Looks like its getting really serious....
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So where are we now?
In 2006 there were hints of an impending housing related crisis in the US. In July 2007 the crisis become full-blown.
You can think of it as, in 2006, the US housing market was hit with HIV and full-blown AIDS developed in July 2007.
The next alarming development was the spread of the disease across the Atlantic to none other than HSBC and Royal Bank of Scotland, among others, like Temasek's purchase, Barclays Bank.
How Temasek can buy Barclays Bank in July at a time when the equivalent of full-blown AIDS hit the banks, is a mystery. Didn't Temasek, with such a big portfolio of banks, know that the banks were infected with the equivalent of HIV in 2006 and developed AIDS in July, the same month they added positions to their Barclays Bank stock holdings?
When the problem became full-blown, the first knee jerk reactions of the central banks were to cut interest rates. Well, that, as we all know failed. The markets were in turmoil.
They could not cut interest rates more to calm the markets because cutting interest rates created other problems, like inflation and problems with the value of the US Dollars, which in turn led to even more problems.
Therefore they decided to do a concerted central bank intervention and loan unlimited amounts of money to banks at lower interest rates. The banks had a massive liquidity problem caused by the write-downs due to their sub-prime related losses.
They were also wary of lending to each other just in case the money they lent, yes money they lent to other banks, become bad debts.
If the problem is contained within the financial markets, the problem could be, well, contained.
If the disease spreads to the US economy, we could see massive infection rates across many countries before it gets better.
Last Friday, the US Department of Labor reported very poor unemployment figures and warning bells started toll.
London was doing pretty well that Friday, smug in the idea that the problem could all go away with the concerted central bank intervention.
When the report came out, the reaction was swift and furious. It was a straight line down.
The US market opened, promptly headed south in a straight line and meandered the rest of the night down.
Last night was quiet. After a big drop you would expect a rebound. A quiet session after a sharp drop is ominous.
Eager money that believes a sharp drop represents buying opportunities, is buying and smart money is quietly selling to them, and no rebound materializes.
In Singapore, the same. After the big drop on Monday, it is quiet today when it should be rebounding.
Big drop, consolidation, big drop, consolidation, is the nightmare scenario to watch out for. It always end with an almighty crash. The more it drops, consolidates, drops, consolidates, the bigger the crash.
Unless of course, it drops, consolidates... consolidates... consolidates... to the point that no one is really interested in the market... that would signal a time to consider getting back into the market...
... to be continued.... -
What are we looking out for next?
1. Further evidence of a deterioration or improvement in the US economy
2. Possible US interest rate cut
3. A big rate cut would send a really strong signal that all is not well with the US economy.
4. It takes time for the effects of a rate cut to flow through.
5. Meanwhile there might be turmoil in the currency markets.
6. If the currency markets sell off US dollars, we might see crude hitting past US$100 per barrel.
7. Further evidence of a deterioration of the housing market and further escalation of the sub-prime crisis. (The way the sub-prime crisis unfolds, it can get worse in the next six months before it gets better.)
In Singapore, the last quarter figures came in below expectations.
QUOTE
Singapore's GDP contracts 3.2 percent in fourth quarter on weak manufacturing
The Associated Press
Published: January 2, 2008
SINGAPORE: Singapore's economy contracted the first time in more than four years in the fourth quarter as weakness in manufacturing outweighed windfall growth from a construction boom, the government said Wednesday.
Singapore's economy shrank 3.2 percent from the third quarter on a seasonally adjusted annualized basis, the Ministry of Trade and Industry's advance estimate showed. It expanded 4.4 percent in the July-September quarter compared to the second.
UNQUOTE
With inflation surging and GDP falling, it does not at all paint a rosy picture. “Construction output rose 24.4 percent compared to the same quarter a year ago, accelerating from 19.2 percent growth in the third quarter.”
This could be due to the effects of the IR construction, the MRT and the on-block sales activities. With the IR and the MRT circle line construction coming to an end, what next? The integrated resorts open in 2009 and so what? The gains made by the casino will be losses by the locals (but losses by foreigners living outside of Singapore will have a net benefit).
The property market is cooling as it should but with many suffering; those that bought recently and heavily in debt.
If MAS let the Singapore dollars rise, then exports will be affected. My guess is that they will let Singapore dollar appreciates against the US Dollars, but let it fall against the rest.
There is not much to look forward to, is there? There is not much to look forward to in the equities market. With a downtrend in equities, can the property prices hold? Stay out of equities for the time being until the picture turns better. -
As usual, Andrew cannot comprehend a world bigger than his flat.
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I see you have a relapse of your insanity. By the way, what happened to your insane threats against me? Too cowardly to carry out your own threats? You were delusional?Originally posted by deathbait:As usual, Andrew cannot comprehend a world bigger than his flat.
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Dow Jones Index last night
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Andrew PK Yap wrote:
Taken from here
DOW Jones main index was down last night, see the chart here:
http://www.casinogamblingpr...
What I said in the previous posts, Big Drop, Consolidation followed by a big drop, and following that, consolidation, has all the possibility of leading to a crash.
What you need to see is not Big Drop, Consolidation or big drop, rebound (even a dead cat will bounce up if you drop it from high enough) but big drop, consolidation, consolidation, consolidation, or big drop, rebound, consolidation, consolidation, consolidation, followed by a sustained up move. Of course, if you are talking about actually investing your money, there is a lot more to consider than this.
As it is, what we have here as of now, is a convincing continuation of the worst case scenario. (It will change but we call it when we see it, because this might go on for the next 6 to 12 months)
This is what Dow did last night,
Index Value:12,589.07
Trade Time:4:03PM ET
Change: Down 238.42 (1.86%)
Prev Close: 12,827.49
Open: 12,820.90
Day's Range: 12567.53 - 12906.4252
As you can see from the ‘Day's Range’, there is not even a rebound from the day low on the day.
Posted on 01/08/08 at 18:45:30
http://www.newsintercom.org/index.php?itemid=568#15406 -
andrew, care to give your view about how SGX^ & HSI^ would perform in the next 6 months? also any indicators to watch out for for a clue in the direction of stock market (i.e employment data as highlighted by buffet)?
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Andrew, what is your opinion on gold and bonds?
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Originally posted by cyee29:andrew, care to give your view about how SGX^ & HSI^ would perform in the next 6 months? also any indicators to watch out for for a clue in the direction of stock market (i.e employment data as highlighted by buffet)?
see: http://www.newsintercom.org/index.php?itemid=568#15407Originally posted by Love Supreme:Andrew, what is your opinion on gold and bonds? -
...it is not an 'official recession', an official recession is when,
recession is a decline in any country's gross domestic product (GDP), or negative real economic growth, for two or more successive quarters of a year. - Wiki
...but recession is when there is a GDP contraction.... (but not 'official')
So... don't continue to sleep....
Singapore's GDP contracts 3.2 percent in fourth quarter on weak manufacturing
The Associated Press
Published: January 2, 2008
SINGAPORE: Singapore's economy contracted the first time in more than four years in the fourth quarter as weakness in manufacturing outweighed windfall growth from a construction boom, the government said Wednesday.
Singapore's economy shrank 3.2 percent from the third quarter on a seasonally adjusted annualized basis, the Ministry of Trade and Industry's advance estimate showed. It expanded 4.4 percent in the July-September quarter compared to the second.
Know whats coming and plan accordingly! Don't just listen to propaganda!
Clear as much debt as possible... if you have debt you cannot clear or if you have too much debt, don't blame yourself if you your debt is for necessities like housing and transport, blame the government for making policies that tries to put Singaporeans into as much debt as possible and to take away as much of Singaporeans money as possible!
If you are thinking of switching jobs or if you are in the 'wrong' sector, try to get into the right industries....
If you fail to plan, you plan to fail! -
... no point worrying, start planning for the worse... if the worse does not happen, all is well even if you planned for it.... if you did not plan for it and it happens, ....
won't help. -
Ho Jinx squandering of Singaporeans hard earned money in action....
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flat...
world...
difference... -
hahaha I have a new coolie to bumpz up my threads... thanks, new coolie...
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not just serious but getting more and more serious liaoz..... -
Hmmm.... ST Index was <2000 in the 97/98 crisis
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let an old uncle give you a tip... don't try to predict...Originally posted by eagle:Hmmm.... ST Index was <2000 in the 97/98 crisis
... and you might ask, 'what the hell are you doing then?'
A legitimate question and my answer is, 'I am following the market' -
Last time I remember I took an accounting module. We did a project on Challenger in 2005. Then our prediction/analysis shows that Challenger will rise in share price. But then hor, after that I never go and research whether our analysis was actually correct.Originally posted by AndrewPKYap:let an old uncle give you a tip... don't try to predict...
... and you might ask, 'what the hell are you doing then?'
A legitimate question and my answer is, 'I am following the market'
Btw, I got A+ for that module.
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that is play play..., when real money is involved, it is a whole different ball-game because your emotions and your delusions come into play, not just your 'prediction/analysis'.Originally posted by eagle:Last time I remember I took an accounting module. We did a project on Challenger in 2005. Then our prediction/analysis shows that Challenger will rise in share price. But then hor, after that I never go and research whether our analysis was actually correct.
Btw, I got A+ for that module.
The gamblers I talk to, they all talk very reasonably before they start gambling... once they are inside the casino, they become 'insane', what I call, temporary gambling insanity in my book.... -
cannot play play too much also mah... play play too much cannot score liao...Originally posted by AndrewPKYap:that is play play..., when real money is involved, it is a whole different ball-game because your emotions and your delusions come into play, not just your 'prediction/analysis'.
The gamblers I talk to, they all talk very reasonably before they start gambling... once they inside the casino, they become 'insane', what i call, temporary gambling insanity in my book....
Gambling... sigh... I don't see why people like to sit down there play a simple jackpot machine so much... Or play so much money in mahjong when it can be played as a strategic game just like a chess game... No point... really... -
...what they teach you in school... play play one fer sure....Originally posted by eagle:cannot play play too much also mah... play play too much cannot score liao...
Gambling... sigh... I don't see why people like to sit down there play a simple jackpot machine so much... Or play so much money in mahjong when it can be played as a strategic game just like a chess game... No point... really... -
... applying it in the real world takes a lot more...
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.... if close here, will be a close lower than the previous low... confirming a downtrend.
...but of course, if you have been following my threads you would have got out since July / Aug last year... -
They didn't teach much for the project. More of learning how to analyse the year-end reports, and talk rubbish in a report. In addition, I did extra research and consulted an external accountant, who is a friend of my gf.Originally posted by AndrewPKYap:...what they teach you in school... play play one fer sure.... -
... you have to do that, but it is still 'tactical' work... it is like Iraqi army looking at their SOP how they should fight the USA... even if they get everything 100% right, it is useless because strategically they lost it, the moment the decided to fight the coalition.Originally posted by eagle:They didn't teach much for the project. More of learning how to analyse the year-end reports, and talk rubbish in a report. In addition, I did extra research and consulted an external accountant, who is a friend of my gf.
If the US army performed 50% below the mark, according to their SOP, they would have won the war anyway because strategically they won it, even before a bullet was fired. -
That's it, the close is below the previous lowest close in Nov 3337.... confirming a downtrend...