29 April 2010 - The financial markets seem to typically "sell first", ask questions later. Yes, Greece is in trouble, (nothing new, we knew this since a few months ago). And yes, maybe even Spain and Portugal might be in trouble.
How would this derail U.S. economic recovery? Below article mentioned that U.S. exports to the WHOLE of Europe only constitutes 2% of U.S. GDP. Thus, from this Big Picture analysis, whatever happens to Greece, Spain and/or Portugal is NOT likely to have a big impact on U.S. economy, and thus unlikely to affect the World significantly.
Since U.S. economy constitutes 24% of the Global Economy, if U.S. is OK, the world will be ok. Despite so much talk about China and India, they currently only contributes to 7% and 2% of the Global economy respectively.
Thinking is really the hardest thing to do, as it appears to me that so few Investors do their own thinking in making investment decisions, but rather let their decisions by affected by sensationalism in News reporting.....reporters like to exaggerate things to make "Interesting and Impactful Newspapers Headlines".
I took the last 2 days' Fear to buy some more CITIGROUP shares instead. Be Greedy when Others are Fearful is easy to say but how many people are able to do it.
Of course, I might be wrong, even if I'm wrong, I'll be financially ok. Since my investment into CITIGROUP only represents 2% of my total investible assets.
Why do I buy more of CITIGROUP shares? Becos the shares are now trading at a discount to Net Asset Value (NAV). While local banks, such as DBS, at S$15 is trading at 136% of Net Asset Value, or premium of 36%. OCBC is trading at 147% of NAV and UOB at 156% of NAV. So which stock is Better Value for Money? Things suddenly become Clearer when one knows What to Look at.
The Good News is we don't have to be Right 100 % of the time to make money in Investing, we only need to be Right 51% of the Time, which is why it is Very Difficult to lose money in Investing and Very Easy to Make Money in Investing, provided you Learn HOW to Invest. If you invest without learning how, you are actually gambling, not investing.
Whatever I teach at my 2-day Secrets to Making Money in Stocks Seminar, is what enabled me to make my first million dollars through investing...and everything I shared are Real and Works, not some theory only.
There are many trainers out there who are FAKE. ie. they did NOT become Rich from the things they are teaching you at the Seminars. I cannot stand such seminars anymore, which is why since last May 2009, I started conducting my own Series of Seminars, to teach what Really Help Make Millions of Dollars for my sifus and for myself, from the strategies I learned from my sifu and I learned and applied in the markets to make Real Money.
Think about it.
Cheers!
Dennis Ng, http://www.HousingLoanSG.com
By Ron Scherer, Staff writer / April 28, 2010
New York
On Tuesday as the news spread that Standard & Poor’s had downgraded the government of Greece’s debt to “junk” status, the US stock market stumbled.
Again, on Wednesday, the market’s gulped as Spain’s debt was downgraded. But by the end of the day, the Dow Jones Industrial Average had shrugged off the news, closed up 53.28 points at 11,045.27.
Other than the stock market, what other affect could Europe’s debt crisis have on the US economy?
At the moment, economists believe the fallout from Athens's or even Madrid’s financial problems may have only a modest impact on Main Street.
• Some US companies that export to Europe may have a harder time competing if the Euro continues to weaken.
• A stronger US currency might cause some German or French tourists to reconsider a trip to New York or Miami.
• US banking regulators will be questioning the largest banks to determine how much they could potentially lose if a European nation somehow defaulted on its debt.
IN PICTURES: The top 10 things Greece can sell to pay off its debt
“At the moment it’s something we need to watch but not fear,” says Nariman Behravesh, chief economist at IHS, Inc., an economic research company in Lexington, Mass. “The US is growing almost three times as fast as Europe and the biggest impact is likely to be as Europe grows slowly, our exports to them grow slowly.”
How big a trading partner is Europe?
The slow growth may come about since economists expect European nations, such as Greece, Portugal, Spain, and Ireland to cut spending and perhaps raise taxes.
“Raising taxes and cutting government spending means relatively weak economic growth,” says Jay Bryson, international economist at Wells Fargo Economics in Charlotte, N.C.
The actual impact of this slower growth and fewer tourists walking around the US will be relatively small but measurable, says Mr. Behravesh. “If we’re growing at 3 percent, it could take a couple of tenths off our growth,” he says.
All US exports represent about 11 percent of US gross domestic product (GDP). Of those, 20 percent go to Europe. So, about 2 percent of the nation’s GDP is involved in exports to Europe.
“Any reduction in exports is not a good thing, but it probably won’t drive the US back into a recession,” says Mr. Bryson.
But, at the same time as some European nations have to tighten their belts, the European Union may have to mount a massive bailout of European banks that own much of the downgraded sovereign debt. Behravesh estimates it could cost as much as €600 billion ($800 billion) to rescue the banks.
The US Troubled Asset Relief Program (TARP), which funneled money into the US banks, cost about $700 billion.
Greek bailout not a sure thing
If the Europeans are going to bailout Greece, a lot of the money will have to come from Germany, where public polls indicate opposition to the rescue. “It’s not a sure thing,” says Bryson. “It may not get done.”
And, as other economists point out, throwing money at Greece might be just the first step.
“The problem, of course, is that if Greece is bailed out, then surely Portugal, Ireland, Spain, and perhaps even Italy may not be too far behind,” writes David Rosenberg, chief economist at Gluskin Sheff, a Canadian wealth management company, in a report.
In the case of Spain, he writes, the amount of debt it has to refinance in the coming year is as large as the Greek economy. “So this is not even a case of being too big to fail as much as being too interconnected globally to default,” he concludes.
Exactly how much Spanish debt is on the books of the US banks is not clear. But Behravesh does not think it presents a major risk to the US banking system.
“There is always the risk to individual banks,” he says. “But it does not present a systemic risk to the US.”
Greece is a Small Problem from Big Picture Perspective
Moderators: alvin, learner, Dennis Ng
Greece is a Small Problem from Big Picture Perspective
Cheers!
Dennis Ng - When You Master Your Finances, You Master Your Destiny
Note: I'm just sharing my personal comments, not giving you investment advice nor stock investment tips.
Dennis Ng - When You Master Your Finances, You Master Your Destiny
Note: I'm just sharing my personal comments, not giving you investment advice nor stock investment tips.
27 May 2010 - Welcome to the 132nd Issue of Weekly e-newsletter by www.HousingLoanSG.com. This week I like to share with you "Will U.S. and China Trigger Another Global Financial Crisis?”
If you have friends who like to receive this information-rich FREE Weekly E-Newsletter, ask them to go to our website http://www.HousingLoanSG.com where they can sign up immediatelyand get a FREE Special Report "How to cut your tax legally by 23% to 59%?"
Cheers!
Dennis Ng, http://www.HousingLoanSG.com - help you get BEST Deal in Housing Loans in Singapore & Australia
Will U.S. and China Trigger Another Global Financial Crisis?
Why Fear Continues, becos Problem is not Solved!
Why despite EU’s announcement of 1 Trillion US Dollars of financial assistance schemes to save Greece the global stock markets continue to fall? The reason is the “huge debt” problem faced by Greece, are also common problem at other countries, such as Spain and even U.S.
For over 15 years, Greece's economy has already lost its competitive edge, but Greece continued its generous "national social welfare system", together with Greece's political corruption, tax evasion, many wealthy people pay little tax, which led to Greece government accumulating Budget Deficit. Over time, because of deterioration in its status, led to the current credit ratings of their country relegated to junk status.
Therefore, the "Root" of Greece's problem is Greece's loss of competitiveness of the economy and also excessive debt, and this problem is NOT going to be solved by pouring more Money (Debt) to Save Greece.
For year 2009, Greece's government budget deficit is 13.6% of its GDP (Gross Domestic Product). However, other countries similarly face high levels of Debt. For example, the Portuguese government budget deficit accounted for 9.4% of GDP, Ireland is 14.3%, Spain 11.2% and Italy 5.3%. Therefore, the market worried that after Greece, that other European countries will also have a debt crisis.
When a country faces economic problems, often the country can devalue its currency, which will reduce the price of their goods in order to stimulate exports. However, the EU's 16 member countries share a common currency - the euro. Thus Greece and other European economies cannot have monetary autonomy, and cannot choose to let the currency depreciate.
The Risk of Domino Effect
Sensing the weakness of Greece as Opportunity, hedge funds and other speculative funds took the opportunity to drive down stock prices and exchange rate of Euro, to make speculative gains by shorting stocks and attacking Euro currency.
After Greece, which is the next country likely to have a debt crisis? Portugal, Ireland and Spain, seem to be the likely candidates.
Therefore if markets continue to plunge, this is likely to result in domino effect, almost a repeat of the Asian financial crisis when the stock market and foreign exchange markets in Thailand after being attacked, Indonesia and the Philippines also were attacked which eventually evolved into the Asian financial crisis.
United States and China are the key to Global Recovery
The U.S. economy accounted for 21% of the global economy, while China was 12.5%. Therefore, whether global economic recovery can continue, especially when the other major economic zone Europe is likely to slow down, the United States and China's economic performance will be crucial.
The latest data showed the U.S. economy seems to continue to maintain growth in 2010, the first 3 months of economic growth for 3.7%, Standard & Poor's 500 index's 460 companies reported profits increased by 55% from a year ago. In April 2010, U.S. recorded an increase of 300,000 jobs. Therefore, pending unforeseen circumstances, the U.S. economy will continue to recover.
On the other hand, China's economy showed that there are signs of a slowdown, China's Shanghai stock market was the first stock market to bottom out and recover in the Financial Crisis in Nov 2008. However, in August 2009 the Shanghai index rose to 3,471 points, but never rise back to this level thereafter, but continued to fall to about 2,600, or a drop of more than 25%.
Usually if the stock market fall more than 20%, may indicate that an upward trend in the stock market has ended, therefore, in the short term if the stock market in Shanghai, China does not rebound to 277.7 points or more, then China's stock market may be the first country to declare the end of the “Bull” market .
Usually the stock market is ahead of the economy by 6 to 9 months ahead. Therefore, whether the stock market in Shanghai is “hinting” that China’s economic outlook for 2011 will not be as good as year 2010? If China and the U.S. economic slowdown, the global economy might fall into a “double-dip” recession (or W shape recovery).
China's real estate market outlook is also not optimistic as the Chinese government has introduced policies that seek to restrain the rise in housing prices. Recently, first-tier cities such as Shanghai and Beijing seem to have signs of housing market cooling down. If the Chinese economic slowdown significantly, then there is an increased risk that China's real estate market may Crash (fall by over 30%). Therefore, the Chinese government policy must be well balanced to avoid stock market crash and the collapse of the real estate market.
Recently, investors have been selling other currencies, such as Euro, Australian Dollar and even S$, to buy US$. However, the fact is U.S. debt is also quite worrying, the government budget deficit accounted for 10.6% of GDP. In fact, the European Union as a whole, government budget deficits is lower than the United States, accounting for only 6.9% of GDP.
Therefore, if global investors start to worry the fact that United States may also face a “Debt Crisis”, that might lead to another Global Financial Crisis.
Note: above is just my personal opinion. This e-newsletter is not giving you advice.
We help consumers compare all the Housing Loan packages so as to help them get the BEST deal.
How much do we charge for our service? As we're paid by banks separately, we have decided NOT to charge a fee for our service. Therefore, this service is FREE to you and you have nothing to lose and everything to gain by engaging our service.
Just call us at 6737 8801 or email us at info@HousingLoanSG.com if you're considering to buy a property or refinance your Housing Loan, whether in Singapore or in Australia and you want to make sure you get "pre-approval" of loan before you commit your cash.
Cheers!
Dennis Ng on behalf of
www.HousingLoanSG.com- get you BEST Deal in Housing Loan in BOTH Singapore and Australia!
6737 8801 or 6339 9255
info@HousingLoanSG.comThis e-mail address is being protected from spam bots, you need JavaScript enabled to view it
Copyright year 2010, LEVERAGE HOLDINGS PTE LTD www.HousingLoanSG.com
If you have friends who like to receive this information-rich FREE Weekly E-Newsletter, ask them to go to our website http://www.HousingLoanSG.com where they can sign up immediatelyand get a FREE Special Report "How to cut your tax legally by 23% to 59%?"
Cheers!
Dennis Ng, http://www.HousingLoanSG.com - help you get BEST Deal in Housing Loans in Singapore & Australia
Will U.S. and China Trigger Another Global Financial Crisis?
Why Fear Continues, becos Problem is not Solved!
Why despite EU’s announcement of 1 Trillion US Dollars of financial assistance schemes to save Greece the global stock markets continue to fall? The reason is the “huge debt” problem faced by Greece, are also common problem at other countries, such as Spain and even U.S.
For over 15 years, Greece's economy has already lost its competitive edge, but Greece continued its generous "national social welfare system", together with Greece's political corruption, tax evasion, many wealthy people pay little tax, which led to Greece government accumulating Budget Deficit. Over time, because of deterioration in its status, led to the current credit ratings of their country relegated to junk status.
Therefore, the "Root" of Greece's problem is Greece's loss of competitiveness of the economy and also excessive debt, and this problem is NOT going to be solved by pouring more Money (Debt) to Save Greece.
For year 2009, Greece's government budget deficit is 13.6% of its GDP (Gross Domestic Product). However, other countries similarly face high levels of Debt. For example, the Portuguese government budget deficit accounted for 9.4% of GDP, Ireland is 14.3%, Spain 11.2% and Italy 5.3%. Therefore, the market worried that after Greece, that other European countries will also have a debt crisis.
When a country faces economic problems, often the country can devalue its currency, which will reduce the price of their goods in order to stimulate exports. However, the EU's 16 member countries share a common currency - the euro. Thus Greece and other European economies cannot have monetary autonomy, and cannot choose to let the currency depreciate.
The Risk of Domino Effect
Sensing the weakness of Greece as Opportunity, hedge funds and other speculative funds took the opportunity to drive down stock prices and exchange rate of Euro, to make speculative gains by shorting stocks and attacking Euro currency.
After Greece, which is the next country likely to have a debt crisis? Portugal, Ireland and Spain, seem to be the likely candidates.
Therefore if markets continue to plunge, this is likely to result in domino effect, almost a repeat of the Asian financial crisis when the stock market and foreign exchange markets in Thailand after being attacked, Indonesia and the Philippines also were attacked which eventually evolved into the Asian financial crisis.
United States and China are the key to Global Recovery
The U.S. economy accounted for 21% of the global economy, while China was 12.5%. Therefore, whether global economic recovery can continue, especially when the other major economic zone Europe is likely to slow down, the United States and China's economic performance will be crucial.
The latest data showed the U.S. economy seems to continue to maintain growth in 2010, the first 3 months of economic growth for 3.7%, Standard & Poor's 500 index's 460 companies reported profits increased by 55% from a year ago. In April 2010, U.S. recorded an increase of 300,000 jobs. Therefore, pending unforeseen circumstances, the U.S. economy will continue to recover.
On the other hand, China's economy showed that there are signs of a slowdown, China's Shanghai stock market was the first stock market to bottom out and recover in the Financial Crisis in Nov 2008. However, in August 2009 the Shanghai index rose to 3,471 points, but never rise back to this level thereafter, but continued to fall to about 2,600, or a drop of more than 25%.
Usually if the stock market fall more than 20%, may indicate that an upward trend in the stock market has ended, therefore, in the short term if the stock market in Shanghai, China does not rebound to 277.7 points or more, then China's stock market may be the first country to declare the end of the “Bull” market .
Usually the stock market is ahead of the economy by 6 to 9 months ahead. Therefore, whether the stock market in Shanghai is “hinting” that China’s economic outlook for 2011 will not be as good as year 2010? If China and the U.S. economic slowdown, the global economy might fall into a “double-dip” recession (or W shape recovery).
China's real estate market outlook is also not optimistic as the Chinese government has introduced policies that seek to restrain the rise in housing prices. Recently, first-tier cities such as Shanghai and Beijing seem to have signs of housing market cooling down. If the Chinese economic slowdown significantly, then there is an increased risk that China's real estate market may Crash (fall by over 30%). Therefore, the Chinese government policy must be well balanced to avoid stock market crash and the collapse of the real estate market.
Recently, investors have been selling other currencies, such as Euro, Australian Dollar and even S$, to buy US$. However, the fact is U.S. debt is also quite worrying, the government budget deficit accounted for 10.6% of GDP. In fact, the European Union as a whole, government budget deficits is lower than the United States, accounting for only 6.9% of GDP.
Therefore, if global investors start to worry the fact that United States may also face a “Debt Crisis”, that might lead to another Global Financial Crisis.
Note: above is just my personal opinion. This e-newsletter is not giving you advice.
We help consumers compare all the Housing Loan packages so as to help them get the BEST deal.
How much do we charge for our service? As we're paid by banks separately, we have decided NOT to charge a fee for our service. Therefore, this service is FREE to you and you have nothing to lose and everything to gain by engaging our service.
Just call us at 6737 8801 or email us at info@HousingLoanSG.com if you're considering to buy a property or refinance your Housing Loan, whether in Singapore or in Australia and you want to make sure you get "pre-approval" of loan before you commit your cash.
Cheers!
Dennis Ng on behalf of
www.HousingLoanSG.com- get you BEST Deal in Housing Loan in BOTH Singapore and Australia!
6737 8801 or 6339 9255
info@HousingLoanSG.comThis e-mail address is being protected from spam bots, you need JavaScript enabled to view it
Copyright year 2010, LEVERAGE HOLDINGS PTE LTD www.HousingLoanSG.com
Cheers!
Dennis Ng - When You Master Your Finances, You Master Your Destiny
Note: I'm just sharing my personal comments, not giving you investment advice nor stock investment tips.
Dennis Ng - When You Master Your Finances, You Master Your Destiny
Note: I'm just sharing my personal comments, not giving you investment advice nor stock investment tips.