Thursday, December 16, 2010

It's a Make-Belief World

The Clock Is Ticking...

Baltic Dry Index at 2069 points(the index tracks worldwide international shipping prices of various dry bulk cargoes and provides "an assessment of the price of moving the major raw materials by sea") is almost half of its peak a year ago and a mere shadow of its peak circa 2008 at 12,000 points.
Its a clear sign that demand for commodities have eased, and probably too. prices have peaked and declining.
Commodities prices move on fears (fear of shortage lead to price rise) while stockmarket prices move on hope (hope that things and events turned better).

Britain's jobless hits 2.5million and Spain is showing signs of strains from the ill effects of her spendthrift days, aside from Portugal, Italy, Greece, Ireland, Iceland... seems like the beggars' queue is growing fast and furious. Even in bustling China, urban and graduate unemployment is fast becoming a social time-bomb.

Nations have spent tomorrow's money yesterday.

USA is still reeling from the excesses of financial imprudence and the motto "spending your way out of poverty" is not dissimilar with 'borrowed time and borrowed money". If you print enough (paper) money to fill the gaps left by a financial earthquake, the real value of money declines. Why is US$ reasonably steady despite printing of more money. Confidence? It is US sheer military might and dominance thats providing confidence in the country, by extension US$.

Globalisation has deepens the World's interdependency and forced nations to unite, not by choice but to survive. Like banks, each is as confident as the other if they mutually underwrites each others' debts; hold tight! When the music stops, someone's gonna be hurt!

The rich nations have imploded. The poorer nations seem richer as the richer nations hollow out. This is not a symptom of growth but backsliding and contraction economically. While China and India (Asia as a whole) economies did improve but pockets of poverty still prevail and the North-South gap is everwidening.

Capitalism is greased by money and if real money are scarce, how will capitalism, by extension capital markets survive, prosper? Banana currencies will lead to inflation.

If cash is King; Real (value) money is the Ruler.

Whichever ideology you subscribe, nations, henceforth economies, cannot grow if unemployment is rife, banks are sick and political will are lacking; tough talks never see recovery, its tough actions. Recent Tea Party shows pop culture and wild promises winning the day.

When demand slows, prices falls, demand for capital goods fall too. Multiplier decline and without a cut in the ability to spend, the economy contracts further. There is no magic. If the house is crumbling, its better if it collapse fast. Restoration and reparation pave the way for recovery.

Politicians over-promised and under-deliver. Electorates love handouts and demand immediate reliefs. Everyone wants something on the cheap but someone has to deliver. Tea party is a 'horay' trip with shallow promises.

The world economies will likely (have to) tank and bring cost lower (deflationary) and make living more affordable. The current pump priming will not cure the ills of capitalism; its prolonging the suffering.

In the meantime, social unrests will surface (already happening in some Western countries), factors of production will be more efficiently and equitably distributed, and hopefully, cost of living lowered.

Booms & Bust are norms of/in life; cyclical changes affect everyone and you are not alone. In between the darkness of changes, there are silver linings.

Be healthy, happy and seek inner peace whilst the World undergo major changes not unlike the 'depression'. . its the degree of downturn, not if... or ... will it happen.

I am not a doomsayer but when bubbles burst, haemorrhage follows. Be there when good days are back.

In this make belief world, words are cheap and winners take all; fools aplenty.

Friday, December 10, 2010

Will I be a stranger in my own country?

I read mainstream newspapers, magazines, temasekreview, and others, both local and international.

The oft repeated topics recently, apart from i) rising property/HDB prices and ii) rising cost of living is iii) "Unemployment among graduate Singaporeans and/or Singaporeans between ages 35-45/above; Worst still it has been often said that foreigners were given the jobs instead of Singaporeans".

How true is (iii)? 

Can the relevant Authorities and/or Ministry(s) confirm (if true and what is being done to address and lessen the anxieties among Singaporeans) or deny ( if untrue with proofs). 

If Singaporeans cannot find jobs now (35 years and above), the issue of working into 70s or re-employment of seniors in the workforce is no more relevant. 

Another pressing issue I heard is (hope its not true) the employment of the younger workforce on contracts basis. 

Fresh graduates or those with some years of working exposure who are on short term employment contracts will find little or no commitment and drive if they are unsure whether they will be continuously employed thereafter, not to mention promotional possibilities.

Besides, companies (the seniors especially) employing them will be less incline to teach or arm them with relevant skills and knowledge as they too are unsure if the 'temp' staff will remain after the contract. It is a loss-loss game. We stand to loss a generation of youths if they feel uncertain about their future. "Why work so hard if I am only a contract worker and I may not belong here?" 
Worst still if 'foreigners-helmed' HRs/Heads may have a tendency to hire most/one of theirs, ceteris paribus. I do not fault them as humans chose to work among their own (countrymen/culture)

I dread the day when my children and their peers are floating digits of the temporary or unemployed data. 

Singaporeans, young and old, are hardworking and full of drive and are comparable, if not better, than many of their foreign peers. But, if they are being replaced by cheaper foreigners (you can find many who are willing and able as the world has 6.9billion people), simply because someone is willing to work longer hours for the same pay or take a lower pay for the same hours worked, then social issues and conflicts will surface sooner rather than later. 

Who will STAND UP for Singapore? If for every 3 Singaporeans, there are 2 foreigners, life is tough. But, if for every 2 true blue, born and breed Singaporeans, there is 1 PR and 2 foreigners, we are in trouble.

Let us keep Singapore for Singaporeans. All foreigners are welcome but not at the expense of Singaporeans. 

I hope I am not screaming in the wilderness. 

Wednesday, December 8, 2010

The Lighter Side Of Life

Tongue In Cheek...

Whats wrong with WikiLeaks? Telling the truth as plainly as it was when spoken - truth hurts

Why are there unemployment, underemployment or simply 'no' jobs? Statistics never lie neither does it tells the truth - happy searching

Why are there so many disconnected teens joining street gangs? They wanted to feel 'belonged' and be recognised - wise up

Why do some people commit suicides? If you can't solve your problems, exit and pass on to others - least sought solution

Why is it the Hong Kong MTR can run at lesser (time) intervals than Singapore MRT? The former caters to travelers demands while the latter demands travelers to take it or leave it  "People can board the trains – it is whether they choose to" - SMRT CEO Saw Phaik Hwa - monopolist/oligopolist speaks loudest

There are plentiful of 'growth' in US and Europe - their debts keep growing - its about grammar

Why is it the West's debts grown so fast while the East is still 'far behind'? The Chinese characters (words文字) have yet to coined words like billions十亿, trillion千亿, quadzillion?, zillion?? .. simply no words to describe numbers that are too big - words that heavy but of no value

Why is income gap widening? Newer buildings are taller, bridges are longer, baby grows bigger - its the natural order of progress

When will the World or mankind ever be equal? Never - mathematically possible, practically impossible

More Regulations do not necessarily mean a better world but it certainly stifle creativity, entrepreneurship and 'thinkability' - ideas originate naturally

Will the world end? This question requires no answer - if it ends, we will meet again in the 'other world'

...alittle laugh lightens up the Soul

Wednesday, December 1, 2010

Stockmarket ++CrossRoad++

Where is the market heading...

In the final days of September, I penned "The Pains & Fun Of Stockmarket" amongst which read '... Lightening up seems an ideal choice (on the upswing) ... Cyclically, quarterly low is expected in October.' Guess, we have seen it all!

A flip through of some major markets/ charts and most show we are at the crossroads including possible 'Head & Shoulders pattern', 'a small Wave C or a Wave 3'...  an impending downside-bias? ?

What's keeping the markets up?
Hot money and self-denial; or what I call the "Hope Syndrome".
Profit in hand is worth zillion$ in the market; I am bopeful but I rather be safe

What you find under the stars...

In year 2000, there were 6.1bil people in the World; now its 6.9bil - demand, multiplier and growth?
There are three times more billionaires today than there were 10 years ago - the newfound rich and the rich gets richer
Similarly, there are more under-nourished, more unemployed, more poverty sprinkled around the Gobe - the poor gets poorer, the struggling class

The World will never be equal

When the financial crisis hit the West, as in most 'club deals', saved were those who belong to the 'club'
The big institutions borrow to pay fellow lenders who underwrite their fresh loans; by extension debts were used as collaterals; and the music continues... 

General Motors (GM) rose from the dead, AIA was rescuscitated and Citibank limped back to recovery; Freddie Mac & Fannie Mae melted into oblivion

USA prints enough money to fill gaps left behind by the financial earthquake - if money can solve problems, its no longer a problem! 

U.S. NATIONAL DEBT CLOCK - shows The Outstanding Public Debt as of 01 Dec 2010 at 02:49:23 AM GMT is: US$13,795,262,233,519.30 

China's reserves hits 3 trillion; Japan's reserves passed 1 trillion
China is fighting inflation whereas Japan is struggling in deflation
Singapore's growth of 15% will taper down to 5% next year

If printing money can steer the World out of depression, the term 'banana' currency would not have been conceived
The value of money is not in the number of zeroes after One; its the confidence and its purchasing power - read the following - 100 trillion Zimbabwean dollar banknote (1014 dollars), equal to 1027 pre-2006 dollars

If you are deep in the plus/profit, take some, if not all
If you are in the red and living with borrowed money, be forewarned and be prepared

China is a developing nation, poor by per capita but rich in absolute dollars
US is a developed nation, rich by per capita but living on borrowed dollars

If Wall Street is the lighthouse of Capitalism, by extension equity markets
The tides have changed

When you make your fortune, I be glad to have a free beer...
And kindly donate to the less fortunate...and I am one