The recession's coming Singapore's way according to Song Seng Wun the  regional economist for CIMB-GK Research.

We are pencilling in the worst for Singapore.... We might see two straight years of (economic) contractions (from 2009 to 2010) - Song Seng Wun

News.

2 years of contraction is no joke but the latest news from US shown that there's a coordinated move globally to cut interest rates. May or may not work. Interest rates have been cut so many times this year.

I remember just weeks ago it was big news when Lehman filed for Chapter 11 and shortly after the Lehman's crisis news about AIG's struggle for survival surfaced.

There was an offer made to AIG to buy one of their business asset for $8bn but was rejected by AIG citing that the offer was too low (they think it's worth more than this amount).

At first I thought, how on earth this company will survive in a crisis like this, there's no sense of urgency at all. (Warren Buffett walked away from them) But then, they were lucky, U.S government stepped in with an $85bn buoy to save the company from going bust.

Alas, the execs spent the money on luxuries just few days after they got the funding. Hmm....what are these people up to? I hope they don't resign from their jobs and take a couple of millions with them as compensation.

Singapore is small and sensitive to every bits of bad news from the U.S, we are not immune from scandals like this at this juncture. Good luck to everyone in the market.

The STI has dropped again the last time I checked (an hour ago),ok AIG is innocent in this case.

I was watching CNBC live telecast at CNBC.COM last night. Astonishing I would have say, aig scrutinize for the misuse of bailout funds, questions about who should be jailed were raised during the conference.

I waited till this morning for the news before updating this blog.

Quoted from CNA

Less than one week after the taxpayers rescued AIG, company executives could be
found wining and dining at one of the most exclusive resorts in the nation,"
Democratic Congressman Henry Waxman told the House Committee on Oversight and Government Reform.

Quoted from CNBC

They were getting facials, manicures, and massages, while the American people
were footing the bill," said Rep. Elijah Cummings, a Maryland Democrat on the
oversight panel.

Full story here: CNA and CNBC. Will be back later with other posts.

I was never a charitable person if being charitable meaning giving to the less fortunate. I hardly made any donations, I don't want to count with my fingers. But if my memory doesn't failed me, I do give away during flag days.

I am not heartless, I feel sad for people who are suffering. I am serious and that's why I seldom make donations. Contradicting? Not really.

You see, I can't stand patients appearing on TV asking for donations because it makes me feel sad. I am not really a happy go lucky but I try to be happy for 366 days in a year. I can't take tears. If someone were to walk up to me and say "Please help the needy", I will as long as I don't see the sight of the sufferings because I will avoid the the sight by any means. Those are usually the flag donation drive. How much do I donate? ...... little. How often do you see flag day? Once in awhile? So you could have guess how many times I actually make donations.

I am not charitable because making money is more appealing to me than giving it away. I am in a rat race and I am making sure that I get out of it so you know my priorities.

But I am kind.

STI recovers a little today with only 9.23 points. Looks like a knee-jerk reaction here, from waves view, this is at most a minute wave.

If I am a little more optimistic then this is because the market has filtered all the bad news and is ready for a correction. But I am not confident of a correction in the near future.

This is a near death struggle before finishing off at lower levels. I would say 1,500 points is where the STI is heading. 

The stock market's Tsunami is coming.

I am not going to buy anything now for sure. There could be more bad news from U.S soon, let's keep our fingers crossed. Watch out for the hedge funds.

I have some ideas for Wake Up Your Ideas.

Will post there in the near future, foreseeable future I mean.

You will see staggering numbers here:

http://www.brillig.com/debt_clock

How many generations do you think U.S will need to payoff their debts?

My AIA agent has not contact me since the day I paid my premiums. Not even when AIA's credibility is in doubt. Maybe I should file a police report for look for my missing agent.

Like many policy holders, I did not have any updates from my agent, but my Manulife agent did call me. Missing when you need them but they will appear when they need to sell you more policies.

Professionals?

But some consolation for me when I read the papers, AIG is not selling AIA.

His response to Luca's circus remark.

If the Ferrari President is right about the Singapore Grand Prix being a circus," he said,"then we have to be grateful to him for providing the clowns.

Full report here

They are never right with their forecasts. How many people actually believe in what they said? Macroeconomics is too vague to draw accurate conclusion, I was told once by a lecturer that no 2 economists will agree with each other. 

I will give my votes to Micro economists over the Macroeconomists if I have to choose one since the macro is too complex to understand and predict. Unlike in the studies of economics whereby micro is more difficult to learn as compared to macro but when it comes to applications, these are opposite. 

Anyway, I have yet come across an economist who can accurately forecast the GDP, but I do come across plenty of commentaries from them after events unfold. Will you trust a salesperson more than an economist?

Why were they here in the first place when they are way off target most of the time?

I don’t need bedtime stories from people who are telling me what I have already known.

In US, median salary of economists is around $72,780 with the top 10% earning more than $129,170 annually. Economic consultants with a Ph.D. had the overall highest median income for any group making $116,250, the median salaries for an assistant professor was $63,500, for an associate professor it lay at $67,000 and $85,000 for a full professor. The overall median income for doctorates in academia was $75,000 compared to $125,000 in consulting and $87,000 in banking.

Do you think they are overpaid? 

What have they been advising the banks prior to the sub-prime crisis?

When I started stocks trading about 10 years ago, Technical Analysis was all I know, watching stock prices plunge and rise gave me the thrill. Fundamental Analysis wasn't my cup of tea because I find it rather passive unlike TA.

I did make some money from TA and I actually made money on the first stock I bought, I was lucky from then because I have loses and if I do, loses are too insignificant. Only until recent years, I began to appreciate the beauty of FA, if I want to hold a stock for the long run and make profits from my investments, FA is the only way, there is no way TA can do that.
I have grown tired of the frequent buying and selling.

But I am not going to give up TA, I want a TA + FA approach to the market. Using FA to fish out companies with good fundamentals and apply TA for the entry price. I don’t think a single approach has the answer to the stock market.

I don’t possess the foresight of Warren Buffett.

It will take quite a while to master FA, it took me a couple of years to really master TA. The best approach will be a method which I truly understand.

It’s a shame that I didn’t pick up FA when I first started.

Going to read business valuation and analysis when I am done with Adam Smith’s books.

If there are any books you would like to read on wealth accumulation, read this first.

There must be plenty of good reasons why a book has been republished so many times over the decades. This is one of those few books and one of the very first books I have read when I took a serious interest in money management and wealth accumulation.

Wealth started out with a thought first, followed by constant actions. I won't say this book has all the answers you need and you most probably won't become rich just by thinking. But read this first, the sate of mind is very important.

Went to buy my groceries as usual and it took me at least 20 minutes just to pay up for my items at the supermarket, it doesn't like the economy is doing badly.

After getting almost everything I need, I managed to catch Big Stan. This is a hilarious movie, had a good laugh and this is so much better than the other movie I have watched recently, Disaster Movie. The producers of the movie are truly honest with the quality of their production. We don't need the movie critics, just ask the producers.

Movie tickets on weekend are expensive and I can't remember how many times ticket prices have increased over the years.

Anyway, I rush home to take a bath thanks to the weather, I am feeling sticky all over. A refreshing bath keeps me awake, got to finish the Wealth of Nations later. 5 books in total and I am reading Book 1 now.

We are not there yet but who knows it could happen tomorrow or the day after. I have to think about the worst before it actually happens, I managed to come up with 10 things to cushion the impact of recession on my lifestyle.

I hate to do this but flexibility is the key to survival.

I can't eliminate all of things I am doing now, but here's some of things which I can do less or best, doing nothing at all.

Here's the 10.

I will not:

1. dine at restaurants
2. use my credit cards
3. spend too much money on entertainment
4. buy another insurance policy
5. take a cab even if I am carrying bulk items
6. buy books off the shelves
7. go to the tailor every month
8. sell off my shares
9. leave my job until I found one
10. dine out
    

There are more but these are the priorities. It's not that difficult for me adjust to that during a recession since I am very adaptive.

I will keep my fingers crossed for now and hope that the worst is not coming.

Sunday has always been a quiet day for me besides a family day, there's nothing much I Want to do on a Sunday. The most active day of the week is most probably Saturday where I will always line up a long list things I want to do.

There are only a few things which I want to do on a Sunday; like reading a coffee table book, reading the Sunday papers, watch a movie etc.. Haven't been reading since the last one, Dialogue in Hell, a narration of politics.

What other activities can I do on a Sunday which will not drain too much of my energy, since I need some reservations for work on Monday.

Maybe I should go back to my book now before heading to the supermarket to buy groceries.

I have just registered for The Newpaper Bigwalk 2008. Ok, participants get to walk on water. I missed the previous walks except for one.

Time to do some exercise. Haven't been doing so for a long time.

Wanted to join the Nike+ Human Race but wasn't quite sure if I could finish the entire marathon, but I will definitely participate in the next run for sure.

This year's Bigwalk is free.

Anyone who is going to sign up should be quick, the registration is going to end really soon or you could go to their blog to download the registration forms. Some information for you:

• Start point: Suntec City Fountain of Wealth
• End point: Marina Barrage
• Distance: About 5km
• Return trip: Free shuttle buses from 9am to 1pm from Marina Barrage to Suntec City Mall
• Registration: FREE

Remember to cut entire masthead of The New Paper before going down to the designated booth for registration.

But not the quality of living, how irony.

Utilities cost will go up by 21%, transportation cost going up, ERP increased, even the the cost morning papers have gone up.

I wonder why transportation cost has to increase each time the government announced a payout to the people. The next thing I wish that would go up is my salary but I am not too optimistic by looking at the current situation.

Despite the increase in transportation, I don't see any better in the service. Can the service also improve along side with the increment in fares?

It's time to tighten budget now............ less holidays, less eating out and I am giving up the thought of getting another insurance policy for now.

The US government is using tax payers' money to buy bad companies. Buying over AIG does not seem to solve the problem at all, AIG is going to sell its business to payoff its debts. How many businesses do AIG needs to sell to pay off everything? What's left for the AIG after that?

Not saving Lehman is probably the best choice they have made. Why bother how much the CEOs are paid?

US status as economic power is not under threat anyway, they are still the largest economy in the world, but how long will the slump last? There's a lot of selling in Asia and in Singapore the STI can barely take it. Companies that are profitable dropped in value because of the heavy selling.

All I can say is that the US government really take cares of companies at the expense of the tax payers. The economy is still going down despite the bailout. Not forgetting the US government owes China US$500billion.

My friend told me that his portfolio is in red due to the heavy sell down, by at least 30% and he is staying away from investments for now. He makes more money from EPL betting than investments.

I am staying on the sideline. I am sure that there are investors out there waiting for the market to bleed more before going in to buy good companies at low prices.

Till now, I am still not convinced by that the bailout can do.