Euro Crisis??!! What crisis!!

http://www.davidmcwilliams.ie/2012/02/24/punk-economics-lesson-2

crisis.. easy just pump in more money.. another billion or trillion hell make it Quadrillion who cares. It's only number on the paper anyway.....

dmateo wrote:

crisis.. easy just pump in more money.. another billion or trillion hell make it Quadrillion who cares. It's only number on the paper anyway.....

You are right partially.

But sooner or later, no matter the nominal growth, real growth will catch up. Using monetary policy will only delay the inevitable and pump nominal growth and build bubbles.

Like it or not, the bubble is already here. Asset prices are at an all time high. Problem is nobody recognizes there's a bubble. An asset deflation is around the corner at 2014.

The primary target of QE in US was housing. Lower mortgage equates to more borrowing right? In March 2012, the new mortgage applications has started to decline. New home sales fell by 1.6 percent. Existing homes salse fell by 0.5%, housing starts feel by 1.1%. Gasoline consumption was down. American truckage tonnages also fell. Oil stockpiles have reached un-precendented high numbers. These are telling numbers that consumption are already slowing in the US.

With slowing consumption, there will be unemployment, which drags down the C component of GDP, which may equates it to recession.

On the side, we have QE, ie printing money. Printing money, distort prices and that leads to inflation.

Alas, now we are looking at a global stagflation on our hands.

If it blooms into that, there's only one sensible way to solve the problem. De-leveraging. Which will lead to asset deflation.

Other less sensible ways includes the US further inflating their debt away (which they are doing now) or defaulting.

Either way, it's going to be ugly.

If you are in stocks, bonds or any other investments, get out now. Wait for the delveraging process to occur in 2014. (Maybe even earlier.) Short it along the way and then smugly pick up assets that have gone too far south.

Good Luck and Good Night

pengsan wrote:

If you are in stocks, bonds or any other investments, get out now. Wait for the delveraging process to occur in 2014. (Maybe even earlier.) Short it along the way and then smugly pick up assets that have gone too far south.

Good Luck and Good Night

Wow, that's a gutsy call!

So what are we supposed to do between now & 2014?

pengsan wrote:

dmateo wrote:

crisis.. easy just pump in more money.. another billion or trillion hell make it Quadrillion who cares. It's only number on the paper anyway.....

You are right partially.

But sooner or later, no matter the nominal growth, real growth will catch up. Using monetary policy will only delay the inevitable and pump nominal growth and build bubbles.

Like it or not, the bubble is already here. Asset prices are at an all time high. Problem is nobody recognizes there's a bubble. An asset deflation is around the corner at 2014.

The primary target of QE in US was housing. Lower mortgage equates to more borrowing right? In March 2012, the new mortgage applications has started to decline. New home sales fell by 1.6 percent. Existing homes salse fell by 0.5%, housing starts feel by 1.1%. Gasoline consumption was down. American truckage tonnages also fell. Oil stockpiles have reached un-precendented high numbers. These are telling numbers that consumption are already slowing in the US.

With slowing consumption, there will be unemployment, which drags down the C component of GDP, which may equates it to recession.

On the side, we have QE, ie printing money. Printing money, distort prices and that leads to inflation.

Alas, now we are looking at a global stagflation on our hands.

If it blooms into that, there's only one sensible way to solve the problem. De-leveraging. Which will lead to asset deflation.

Other less sensible ways includes the US further inflating their debt away (which they are doing now) or defaulting.

Either way, it's going to be ugly.

If you are in stocks, bonds or any other investments, get out now. Wait for the delveraging process to occur in 2014. (Maybe even earlier.) Short it along the way and then smugly pick up assets that have gone too far south.

Good Luck and Good Night

Market sideway just trade it but play it safe that's all.
@pengsan, those remark are meant to be a sarcasm at the way US manage their financial "challenges". US keep printing money that they know they don't have oh and giving out aids with the money they don't have plus euro's policy I will bail you till we all die doesn't matter it that is the most sensible thing to do or the fact that sh!t is sh!t even if you wrap it in gold.

So all in all, it's probably good to start being sensible and play it safe. You never know when it will come with all three euro, japan and USA going down at the same time. Are we witnessing the making of a complete meltdown of the world financial systerm? now that is what I will call a perfect storm .

Hopefully it will never happen and if it does hopefully it does not impact us. All are hopes and it does not need to be logical

[quote="bogeyman72"]So what are we supposed to do between now & 2014?


Hold sound currencies. Singapore dollars, Swiss Francs. All the boring currencies.

Or... go defensive. Buy sound defensive shares like Sembcorp, Starhub when the price is right. They pay dividend and can hedge against inflation. Even if things get tough, they will still make money. Telcos and utilities are always resilient.

I see a property bubble building. I goto the man on the street nowadays and they all say Property in Singapore will never fall, there's only up. Well, there's nothing that will NEVER fall. I remembered 1997 to 2001. Property prices fell then. Nowadays whenever there's a property launch, it gets snapped up right away. Prices are going at 1500sgd psf upwards.

What's next ? 2000sgd psf? Singaporeans are all so rich. But if a recession ever hits us, they may realize that they may have over-committed. That's when you see fire sales and de-leveraging. I have seen it before and It's scary. People actually wanted to downgrade to 3 room flats.

Keep your war chest ready. The business cycle has peaked and has no way to go but down. And when it does, you can take your pick and choose what you want at a more reasonable price. The mickey mouse flat is an example. The new launches maybe selling but the prices of re-sale mickey mouse flats are already falling. And I have a feeling this is just the beginning.

Wow, sound like I better stop playing so much golf and start saving some money for the raining days ....

seebayho wrote:

pengsan wrote:

If you are in stocks, bonds or any other investments, get out now. Wait for the delveraging process to occur in 2014. (Maybe even earlier.) Short it along the way and then smugly pick up assets that have gone too far south.

Good Luck and Good Night

Wow, that's a gutsy call!

SBH..please take this kind of advice with a pinch of salt. The way Pangsan put it, he sounds like an analyst, I could be wrong though. But have you ever heard of an analyst advising clients to buy at the low or sell at the top?? No, never!! Its always recommended to buy at the top because market at that time is bullish and sell at the low because market at that time is bearish. Please also take my analysis with a double pinch of salt but that has always been my observation. I would rather advise at this juncture when things looked unpredictable, take quicker profit and set a quicker cut loss level than during a boring consolidating market.

Tituman wrote:

seebayho wrote:

pengsan wrote:

If you are in stocks, bonds or any other investments, get out now. Wait for the delveraging process to occur in 2014. (Maybe even earlier.) Short it along the way and then smugly pick up assets that have gone too far south.

Good Luck and Good Night

Wow, that's a gutsy call!

SBH..please take this kind of advice with a pinch of salt. The way Pangsan put it, he sounds like an analyst, I could be wrong though. But have you ever heard of an analyst advising clients to buy at the low or sell at the top?? No, never!! Its always recommended to buy at the top because market at that time is bullish and sell at the low because market at that time is bearish. Please also take my analysis with a double pinch of salt but that has always been my observation. I would rather advise at this juncture when things looked unpredictable, take quicker profit and set a quicker cut loss level than during a boring consolidating market.

I am not an analyst lah. Just a hobby. Cooking, reading economics, exercise all my hobbies. Now I learn to play golf. So I have new hobby.

I am a clerk working in a bank. Smallest fry.

Just that in the course of my work, alot of figures can be accessed. I ever spoke to an economist name Mr. Song and he told me that to see the health of the economy, you should look at certain things. For example, China. He looks at power consumption in China. The more power consume, the livelier the economy. He looks at that because alot of the books in China maybe cooked. So he looks at electricity consumption to see if the manufacturing plants are humming.

So I go bloomberg, take out all the figures in the US and plot charts during my lunch time. Kaypoh loh. I look at inland truck tonnage shipped, housing starts and housing resale prices.

All are slowing or declining in March. But that's just figures lah. No 100% one.

Analyst will always ask you to buy. But I always tell people to be conservative and hold. Wait. Wait. Wait. Wait for another 2008. There's always a down cycle. Analysts hate me.

You know this thing about 7s? 87, 97, 07? Well, 2014 is just a hunch. So yup, take it with a lots of salt.

When I am bored, , I just come here and ramble loh. I have no one and no where to ramble. So just making use of the forum to ramble.

I do get carried away. So please don't take it too seriously.

Tituman wrote:

seebayho wrote:

pengsan wrote:

If you are in stocks, bonds or any other investments, get out now. Wait for the delveraging process to occur in 2014. (Maybe even earlier.) Short it along the way and then smugly pick up assets that have gone too far south.

Good Luck and Good Night

Wow, that's a gutsy call!

SBH..please take this kind of advice with a pinch of salt. The way Pangsan put it, he sounds like an analyst, I could be wrong though. But have you ever heard of an analyst advising clients to buy at the low or sell at the top?? No, never!! Its always recommended to buy at the top because market at that time is bullish and sell at the low because market at that time is bearish. Please also take my analysis with a double pinch of salt but that has always been my observation. I would rather advise at this juncture when things looked unpredictable, take quicker profit and set a quicker cut loss level than during a boring consolidating market.

I only say is a gutsy call, but never comment on the quality of the calls
After being a 'local for so long'.......I think play golf better.

seebayho wrote:

Tituman wrote:

seebayho wrote:

pengsan wrote:

If you are in stocks, bonds or any other investments, get out now. Wait for the delveraging process to occur in 2014. (Maybe even earlier.) Short it along the way and then smugly pick up assets that have gone too far south.

Good Luck and Good Night

Wow, that's a gutsy call!

SBH..please take this kind of advice with a pinch of salt. The way Pangsan put it, he sounds like an analyst, I could be wrong though. But have you ever heard of an analyst advising clients to buy at the low or sell at the top?? No, never!! Its always recommended to buy at the top because market at that time is bullish and sell at the low because market at that time is bearish. Please also take my analysis with a double pinch of salt but that has always been my observation. I would rather advise at this juncture when things looked unpredictable, take quicker profit and set a quicker cut loss level than during a boring consolidating market.

I only say is a gutsy call, but never comment on the quality of the calls
After being a 'local for so long'.......I think play golf better.

You at Ong First?

I was at the PIT. I remember the shouting, check trade. There was 1X1, CMD, LKY, PEN. And all the other super 'Zai' locals. sigh... Now all electronic. Last time jump from 225 to Taiwan. Then go see Euro Dollar. Jump, jump, jump.

Now I am small fry working at a bank doing reporting also good lah. No heart attack.

pengsan wrote:

Now I am small fry working at a bank doing reporting also good lah. No heart attack.

I'm a dead fly.....unemployed!

seebayho, unemployed can also mean employer aka business owner aka big bos
They are not employed, they are the employer..

eating grass now