Forgot to mention a major difference between US & Australia.
Australia recently announced it Guarantees ALL money deposited at Banks for 3 years.
Whereas, US (as far as I am aware of) Guarantee only US$100,000 deposited at banks - though there has been suggestion of doubling that to US$200,000.
Just noticed there are two comments in my post published on 14 Oct, titled "Heart Attack".
1) 8 up - I will buy A$ NOW (i.e. below HK$5.5).
But, remember, it's not only about "What you buy", but also "How to buy" is also important.
Make sure you're buying in phases - because we're only Humans and we therefore do make Mistakes.
I will sell A$ after gaining a 5% profit. (This time I may wait until it reaches HK$6 - around 10%)
The difference of Buying Currency and Shares is,
For the former, I'm doing it while waiting for the CRASH in stock market, the profit is mainly for upgrading to Business Class, or for a Longer Overseas holiday.
For the latter, it's for BIG Profit, to finance the Retirement Plan for my boys - yes, for my children - I've already retired in a sense.
2) carol - The US$ has actually been on the decline for the last 5-6 years.
It, however, rebounds everytime when the global finance was nervous recently - people are prepared to accept 0.3% interest rate from the US 1-month Treasury Bill for SAFETY.
I am very confident US$ is soon to resume its fall again.
Governments can NOT just keep printing money and buying every firms - US Government is already the Biggest Mortgage Provider in US, the Biggest Insurer in US, the Biggest Single Shareholder in 9 Major US Banks, and the Federal Budget Deficit is already the Biggest on record!!
There is always a Time Gap between,
"What is predicted to Happen" and "When it actually happens".
In Japan, some people seen the CRASH coming in 86, but it did not happen until 89!
I've been warning investors since July 2007, expecting the CRASH is soon to happen.
It is only until recently my friends started waking up and worrying the Big One could be coming.
The Only Difference is,
This time is the Biggest CRASH.
Be Prepared.
Fate
Two Steps Ahead makes ALL the Difference
Saturday, October 18, 2008
Friday, October 17, 2008
Two Countries, Two Circumstances
Let's compare US & Australia.
In US, it has launched a US$700 Billion Rescue Package.
In Australia, we have a A$10 Billion Stimulus Plan.
The amount of money reflecting the Seriousness of the Problem.
And reflect the Degree of Panic.
Also, US Government has to buy bank shares to stabilise the Share Market as the mean to stabilise the Economy. Whereas our Australian Government is trying to put money into everyone's pocket, aiming to encourage people to spend.
After the recent turmoil, the World Economic Forum has assessed "How Safe the Banking System" in 134 countries. It has ranked US's at 40th, UK's at 44th, HK's at 11th and Australia's?
At 4th!
In US, even though the Federal Reserve has cut rate dramatically since Sept 2007, the mortgage rate did not fall much as it is linked to the UK's Inter Bank Rate. Whereeas in Australia, when the Reserve Bank cut the rate by 1%, the mortgage rate dropped by about 0.8% and tonight another surprise, ANZ bank cut another 0.25% in its mortgage rate.
In US, the house price has dropped about 15-18% from its height at 2006 and is expected to fall by another 10-15%, whereas in Australia I personally felt that the price has dropped about 10% from a year ago.
With the Australian Government's recent Stimulus Plan and the recent 1% interest rate cut (and more is expected), the auction I attended earlier today had a better clearance rate.
To conclude, I do feel Australia is much much better placed than US - let's do NOT forget Australia is closer to the Rising Super Power, China than US - "The Eye of Storm".
Even though China is slowing down but is still expected to grow at 9% a year, whereas US is expected to have ZERO growth if not Negative for the coming quarter, confirming it's in Recession.
Cheers
Fate
Think Globally, Gain Locally
In US, it has launched a US$700 Billion Rescue Package.
In Australia, we have a A$10 Billion Stimulus Plan.
The amount of money reflecting the Seriousness of the Problem.
And reflect the Degree of Panic.
Also, US Government has to buy bank shares to stabilise the Share Market as the mean to stabilise the Economy. Whereas our Australian Government is trying to put money into everyone's pocket, aiming to encourage people to spend.
After the recent turmoil, the World Economic Forum has assessed "How Safe the Banking System" in 134 countries. It has ranked US's at 40th, UK's at 44th, HK's at 11th and Australia's?
At 4th!
In US, even though the Federal Reserve has cut rate dramatically since Sept 2007, the mortgage rate did not fall much as it is linked to the UK's Inter Bank Rate. Whereeas in Australia, when the Reserve Bank cut the rate by 1%, the mortgage rate dropped by about 0.8% and tonight another surprise, ANZ bank cut another 0.25% in its mortgage rate.
In US, the house price has dropped about 15-18% from its height at 2006 and is expected to fall by another 10-15%, whereas in Australia I personally felt that the price has dropped about 10% from a year ago.
With the Australian Government's recent Stimulus Plan and the recent 1% interest rate cut (and more is expected), the auction I attended earlier today had a better clearance rate.
To conclude, I do feel Australia is much much better placed than US - let's do NOT forget Australia is closer to the Rising Super Power, China than US - "The Eye of Storm".
Even though China is slowing down but is still expected to grow at 9% a year, whereas US is expected to have ZERO growth if not Negative for the coming quarter, confirming it's in Recession.
Cheers
Fate
Think Globally, Gain Locally
Thursday, October 16, 2008
Recession - any doubt?
Did I not tell you to Sell everytime the market Rebounds?
Another round of Panic - Wall St fell over 733 points overnight, that is, 7.87%, causing worldwide markets to fall - fall badly Again!
The US Economy is getting worse and worse, just hear what they have said.
Bill Gates, the World's Richest Man until this year : The US Unemployment Rate to rise to 9% (Currently at 6.1%)
Bernanke, Federal Reserve Chairperson : Not to make the errors made in the Great Depression
(= formally for the 1st time acknowledged openly the current crisis is as Big as the 30's )
Chairperson of San Fransisco Reserve Bank : We are now in Recession.
And, the Mortgage Default (i.e. People could NOT pay their mortgage and have their homes re-possessed by banks) has risen from 3.5%, 4.5% to now 5% - all time high. And in some areas like California and Nevada, it is 8%.
There are currently about 12 Million homes in US that are having "Negative Equity" and the homeowners could walk away from their homes anytime from now.
This is a Crisis that could put back your Retirement Plan for at least 5 years if not 10.
If the Wall St is to fall by another 5% or More tonight, we could be in for the Big Fall.
Fate
Failing to Act is Waiting to Fail
Another round of Panic - Wall St fell over 733 points overnight, that is, 7.87%, causing worldwide markets to fall - fall badly Again!
The US Economy is getting worse and worse, just hear what they have said.
Bill Gates, the World's Richest Man until this year : The US Unemployment Rate to rise to 9% (Currently at 6.1%)
Bernanke, Federal Reserve Chairperson : Not to make the errors made in the Great Depression
(= formally for the 1st time acknowledged openly the current crisis is as Big as the 30's )
Chairperson of San Fransisco Reserve Bank : We are now in Recession.
And, the Mortgage Default (i.e. People could NOT pay their mortgage and have their homes re-possessed by banks) has risen from 3.5%, 4.5% to now 5% - all time high. And in some areas like California and Nevada, it is 8%.
There are currently about 12 Million homes in US that are having "Negative Equity" and the homeowners could walk away from their homes anytime from now.
This is a Crisis that could put back your Retirement Plan for at least 5 years if not 10.
If the Wall St is to fall by another 5% or More tonight, we could be in for the Big Fall.
Fate
Failing to Act is Waiting to Fail
Tuesday, October 14, 2008
Heart Attack
For many investors, it must have been a very tough year so far - many many sleepless nights.
And in particular, for the last 2 weeks, many have to be in extreme good health to survive all these Record Breaking Events, witnessing History being made, made Again and Again - Everywhere, Everyday and NOT having a Heart Attack!
Wall St had the Biggest One Day Gain in points overnight, 936 Points.
Japan's Nikkei had the Biggest One Day Percentage Gain, 14.2%
US Government, following UK's lead, is to buy stakes in banks.
But, Australian has taken a different approach.
Earlier today, the Australian PM revealed his A$10 Billion Economy Stimulant Plan.
Rather than directly buying bank shares, he is to give every eligible child a one-off cash payment of A$1,000, every single pensioner a lump sum cash payment of A$1,400, every first home buyer a cash grant of A$14,000 to buy their first house etc. as a Christmas Present!
But still, I am afraid nothing will NOT stop the Unstoppable from happening -The Biggest CRASH.
The Dramatic up & down in the share markets have also presented Many Great Money Making Opportunities :
In one day, GM fell by 31%, the following day rose by 30%;
Morgan Stanley almost doubled (from US$9.xx to US$18.xx) in a day;
In HK, Property shares rose by 10-20%.
But only for those are :
the Bravest (NOT afraid of Losing Everything)
+
Most Energetic (Non stop watching markets for 18 hours +)
+
Very Decisive (could make Buy/Sell decision within seconds)
+
Cash Rich (money NOT tied up with "Once Thought Bargain Shares)
+
LUCK, LOTS OF LUCK
With the ALL of the above, you could then make Millions in just 2 days.
But for me, this is NOT my type of Investment.
So, I did other things while waiting for the CRASH.
I've shifted my attention to the Currency Market - the A$.
If C$ could be at HK$6.8, I do NOT see A$ will stay below HK$5.5. for long - by the "Rules of Relativity" and Canada is closer to the "Eye of the Storm" - USA.
In fact, I've been advising some of my friends to buy A$ last week.
I'd applied a loan from HSBC HK on 8 Oct. *(PLEASE SEE BELOW)
But because of the application took time, I'd missed the opportunity to buy A$ at HK$5.00
Still, I consider A$ below HK$5.5 is a Good Buy and I will buy once I've my money.
Again, using the Phase Buying Rule - 1/3 at a time.
Remember to SELL your shares everytime there is a Rebound.
And I'm now seriously considering selling my Australian House to further Reduce my Risk.
Cheers
Fate
Proper Planning Prevent Persistent Pain
* DO NOT TAKE A LOAN LIKE ME IF YOU HAVE NOT DONE THIS BEFORE. I'VE DONE THIS A FEW TIMES BECAUSE I SEE THE DEPRECIATION OF HK$ AS A REAL RISK, SO I REDUCE MY HK$ HOLDING WHENEVER I COULD. BY TAKING A HK$ LOAN, I COULD HAVE A LUMP SUM RIGHT AWAY TO BUY NZ$/A$ EARNING HIGH INTEREST AND REPAYING WITH MY MONTHLY HK$ INCOME.
And in particular, for the last 2 weeks, many have to be in extreme good health to survive all these Record Breaking Events, witnessing History being made, made Again and Again - Everywhere, Everyday and NOT having a Heart Attack!
Wall St had the Biggest One Day Gain in points overnight, 936 Points.
Japan's Nikkei had the Biggest One Day Percentage Gain, 14.2%
US Government, following UK's lead, is to buy stakes in banks.
But, Australian has taken a different approach.
Earlier today, the Australian PM revealed his A$10 Billion Economy Stimulant Plan.
Rather than directly buying bank shares, he is to give every eligible child a one-off cash payment of A$1,000, every single pensioner a lump sum cash payment of A$1,400, every first home buyer a cash grant of A$14,000 to buy their first house etc. as a Christmas Present!
But still, I am afraid nothing will NOT stop the Unstoppable from happening -The Biggest CRASH.
The Dramatic up & down in the share markets have also presented Many Great Money Making Opportunities :
In one day, GM fell by 31%, the following day rose by 30%;
Morgan Stanley almost doubled (from US$9.xx to US$18.xx) in a day;
In HK, Property shares rose by 10-20%.
But only for those are :
the Bravest (NOT afraid of Losing Everything)
+
Most Energetic (Non stop watching markets for 18 hours +)
+
Very Decisive (could make Buy/Sell decision within seconds)
+
Cash Rich (money NOT tied up with "Once Thought Bargain Shares)
+
LUCK, LOTS OF LUCK
With the ALL of the above, you could then make Millions in just 2 days.
But for me, this is NOT my type of Investment.
So, I did other things while waiting for the CRASH.
I've shifted my attention to the Currency Market - the A$.
If C$ could be at HK$6.8, I do NOT see A$ will stay below HK$5.5. for long - by the "Rules of Relativity" and Canada is closer to the "Eye of the Storm" - USA.
In fact, I've been advising some of my friends to buy A$ last week.
I'd applied a loan from HSBC HK on 8 Oct. *(PLEASE SEE BELOW)
But because of the application took time, I'd missed the opportunity to buy A$ at HK$5.00
Still, I consider A$ below HK$5.5 is a Good Buy and I will buy once I've my money.
Again, using the Phase Buying Rule - 1/3 at a time.
Remember to SELL your shares everytime there is a Rebound.
And I'm now seriously considering selling my Australian House to further Reduce my Risk.
Cheers
Fate
Proper Planning Prevent Persistent Pain
* DO NOT TAKE A LOAN LIKE ME IF YOU HAVE NOT DONE THIS BEFORE. I'VE DONE THIS A FEW TIMES BECAUSE I SEE THE DEPRECIATION OF HK$ AS A REAL RISK, SO I REDUCE MY HK$ HOLDING WHENEVER I COULD. BY TAKING A HK$ LOAN, I COULD HAVE A LUMP SUM RIGHT AWAY TO BUY NZ$/A$ EARNING HIGH INTEREST AND REPAYING WITH MY MONTHLY HK$ INCOME.
Monday, October 13, 2008
Sell NOW
Yet another Dramatic Day.
First, the Australian Market rebounded by 5.6%, after the Prime Minister appearing on national TV the night before, assuring ALL bank deposits will be guaranteed for 3 years. (For a moment , I thought we were in WWII!)
Then, HK had a Massive Rise of over 10%!
Followed by the European major markets rose by over 5% after Rescue Packages announced by the UK, Germany, Spain, Swiss..... and 3 European Banks' strong stance.
(And days before the G7, G20 etc. Joint Declarations to use whatever means to protect the financial system)
But, all these does not change one thing,
The CRASH is coming.
What have been done by all these Governments & Central Banks only trying to achieve one thing,
Buy More Time - hoping the Crisis will go away.
The Crisis will NOT go away.
And they could only buy a week time - the most.
Of course, there will be Rebounds. Strong Rebounds.
But, let's do Not forget some Facts,
In US, more people are having their telephone/Internet disconnected(AT & T CEO stated it this Jan) and now many are cutting back on electricity - using candles at home;
In US, more and more businesses are closing down as they could not get loan/cheaper loan to just carry on day-to-day operations;
In US, about 1 million home being re-possessed every month and there are a total of about 17 million homes currently unoccupied (= 3 times of ALL homes in Australia);
Then, look at the following Possible scenarios,
Funds have to face Massive Redemption as investors lose faith?
It is now retail shares, car manufacturer shares etc. being dumped at - how much more money does any government have left to buy these shares like they did for banking shares?
Pre-programmed Computer Sale Orders triggered off the CRASH?
An assassination of President Hopeful, Obama?
The Only Strategy for those having Cash - WAIT.
Do NOT rush to buy - just look at the price of Morgan Stanley.
The Chinese State Investment bought at US$50 last Dec thought they got a Bargain.
The Japanese Giant Bank bought at US$30 in this Sept thought they got a Bargain.
But, Morgan Stanley dropped to less than US$10 last Friday!
Same to Goldman Sach.
After Warren Buffett had bought it, its price dropped by another (over) 35% last week.
We saw the most volatile week in Wall ST 112-year history AND the week suffering the Most Loss last week. In theory, 20% drop within a year means the market has entered "Bear" - it happened WITHIN ONE WEEK , most if not all major markets dropped more than 20% last week!
The Only Tragedy for those having 30% Loss - Cut Loss.
Sell everytime when there is a Rebound.
Let's do the maths here.
Assuming you bought the share at $100, now only at $70 = a loss of 30%.
Sell now, keep $70.
The share in my view is to drop by at least 50%, that is, $35.
Now, use your $70 to buy back the same share.
Instead of having 1 share, you now have 2 shares.
Remember, investing is NOT necessary about,
"How Much you have spent in buying the shares"
But, could be more about,
"How MANY shares one owns at the end of the day."
(i.e. MORE shares with the SAME amount of money)
Cheers
Fate
Change your Thinking = Change Your Fate
First, the Australian Market rebounded by 5.6%, after the Prime Minister appearing on national TV the night before, assuring ALL bank deposits will be guaranteed for 3 years. (For a moment , I thought we were in WWII!)
Then, HK had a Massive Rise of over 10%!
Followed by the European major markets rose by over 5% after Rescue Packages announced by the UK, Germany, Spain, Swiss..... and 3 European Banks' strong stance.
(And days before the G7, G20 etc. Joint Declarations to use whatever means to protect the financial system)
But, all these does not change one thing,
The CRASH is coming.
What have been done by all these Governments & Central Banks only trying to achieve one thing,
Buy More Time - hoping the Crisis will go away.
The Crisis will NOT go away.
And they could only buy a week time - the most.
Of course, there will be Rebounds. Strong Rebounds.
But, let's do Not forget some Facts,
In US, more people are having their telephone/Internet disconnected(AT & T CEO stated it this Jan) and now many are cutting back on electricity - using candles at home;
In US, more and more businesses are closing down as they could not get loan/cheaper loan to just carry on day-to-day operations;
In US, about 1 million home being re-possessed every month and there are a total of about 17 million homes currently unoccupied (= 3 times of ALL homes in Australia);
Then, look at the following Possible scenarios,
Funds have to face Massive Redemption as investors lose faith?
It is now retail shares, car manufacturer shares etc. being dumped at - how much more money does any government have left to buy these shares like they did for banking shares?
Pre-programmed Computer Sale Orders triggered off the CRASH?
An assassination of President Hopeful, Obama?
The Only Strategy for those having Cash - WAIT.
Do NOT rush to buy - just look at the price of Morgan Stanley.
The Chinese State Investment bought at US$50 last Dec thought they got a Bargain.
The Japanese Giant Bank bought at US$30 in this Sept thought they got a Bargain.
But, Morgan Stanley dropped to less than US$10 last Friday!
Same to Goldman Sach.
After Warren Buffett had bought it, its price dropped by another (over) 35% last week.
We saw the most volatile week in Wall ST 112-year history AND the week suffering the Most Loss last week. In theory, 20% drop within a year means the market has entered "Bear" - it happened WITHIN ONE WEEK , most if not all major markets dropped more than 20% last week!
The Only Tragedy for those having 30% Loss - Cut Loss.
Sell everytime when there is a Rebound.
Let's do the maths here.
Assuming you bought the share at $100, now only at $70 = a loss of 30%.
Sell now, keep $70.
The share in my view is to drop by at least 50%, that is, $35.
Now, use your $70 to buy back the same share.
Instead of having 1 share, you now have 2 shares.
Remember, investing is NOT necessary about,
"How Much you have spent in buying the shares"
But, could be more about,
"How MANY shares one owns at the end of the day."
(i.e. MORE shares with the SAME amount of money)
Cheers
Fate
Change your Thinking = Change Your Fate
Sunday, October 12, 2008
How Low Could It Be?
Although it was only the 10th, it was a Black Friday.
Although all share prices were in "Red", it was a "Black" Friday.
Things are getting from Worse to Even Worse.
From Australia in South Hemisphere to Iceland in North Hemisphere - and HK in between!
Australian market fell by a stunning 8.3%, not seen since 87 CRASH & a world away from USA.
Iceland government took over the 3rd largest bank, then the largest bank, with its currency dropped from about 130 = 1 Euro to, last I checked, about 340 = 1 Euro!
And in Zimbabwe, Inflation is at an Unbelievable 238 Million %.
NOT 238% but 238,000,000%!
2 months ago, one could still buy a toilet roll for 1 million Zimbabwe money, now....... you need 40 million Zimbabwe money to buy the same toilet roll - make sure you do not have a stomach.
In Britain, the share dropped by 10% within the First 7 minutes when the market opened.
And the British Government has done something not done before - Guarantee the Liabilities of several major British Banks.
In USA, another precedent after so many precedents,
The Government is prepared to buy Bank Shares Directly.
And this is only to Worsen the Balance Sheet of the US Government - and the downgrade from Credit Agencies could happen anytime from now.
So, now we only need one/two more incidents to see the 50% + Fall in Wall St.
(I suspect DJIA is to fall to about 2,500 points, though the article "What History Tells Us About the Market" in www.wsj.com, suggesting Wall St. to fall around 6,000 level)
Now, the Storm has spread from US to Europe and Asia .
(Just look at Japan Nikkei Index's record fall every day!)
What is to happen in HK?
Property price to drop 20-30% (Worse than in US?)
Inflation is to rise further? (NOT as bad as Zimbabwe though)
Unemployment to rise further? (Any Doubt?)
Smaller banks to collapse? (Many developed countries now guarantee FULL bank deposits)
HK$ - will it be forced to Depreciate?
(South Korea, the "Asian Iceland", its Won has fallen by about 15% so far)
HSI to drop to SARS Level?
(I was advised it was around 8,000 points in April 2003)
I personally suspect HSI to fall to about 4,000 points.
Again, I could be Dead Wrong.
But if I'm Right, you are DEAD if you've NOT already made the necessary arrangements.
Cheers
Fate
Every Day There is a New Low
Although all share prices were in "Red", it was a "Black" Friday.
Things are getting from Worse to Even Worse.
From Australia in South Hemisphere to Iceland in North Hemisphere - and HK in between!
Australian market fell by a stunning 8.3%, not seen since 87 CRASH & a world away from USA.
Iceland government took over the 3rd largest bank, then the largest bank, with its currency dropped from about 130 = 1 Euro to, last I checked, about 340 = 1 Euro!
And in Zimbabwe, Inflation is at an Unbelievable 238 Million %.
NOT 238% but 238,000,000%!
2 months ago, one could still buy a toilet roll for 1 million Zimbabwe money, now....... you need 40 million Zimbabwe money to buy the same toilet roll - make sure you do not have a stomach.
In Britain, the share dropped by 10% within the First 7 minutes when the market opened.
And the British Government has done something not done before - Guarantee the Liabilities of several major British Banks.
In USA, another precedent after so many precedents,
The Government is prepared to buy Bank Shares Directly.
And this is only to Worsen the Balance Sheet of the US Government - and the downgrade from Credit Agencies could happen anytime from now.
So, now we only need one/two more incidents to see the 50% + Fall in Wall St.
(I suspect DJIA is to fall to about 2,500 points, though the article "What History Tells Us About the Market" in www.wsj.com, suggesting Wall St. to fall around 6,000 level)
Now, the Storm has spread from US to Europe and Asia .
(Just look at Japan Nikkei Index's record fall every day!)
What is to happen in HK?
Property price to drop 20-30% (Worse than in US?)
Inflation is to rise further? (NOT as bad as Zimbabwe though)
Unemployment to rise further? (Any Doubt?)
Smaller banks to collapse? (Many developed countries now guarantee FULL bank deposits)
HK$ - will it be forced to Depreciate?
(South Korea, the "Asian Iceland", its Won has fallen by about 15% so far)
HSI to drop to SARS Level?
(I was advised it was around 8,000 points in April 2003)
I personally suspect HSI to fall to about 4,000 points.
Again, I could be Dead Wrong.
But if I'm Right, you are DEAD if you've NOT already made the necessary arrangements.
Cheers
Fate
Every Day There is a New Low
Friday, October 10, 2008
Are You Ready?
No matter how fast China is Rising, how influential China has become, Wall St still Matters, Matters Most and Matters NOW.
Another 7.33% drop overnight.
20% drop in 7 days.
Almost 40% in Exactly 1 year.
There will be BLOOD everywhere when other markets open later today.
Just look at USA.
GM lost 31% in one day after being considered downgraded by Credit Agencies.
Goldman Sach & Merrill Lynch - both lost 26% in one day.
1 in 6 house owners in USA is having a house value LESS than its purchase price (i.e. Negative Equity)
Many States in USA are in the brink of Bankruptcy.
Unemployment will rise dramatically.
The Problems will get worse and worse.
Are you ready?
Ready for the Once in a Century Opportunity?
Cheers
Fate
Waiting is a Blessing
Another 7.33% drop overnight.
20% drop in 7 days.
Almost 40% in Exactly 1 year.
There will be BLOOD everywhere when other markets open later today.
Just look at USA.
GM lost 31% in one day after being considered downgraded by Credit Agencies.
Goldman Sach & Merrill Lynch - both lost 26% in one day.
1 in 6 house owners in USA is having a house value LESS than its purchase price (i.e. Negative Equity)
Many States in USA are in the brink of Bankruptcy.
Unemployment will rise dramatically.
The Problems will get worse and worse.
Are you ready?
Ready for the Once in a Century Opportunity?
Cheers
Fate
Waiting is a Blessing
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