- investors turn against dollar assets after rate cut to as low as zero starts another wave of dollar selling, unwinding yen carry trade.

- hurts manufacturing and economy, central banks prepare to intervene

- Although treasury offered lower yield, US is still a safe heaven for investors to put their money instead of investing in emerging markets or other developed market that are bleeding. Economic outlook bleak. Inflation subdued.

- Banks need more money to weather the asset devaluation, selectively sells assets for the provision.

- Quote from (FT, Ricardo Hausmann): The crisis gives America new financial power
The US has become the only remaining super-borrower, able to issue thousands of bilions of dollars in debt at record low rates while the dollar strengthens. People are unwilling to lend to almost anybody except for the US Treasury. This has allowed the US to provide - at record low cost about $5000 bn to bail out its financial system and organise a Keynesian reflation of its economy.

>>Several reasons for this possibility (unknown source) :-

1. Expectation of a reversal may cause traders and hedge funds to change the US dollar positions from short to long.

2. G7 may interfere if the US dollar falls further, indicating limited down side.

3. Many countries are feeling the pinch from exports and do not want to see the dollar falling too much and more will intervene if the US dollar falls further.

4. Many emerging countries suffered huge capital losses from their massive holdings of US dollar foreign reserves and they prefer a stable US dollar.

5. Weaker US dollar will attract more tourist money as it is now cheaper to visit the US.

6. Weaker US dollar also makes US assets more attractive from conversion perspective.

7. After price depreciation, US properties and some of US stocks are now attractively priced.

8. Higher exports due to the more competitive US dollar, especially against the euro, helps to generate substantial export revenue.

9. The substantial international investments by US corporations allow them to repatriate sizeable investment income back to the US at a higher translational gain in the US dollar.

Read More...

Dow Jones is still trading flat at current level despite the fact that existing home sales slumped more than forecast as prices continue to plunge.
Christmas is approaching and retailers are scrambling to destock, signals how bad the business activities are.

Crude oil sustained at current level rebounds from the low of USD 33 on the news of OPEC's determination is production cutting to stabilize the price.
Be prepared for the worst, this is a calm before the storm. When smaller companies cant sustain and unemployment rate worsen, DJ might collapse to 5000 - 7000 points. Hold your cash to weather the storm!
2009 is a big challenge for everyone, every countries administration especially the newly elected US president, Barack Obama.

Read More...

Good tips from StarBiz. Besides of these 10 tips, property buyers should also consider:

1. Feng shui - Chinese in particular, wants to buy property with good Feng shui in believe that they will receive positive Qi, which will help them to do good in their business and family. House number is one.

2. Rennovation - Is the current rennovation suit your living style? The amount of redo might cost you a fortune, or otherwise save you a lot. It also determines, in some way, the resale value of property.

3. Purpose - Investment or own stay. For investment, rental yield and maintenance

4. Property type - landed or apartments ? Apartments / Condos need to pay management fee and the utility bills are higher. For investment purpose, location and rental yield as well as resale market are the considerations.

5. Market condition - We are in low interest rate environment with deteriorating economy condition. Banks are not willing to give out loans, or giving out loans to selective location, it will dampen the demand of the properties. All these factors would lead to lower property price. Still, it is many depends on the property location.

6. Target preference locations and areas and be patient for availability.

===== ----- =====
(source: StarBiz Week)

If you are looking for a property here are ten tips.

1.Location: Fundamental to your wellbeing and will determine potential value.

2.Ability to repay: You have to service your loan for many years to come and should buy within your means.

3.Rental or occupation: Establishing your objective to buy will ensure that look for the right property at the price.

4.Quality: Find out the materials used, finishes and project maintenance standards to ensure that you get value for money.

5.Developer’s reputation: Buying from a reputable developer will ensure a project will be completed on time will not be abandoned during difficulty times.

6.Neighbourhood: The surrounding neighbourhood will determine safety and wellbeing of you and family.

7.Facilities: Good amenities and facilities will ensure convenience and comfort.

8.Accessibility: Having good road connectivity will ensure easy travel and accessibility.

9.Resale value: The property should potentially provide good capital appreciation in the future.

10.Financing: Choosing the best loan package will protect your interest the long term.

Read More...

(source: The Edge Weekly)

Dec 22
- Bank Negara Malaysia to release foreign reserves data as at Dec 15
- Bank of Japan to release monthly economic survey data
- New Zealand to release 3Q2008 GDP

Dec 23
- Australia's Conference Board Leading Index release for October
- Singapore to release CPI for November
- UK to release 3Q2008 GDO data and current account balance
- European Monetary Union to release current account balance for October, and industrial new orders
- US to release annualised 3Q2008 GDP data, personal consumption and November home sales
- US University of Michigan consumer sentiment index release for December

Dec 24
- Minutes of Bank of Japan monetary policy meeting
- US to release personal consumption expenditure price index, and durable goods orders for November
- Canada to release GDP for October

Dec 25
- Christmas Day. All markets closed.

Dec 26
- Japan to release Tokyo CPI for December, and preliminary industrial production for November
- Singapore to release industrial production data for November

Dec 30
- BNM to release November statistical bulletin, money supply M3 data and current account balance
- South Korea to release industrial production data for November
- Thailand to release trade balance data for November
- US conference board to release consumer confidence data for December

Dec 31
- Malaysia to release Producer Price Index for November
- South Korea to release CPI for December

Read More...

- (source: BNM) Ringgit sharply strengthen against major currencies. Dollar dipped is one. I reckon central banks are going to intervene. It seems that funds are not exiting for now.

- Despite regional bourses closed flat, CI rallied and closed at 880.50 up 18.00, a 2.09% jump. CPO once again in focus due to 1. huge oil production cut at 2.2m barrel a day. 2. dollar falls. Plantation companies rallied with but CPO closed red. KLK, IOICorp and Utdplt among the plantation companies that gain the most. Both leading indicators have contradicted. CPO is still tracking crude oil while investors expect plantation companies will benefit from weaken dollar. I reckon central banks are going to intervene, hence a pullback on CI is imminent. Shall they not, exporters will continue to suffer, offsetting their gain from hike of CPO.

- Latest news from Reuters has reported that BoJ might follow Fed's interest rate cut to near zero. Federal Reserve cut rate to ZERO, what next ? We shall see what is going to happen in weeks.

- Western Digital in Malaysia to cut 2500 staffs worldwide, halt production for 2 weeks and staffs are experiencing pay cut due to slow down in order. This signals companies cut technology spending, retail spending on technology products also slows.

Read More...

9 rate cut in prior 14 months and $1.4 trillion in emergency lending had failed to reverse the economic downturn. Yesterday Federal Reserve cut rate to 0%, it's record low. USD/Yen once again surge to 89.1600. Together with Madoff scam where possibility of hedge redemption intensify, carry trade unwinding has been continuing, as the different rate between US and Japan of 0.3%. and in turn USD can be the ultimate carry trade currency where investors can borrow it cheaply and readily to invest in higher yield return countries. Would dollar flows into Asia pacific again ? Seeking alpha is what they do.

Federal reserve is determined to use all the instruments they have to counter the recession, and with these tools, Fed is sending message to the world, they will print greenback to the unlimited extent until it starts to see market expanding. US has been flooding the world with $8.5 trillion and more to come. Any stimulus package from White house or market operation from Fed, is just going to increase the money supply. Have they ever think about post crisis ? I believe we are no way out from hyper inflation export from US, and we gonna pay off what they have created in this crisis. Please understand that, cut rate means injecting market with dollar, and where the dollar comes from? From printing machines !

How would this help ? Would it able to battle the deflation and reduce foreclosure rate? It doesnt seems to be. Economic recession has forced companies to layoff, as you can see from the surge of umemployment rate, deflation is not going to get better and foreclosure is not where near an end. The issue is still, credit and confidence. Banks are not going to lend money at this critical time, they will register more losses on from the property slump. So what is the liquidity that Fed injected for? Preserve for the coming losses, to make them stay alive !

Hong Kong whose currency HKD pegged to dollar, follow suit Fed action by cutting 1% to 0.5% in the hope to curb its economy contraction.

Japan’s central bank kept its main rate at zero from 2001 to 2006 while flooding the banking system with extra cash to encourage lending, spur growth and overcome deflation. The abundant funds failed to prompt lending by commercial banks, which expanded their reserves at the central bank almost nine times by early 2004. The senior central bank official said the Fed’s policy differs from Japan’s approach by focusing on purchases of short- term debt and other assets in constrained markets rather than on adding cash to the banking system. (Source: Bloomberg)

Credit remains scarce in many markets and major financial institutions worldwide continue to report losses and writedowns totaling $994 billion.

The Fed may increase its asset purchases and lend against lower-quality debt should Treasury provide funding, the senior central bank official said. (Source: Bloomberg)

So, what is their next way out? What Ben Bernanke is going to do ? Please comment !

Read More...

15 Dec, Mon. Kuala Lumpur, Malaysia. GMT+8

Asia bourses generally closed higher in the hope that Bush to allow automakers to access TARP fund. This week's Fed interest rate decision further push the stocks up. Only KLSE experienced a swing to close lower. However, Bush announced that auto industry rescue is not imminent, leaving the industry's fate clouded in uncertainty.

Crude oil jumps to USD 50 as OPEC says sizable cut is needed. CPO would follow suit. Dollar falls has pushed the price further up.

Dollar falls on outlook for Fed rate cut, speculating a 75bps cut. US is flooding the whole world with more than USD 8.5 trillion with various packages. Rate cut is just going to make it worse. Yen strengthen. Nonetheless, RM weaken against all major currencies. Money continues to flow out from Malaysia where funds exit from selective counters.

Madoff USD50 billion scam could worsen the market situation as banks reveal the exposure to the hedge fund.

Generally global market will be see-sawing until they get a clear picture from Fed meeting tomorrow night. Negative news once again clouding DJIA and the rest.

Read More...

Legoland theme park is coming to Malaysia ! The location for the theme park will be in Medini in Nusajaya, which is at the heart of the Iskandar Malaysia development. Legoland Malaysia Sdn Bhd will own and operate the theme park. The Legoland logo is cute, isn't it?

Of late, Temasek has become substantial shareholder of WCT, EPF has acquiring WCT's share aggresively from the market. Meanwhile, WCT has built up its reputation in middle east. Looking at the parties that involved in Nusajaya projects, would WCT stand a chance to grab any contract from Nusajaya, if not this Legoland project ? Najib met Hsien Loong in Peru and came to an agreement to develop Nusajaya, looking at the shareholding of EPF, Temasek, and reputation of WCT in middle east (Iskandar is trying to entice investment from middle east), again, would WCT stand a chance to grab any projects in future ? [dislaimer: I am not spreading rumours and not asking you to buy WCT, you should do your own homework before doing any investment !]

Some background of the companies involved:

Iskandar Investment is owned
- 60% Khazanah National Bhd
- 20% EPF
- 20% Kumpulan Prasarana Rakyat Johor

Legoland theme park
- 70% Merlin Entertainments Group Ltd
- 30% Lego Group, vehicle of Kjeld Kirk Kristiansen, the grandson of the founder of Lego, Ole Kirk Kristiansen

Legoland has four operating parks at: Windsor in UK, Bilund in Denmark, Gunzhurg in Germany and California in US

Merlin Group
- controlled by Blackstone Group LP & Dubai International Capital LLC
- has 58 theme parks and 6 hotels across the globe and caters to about 33 million visitors a year, making it the world's second largest visitor attraction operator.
- several of Merlin's theme parks are in the top 60 worldwide for attendance.

Read More...

(source: The Edge Weekly)

Dec 16
- US to release CPI data. Economists expect inflation to decline by 1.3% m-o-m in November.

Dec 17
- The US Federal Reserve to announce rate decision. Expectations are for a cut in interest rate by 50bps to 0.5%

Dec 19
- Malaysia to release CPI data. Economists expect inflation to ease further to 5.8% in November from 7.6% in October.

Date to watch: Dec 16 & 17

===== ----- =====

Malaysia factory output falls
- Malaysia's exports posted the first drop in 15 months in October as electronics and palm oil sales fell. The slowdown may trigger an interest rate cut next month.

US new claims for jobless benefits surge
- Most Americans expect the jobs situation to get even worse, according to a poll released last Thursday by the Pew Research Centre for the People & The Press.

Japanese economic data increase deflation fears
- Overseas orders for Japanese machinery dropped in October while deflationary pressure appreared to increase in the country's corporate sector, according to government data. The figures suggest that the global slowdown could continue to cut into foreign demand for Japanese products. They also indicate that a sharp drop in world commodity and energy prices might bring deflation back to Japan's economy, possibly forcing its central bank to cut its policy interest rate lower than the current 0.3%

China inflation down

Read More...

This interesting article caught my eyes in 13 Dec (Sat) StarBiz Week, written by P. Gunasegaram, managing editor of The Star.

How to become very rich in Malaysia? Marrying a rich guy or a rich women, or marrying someone from wealthy family ? Start up your own business ? Through investing or speculating ? Whatever that you can think of, but to speed them up, you definitely need these elements mentioned in Malaysia.

>Connections
strong ones, the higher the better and if it goes right up to the top all the better. Why? Because you need to convince the powers that your projects are good. You need the state to give you something to do the deal that will help the nation.

Examples:
- The country needs a port. You tell the state or federal government you need land - cheap land, preferably free to build the port.
- Help country by building a power plant. You need land and need the power to be sold. So you get someone else to build the power plant, they guarantee the performance of the plant and someone else guarantees to buy your power and pay for all your costs.
- To start an air hub. If you are persuasive enough, you can even convince the government to compulsorily acquire the land and sell it to you cheap. Once you have cheap land, lucrative contracts and concession agreements, the sky's the limit.

>Ability to flip assets
To realise the value of all of the projects and still keep control of them, it's nice to have a listed company into which you can inject them. Inject one asset for shares and you gain control of the company. Then inject others over the years for cash, taking the money out of the company. Do it right and get a flow of assets to inject in, and you get a tidy flow of profits and cash into your personal accounts over the years.

Example:
- Tan Sri Syed Moktar Albukhary actually made some RM 4.5 bil that way - actually more because he still controls the listed company. The latest, it involves a deal to sell Senai Airport to MMC Corp Bhd for RM 1.7 bil cash.

But then if things change - and that's still a big "if" - you might not find it so easy anymore.

Read the full story here:
How to become very rich in Malaysia
MMC’s latest RM1.7bil deal irks investors

Read More...

Investors were hoping for a good weekend, yet again, bad news always come late. This has not been a good week as worsening data was released. Christmas is approaching and this winter seems to be colder than ever.

** Bush Drops Opposition to Using TARP to Keep Automakers Alive Until January - a temporary relief? DJIA rebound and closed at 8629.68 + 64.59

** U.S. Stocks Advance on Speculation Government to Boost Technology Spending - next wave back to technology stocks ?

1. Auto bailout dies
2. Sony, Dow Chemical, Rio Tinto cut job. Tribune file for bankruptcy
3. Japan's Economy Shrinks Greater-Than-Estimated 1.8% as Recession Worsens
4. Weekly jobless claims jump to 26-year high
5. Trade Deficit in U.S. Unexpectedly Widens as Exports Fall on Weaker Demand
6. Obama to spur economy with infrastructure investment
7. China economy stimulus plan, exports fall.

Gloomy economy ahead, cash is king. Auto bailout dies would push GM and Chrysler to abyss of despair. Would they file chapter 11 to restructure? Would lost of jobs causing the house foreclosure even worse? Questions ... remain to unanswer ... Bad, bad Christmas 2008. Paulson is working on a proposal to cut the mortgage rate to reduce foreclosures, but will that stabilize the property price? If devaluation continues, the crisis continues until the price stop going down ?

Market Snapshot for the week:
12 Dec Market Snapshot (Update 2)
11 Dec Market Snapshot (Update 1)
10 Dec Market Snapshot (Update 1)
9 Dec Market Snapshot (Update 1)
8 Dec Market Snapshot (update 1)

Read More...

Forex.com has offered Free ebook and forex practice account with USD 50,000.

You can learn how to trade currencies with no money at risk. Morever you are able to access to real-time forex quote, news, research and tools.

Forex.com provides free online training, as well as useful resources like tutorials, news, research, charting tool and commentary.

It provides 4 trading platforms : Java, HTML, Mobile, and ForexTrader (Windows application, i would recommend this !)

Join the forex trading world today and get your free ebook! Click here to register your account and receive your ebook now !

To download the Ebook only:

Read More...

12 Dec, Fri. Kuala Lumpur 0940, GMT+8

N225 closed at 8235.87 - 484.68 - 5.56%
HSI closed at 14758.40 - 855.51 - 5.48%
FTSTI closed at 1740.34 - 53.82 - 3%
KLSE closed at 852.57 - 8.41 - 0.98%

DJIA (12 Dec) closed at 8629.68 + 64.59 + 0.75%
DJIA (11 Dec) closed at 8565.09 - 196.33 - 2.24%

CPO (Feb 09), 12 Dec closed at RM 1581
CPO (Feb 09), 11 Dec closed at RM 1644

US Crude Oil 44.87 - 3.11 - 6.48%
Gold 819.80 - 814.10 - 1.51%

USD/JPY 90.1950 - 1.2425 - 1.36%

(sources: Bloomberg, Reuters, FT, WSJ, The Star Business, The Edge Daily)

> Stocks, Dollar, Oil Tumble as Auto Bailout Plan Fails; Treasuries Advance
> GM, Chrysler Bankruptcies Loom After U.S. Senate Rejects Auto-Rescue Plan
> Holiday cheer, and spending , December US retail chain store sales outlook dims
> Malaysia's Nov palm inventories seen hitting new peak‏
> Recession seen worsening, deflation a risk
> Trade Deficit in U.S. Unexpectedly Widens as Exports Fall on Weaker Demand
> Weekly jobless claims jump to 26-year high
> Dollar Declines to Six-Week Low on Reduced Demand for Funding
> Oil Rises After Saudi Arabia Says Production Is Near OPEC Quota
> Dollar Money-Market Rates Tumble on Fed Rate-Cut Speculation
> Russian Devaluation Gathers Pace as Central Bank Loosens Control of Ruble

===== ----- =====

Comments:

> Falling dollar sends gold price higher. Yen strengthen, unwinding carry trade?
> Asia market closed flat amid released of economic data. Rebound might come to an end and trend reverse. Dollar fall, Yen strengthen is going to hurt exporter, N225 might see a pull back.
> CPO has mixed news flow, but dollar far and crude oil production cut would send it higher. Nonetheless, i expect crude oil would continue downtrend due to recession fear, demand slow down.
> Would Fed cut rate soon? Nevertheless, rate cutting is not giving much help to spur the economy. Weekly jobless claims jump to 26 year high, points to worsening labor market.
> Swiss & Korea slash interest rate signals growing concern on recession. Global recession in sync! De-coupling story is history. Russian is also being hit by recession worry.

Read More...

11 Dec, Thurs. Kuala Lumpur 0145, GMT+8

N225 closed at 8720.55 + 60.31 + 0.70%
HSI closed at 15613.90 + 36.16 + 0.23%
FTSTI closed at 1794.16 - 27.54 - 1.51%
KLSE closed at 860.68 + 6.02 + 0.70%
DJIA (10 Dec) closed at 8761.42 + 70.09 + 0.81%
US Crude oil 45.25 + 3.18 + 7.18%
Gold 809.80 + 35.60 + 4.60%

USD/JPY 92.9500 + 0.8200 + 0.89%


(sources: Bloomberg, Reuters, FT, WSJ, The Star Business, The Edge Daily)

> Republicans criticize auto bailout
> House Approves $14 Billion Automaker Bailout, Sending It to U.S. Senate
> South Korea, Taiwan May Cut Interest Rates as Global Recession Hurts Trade
> U.S. Consumers Will Spend Less on Holiday Gifts Amid Recession, Poll Shows
> Rio Tinto to cut 14,000 jobs
> Devil in the details of accounting changes
> Death of commodities greatly exaggerated
> Oil Pares Gains After Unexpected Increase in U.S. Fuel Supplies
> Crude Oil Rises on Speculation OPEC, Russia Will Coordinate Cut
> Asian palm hits 1-week high as exports almost double

===== ----- =====

Comments:

> Watch out Yen carry trade ! If USD-Yen reverse trend, DJIA will retreat.
> Gold price rally. Carry trade? Investors worry on worsen economy?
> CPO expects to open high, tracking oil rally.
> Market rally, still, on expectation of automaker bailout despite gloomy consumer spending data. Bailout expectation is already built into the recent rally, i see sharp pull back after Congress pass the bailout plan. This is a push up-exit time for investors.
> Hell for commodities especially Iron, Steel, due to slow down in economy, seeing Rio cut 14,000 jobs. Aren't Obama going to push for infrastructure investment ?
> Comparison on EPF and stock market investment

Read More...

10 Dec, Wed. Kuala Lumpur 2330, GMT+8

N225 closed at 8660.24 + 264.37 + 3.15%
HSI closed at 155770.70 + 824.52 + 5.59%
FTSTI closed at 1821.70 + 67.12 + 3.83%
KLCI closed at 854.66 + 19.49 + 2.33%

DJIA (9 Dec) closed at 8691.33 - 242.85 - 2.72%
FTSE (9 Dec) closed at 4381.26 + 81.20 + 1.89%

US Crude oil 42.83 + 0.76 + 1.81%
Gold 778 + 3.80 + 0.49%

(sources: Bloomberg, FT, WSJ, Reuters, The Star Business)

> Nikkei hits 1-mth closing high on autos bailout
> HK shares extend gains, up 3 pct on China hopes
> Japanese Machine Orders Decline 4.4% as Global Recession Chokes Off Demand
> Oil Rises on Potential OPEC Cut, Traders’ Contract Buybacks
> China Producer-Price Inflation Slows to Weakest Pace in 2 Years on Energy
> Yen Falls as Stock Gains Spur Buying of Higher-Yielding Assets
> US STOCKS-Wall St falls on caution, weak company outlooks
> Democrats, White House Agree on $15 Billion U.S. Automaker Bailout Plan
> Malaysia to sell biodiesel at domestic pumps by 2010
> CPO futures: Players will look closely on Nov MPOB crop data and Dec 1 -10 exports estimates release today.
===== ----- =====

Comments:

> Lower rates is a wrong prescription
> Asia shares jump on stimulate plan and automaker bailout, Europe ends flat
> Can rally sustain on gloomy outlook ?

Read More...

9 Dec, Tue. Kuala Lumpur 1926, GMT+8
London 1126, Tokyo 2026

N225 closed at 8395.87 + 66.82 + 0.8%
HSI closed at 14753.22 - 291.65 - 1.94%
KLSE closed at 835.17 - 3.11 - 0.37%
FTSTI closed at 1754.58 + 95.41 + 5.75%

FTSE 4369.81 + 69.75 + 1.62%

DJIA (8 Dec) closed at 8934.18 + 298.76 + 3.46%

US Crude Oil 43.64 - 0.07 -0.16%
Gold 771.50 + 2.20 + 0.29%
FCPO (Feb09) RM 1555 unchanged

(sources: Bloomberg, FT, WSJ, Reuters, The Star Business)

> U.K. Manufacturing Shrinks, Housing Sales Fall to Lowest Level Since 1978
> Asian Stocks Gain for Third Day on Stimulus Plans
> Asia Bond Risk Falls on Optimism Bailouts Will Spur
> Japan's Economy Shrinks Greater-Than-Estimated 1.8% as Recession Worsens
> Fresh optimism for markets
> Tribune files for bankruptcy protection
> Crude ended higher on stimulus hope, dollar dipped against Euro, Saudi would cut supply, cold weather
> Malaysian palm seen rally on crude gains
> Malaysian palm oil climbs on rising flood fears
> White house reviews final Democrat auto bailout plan, near agreement
> Sony to Cut 8,000 Jobs, Close Plants, Reduce Investments as Sales Stall

===== ----- =====

Comments:

> Rumour: Genting to take Resorts private?
> how long more can share rise given overall economic conditions? Wall street shares rose on expectations despite the indicators are so bad they could hardly be worse. I expect global market share pull back after days of rally without fresh catalyst. Nonetheless, automaker bailout plan is near agreement, fear subdued and investors will focus on the recent economic data, DJIA could hover at recent level, awaiting Christmas sales data. Looking beyond weak data ?
> Crude hold steadily while investors are eyeing OPEC to cut production next week. CPO closed unchanged despite of the flood fears. CPO mostly will hover around current price or continue the downtrend shall there any negative economic data released.
> KLCI is still lagging behind the region, close at 835.17 down 3.11 despite the global rally for the past 2 trading days, due to foreign funds pulling out money from selected counters.

Read More...

8 Dec, Mon. Kuala Lumpur 2320, GMT+8
New York 1020, London 1520, ShangHai 2320, HongKong 2320
Tokyo (Tue) 0020, Sydney (Tue) 0220

HSI closed at 15044.87 + 1198.78 +8.6%
N225 closed at 8329.05 + 411.54 +5.2%

Dow closed at 8934.18 + 298.76 +3.46%

US Crude oil (USD) @ 44.13 + 3.33
Gold (USD) @ 776 + 23.80

(sources: Bloomberg, FT, WSJ, Reuters)

> Obama to spur economy with Infrastructure Investment
> Stocks Rally Worldwide After Obama Pledges Spending Surge; Alcoa, GM Gain
> Wall Street rallies on Obama stimulus plan and autos
> European stocks extend gains, tracking Wall Street
> US job market slips again, outlook bleak
> Dow Chemical to cut 5000 full time jobs, close 20 facilities
> Oil, Copper Advance After Obama Promises Public Works Spending
> China support talk drives HK shares to 7-wk high
> Nikkei hits highest close in week, machinery surges

===== ----- =====

Comments:

Following last friday soared 3+%, DJIA sees another rally today on Obama stimulus plan. Stocks are sharply higher on stimulus hopes and optimism that automaker would get a government lifeline. While European stocks extend gains by tracking Wall Street's gain, Asia has shown a strong rebound on the hope of the economic stimulus package expectation. Although job data posted a slip in November, Obama investment plan has sparked the optimism on expectation that the president-elect would act boldly.

Nevertheless, questions are gonna be asked on the detail of the investment plans, the size of the plans. Automakers arent making losses solely this year of the recession, they have been making losses. Bailout no doubt can lengthen their life but eventually these giants still need to revive their business by restructuring their business.

Bear in mind, Fed has not much room to cut the rate, and central banks across the globe seems to be re-active rather than pro-active, following Fed's footstep.

I doubt that this rally is sustainable, as more negative news are expected to release. To me, this could be seens as a chance to unload in a bear market. Beware! Worldwide investors are looking at the government to stimulate the global economy. This expectation has reflected in this round of rally. Shall there any negative news released in coming days, the pullback would be very strong.

Read More...

(Source: The edge weekly)

Dec 8
- Japan to release GDP annualised data for 3Q2008

Dec 9
- Canada to announce interest rate decision

Dec 10
- US to release October wholesale trade data

Dec 11
- Malaysia to release October industrial production index (IPI)
- US to announce jobless claim
- UK inflation expectation

Dec 12
- US to announce producer price index for November (PPI)

Watch out Dec 8 and 11!

===== ----- =====
Last week

Malaysia October exports fall
-fell 2.6% to RM 53.45 billion from a year ago and also declined by 14.2% m-o-m
-due to lower exports of E&E products and commodities (petroleum and palm oil)
-Major export markets which registered declines on imports were the US, Singapore, China, Hong Kong and Australia

Europe's economic slump deepens
-European economic activity appeared to fall off a cliff in November, increasing pressure on the European Central Bank, the Bank of England and Swede's central bank to cut interest rates sharply last Thursday (Dec 4) to revitalise growth.
-ECB cut interest rate by 75 bps to 2.5% (ECB chief, Jean-Claude Trichet)

Japan shifts from austerity
-More spending is in the cards if Japan falls deeper into a recession.
-Increased spending could have more serious implications for Japan. The nation's public debt stands at 170% of GDP - the highest ratio among industrilised nations.
-Japan PM Taro Aso

China manufacturing tumbles
-Purchasing Managers Index (PMI) November was 38.8, down from 44.6 in October, lowest level since index started in 2005.
-Citing the global downturn, the slowdown in Chinese manufacturing and weakening domestic demand, economists cut their forecasts for China's economic growth to 7.7% in 4Q2008 from 8.2%, and to 9.2% for all of 2008 from 9.4%

Read More...

In 2004, when Datuk Seri Abdullah Ahmad Badawi took over the helm from Tun Mahathir, there emerged a new group of elite businessmen. The most visible of them were Equine Capital Bhd's Datuk Patrick Lim, ECM Libra Group's Datuk seri Kalimullah Hassan and Scomi Group's Datuk Kamaluddin Abdullah (also PM's son). Scomi (7158), who IPO at RM 1.38 in year 2003, saw the share price rocketed to all time high of RM 2after 1-10 split. Please refer to: The Scomi Story

The Prime Minister in waiting, after taking over the role of Finance Minister in mid-September, had organised a corporate roundtable session. 6 individuals, each with deep knowledge of his field, were personally chose by Najib. They were tapped for ideas on how to address issues ranging from the economy, capital markets and business in general.

The 6 were:
1. Tan Sri Azman Mokhtar, MD of Khazanah Nasional Bhd.
2. Tan Sri Md Nor Yusof, director and chairman of Khazanah's executive committee
3. Datuk Mohd Nadzmi Mohd Salleh, chairman and MD of express bus operator, Konsortium Transnational Bhd.
4. Datuk Shahril Shamsuddin, Sapura group
5. Datuk Mohamed Azman Yahya, director of Khazanah, and founder and group chieft executive of Symphony House Bhd.
6. Dr Gan Wee Beng, the executive director of CIMB group. He was a consultant to Bank Negara, the Economic Planning Unit, finance ministry and the World Bank.






From left: Azman Yahya, Mohd Nadzami Mohd Salleh, Lodin Wok Kamaruddin Md Nor Yusof, Gan Wee Beng, Mohd Bakke Salleh and Azman Mokthar.

Names linked to Najib
- Tan Sri Tan Kay Hock, Johan Holdings Bhd Chairman and Chief executive, golf buddy
- Tan Sri Robert Kuok & family, Tun Abdul Razak & Tun Hussein Onn were good friends of Tan Sri Robert Kuok.
- Datuk Shahril & family, Sapura group
- Tan Sri Syed Mokhtar Albukhary, MMC group, DRB-HICOM has a huge vehicle assembly plant and is one of the largest employers in Pekan, Pahang, Najib's mainstay political base.
- Rohana Mahmood, chairman and partner of Ethos Capital, a RM 200mil private equity firm. Rohana and Omar Mustapha Ong, a former special assistant to Najib, are co-founders of the boutique advisory firm Ethos & Co. Rohana sits on the boards of Paramount Corp Bhd, TH Group Bhd, and Dijaya Bhd.

Razak Brothers
- Datuk Johari Razak, senior partner at Shern Delamore & Co. a large firm in KL. He is also a non executive director in several publicly listed companies including, being chairman of Ancom Bhd, deputy chairman of related Nylex (M) Bhd, and directorships in Hong Leong Industries Bhd and Daiman Development Berhad. He is also a director of Deutsche Bank (M) Bhd.
- Datuk Mohamed Nizam Razak, non executive director in several publicly listed companies including Hiap Teck Venture Bhd, Mamee Double Decker Bhd, Delloyd Ventures Bhd, and Yeo Hiap Seng Bhd. He is also a director of Deutsche Bank Bhd.
- Datuk Mohamed Nazim Razak, an architect.
- Datuk Nazir Razak, CIMB group CEO

Summary
Come March, DPM Datuk Seri Najib Razak will take over from Datuk Seri Abdullah Badawi as Malaysia's sixth Prime Minister.

1. What change will bring along with him? How will the leadership affect business?

2. CIMB, GLC, Symphony House Bhd, Johan Holdings Bhd, Sapura group, Hong Leong group, Paramount Corp Bhd, TH Group Bhd, Dijaya Bhd, MMC group, DRB-HICOM, Hiap Teck Venture Bhd, Mamee Double Decker Bhd, Delloyd Ventures Bhd, Yeo Hiap Seng Bhd, Nylex Bhd, Hong Leong Industries Bhd, Daiman Development Berhad. These are the names that has connections with him, will they benefit from the change? Which family will arise from the change?

3. Razak brothers has been involving in banking, will they have the upper hand in the bank mergers? Obviously, there are conflict of interest between PM in waiting/Finance minister with CIMB CEO, how are they going to resolve this conflict?

4. Quek's Hong Leong bank will have upper hand in bank merger? (Rumour on merger of Hong Leong and Public bank)

5. Will Second Finance Minister, Tan Sri Mohamed Nor Yakcop stay on?

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