What I've been doing

Another Heart Breaking Day.

The Australian Benchmark S&P/ASX200 fell to 4-Year Low.
The HK HSI fell by over 1,600 points or 12.7% to 11,015 - a Drop of about 65% from its Peak.

In Japan, the Nikkei Index fell to a 26-Year Low - Yes, the Lowest since 1982.
There will be more troubles ahead as the world's 2nd largest economy's shares tumbled so badly.

So, what have you been doing to protect your Hard Earned Cash?

For the last few days, I've been receiving many calls/E Mails from my friends in Toronto, New York, Beijing, HK, Sydney etc., asking if it's the Best Time to buy. If so, What, How and Where to Buy.

So, I think I may as well share with you lot here.

1) Currency

I've mentioned in my blog dated 18 Oct, titled "Difference", stating that I am to buy some A$ while waiting for the CRASH in the share markets.

My Instinct at the time was to buy "Below A$1 = HK$5.5."
(AT the time it was A$1 = HK$5.2)

Although I'd a HK$ loan from my bank in HK, I had to fight the Bureaucracy in trying to get the money sent to my bank in Australia in A$ for the last week. And now, A$ drops to HK$ 4.75 - drops by about 8.6%. (www.hsbcnet.com/treasury/market-data) Thanks to the Bureaucracy!

I later visited the website, www.oanda.com/convert/fxhistory, confirming during the last 2,000 days (i.e. between 8.5.03 & 27.10.08) there were only 4 days A$ was around $HK4.90 before this week. The Average of these 2000 days is HK$6.076, High is HK$7.624 and Low? Just made today at around HK$4.75!!

I believe the current strength of US$ will NOT last long.

Everyone is soon to wake up and realise US$ worths much less than what it is now, because the US Government just keeps printing money to bail out almost every industry!! A Big Fall is inevitable. (Although there will be a Time Gap - just like when I first warned others about the CRASH back in July 2007)

So I'm to buy more NZ$/A$. Again, using the 1/3 Approach. Putting another 1/3 in when it drops by another 20% and so forth - we're only Humans and we will make Mistakes, so always better to buy in phases.

Better Be Safe than Sorry.

2) Share

I'll only buy one share.

Because I'm a customer of it for the last 23 years, have been keeping an eye on it since early 90's, its leading position in China/HK, Asia and the World, I have received personal apology from its CEOs/Chairperson and it has won numerous awards for its Outstanding Management etc.,

HSBC Holdings

(One of the Largest Banking Group in the World, currently ranked at 5th or 6th)

I've been warning the HK HSI to fall dramatically since July 2007 (NOT 2008), reminding others to start considering to buy ONLY when HSI fell to SARS LEVEL in 2003, that is, at 8,000. But of course, noone was listening to me - especially when the HSI hit the Historical High of 31,638 on 31 Oct 2007!

For the last few days, everyone finally rang/E Mailed me, stating that,
"I wish I had listened to you back then!"

I'd stated in my previous blog how Low I believe the HSI and DJIA would be. dated 12 Oct, titled "How Low Could It Be?" (Using the same principle, S&P/ASX200 should fall to around 1,000 points)

When to buy HSBC : when it drops to around HK$60.
(Today closed at HK$75, although one year High was at HK$152)

How to buy : 1/3 at HK$60, another 1/3 at HK$48, last 1/3 at around HK$38.

Fund Involved : STILL KEEP 50% CASH after buying the above HSBC.

Where to buy : For me, I'll try to buy it from the London Listing, as I mainly have NZ$ and if buy it in HK$, I am to suffer a 35% LOSS due to recent great fall of NZ$. Buying in Sterling Pounds, I am to suffer only about 5% loss on the Cross Rate. Also, buying in Sterling Pound may benefit from the future recovery of UK Economy, making a gain both in share price & exchange rate and to reduce the loss due to a sudden Depreciation of HK$.

3) Property

Although I expect the Australian Property Price to fall further, I suffer Minimum Loss.

Because the monthly interest income I receive from my Lump Sum, which I could have used for a Cash Purchase, has offset most of my monthly mortgage repayment. So, I'm in a way like "Paying a A$200 rent a week" for my Lakefront Brand New Home - the market rent for which should be around A$550-600 a week.

If interest rate AND house price are to drop significantly in USA, HK, Australia, UK etc., one may start to think buying some properties.

4) Cross Rates

If I'm to return to HK tomorrow, I'm to suffer a LOSS of abut 35% as I mainly hold NZ$. But if I continue to stay in Australia, I'm actually Better Off because the Cross Rate between NZ$ and A$ has risen from A$0.86 when we came here from NZ two years ago to now at A$0.89.

So, one should start looking at Cross Rates to ensure how they could be suffering Less Loss, some like my UK friends, they acutally made a Gain of 25-30 %, even thoug Sterling Pounds has dropped to a 5-Year Low against US$!

Noone knows your Full Circumstances better than Yourself, so make a Good Assessment of your Current Financial Situation and make the Next Right Move to Minimise your Potential Huge Loss.

It's Coming - the Greatest CRASH.

I could be Totally Wrong. But if I'm Right, you'll NOT be Alright!

Fate
Investment is about Having Discipline