instead remain mere speed bumps on your path to financial independence.

Friday, September 04, 2009

5 Lessons From The Recession

Lisa Smith
On Wednesday September 2, 2009, 6:56 pm EDT

The bear market of 2008 was a game-changer for many investors. Prior to 2008, a market decline of staggering proportions was a philosophical idea. The Great Depression was a distant event that few people alive today were even around to experience it - and most them were so young when it occurred that it had little or no impact on their personal investment portfolios. (Remember, the 401(k) wasn’t even introduced until 1978, so even the Great Depression did little to derail the retirement dreams of the average investor.) Now that we've lived through a stock market decline in 2008-2009 that not only wiped out a decade's worth of growth but also changed the face of Wall Street forever, what have we learned? Here we look at the top lessons.

1. Risk Matters
Clearly, the amount of risk taken in one's investment portfolio will capture a significantly greater degree of attention in the years ahead. The decline of 2008 taught us that once-in-a-lifetime events can occur. We've also learned that diversification means more than just stocks and bonds. The simultaneous decline of stocks, bonds, housing and commodities is a stark reminder that there are no "sure bets," and that a cash cushion could save the day when times get tough. The blind pursuit of profit with no thought to the downside is a strategy that failed spectacularly.

Moving forward, investors should learn to be leery. Protecting what you've got is just as important as trying to get more. Keeping one eye on risk and the other on growth is a lesson worth remembering.

2. Experts Don't Know Everything
We put a lot of trust in experts, including stock analysts, economists, fund managers, CEOs, accounting firms, industry regulators, government and a host of other smart people. They all let us down. A great many of them lied to us, intentionally misleading us in the name of greed and personal profit. Even index fund providers let us down, charging us a fee for the "privilege" of losing 38% of our money.

While the collapse of long-term capital management in the late 1990s demonstrated that genius does fail, the lesson was seen by all but felt by few. The crash of 2008 was the complete reverse. Few saw it coming, but most felt it arrive. If we've learned anything from the experience, it should be that blind trust is a bad idea and that even experts can't predict the market.

3. You Can't Live on Averages
Market projections, such as those seen in the hypothetical examples included in many 401(k) enrollment kits, always seem to show an 8% return per year, on average doubling your money every eight years. Those pretty pictures make it easy to forget that markets don't usually move in a straight line. All of those projections are based on the idea that investors should buy and hold, but 2008 showed that that strategy doesn't always work, particularly for investors who are approaching retirement.

Next time the markets start to take a dive, people on the cusp of retirement should pay more attention to the possibility of severe declines damaging their odds of leaving the work force any time soon.

What to do? If you see the train coming, get off of the tracks.

4. You Shouldn't Buy What You Don't Understand
The marketplace if filled with complex and exotic offerings that promise the world to investors. Derivatives, special investment vehicles, adjustable-rate mortgages and other new-fangled investments that may be too complex for the average investor racked up huge fees for financial services firms and huge losses for investors. Don't buy what you don't understand is a trite but true sentiment that may be the biggest lesson from the recession.

5. You Can't Delegate Your Future
Far too many investors operate on the "set it and forget it" plan. They dutifully make their biweekly contributions to their 401(k) plans and let the years pass, hoping for magic by the time they retire. Anyone on that plan who expected to retire anytime between 2008 and 2018 or so is likely in for a rude awakening. Set it and forget it failed. Even target-date-funds, which are supposed to automatically move assets to a more conservative stance as retirement approaches, didn't all do the job investors expected them to do. Moving, forward, "pay attention" may be a better mantra than set it and forget it.

The Bottom Line
If your investments are doing well and you get a good run, rebalance to remove risk. If the markets have fallen as far as you can stand, take what you have left and get out. You should know your risk tolerance and know how much damage you have the stomach to take. When you hit your limit, there's no shame in crying "uncle." It's your money, so manage it. Even if you delegate the investment management to experts, educate yourself so that you understand what your money is buying, what your hired experts are doing and what course of action you will take if things don't go your way.

Monday, August 10, 2009

Whither the market now?

Looks like the market will not reverse any time now. If history is any guide, it's odds on that the market will go on from strength to strength. New birds are probably waiting in the wings. Once these newbies come into the market in droves, completely convinced, that "this time it's different," will the market reverse direction. Presently the market is firmly embedded in an uptrend. A glance at the chart will quickly confirm this.
The market is strongest at or near the top, so the saying goes. Today's volume is less than 1.3 billion. This is a far cry from the historic high of more than 4.2 billion shares traded in a single day. The majority of investors and speculators are still not convinced that this market is sustainable. Beaten by the bears of yesteryear, they are still controlled by fear. But as the market gathers momentum positively, this fear will soon give way to greed. When that happens, the market will explode to the upside. All hell will break lose and cautious will be thrown to the wind. Rises will be phenomenal and the next day taken as a certainty of more rises. Everywhere people will be talking about the market. From shoeshine boys and ice cream sellers to company executives and business tycoons, their topic will be the stock market. This will then be a sure sign that the market is coming to an end.
Savvy investors will sense this as a golden opportunity to sell and unload their shares as quickly as possible. The naive and the not-so-experienced will rush in to buy. At the most unexpected moment, the market will reverse. Suddenly, there are no more buyers. Prices will retreat at an alarming rate and soon the market will be back to square one. By then millions and millions of shares would have changed hands. The smart laugh all the way to the banks while unintelligent ones are left holding the "babies".
The stock market is not the place for you to have fun. You need to know fundamental and technical analysis if you want to have any chance to come out unscathed in this jungle where survival is of the fittest.
Good luck.

Thursday, August 06, 2009

Different colors mean different things

I have a friend, who shall be nameless for obvious reasons as I love her dearly. This friends favourite colour is red. Her car is red, flowers in her garden are red, she wears red, her lipstick is red. Need I say more – everything is red. She is a go-getter and the speed with which she embraces life is past the speed limit. So recently I was very interested to read on how wearing certain colours can reflect our mood.

We do react to colour, and scientists have ascertained that each colour transmits a unique message to the brain which impacts our moods in different ways. Consider the list of colours below and consider how your own clothes and decor can enhance particular moods.


Red is a stimulating and energizing colour. It also enhances self-assurance; what woman in a fiery red dress doesn’t exude confidence. Red will produce an illusion of fantasy. It can promote opposition in others ( you have been warned) If you want to be attention-getting, feel powerful and dominate – wear red. The colour also symbolizes love. It is a hot and passionate color. Red is said to increase the appetite, so you may want to keep it out of the dining room unless you’re having a dinner party. In the bedroom, red light helps sexual activity, and could lead to active nights.


To wear yellow will rejuvenate and balance the mind. It wipes out the feeling of heaviness and oppression. Yellow is a sunny and reflective and is a pensive colour. It will lift ones mood to be positive and optimistic.


This is also the colour of love. It is perhaps a little less serious and a little more fun. Wear it to lift your love life. Orange is a very high energy colour imparting boldness and distinction. Is about being different. Like red and yellow, orange is stimulating. It is an antidepressant and also stimulates the mind. Anyone with a desire to sharpen and add focus and purpose to their life can do with a little orange. ( It is potent, do not add too much)


Green is relaxing and tranquil to the eyes. It reduces stress and brings a feeling of tranquility. It presents natural healing and balance. Wear it to inspire harmony in others and restore your energy. It is the second most popular color. Green is symbolic of faithfulness and unity and hope. It is quick to help others even at their own expense. It represents dependability and tactfulness.


The colour pink is trendy. Its a girly color and is a symbol of innocence and beauty. Pink has a soothing effect. It also speaks of pure love. It is a romantic color, while red is hot and passionate. It also is bright, vibrant, a strong and healthy color.


Blue relaxes muscles, lowers blood pressure and was found to have a calming effect on hyperactive children. Blue causes a slight psychological change which results in people feeling less hungry. I don’t think you could call it a weight loss program though. Blue is also regarded to be effective for increasing wisdom energy. It is the color of peace, tranquility and is excellent in increasing spiritual meditation and healing.


Purple balances the mind, brings serenity and combats fear. It’s connected with psychic powers and helps wake up that aspect. Its also the colour that speaks of royalty. Purple stands out in a crowd.

In conclusion; consider the colours you are wearing – maybe you can create the mood you want to reflect. The chose is yours!

Resource Box:

Lynn Zingel is the author and editor of Here you will find words of encouragement, inspiration, and challenge to change/ whatever you focus your mind upon

Saturday, August 01, 2009

Tongue twisters

Tongue Twisters are great for your tongue-twisting exercise. Below are some for you to try.

I wish to wish the wish you wish to wish, but if you wish the wish the witch wishes, I won't wish the wish you wish to wish.

I see a sea down by the seashore.
But which sea do you see down by the seashore?

If you notice this notice,
you will notice that this notice is not worth noticing.

If you understand, say ""understand"".
If you don't understand, say ""don't understand"".
But if you understand and say ""don't understand"".
how do I understand that you understand. Understand!?

Love's a feeling you feel when you feel
you're going to feel the feeling you've never felt before.

If coloured caterpillars could change their colours constantly could they keep their coloured coat coloured properly?

How may saws could a see-saw saw if a see-saw could saw saws?

A fly and flea flew into a flue,
said the fly to the flea 'what shall we do?'
'let us fly' said the flea
said the fly 'shall we flee'
so they flew through a flaw in the flue.

If Kantie can tie a tie and untie a tie,
why can't I tie a tie and untie a tie like Kantie can.

Fresh fried fish,
Fish fresh fried,
Fried fish fresh,
Fish fried fresh.

Peter Piper picked a peck of pickled peppers.
A peck of pickled peppers Peter Piper picked.
If Peter Piper picked a peck of pickled peppers,
Where's the peck of pickled peppers Peter Piper picked?

She sells seashells by the seashore.
The shells she sells are surely seashells.
So if she sells shells on the seashore,
I'm sure she sells seashore shells.

You can't can cans as well as a canner cans for the cans a canner cans are the best cans.

Sunday, June 28, 2009

Five Fatal Flaws of Trading

Posted: 26 Jun 2009 03:03 PM PDT
By Jeffrey Kennedy
Close to ninety percent of all traders lose money. The remaining ten percent somehow manage to either break even or even turn a profit – and more importantly, do it consistently. How do they do that?
That’s an age-old question. While there is no magic formula, one of Elliott Wave International’s senior instructors Jeffrey Kennedy has identified five fundamental flaws that, in his opinion, stop most traders from being consistently successful. We don’t claim to have found The Holy Grail of trading here, but sometimes a single idea can change a person’s life. Maybe you’ll find one in Jeffrey’s take on trading? We sincerely hope so.
The following is an excerpt from Jeffrey Kennedy’s Trader’s Classroom Collection. For a limited time, Elliott Wave International is offering Jeffrey Kennedy’s report
How to Use Bar Patterns to Spot Trade Setups, free.
Why Do Traders Lose?
If you’ve been trading for a long time, you no doubt have felt that a monstrous, invisible hand sometimes reaches into your trading account and takes out money. It doesn’t seem to matter how many books you buy, how many seminars you attend or how many hours you spend analyzing price charts, you just can’t seem to prevent that invisible hand from depleting your trading account funds.
Which brings us to the question: Why do traders lose? Or maybe we should ask, ‘How do you stop the Hand?’ Whether you are a seasoned professional or just thinking about opening your first trading account, the ability to stop the Hand is proportional to how well you understand and overcome the Five Fatal Flaws of trading. For each fatal flaw represents a finger on the invisible hand that wreaks havoc with your trading account.
Fatal Flaw No. 1 – Lack of Methodology
If you aim to be a consistently successful trader, then you must have a defined trading methodology, which is simply a clear and concise way of looking at markets. Guessing or going by gut instinct won’t work over the long run. If you don’t have a defined trading methodology, then you don’t have a way to know what constitutes a buy or sell signal. Moreover, you can’t even consistently correctly identify the trend.
How to overcome this fatal flaw? Answer: Write down your methodology. Define in writing what your analytical tools are and, more importantly, how you use them. It doesn’t matter whether you use the Wave Principle, Point and Figure charts, Stochastics, RSI or a combination of all of the above. What does matter is that you actually take the effort to define it (i.e., what constitutes a buy, a sell, your trailing stop and instructions on exiting a position). And the best hint I can give you regarding developing a defined trading methodology is this: If you can’t fit it on the back of a business card, it’s probably too complicated.
Fatal Flaw No. 2 – Lack of Discipline
When you have clearly outlined and identified your trading methodology, then you must have the discipline to follow your system. A Lack of Discipline in this regard is the second fatal flaw. If the way you view a price chart or evaluate a potential trade setup is different from how you did it a month ago, then you have either not identified your methodology or you lack the discipline to follow the methodology you have identified. The formula for success is to consistently apply a proven methodology. So the best advice I can give you to overcome a lack of discipline is to define a trading methodology that works best for you and follow it religiously.
Fatal Flaw No. 3 – Unrealistic Expectations
Between you and me, nothing makes me angrier than those commercials that say something like, “…$5,000 properly positioned in Natural Gas can give you returns of over $40,000…” Advertisements like this are a disservice to the financial industry as a whole and end up costing uneducated investors a lot more than $5,000. In addition, they help to create the third fatal flaw: Unrealistic Expectations.
Yes, it is possible to experience above-average returns trading your own account. However, it’s difficult to do it without taking on above-average risk. So what is a realistic return to shoot for in your first year as a trader – 50%, 100%, 200%? Whoa, let’s rein in those unrealistic expectations. In my opinion, the goal for every trader their first year out should be not to lose money. In other words, shoot for a 0% return your first year. If you can manage that, then in year two, try to beat the Dow or the S&P. These goals may not be flashy but they are realistic, and if you can learn to live with them – and achieve them – you will fend off the Hand.
For a limited time, Elliott Wave International is offering Jeffrey Kennedy’s report,
How to Use Bar Patterns to Spot Trade Setups, free.
Fatal Flaw No. 4 – Lack of Patience
The fourth finger of the invisible hand that robs your trading account is Lack of Patience. I forget where, but I once read that markets trend only 20% of the time, and, from my experience, I would say that this is an accurate statement. So think about it, the other 80% of the time the markets are not trending in one clear direction.
That may explain why I believe that for any given time frame, there are only two or three really good trading opportunities. For example, if you’re a long-term trader, there are typically only two or three compelling tradable moves in a market during any given year. Similarly, if you are a short-term trader, there are only two or three high-quality trade setups in a given week.
All too often, because trading is inherently exciting (and anything involving money usually is exciting), it’s easy to feel like you’re missing the party if you don’t trade a lot. As a result, you start taking trade setups of lesser and lesser quality and begin to over-trade.
How do you overcome this lack of patience? The advice I have found to be most valuable is to remind yourself that every week, there is another trade-of-the-year. In other words, don’t worry about missing an opportunity today, because there will be another one tomorrow, next week and next month … I promise.
I remember a line from a movie (either Sergeant York with Gary Cooper or The Patriot with Mel Gibson) in which one character gives advice to another on how to shoot a rifle: ‘Aim small, miss small.’ I offer the same advice in this new context. To aim small requires patience. So be patient, and you’ll miss small.”
Fatal Flaw No. 5 – Lack of Money Management
The final fatal flaw to overcome as a trader is a Lack of Money Management, and this topic deserves more than just a few paragraphs, because money management encompasses risk/reward analysis, probability of success and failure, protective stops and so much more. Even so, I would like to address the subject of money management with a focus on risk as a function of portfolio size.
Now the big boys (i.e., the professional traders) tend to limit their risk on any given position to 1% - 3% of their portfolio. If we apply this rule to ourselves, then for every $5,000 we have in our trading account, we can risk only $50-$150 on any given trade. Stocks might be a little different, but a $50 stop in Corn, which is one point, is simply too tight a stop, especially when the 10-day average trading range in Corn recently has been more than 10 points. A more plausible stop might be five points or 10, in which case, depending on what percentage of your total portfolio you want to risk, you would need an account size between $15,000 and $50,000.
Simply put, I believe that many traders begin to trade either under-funded or without sufficient capital in their trading account to trade the markets they choose to trade. And that doesn’t even address the size that they trade (i.e., multiple contracts).
To overcome this fatal flaw, let me expand on the logic from the ‘aim small, miss small’ movie line. If you have a small trading account, then trade small. You can accomplish this by trading fewer contracts, or trading e-mini contracts or even stocks. Bottom line, on your way to becoming a consistently successful trader, you must realize that one key is longevity. If your risk on any given position is relatively small, then you can weather the rough spots. Conversely, if you risk 25% of your portfolio on each trade, after four consecutive losers, you’re out all together.
Break the Hand’s Grip
Trading successfully is not easy. It’s hard work … damn hard. And if anyone leads you to believe otherwise, run the other way, and fast. But this hard work can be rewarding, above-average gains are possible and the sense of satisfaction one feels after a few nice trades is absolutely priceless. To get to that point, though, you must first break the fingers of the Hand that is holding you back and stealing money from your trading account. I can guarantee that if you attend to the five fatal flaws I’ve outlined, you won’t be caught red-handed stealing from your own account.
For more information on trading successfully, visit Elliott Wave International to download Jeffrey Kennedy’s free report, How to Use Bar Patterns to Spot Trade Setups.
Jeffrey Kennedy is the Chief Commodity Analyst at Elliott Wave International (EWI). With more than 15 years of experience as a technical analyst, he writes and edits Futures Junctures, EWI’s premier commodity forecasting package.
If you liked this, also check out: How to Fail as a Trader in 10 Easy Steps
discipline, Elliott Wave, EWI, expectations, free, Jeffrey Kennedy, methodology, money management, patience, trading

Tuesday, June 23, 2009

Must Read Quotes from Legendary Investor - Warren Buffett

Warren Buffett is the most successful investor of our time. Some of his quotes which are useful are appended below.

I never attempt to make money on the stock market. I buy on the assumption that they could close the market the next day and not reopen it for five years.

If a business does well, the stock eventually follows.

Investors making purchases in an overheated market need to recognize that it may often take an extended period for the value of even an outstanding company to catch up with the price they paid.

It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.

It’s better to hang out with people better than you. Pick out associates whose behavior is better than yours and you’ll drift in that direction.

It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price.

Look at market fluctuations as your friend rather than your enemy; profit from folly rather than participate in it. Long ago, Sir Isaac Newton gave us three laws of motion, which were the work of genius. But Sir Isaac’s talents didn’t extend to investing: He lost a bundle in the South Sea Bubble, explaining later, ‘I can calculate the movement of the stars, but not the madness of men.’ If he had not been traumatized by this loss, Sir Isaac might well have gone on to discover the Fourth Law of Motion: For investors as a whole, returns decrease as motion increases

Most people get interested in stocks when everyone else is. The time to get interested is when no one else is. You can’t buy what is popular and do well.

Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years

Only when the tide goes out do you discover who’s been swimming naked.

Our favorite holding period is forever.

Rule No.1: Never lose money. Rule No.2: Never forget rule No.1.

Time is the friend of the wonderful company, the enemy of the mediocre.

We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful.

Should you find yourself in a chronically leaking boat, energy devoted to changing vessels is likely to be more productive than energy devoted to patching leaks.

Wide diversification is only required when investors do not understand what they are doing.

Sunday, May 24, 2009

The Potential Value of Keck Seng Berhad

Friday April 6, 2007

Revaluation of Keck Seng assets
By Yeow Pooi Ling

PETALING JAYA: The market has yet to fully appreciate the potential revaluation surplus of Keck Seng (M) Bhd's rich assets, especially its huge land bank in south Johor.
Main board-listed Keck Seng is involved in four core businesses – property development, hotel management, plantations and palm oil milling.

According to the company's 2005 annual report, about 10,000 acres in south Johor are still valued based on prices at the 1980s level.

The surplus from the revaluation of land, especially in Ulu Tiram, Bandar Baru Kangkar Pulai, Pasir Gudang and Tanjong Langsat, could be significant since land and property prices in south Johor have appreciated due to plans to develop the Iskandar Development Region.

In 2005, Keck Seng sold 181 acres of plantation land in Ulu Tiram to the state government for RM45.4mil, or about RM251,000 per acre, which resulted in a one-off gain of RM39.5mil.

Assuming a price of RM251,000 per acre, the total land bank in south Johor could be worth RM2.5bil, which is a surplus of RM2.3bil from the current book value.

This could enhance Keck Seng's net tangible asset (NTA) by a whopping RM9.50 per share.

The company's plantation land bank could eventually be converted for property development, which would fetch better pricing as it is close to the urban area.

Its commercial properties are also valued at below market prices. The net book value of Menara Keck Seng at Jalan Bukit Bintang, for example, was last valued at RM63.5mil, or RM240 per sq ft, in 1996.

The MAS building at Jalan Sultan Ismail was sold last year for RM130mil, or about RM481 per sq ft. Based on the same price per sq ft, Menara Keck Seng could be worth RM127mil, double its current book value.
The company also owns properties in Singapore, which were last valued in the 80s; two hotels in Canada (1997 and 2000) and another hotel in Hawaii, last valued at 2000.

Keck Seng's investment in equities is also priced at a book value lower than the current market price.

According to notes accompanying its fourth quarter results ended Dec 31, 2006, the book value of these investments amounted to RM146.7mil, but based on market value as at end-December, they were worth RM567.2mil.

Keck Seng owns 4.9 million shares in PPB Group Bhd and 2.8 million shares in Chin Teck Plantations Bhd.

When the Financial Reporting Standards 139 (FRS 139) are fully enforced, all companies including Keck Seng would have to mark-to-market their investment in equities, and state the surplus or deficit over cost as earnings or losses in the profit and loss accounts.

As a result, Keck Seng could see a surplus of RM420.5mil on its investment in equities, which could boost its NTA by RM1.74 per share.

Meanwhile, its healthy balance sheet enabled it to buy Regency Tower in Kuala Lumpur last year for RM62.5mil cash. Its net cash stood at RM189mil as at Dec 31, 2006.

Based on a conservative estimation arrived at by adding surpluses from the revaluation of Keck Seng's Johor land bank and its equity investments, the company's total NTA could reach as high as RM15 a share compared with RM4.34 currently.

However, the present share price is below the year's high of RM5.45, while other property stocks with exposure to south Johor have soared to their 52-week highs. The counter rose 22 sen to RM4.66 yesterday.

The above article is not a solicitation that you buy or sell shares in Keck Seng Berhad. You are fully responsible for your own action. You buy or sell at your own risk.

Are You Ready for the World's Biggest Bankruptcy?

By Tom Dyson
Wednesday, March 04, 2009

The media have given London a new nickname: Reykjavik-on-Thames.

Britain's economy revolved around banking. British banks hold about $4.4 trillion in foreign debt. The total size of the UK economy is $2.1 trillion. This year, the British government nationalized major parts of the UK's banking system. In total, the UK Treasury is on the hook for over $2 trillion in potential liabilities, according to an estimate by the Office of National Statistics.

But Britain is NOT going to be the world's biggest national bankruptcy. The government debt of the United Kingdom is only around $950 billion... or about $15,000 per capita.

This week, the United States Treasury sunk another $30 billion into AIG... its fourth bailout. It also put another $25 billion into Citigroup. The Treasury is now on the hook for as much as $6 trillion in liabilities. Last week, the White House produced its new budget. President Obama wants to run a deficit of $1.75 trillion in 2009.

The Treasury will pay for these bailouts by borrowing money. The Treasury borrows money by issuing Treasury bonds. Tomorrow, for example, it will auction three-year, 10-year, and 30-year bonds. This auction should raise around $60 billion.

The "debt clock" measures the amount of money the government owes its creditors. Today, the U.S. debt clock reads $11 trillion. To pay off this debt tomorrow, the government would have to collect $36,000 from every American.

But America is NOT about to be the world's biggest bankruptcy.

Of the major industrial economies in the world, Japan's government is the most indebted.

Since its recession began 20 years ago, Japan has plowed trillions into its banking system via numerous bailout programs. Japan's mantra is growth without cost. As a result, the Japanese government has built up the world's most crippling debt load.

The government of Japan owes $7.8 trillion. That's $157,000 per capita.

We've been using government debt per capita to compare the government debts of Britain, the United States, and Japan. But government debt to GDP is the ratio economists use to compare the indebtedness of countries. The UK has a government debt-to-GDP ratio of 48%. The U.S. has a government debt-to-GDP ratio of 75%. Japan has a government debt-to-GDP ratio of 187%.

If there's going to be a major sovereign bankruptcy, it's going to happen in Japan. Its economy is a shambles. For years, Japan has relied on exports... but even that's drying up now. In January, Japan's exports plunged 47%, producing a trade deficit. People talk about Japan as a "nation of savers." But that's not true anymore. Japan's personal savings rate has collapsed from 16% in the early 1990s to 2.2% last year.

Japan has an aging population and no immigration. I can't see where it's going to find the money to pay off its huge pile of debt.

The way to play the collapse in Japan is by shorting the yen. Right now, the Japanese yen is the world's most popular currency. Traders perceive it as a safe haven. In 2008, the yen was the world's best performing currency.... Rising 33% against the Canadian dollar, 40% against the British pound, and 19% against the dollar.

Back in January, I told you a fall in the yen was all but inevitable. The yen is down 12% since that article. But according to

Japan Is About to Devalue Its Currency: Here's How to Profit
This Year's Triple-Digit Trade
a Merrill lynch report I saw yesterday, large speculators still have a $3.7 billion long position in yen futures. The analyst described it as "crowded."

The Japanese yen has been in a 40-year bull market. I think a new long-term bear market has just started... and it will end in the bankruptcy of Japan's government. FXY is the ETF for the Japanese yen. When then yen falls, this fund falls, too. The easiest way to bet on a fall in yen is to short this fund or buy put options on it.

Good investing,


Sunday, May 17, 2009

Money for value you must insist

BY DANIEL AT 15 MAY, 2009, 11:58 PM

Buy quality, go to sleep with quality, and hold quality; you my friend understand the basic principle of investing. When you wake up each day, you will still be owning quality, not s***!

Buy good stocks, and hold until you have reached your goals for that particular stock.

20% off of 8500 is 6800; still higher than the Dow low of 6540 on March 9th.
20% off of 925 is 740, still higher than the S&P 500 low of 670 on March 9th.

I rounded off all the above figures to end in 0’s, so please, don’t anyone call me for being off a point one way or another!

The daily trader 99% end up the loser over time; the people that buy good quality for the purpose of investing, and not gambling, end up reaping the rewards, and winning.

A “true” bull market is not that far off; now is the time to be investing in good quality, and holding on to it till you reach your goal!

Will you take some losses; of course! But, in the process you will, if you are doing things properly, be able to write those losses against gains; gains made by selling good quality stocks at a profit, and harvesting them.

Harvesting = Buying back at a lower price at some time in the future!

I am not going to reveal my net worth or anything personal on the INTERNET; but this much I will tell you - I am quite wealthy!

I have never been a daily trader, I have always been a long term investor; I have reaped the harvest, and all of the rewards of investing smartly, and having patience!

Good luck my friend; you have it down pat - don’t deviate!

Just don’t chase the market; the market, sooner or later, will always come to you, in time!

My father was a great investor; he used to say if you buy s***, you go to bed with s***, and then, you wake up still owning s***!

Do exactly as you have proposed, and in time, you will be a very happy person!

If you want to gamble, go to Vegas!


Thursday, May 14, 2009

The Stock Market at The Top

The stock market near the top is a hive of activity
Making money is everyone’s ability
Price rises are spectacular, steady and daily
Today’s high becomes tomorrows low, normally
Everyone is talking about stock and shares
No one is losing and nobody fears the bears
Laughter and giggles are in the air
Perpetual prosperity is what people talk and share
All around, people are boasting about their gains
Not knowing when to get out, they may soon cry in pain
At the most optimistic time, the reversal suddenly comes
The turn of the tide is only aware to some
Amidst the rumblings of thunder and lighting comes the landslide
Prices gone up have started their downslide
Astute traders immediately make their exit at what is given
The naïve hold on hoping to get out even
Sadly, their hopes soon turn into a nightmare
Trapped and unable to get out of their snare
Their monies are now gone for want of a few dollars more
Hopefully, they are now not as stupid as before.

Wednesday, May 06, 2009

Ginger - the wonder herb

Ginger is well known as a culinary spice and flavoring agent all over the world. It is also used as a herb to treat:
stomach upset, diarrhea, nausea, colic, motion sickness, headaches, common cold and other ailments.
In Bentong at Bukit Tinggi, ginger is widely planted. Malaysian use ginger everyday in their cuisine.

Ginger roots (zingiber officinale) has been used as a folk medicine for thousand of years.

Do not take ginger if you have a bleeding disorder or if you are taking blood-thinning medications, including aspirin.

Tuesday, May 05, 2009

Security Is The First Priority

No place is a good place to stay if security there is a problem. If Malaysia are serious about imaging the country as a second home for foreigners or a tourist attraction, they must first and foremost tighten their security.

The recent rounding up of Mat Rempit is a good start. This operation should continue for some time to root out the undesirable activities of Mat Rempit who have become very brave indeed. They fight the police, rob citizens and create lots of violence. What's next? Rape, daylight robbery, road bullying, etc. may be on their agendas if left unchecked.

Perhaps the government should construct a special track for them to do their racing. There, they can race to their hearts" content without causing danger to other people.

Corruption is the root of many evils. Many people contribute to corruption without realizing it. Do you know that if you buy illegal lotteries, pirated goods, stolen goods or get yourself involved in illegal organized gambling, you are actually contributing to corruption?

Here in Malaysia, you can easily buy illegal lotteries. This is a sign that corruption is at a high level.

You can easily judge whether corruption is on the rise or otherwise by looking at organized crimes such as drug abuse, prostitution, illegal gambling or the like.

Once corruption is weeded out, a clean image of the country will emerge. This will be a great boost to tourism. Security will be much better and people can go about their daily chores without fear.

My vote for the next election will definitely depend on how well the present government weed out corruption.

Monday, May 04, 2009

World No. 2 Happiest Country

No. 2: Puerto Rico
Population: 3,958,128
Life Expectancy: 79
GDP Per Capita: $19,600

With the U.S. rated at a disappointing 16th on the list of happiest countries, the World Values Survey saw fit to separate Puerto Rico, an American territory that's culturally closer to its Latin American cousins. The result: The self-described "Island of Enchantment" ranked No. 2 in the world, despite having per capita income lower than Mississippi and receiving less than 15% of the Medicaid funding it would be allotted as a state. But Puerto Ricans, who enjoy permanent summer weather, a vibrant musical heritage, and idyllic emerald beaches, pay no federal income taxes.

Sunday, May 03, 2009

My Prostate Operation

Probably about a month prior to Feb 28, 2009, I was having urinary infection. I went to a local clinic at Bandar Puteri for treatment. My urine was checked and I was given antibiotic to combat the illness. For the one month, while I was on antibiotic, I was okay. But when I stopped taking the medicine, the infection came back.

Finding this to be unacceptable, I went to see a urologist. The doctor recommended that I go for an operation called TURP. He was very reassuring; he told me that he had done more than a thousand such operation and that there was really nothing to be scared of or worried about. As I was also having hernia he recommended that both operations be done at the same time. I agreed to his proposal.

The TURP operation commenced on March 03, 09 in the late afternoon. I was given regional anesthesia. The injection called Epidural was really killing; it was very painful indeed! (I can't understand why I was not given general anesthesia that is not so painful.)

Two days after the operation, the catheter, (the tube that drains out urine from the bladder) was removed from the urethra. I was then instructed to drink plenty of water to induce urination. Unfortunately I was unable to urinate despite tremendous effort amidst excruciating pain. The catheter was then inserted into the urethera again. Two days later, it was removed and I was asked to try to urinate again. Again I failed. The doctor had to insert the catheter again. This procedure went on for a few times before I was asked to go home with the catheter in place.

Five days later, on 17.03.09 I was back to the Medical Centre. Again I was unable to urinate when the catheter was removed in spite of every effort I put in. The taking out and putting in the catheter was really a very painful experience. The doctor then said that he had no option but to use another catheter to drain out the urine. I was put under anesthesia and a new catheter inserted at a point about five inches right below the navel. With two catheters in place, you can imagine the position I was in at that time. The next morning, the catheter in the urethra was removed. That time I was a bit fortunate. I was able to urinate but with severe pain and with a little bit of blood. From then on the progress was slow and painful.

On May 02, 09 I went for a check-up of my urine flow which was weak. The doctor said that the weakness could be due to scar tissue. This is very scary as scar issue has the tendency to grow back when removed. The doctor has now put me under watchful alert for the next three months. I pray and hope that my urine flow will improve over time.

This morning I came to know about Professor George Lee. His article is appended below for those who are interested to know about Green LIght Laser Surgery on prostate.

The green light at the end of the tunnel- Prostate operation
I have been looking forward to today in the last few months. Finally, the arrival of a Green Light Laser prostate surgery machine to a Government Hospital in Malaysia. Green Light Laser surgery operation is an important landmark in surgery as this operation offers patients the prostate surgery without having significant morbidity such as blood loss and long hospital stay.
I have been working in London Hospital in the United Kingdom for a few years prior to my return to Malaysia. In the United Kingdom, I had the opportunity to use Perform Laser operations for patients and had observed the benefits of such operations over the conventional operation. Of course, the healthcare budget in the country was significantly larger than the government healthcare budget in Malaysia. The Laser operation for prostate is widely available for the general public, and the costs are fully supported by the Government. In Malaysia, however, the constant thrive to keep up with the state of the art technology for patients is not lacking. This operation actually has been offered to patient in a Private Hospital in Kuala Lumpur recently, and the interest has been overwhelming! In a government Hospital, we are not lagging; in fact we were the first one to place the order for the machine. Although in Many fields of medicine, we may not be in the forefront, however, in Malaysia we have the constant drive to keep up, and that gives me a sense of pride.
Today, we are having our soft launch before the official launch. The list of the patients eagerly waiting for this surgery is phenomenal. We invited an expert from Australia to train the staff and provide laser safety, and everyone could feel the excitement in the air.
Our first patient was a man in his sixties. He has been suffering from the typical prostate problems such as hesitancy of initiating urine, poor flow, dribbling and incomplete emptying. This is further complicated by the fact that he has both urinary urgency and the necessity of waking up at night to pass urine. Despite on medications, the symptom of this patient persisted. Of course, this is a well educated retired professional who also has read up about PVP Laser prostatectomy from the newspaper, and he is keen to have the contemporary operation. The man had the operation under spinal anesthesia, and he actually was awake through the operation and did not feel any pain. The operation went as smooth as the clockwork and we drew a large audience from the other operating theatres. Everyone knew this was going to be landmark advancement in the University Malaya Medical Centre.
I went to see the patient the day after the operation. We were already up and had a shower, and enjoying his breakfast in bed. I asked him whether he had a good rest last night. He reply “of course not! I am still in disbelief that I managed to be one of the first few patients to have this operation in Malaysia. The catheter was removed that morning and the patient went home by that afternoon.
When I was writing this article, I was thinking…”Would I feel as proud with this operation when it is done in the United Kingdom?” This answer was a definite NO! I felt proud because this was a technology we fight for and providing for our fellow country Malaysians.

Is Green Light Laser Surgery the answer to those who need prostate surgery? Anyone who has any experience with it, is most welcome to comment. Thanks.





Thursday, April 30, 2009

China's new interesting site

In Beijing, the big attractions remain the famous sites from Imperial China such as the Great Wall, the Forbidden City, and the Summer Palace. But tourists are also visiting new attractions such as the National Grand Theater, the controversial performing-arts center near Tiananmen Square designed by Paul Andreu.

The total revenue for the tourism industry in 2007 was $160 billion, according to the China National Tourism Administration. That was a 22.6% increase over the previous year. Tourists, both Chinese and foreign, favor traditional favorites such as the Great Wall (pictured) outside Beijing.

Wednesday, April 29, 2009

Don't Mess With Women

Bottle of Wine
(Women will LOVE this one!)
A woman and a man are involved in a car accident on a snowy, cold Monday morning; it's a bad one. Both of their cars are totally demolished, but amazingly neither of them is hurt. God works in mysterious ways. After they crawl out of their cars, the man is yelling about women drivers. The woman says, 'So, you're a man. That's interesting. I'm a woman. Wow, just look at our cars! There's nothing left, but we're unhurt. This must be a sign from God that we should be friends and live in peace for the rest of our days.'
Flattered, the man replies, 'Oh yes, I agree completely, this must be a sign from God! But you're still at fault...women shouldn't be allowed to drive..'
The woman continues, 'And look at this, here's another miracle. My car is completely demolished but this bottle of wine didn't break. Surely God wants us to drink this wine and celebrate our good fortune.'
She hands the bottle to the man. The man nods his head in agreement, opens it and drinks half the bottle and then hands it back to the woman.
The woman takes the bottle, puts the cap back on and hands it back to the man.
The man asks, 'Aren't you having any?'
The woman replies, 'No. I think I'll just wait for the police...'

Don't mess with women.

Tuesday, April 28, 2009

If God brings you to it, He will bring you through it. Happy moments, praise God. Difficult moments, seek God. Quiet moments, worship God. Painful moments, trust God. Every moment, thank God.

Monday, April 27, 2009

Phone Scam - Watch Out!

Phone scam that empties your account
By : Sonia Ramachandran
Email to friend Print article

Fraudsters are emptying the bank accounts of people by tricking them
into divulging their personal financial information.

KUALA LUMPUR: You receive a call, purportedly from a bank, asking if you had just conducted a credit card transaction for goods or services.
When you answer in the negative, the caller then tells you in a concerned tone to call an agent of a commercial bank and you are given the number.

Upon calling, the agent gives you the telephone number of the "bank" and tells you to call the bank itself.

You call and someone picks up, identifying himself as an officer of the "bank". You then tell him that you did not conduct the transaction and you do not have such card.

But he informs you that the records, however, show that the transaction had been carried out and that the card belongs to you!

He suggests you call Bank Negara's "Unit Kad Kredit Palsu" (Credit Card Fraud Unit) and gives you the number. You then reach an automated voice message service which says you have contacted "Bank Negara".

A Bank Negara "officer" then comes on and identifies himself. He asks for your banking and credit card information so that he can lodge a complaint on your behalf.

You then give your details over the phone and finally assured that "Bank Negara" will "look into your problem", you heave a sigh of relief.

But what you don't realise is that as soon as you have put down the phone, the fraudsters are already emptying your account, thanks to the information you had just furnished them.

This is the latest scam that Malaysians are falling prey to.

Last year, Bank Negara received 165 complaints on unauthorised withdrawals. As of mid-April this year, there have been 265 complaints.

The losses range from a minimum of RM4,000 to a maximum of RM10,000.

The Association of Banks in Malaysia received 42 complaints from April 1 to Friday on the scam which uses Bank Negara's name alone.

"One of the victims who walked in a few days ago lost RM7,000," said Bank Negara corporate communications director Abu Hassan Alshari Yahaya.

There is no such "Unit Kad Kredit Palsu" in Bank Negara, he added.

Abu Hassan said the fraudsters used a different approach before. They would SMS potential victims informing them that they had won prizes and to collect these prizes, they had to open an Internet banking account.

If you fall for this scam, the fraudster then provides a step-by-step guide on how to register and activate an Internet banking account using an automated teller machine (ATM) terminal.

At the ATM terminal, you will be given an Internet banking personal identification number (PIN) which will be given to the fraudster.

Based on the fraudster's instructions, you also key in his or her mobile number into the ATM.

When a person conducts Internet banking, he would receive a Transaction Authorisation Code (TAC) from the bank via SMS.

Since you have keyed in the fraudster's mobile number, this code will also be sent to him.

"People are vulnerable when they are told they have won prizes and these fraudsters take advantage of that vulnerability. There are no shortcuts to prizes. The public need to be aware at all times."

Abu Hassan advised people to never respond to any SMS, phone calls or email asking for personal information such as PIN and passwords for banking accounts.

"Banks will never request for such personal information through email, SMS or phone calls."

In June last year, the New Sunday Times reported that the SMS scam was so serious that the police were receiving at least one report a day.

The police said the number of scams was increasing with some victims losing up to RM1.2 million.

Email scams, said Abu Hassan, were those where email were sent out, purportedly from the banks asking the recipients to update their personal banking information or accounts.

To do that, the recipient would have to click on a link provided in the email and be led to a site that looks exactly like the bank's site. When you key in your personal information on this duplicate site, the fraudster retrieves it and withdraws the money from your account.

Bank Negara is now working with the telecommunications operators to warn their subscribers via SMS not to fall prey to such scams.


- Do not respond to any request for your login ID, password or PIN over the phone, through fax, email or pop-up messages.

- Take down the name, phone number and any other information you can from the caller who asks for the information

- Call your bank if you are not sure of the authenticity of a call, SMS or email. ATM machines also provide numbers that you can call.

- You can also call the Association of Banks in Malaysia's toll-free hotline at 1300-88-9980 and Bank Negara's at 1300-88-5465.

- Always enter the Universal Resource Locators (URLs) directly into the web browser. Avoid being redirected to the website or hyperlinked to it from an email or another website.

- Ensure that you are in a secure website by checking the URLs to ensure that it begins with "https://'" instead of "http://'" and look for a display of a closed padlock symbol on the status bar of your browser.

- Protect your personal computer from hackers, viruses and malicious programmes.

Source: Bank Negara corporate communications director Abu Hassan Alshari Yahaya.

Tuesday, March 31, 2009

America Once Ruled the World - The Last Bubble is Bursting ( By Daniel)

In less than two generations, America has squandered the human sacrifice, blood, sweat and tears of than seventy decades. We have been an independent country for 226 years. From 1783 until 1946 was an unrelenting upward trajectory for the beacon of the free world.
With the end of World War II, America was the last country standing. Germany and Japan were in shambles. Russia had lost millions of citizens, with Stalin about to murder millions more. Great Britain was a shell of its former self. The American Empire had been born. We were the manufacturer to the world. We rebuilt Europe and Japan. Our military was dominant. We made the best automobiles. We built 41,000 miles of national highway over two decades. In 1946, one in three U.S. workers was employed in the manufacturing industry.
Today, less than one in ten workers makes something.
In the years following World War II, the United States ran trade surpluses of 2 percent to 4 percent of GDP. We regularly ran surpluses until the late 1970’s. Since the late 1970’s, the United States has run increasingly large trade deficits, reaching 6 percent of GDP in 2007. For the last three decades, Americans have tried to spend their way to prosperity.
The government politicians and their moneyed backers have sold the idea that Americans could be the thinkers for the world, while other countries could do the menial work of producing stuff. After thirty years we are left with a hollowed out economy of paper pushers. It may be a reach to transition the Wall Street geniuses who created Mortgage Backed Securities, Credit Default Swaps, Credit Default Options–MBSs, CDSs, and CDO’s– into jobs building bridges. In truth, many of America’s manufacturing jobs are gone. Too many of the nation’s workers are left to sweep the streets they used to own.
After three decades of burning our furniture to keep warm, we are left owing the rest of the world $2.7 trillion. Many of these countries don’t like us. Ben Bernanke is actively trying to drive the value of the U.S. dollar down, while decreasing interest rates paid on this government debt. As Ben prints trillions of new dollars, the value of China’s, Japan’s and the oil exporting countries’ holdings goes down. The U.S. will run a $2 trillion deficit in the next year. We need these foreign countries to buy at least $1 trillion of our new debt. We are sure they will do so. Our reasoning is, what else can they do. From a purely financial standpoint, it is insanity for a country to make an investment in an asset paying 2.5 percent interest, when in one day last week the Federal Reserve purposely knocked the value of the dollar down 5 percent in one day, wiping out two years of interest income.
The Chinese are not fools. They can clearly see that the U.S. will try to devalue our way out of our financial mess. They are going to put the $500 billion of USD holdings to work, before it becomes worthless.
Recent examples reported by the Washington Post have been:
• On Feb. 12, China’s state-owned metals giant Chinalco signed a $19.5 billion deal with Australia’s Rio Tinto that will eventually double its stake in the world’s second-largest mining company.
• On Feb. 17 and 18, China National Petroleum signed separate agreements with Russia and Venezuela under which China would provide $25 billion and $4 billion in loans, respectively, in exchange for long-term commitments to supply oil.
• On Feb. 19, the China Development Bank struck a similar deal with Petrobras, the Brazilian oil company, agreeing to a loan of $10 billion in exchange for oil.
• Iran announced that it had signed a $3.2 billion agreement with a Chinese consortium to develop an area beneath the Persian Gulf seabed that is believed to hold about 8 percent of the world’s reserves of natural gas.
The Chinese have a long-term plan to rule the world. They are buying up natural resources throughout the world. The walls are closing in on the U.S. The U.S. solution is to print more dollars, borrow from future generations, and tax their citizens more. Ben Bernanke has rolled the dice, but the fear is in his eyes, not our enemies’. We will shortly realize that our castles were built upon pillars of salt and pillars of sand.
Bubble, Bubble
Never in the history of the world has a bubble burst halfway. Every bubble has collapsed to its starting point or below. The pundits on CNBC and on Sunday talk shows continue to predict a stabilization of the housing market. They are wrong. The bubble is still deflating and will not end until home values are back to 2000 levels, if we’re lucky. Examples of bubbles that fully deflated include the tulip bubble of 1637 - 1638, the South Sea bubble of 1719 - 1722, the Nikkei bubble from 1983 until today, and the NASDAQ bubble from 1999 – 2003. The United States has three bubbles that are deflating simultaneously, compliments of the Federal Reserve, George Bush, and Congress. Housing, consumer spending, and U.S. total debt are all at different phases of bubble deflation. No matter what politicians attempt, these bubbles cannot be re-inflated. They will deflate fully.
Tulip mania struck Holland in 1637. The whole nation was consumed by tulip bulbs in the first recorded speculative bubble. Contract prices for tulip bulbs reached astronomical levels and then suddenly collapsed. At the peak of tulip mania in February 1637, tulip contracts sold for more than 10 times the annual income of a skilled craftsman. In a matter of seven months, fortunes were made and lost. The bubble popped completely.
The South Sea Company was the AIG of the 1700’s. It was a British joint stock company, founded in 1711. The company was granted a monopoly to trade as part of a treaty during the War of Spanish Succession. The company assumed the national debt England had incurred during the war. In 1719 the company proposed a scheme by which it would buy more than half the national debt of Britain (£30,981,712), again with new shares, and a promise to the government that the debt would be converted to a lower interest rate, 5 percent until 1727 and 4 percent per year thereafter. The purpose of this conversion was similar to allow a conversion of high-interest but difficult-to-trade debt into low-interest, readily marketable debt and shares of the South Sea Company. These are the games that declining empires play when they have overreached in their empire building. The plan sounds a lot like Tim Geithner’s “Good Bank Bad Bank” scheme. Shuffling debt from one entity to another entity doesn’t get rid of it. It is just a scam paid for by taxpayers.
The price of South Sea Company stock went up from £100 a share to almost £1,000 per share. Its success caused a country-wide investing frenzy by peasants, businessmen and lords. The price reached £1,000 in early August and the level of selling was such that the price started to fall, dropping back to £100 per share before the year was out, triggering bankruptcy among those who had bought on credit. The English Parliament reacted to the crisis exactly the way our current clueless bunch of moron Congressmen are reacting to the AIG debacle. The estates of the directors of the South Sea Company were confiscated and used to relieve the suffering of the victims, and the stock of the South Sea Company was divided between the Bank of England and East India Company. A resolution was proposed in parliament that bankers be tied up in sacks filled with snakes and tipped into the Thames River. I’m sure Barney Frank is preparing a similar resolution regarding AIG executives. No one can calculate the madness of men.
Japan Inc. was going to dominate the world. From 1983 until its peak in 1989, the Nikkei rose from 7,500 to 38,900, a 500 percent increase in seven years. Following World War II Japan implemented tariffs that protected their industries from overseas competition. This resulted in large trade surpluses and an appreciating yen. With artificial protections, Japanese companies made mal-investments. Easy money and false confidence led to a frenzy in the stock market and real estate market. Japanese banks had financed this speculative bubble with high risk loans. The PE ratio of the Nikkei reached 78 in 1989. Twenty years after this peak, the Nikkei hit a low of 7,500 this year, the same level it started at in 1983. This has occurred despite spending billions on make work stimulus programs, reducing interest rates to zero, and artificially reducing the value of the …

Saturday, March 28, 2009

Don't Fall Victim to these 5 Wall Street Lies

Don't Fall Victim to these 5 Wall Street Lies
By Keith Fitz-Gerald

What Got Us Here?
As we watch the government and Wall Street scramble to repair the economic mess we're in, it's more important than ever to understand exactly what got us in this situation in the first place.

Even if you're on the investing sidelines right now, looking at how we got here can help you avoid repeating past mistakes, learn how to spot future red flags and repair and grow your portfolio.

So, what got us here?

And how do we steer clear of such drastic losses in the future?

There are a few pieces of advice that Wall Street kept pitching to investors as gospel truth that I refer to as "Wall Street's biggest whoppers."

Wall Street Lie #1: Buy and Hold
It's a simple-enough concept: Consistently invest in the market and let it ride. You'll be laughing all the way to the bank. How could you go wrong?

In reality, "buy and hope" – a far better name for this myth – is one of Wall Street's favorite strategies.

Win or lose, brokers never want you to stop playing the game. So the collective "they" pitch you on a hot investment to get you hooked and then keep stringing you along.

To further increase the risk, ratings agencies that are in bed with certain companies will give the green light on investments that are anything but safe.

Of course, the rude awakening comes when the market goes through one of its frequent periods of readjustment.

Timing really is everything, isn't it?

What to Do Now
Just because you may have some time before you'll need the money does not necessarily mean you should take on more risk. A better strategy is to base choices on the certainty of returns – especially in this investing climate. At this point, boring is good!

Look at dividends and reinvestment for stable returns.
Stay with businesses that have proven management, plenty of free cash flow and increasing dividends that are backed up by unstoppable global trends.
Do your homework, and you'll find there are still plenty of solid investing options – just be selective!

Wall Street Lie #2: Some Debt Is Good
One of Wall Street's biggest (and most dangerous) lies is that debt is an appropriate tool for building wealth.

Here's the bottom line…

If you owe someone money, you've still got to pay it off eventually. That means any growth you attribute to debt until it's paid off in full exists only in fantasyland. How do you think General Motors and Lehman Brothers got into so much trouble?

It's no different for personal portfolios. Maybe if our leaders had understood this in the first place, millions of investors would not have been taken on a white-knuckle ride.

Even those who act responsibly are finding out that we're now liable for the "other" guys' debts, too.

What to Do Now
As an investor:

Only stick with companies that have little or no debt. Avoid any that are getting life support from the Federal Reserve – it's too shaky to assume they'll be able to stand on their own two feet once the crutch of government financing is taken away.
In your personal life:

Borrow only if you have to and on the conservative side.
Refinance your house by taking advantage of low interest rates before they start rising again.
Pay off your credit cards each month.
If you have trouble with plastic, shift to a cash-only lifestyle for a while.
And make sure that any new debt you take on is debt you can afford to pay off.

Wall Street Lie #3: It Pays to Diversify
Common investing wisdom touts spreading your money around as a safety precaution.

In reality, this is no more effective than rearranging the deck chairs on the Titanic. It's best to just get off the boat.

Instead, a "safety first" strategy is far more stable and generates some impressive returns by emphasizing high current income and long-term appreciation.

Many investors don't understand the name of the game right now, incorrectly believing investing in a recession is an all-or-nothing equation. They're wrong.

What to Do Now
In a time when so many markets – stock, bond, housing and credit – have collapsed simultaneously, it is crucial to hedge your portfolio at all times and not just when it's popular.

Skew your investments toward safety first. You can still allow yourself to screw up on speculative bets, but you won't be dependent on them to make up for losses.
Look into specialized tools, such as inverse funds or options, for low-risk choices with an upside. After all, the name of the game is planning for the worst while still obtaining the best of what's out there.

Wall Street Lie #4: Your Home Is an Investment
Actually, it's not.

A house is really a roof over your head that shields you from being priced out of the local rental markets.

Or, at worst, it's a money pit that provides you with the illusion that you're doing something sensible with your hard-earned money – despite the fact that an entire industry would have you believe otherwise.

Research shows that since 1900, home prices have run sideways or declined for long periods of time. What that means is real estate hasn't been the golden investment everyone claims it is.

Sadly, millions are learning the hard way right now that real estate can, and does, lose value.

Wall Street Lie #5: Shop 'til You Drop and Save the Economy
Have you heard?

It's our new patriotic duty to go out and spend money.

Not only does the U.S. government want you to go on a spending spree, but Wall Street and the credit card companies are also looking to you to save their sorry hides by helping you do just that.

That's why the stimulus plans – you know, the ones designed to give you relief during a recession – revolve around tax cuts and handouts. It's mere window dressing.

Here's the bottom line…

Nothing will matter until the banks start lending again. Period.

What to Do Now
People talk about our current situation as though it is an enigma, but that's simply because only a precious few people actually remember similar events in the past. For example, the Panic of 1873 (often referred to as the "real" Great Depression), the Great Financial Crisis of 1914 and the Banking Crisis of 1931.

So, what can you do?

Keep your powder dry. Misguided though our economic policies may be, savvy investors should plan for an eventual rebound – even if we're destined to test new lows in the months ahead.

Don't fall victim to Wall Street's lies, and you'll be able to come out ahead when it finally does.

Thursday, February 19, 2009

Depositors can't get their Cash

Billionaire's bank customers denied their deposits
Wednesday February 18, 7:09 pm ET
By Ben Fox, Associated Press Writer
Stanford depositors can't get their cash while politicians scramble and regulators urge calm

ST. JOHN'S, Antigua (AP) -- Panicky depositors were turned away from Stanford International Bank and some of its Latin American affiliates Wednesday, unable to withdraw their money after U.S. regulators accused Texas financier R. Allen Stanford of perpetrating an $8 billion fraud against his companies' investors.

Some customers arrived in Antigua by private jet and were driven up the lushly landscaped driveway of the bank's headquarters, only to be told that all assets have been frozen pending an investigation by Antiguan banking regulators.

"I don't know what to think. I have my life savings here," said Reinaldo Pinto Ramos, 48, a Venezuelan software firm owner who flew in by chartered plane from Caracas Wednesday with five other investors to check on their accounts. "We're waiting to see some light."

Banking regulators and politicians around the region are scrambling to contain the damage after the U.S. Securities and Exchange Commission filed civil fraud charges against the billionaire on Tuesday. Regional Director Rose Romero of the SEC's Fort Worth office called it a "fraud of shocking magnitude that has spread its tentacles throughout the world."

Stanford, 58, is a larger-than-life figure in the Caribbean, using his personal fortune -- estimated at $2.2 billion by Forbes magazine -- to bankroll public works and sports teams. He also is a major player in U.S. politics, personally donating nearly a million dollars, mostly to Democrats. At 6-foot-4 and 240 pounds, he towered over House Speaker Nancy Pelosi while giving her a warm hug at the Democratic National Convention last year.

He owns a home in the U.S. Virgin Islands, and operates businesses from Houston to Miami and Switzerland to Antigua, where the government knighted him in 2006 in recognition of his economic influence and charity work.

U.S. regulators have accused Stanford, two other executives and three of their companies of luring investors with promises of "improbable and unsubstantiated" high returns on certificates of deposit and other investments.

Many details about the alleged fraud remain unclear, but the SEC alleges a pattern of secrecy, including a failure to disclose the bank's exposure to losses by in money manager Bernard Madoff's alleged Ponzi scheme.

The SEC said no one but Stanford and James M. Davis of Baldwyn, Miss., the Antigua-based bank's chief financial officer, know where most of the depositors' cash is invested, and both men have failed to cooperate with investigators. "Approximately 90 percent of SIB's claimed investment portfolio resides in a 'black box' shielded from any independent oversight," the SEC said in its complaint.

Stanford wasn't talking Wednesday. A company Web site directed inquiries to the SEC. But in an e-mail to his employees last week, the billionaire said his company was cooperating with the probe, and vowed to "fight with every breath to continue to uphold our good name and continue the legacy we have built together."

A federal judge appointed a receiver to identify and protect Stanford's assets worldwide, including about $8 billion managed by bank, which has affiliates in Mexico, Panama, Colombia, Ecuador, Peru and Venezuela.

Also frozen were assets of Houston-based Stanford Capital Management and Stanford Group Company, which has 29 brokerage offices around the U.S.

"The fallout threatens catastrophic and immediate consequences" for the twin-island nation of Antigua and Barbuda, said Prime Minister Baldwin Spencer. It also could rattle the economies of smaller nations where Stanford's companies have had outsized influence.

SEC spokesman John Nester said the agency does not know where Stanford is. James Sullivan, the U.S. marshal for the Virgin Islands, said agents are monitoring his "extensive holdings" in St. Croix, including a boat he sometimes he docks there, but could not say whether he is currently in the territory. He does not currently face any charges requiring his presence in court.

"As of right now, all we are doing is an ongoing investigation to monitor his holdings, for lack of better term, and we are not actively pursuing him," Sullivan told The Associated Press.

Some U.S. lawmakers quickly announced they would donate his campaign contributions to charity.

The Stanford Financial Group, through its political action committee and employees, has contributed $2.4 million to political candidates, parties and committees in the U.S. since 1989, with nearly two-thirds going to Democrats, according to the Center for Responsive Politics, a group that tracks campaign spending.

Most of that cash flowed during the 2002 election cycle, when Congress was debating a financial services antifraud bill that would have linked the databases of state and federal banking, securities and insurance regulators. The bill ultimately died in the Senate, where the biggest recipients have been Sen. Bill Nelson, D-Fla. ($45,900); Sen. John McCain, R-Ariz. ($28,150); Sen. Chris Dodd, D-Conn. ($27,500); and Sen. John Cornyn, R-Texas ($19,700). Rep. Pete Sessions, R-Texas also received $41,375.

Stanford and his wife Susan also donated $931,100 of their own money, with 78 percent going to Democrats, including $4,600 to President Barack Obama's presidential campaign last May 31. Records show $2,300 of that was returned on the same day.

Governments across the region took a variety of actions Wednesday to protect local investors who'd deposited money with Stanford-linked institutions.

Colombia and Ecuador suspended the activities of Stanford's local brokerages Wednesday, and Panamanian regulators occupied Stanford bank branches hit by a run on deposits, which they described as an isolated "consequence of decisions adopted by foreign authorities." Assets at the bank's four Panama branches, which reportedly held $200 million in deposits at year's end, are held largely in liquid, fixed-income investments that can more easily be converted into cash to cover deposits if necessary, the bank said.

In Venezuela, banking regulator Edgar Hernandez said the government was considering a request for help from Stanford Bank SA in Caracas after a $26.5 million run on deposits removed about 12 percent of its holdings.

"We suggested an open intervention" by the government, including the possibility of the government or a state-run bank depositing funds to back deposits, Hugo Faria, one of the bank's directors, told The Associated Press.

In Mexico, where the Stanford Fondos unit manages about $50 million for some 3,400 clients, a note posted on a shuttered office door in the capital's wealthy Polanco neighborhood announced that all accounts "are temporarily frozen."

"We don't have any other information at this time, you will be contacted in the future with more details," the note said.

Karina Klinckwort, 38, had rushed to the office Wednesday: "Everything I have is with them, everything that my husband, may he rest in peace, invested is with them."

The Stanford-controlled Bank of Antigua was not named in the complaint, but many Antiguans lined up outside nevertheless to try to get their money. Some of these working-class depositors clutched portable radios to listen to financial news.

"People have to come to get their money," said electrician Rasta Kente.

But panicking will only make things worse, regional regulators warned.

"If individuals persist in rushing to the bank in a panic they will precipitate the very situation that we are all trying to avoid," said K. Dwight Venner, governor of the Eastern Caribbean Central Bank.

Associated Press Writers Anika Kentish in St. John's, Antigua; Jim Abrams in Washington, D.C.; Jeff Kummer in Dallas; Frank Bajak in Bogota; Jeanneth Valdivieso in Olga Rodriguez in Mexico City; and Fabiola Sanchez in Caracas, Venezuela contributed to this report.

Thursday, February 05, 2009

Are You Using Your Right Brain or Your Left Brain?

Do you see the image turning clock-wise or counter clock-wise? Can you use your imagination to make the image turn the other way? Try it, it's fun.

Wednesday, February 04, 2009

Let's Smile

A smile costs nothing but gives much.
It enriches those who receive without making poorer those who give.
It takes but a moment, but the memory of it sometimes lasts forever.
No one is so rich or mighty that he can get along without it, and no one is so poor that he cannot give it.
A smile creates happiness in the home, fosters goodwill in business, and is the cornerstone of friendship.
It brings rest to the weary, cheer to the discouraged, sunshine to the sad, and is nature's best antidote for trouble.
Yet it cannot be bought, begged, borrowed, or stolen, for it is something that is of no value to anyone until it is given away.
When people are too tired to give you a smile, give them one of yours.
No one needs a smile so much as he who has none to give. - Author unknown

Cheers! and don't forget to smile, smile and smile.

Saturday, January 24, 2009

Tuesday, January 20, 2009

A Wonderful Therapy

Read this wonderful therapy and inform your friends about it.

Sunday, January 11, 2009

Zimbabwe Today

Inflation at 231 million percent. One US$ equals ZW$25 billion. Two loaves of bread cost ZW$50 billion.

Truth is stranger than friction. Here's the article:

HARARE, Zimbabwe (CNN) -- Zimbabwe's central bank will introduce a $50 billion note -- enough to buy just two loaves of bread -- as a way of fighting cash shortages amid spiraling inflation.

Zimbabwe's dollar is virtually worthless, with foreign currency now being used to purchase basic items.

The country's acting finance minister, Patrick Chinamasa, made the announcement in a government gazette released Saturday.

Although Chinamasa did not give the date on which the $50 billion and new $20 billion notes would come into circulation, an official at the Reserve Bank of Zimbabwe said the notes would be distributed to all banks by the end of Monday.

Zimbabwe is grappling with hyperinflation now officially estimated at 231 million percent, and its currency is fast losing its value. As of Friday, one U.S. dollar was trading at around ZW$25 billion.

When the government issued a $10 billion note just three weeks ago, it bought 20 loaves of bread. That note now can purchase less than half of one loaf.

Realizing the worthlessness of the currency, the RBZ has allowed most goods and services to be charged in foreign currency. As a result, grocery purchases, government hospital bills, property sales, rent, vegetables and even mobile phone recharge cards are now paid for in foreign currency, as the worthless Zimbabwe dollar virtually ceases to be legal tender.

Once a regional economic model, Zimbabwe is in the throes of an economic crisis, with unemployment running at more than 80 percent and many families unable to afford a square meal. President Robert Mugabe's critics blame his policies for the economic meltdown, but he says the West is sabotaging his efforts.

Don't Miss
Zimbabwe's new $10 billion note buys bread
Zimbabwe court leaves activists in jail
In order to attract foreign currency, Zimbabwe's central bank has, since September, licensed at least 1,000 shops to sell goods in foreign currency. All mobile phone service providers are now licensed to accept foreign exchange for airtime and other services.

John Robertson, an economist in Zimbabwe, said he's puzzled by the introduction of the $50 billion and $20 billion notes.

"I am not really sure what these notes would be for," he said. "No one now accepts the local currency. It is a waste of resources to print Zimbabwe dollar notes now. Who accepts a currency that loses value by almost 100 percent daily?"

In August, the RBZ slashed ten zeros from the currency. But the zeroes have bounced back with more vigor.

A power-sharing deal between Mugabe and opposition leader Morgan Tsvangirai signed in September, and brokered by former South African leader Thabo Mbeki, raised hopes of halting Zimbabwe's plunge into economic destruction.

But the pact has stalled over the allocation of key cabinet ministries, with Tsvangirai accusing Mugabe of grabbing all key posts such as defense, home affairs, local government, foreign affairs and finance.