The Best Buy

The US Government has been a "Shopaholic" for sometime.

Having bought the Largest Mortgage Providers, the Largest Banks, the Largest Insurance Firm, it may soon have to buy the Largest Auto Markers too.

And yet,the US Government seems to have overlooked a Very (if not The Most) Important Buy.

Did anyone remember how speedy the share prices of the above Largest collapse?
Remember how they all started?

Just a rumour that a firm would soon be Downgraded could push the price down by 20-30% in a day!
More when Confirmed.

So, the US Government should have acted NOW, making the Best Buy of the Century - did they not say the current WWIII is an "Once a Century Event"?

Buy ALL the Credit Rating Agencies.

NOT necessary Stopping them from publishing "Downgrade" Reports.
But only to "Reminding" them to publish reports Less Frequently, say like only Once a Year! Allowing More Time to fix up the Mess!

And all these Credit Rating Agencies have been shifting their focus from Firms to Countries.

Imagine UK being Downgraded.
Getting more likely everyday, especially it has managed to have sold only 93% of its Bonds recently - 1st time in 7 years.
And last year, 10 Times More Investment Money was being shifted out of UK than any other period during the last 10 years.

Imagine USA being Downgraded?

Fate
Never Say Never, Embrace a New Era

G2000

No, there is NO typing mistake.
The Title is G2000.

Yes, G2000.
To be precise G2000 = G20.

G2000 = A Famous Retail Firm in Hong Kong that sells clothes.
G20 = The 20 Largest Economies in the world, accounting for about 75% of world population and 85% of world output.

Both are basically the same.
Making People Look Good, Feel Good.
Nothing else.

Do you sincere believe all these Presidents/Prime Ministers are to agree on major issues?

Just look at yourself.
Can you and your children agree on where to go for the coming Easter Holidays?
Or even just between you and your spouse, can you two agree on what to have for dinner or just which TV channel to watch?

How could you expect all these people coming from different parts of the world, with different mentality, different own agenda, different major problems etc. to agree on the major issues?

Well, one thing they must have all agreed on,

To eat good food, stay good hotel, spend good money by using your and my money - the hard earned cash of every taxpayer!!

They are not here to agree.
They are here to show their Greed,

To Get More Power by taking away from others.

China is there to get more and has someone to do it for it.
Australian Prime Minister has already openly stated China should take a more important role in the IMF.

And China just stated in the last few days,
There is a need for a New International Trading/Settlement/Reserve Currency.

US is soon to become the Past, just like the once Great Great Britain.
The stage is set for the Rising of China - also thanks to the ever fighting US + UK Vs Europe!!

And watch out the Currency - now is the Most Powerful Weapon.
In particular, the US$ and the RMB$

Anything could happen with these two Currencies.

Fate
Prepared for the Unexpected

The Biggest Gamble

Britain now has more than 2 Million people out of job.
Spain is twice of Britain's = 4 Millions!
And IMF has seen for the First Time since WWII the Global Output has contracted.

Every country is racing against time to fight hard against the Greatest Depression.
Japan has initiated its 3rd Stimulus Plan (when were the first two started??)
Australia just started its 2nd. So was US.

So, US has just took another Dramatic action - printing money - only over US$1 Trillion of it!

And the consequences?

One of which is the US$ just had its One Day Biggest Fall since 1985!!

Did I not say the New Battlefield is in the Exchange Rate just 5 days ago?

Every Government has tried every avenue to stimulate demand for the last 18 months.
But Failed.

So, if one cannot stimulate "Internal Demand", let's stimulate "External Demand".

Making US$ Cheaper, making Every US Business Dead Cheap, making Every US product Dead Cheap etc.... to attract Massive Inflow of money, which in turn is to create the much needed Jobs.

Japan has been doing this for the last 2 months.
So has been Switzerland for the last week.
And both had good results - Until yesterday.
US has now joined the game - Depreciating its currency.

US is now using this dangerous tool to make its Biggest Gamble.

How LOW will US$ go?

Fasten your seat belt and be ready for an amusing Roller Coater Ride!

Fate
There are More Losers than Winner at Every Gambling Table

Better

There were strong rebounds in the global share markets.
Does it mean things could only get Better from now on?

Yes - You Better Sell your shares now - while there is still a demand AND a price for it!

Have I NOT mentioned one should focus the MRF (Most Relevant Factor)?
The Unemployment Rate!

US's has risen to 8.1% and Rising - tipped to break the 1945-1946's record of about 10.8% (Some small towns in US already exceeding this!!)

Australia to 5.2% and Rising - tipped to be 7% by the end of 2009 and 9% by the end of 2010!!

Spain's at 14.8% NOW!!

20 years ago, there were about 60 US firms had AAA - the Highest Credit Rating.
And how many firms do you think have AAA now?






Just 5!!!

GE, the once World's Greatest Firm, in terms of Capitalisation, in terms of Leadership Skill etc, just lost its AAA Rating!

And even the Legendary Investor, the once World's Richest Man (Yes, because Bill Gates just reclaimed the Clown!) - its Flagship, Berthshire Hathaway has also just lost its AAA Rating!

Meaning there are More and More firms are Vulnerable.
Not Just In US.
But also in UK, HK......in every country.

And the Paper all these firms have been issuing called Shares could soon become what it once was,

Paper.

Worthless Paper.

A Wise Investor has once stated,
"Why do I have to buy a share today at $10, when I can buy it at $8 the following week, and may be only $6 the following month?"

Another even Wiser Investor suggesting,
"It's NOT about me Buying. It's about Firms Surviving - how can I be sure the firm I intend to buy share of will Still Be In Existence in 6 or 12 month time?"

Let's forget about firms for the time being.
It's NO Longer about Failure of Firms, it's now about Failures of Countries.
And we're heading for a even Bigger Crisis.

And the Next Battlefield will be in the................












Exchange Rate!!

You Better be Prepared.

Share more on this next time - have to go to the Sunday Market!
After all, Investment is for Pleasure NOT for Pressure.


Fate
Stay Two Steps Ahead or you'll be......Dead

Sound Familiar?

The Head of IMF just named the current Global Crisis as,
"The Great Recession."

Sound Familiar?
I've been calling it the "Greatest Depression" since July 2007!
(Please refer to my comments made in the "Beginnings" of this Blog, dated 29 Sept 08)

He also stated that,
"The Great Recession would lead to (amongst other things) Civil Unrest in some countries"

Sound Familiar?
I've been reminding you lot that,
"With the Greatest Depression comes the Greatest Unemployment, leading to the Social Instability" (Can't remember the exact date though)

Warren Buffett, the Richest Man on Earth, just stated the current Global Crisis was like,
"The WWII Pearl Harbour"

Sound Familiar?
I've been calling this current Global Crisis ( Westerners call the Credit Crunch, Easterners call the Financial Tsunami) as "WWIII' in this Blog since 26 Oct 2008.

4 Well Respected US Investors have now all changed side, abandoning their Once Very Bullish View by adopting a Very Bearish one.

I could only remember what 3 of them have stated (getting a bit old now!!)

One stated,
"Just forget about all these Traditional Investment Theory, Tools..... they NO longer work"

Sound Familiar?
Did I NOT say, "New Era Demands New Thinking" long time ago?

The other one stated,
"Do not buy now.
If you really have to, be prepared to see share price drop by another 50%."

Sound Familiar?
Did I NOT say, "The Worst have yet to come" long time ago?

The Third one stated,
"The ONLY thing that one needs to buy now is........................."



















"A Gun!"
Worrying the Great Recession leads to Great Social Instability.

Sound Familiar?
Did I NOT say, "Great Unemployment will lead to Social Instability" sometime ago?

So, what should you do NOW?











Sell! Sell! Sell!

Sound Familiar?
Yes, I've been saying this for the last 21 months!!!

Fate
Only You Could Save Yourself Now

The Biggest Threat

The Biggest Threat of this WWIII is,

NOT from the Incompetent "Faked" Expert Fund Managers;
NOT from the Greedy Hedge Fund Directors,
NOT from the Complacent Regulators;
But from....................














YOU!!

Because you've failed terribly, failing to understand

Investment is NOT just about Buying Low, Selling High;
Investment is NOT just about Securing Profit, Reducing Loss;
Investment is NOT just about Sell when Others Fear, Buy when Others are Greedy.

Investment is about Putting YOUR Emotions Away.

Many of you are Living in the Good Old Memories.
Emotion runs High when seeing Price is Low and therefore rush to Buy.
But Only to Painfully discover a few months later, the "Bargain Price" is actually a "Bitter Price."

Just look at Citi Group.
US$55 in May 2007.
Less than US$5 in Nov 2008.
Last week, it was Less than US$1.

Just look at HSBC.
HK$153 in Nov 2007.
About HK$70 in Jan 2009.
Less than HK$40 as me typing this.

Why should one do NOW?
Did I NOT keep reminding you to "SELL, SELL, SELL.", Now is the Time to Sell NOT Buy?

Yes, it was Very Temping to see HSBC at HK$28 - a price that was last seen back in 89/90, when back then 4 share consolidated to 1 share - especially when a few high profiled billionaires in HK keep saying HK$28 is a "Super Bargain Price"

Sell it tomorrow.
Or you're to regret for NOT doing so in a few month time.
And if you wish, then buy it back at a Much Much Lower price.

Do your Maths NOW.
It's NOT about how much you've paid for it 3 months, 6 months or 12 months ago.
It's about HOW MANY shares you're have at the end of the day.

Assuming you'd bought one lot of HSBC (i.e. 400 shares)at HK$107.
Assuming you've sold HSBC tomorrow at HK$35.
You then have HK$35 x400 shares = HK$14,000.
Assuming fee = 0 for easy calculations.

Assuming HSBC falls to HK$30, you NOW have 466 shares (i.e.16.5% MORE HSBC shares!!)
If HSBC falls to HK$25, you NOW have 560 shares (i.e. 40% MORE HSBC shares!!)

This just reminds you NO MATTER How High Price you'd once paid for HSBC, it is NOW IRRELEVANT. The Most Relevant point is,

You NOW Have MORE Share WITHOUT paying More!!

Now it's Time to Look Forward NOT to Look Backward - how much HSBC ONCE worth is Meaningless - it is to worth Much Much Less than the HK$28 Offer Price.

The Coming Big, Big Drop is NOT restricted to HSBC, NOT restricted to HSI but Every Share in Everywhere.

Stay Calm this time.

Fate
Emotions could lead to Fatal Destruction

How Low?

The Dow fell below 6,800 on Monday Trading.
The first time since April 97 - that was almost 12 years ago.
What were you doing back then?
I was preparing hard to emigrate to Britain, starting my overseas living Life.

So, how Low would the Dow go?
As stated on 12 Oct 08 in this Blog,
I was and still am convinced the Dow would go as Low as 2,500 points!
Well, Just a Guess.
But then again, who's NOT?

What about the just announced result, the Europe's Largest Bank, also the 4th/5th World's Largest Bank, HSBC, how Low would its share price go?

You may get some ideas from the share price of the Once World's Largest Bank, the Citi,

On 2 March 2007, it was about US$50.
On 2 March 2009, exactly two years later, its share price was...........
















About US$1.20 ONLY!!!

That is a Drop of about.....mmm.....(wait for me....I need a calculator)







About 97.6%!!!!

And still Dropping - and could be 0!

So, do you think HSBC's Capital Raising Offer of 50% discount (compared to the last Friday's closing price) at HK$28 to the Existing Shareholders is a Good Deal?

Have a look of other leading British Banks, Lloyds Group, Barclay's & Royal Bank of Scotland - their share prices are all LESS than Sterling 1 Pound!

So, if we compare HSBC with the Citi on a World Bank basis, how could HSBC still be at US$28.25 when the Citi is now at US$1.20 Only?

And if we compare HSBC with the above three on a UK Bank Basis, how could HSBC still be at Sterling Pound 3.90 when the other three are only Sterling Pound 0.47, 0.84 & 0.21 Only?

If the Citi has dropped about 97% from 2 years ago, the 3 British Banks have dropped between 80-90% from last year, how much more will HSBC drop?

I personally will NOT take the Offer and therefore will Sell the Right.

Remember, many bought HSBC at HK$120 (if not at HK$140!), now with the Offer at HK$28, the Average Price will only come down to HK$92.9

Many bought HSBC at HK$80, with the Offer at HK$28, the Average Price will only come down to HK$64.7

Even if one is to buy HSBC at HK$40 from the market and take the HK$28 Offer, the Average Price for HSBC will only be at HK$36.4

I believe in about 3-month time (if NOT less) HSBC will drop BELOW the Offering Price - BELOW HK$28.

It's ONLY the Beginning.

Fate
Everything is By Comparison