Video: Jim Rogers 2009 Market Outlook

Hi guys,

The video clip below is Jim Rogers's 2009 market outlook on the global economies, and primarily on the outlook of the US economy and oil markets.

Enjoy...

Season Greetings: Santa Claus Bailout Hearings

Hi guys,

Happy Holidays to all and hope that all of us could have a more profitable trading year ahead. Let me try making more posts here from 2009 on, as I begin to have more time after this season.

Below is a video clip of Santa's Bailout proposal to the House of Governors, enjoy...

USD Outlook

Hi all,

Today's event would be focused on ECB (1345 GMT) and BOE (1300 GMT) respectively, where expectations are talking about a cut of 50 bps for ECB and a possible 100bps cut on BOE. I personally have a view that BOE may not go for this full point cut, probably 75bps may be more realistic. 

Look at the economic calendar above for further announcements today. My opinion on the market in the next few weeks, would be greatly influenced by the payroll figures in tomorrow's NFP. 

The photo above is another teaser on the new US President.  You think the USD will really be printed in this manner in the future? 

Enjoy.

Video: Jim Rogers Forecast

Jim's on oil, SIA and short TBT treasuries. What's your view?

Hope this is helpful for your reference. Enjoy the video! 

Part 1

Part 2

Change! Is This A New Beginning?

Hi all,

As seen on the site, Barack Obama is now the America's new elected President. The facts and figures of this election could be seen on the page. 

So what could be expecting next for the economy? Here are views from a few news articles that I had came by over the week. Day after election and Bulls, Bear, Donkeys and Elephants

A small titbit to mark today, as the market rallied the past few days, and the election is just over, the above is an illustration of the current yields at the present moment.

Lastly, the video below is an interesting scene captured today from CNN, where they are the first to implement Hologram TV, seems like the technology for media and telecommunications have made another big step ahead, even though we had seen this 20 years back from Star Wars. I wonder what other media enhancements we may witness in time to come. Enjoy...

Real-Time US Presidential Election Count

Hi all,

Great day.

As the US presidential election poll is taking place now, 2 widgets have been placed for everyone to capture live results on the election results.

McCain seems to have a soft lead in some states currently, as many political parties seem to have given him their endorsements towards the end of the presidential race. It is going to be another  interesting US election again. My bet is on McCain to win (underdog).

Let us just anticipate the results, and see what may evolve from the tolls.

Cheers. 

October 2008 Trading Account Summary

Hi all,

The illustration above show the total trading account balance after a month plus's trading. The total ytd from end Sept till now is 14.71%, with a starting account balance of US$10,000. As I reviewed my posts in Oct, there were some trades at the early part of Oct where it was not posted, as these trades could have been made while I was outdoors, that could likely have caused the omission. I hope my series of profits could continue, and I hope the posts I have made, could be helpful to you in the very near future.

The last 6 weeks have indeed been really tough for me, as I had to juggle between making contents for the blog, making trades, studying market sentiment, and between personal time, I have found posting market calls consistently to be a challenge for me. Therefore, I went into a dilemma as to whether this is meaningful for me to pursue further.

Thus over the past few days, I came up with a solution to these dilemmas. 

As my trading strategy has been short term to medium term (carrying a few days the most), I've decided to use http://www.market-hub.com as my new medium to post market calls, and an area where we can discuss more about the markets. I trust that everyone here are students of the market, so why don't we just throw out our thoughts in this new and free trading community?

If you happen to sign up at http://www.market-hub.com, just drop a note, bookmark the page, and I'm sure you will have get your reply pretty soon.

So see ya there then. 

Market Update

Here is a brief summary of what will and had happened during the period of my absence from the market:

1. A good move made by RBA today, where they cut interest rates by 75bps to 5.25% at 03:30 GMT. The 75bps came above expectations as speculators were anticipating a cut of 50bps instead. RBA has indeed shown their aggressiveness on their countercyclical monetary policy, and at the same time to exert some pressure on BOE and ECB for a significant ease this Thursday. 
2. Economic data everywhere seems horrifically weak globally, not sparing China as well, as China's manufacturing data shrunk by record. Interestingly, there was an article on LA Times, where it reported that some owners deserted their factories in China.  From the British Beer and Pubs Association in U.K, pubs are shutting down at a rate of 5 pubs a day, from Reuters, click here. 
3. Focus will be on US elections on Tuesday, where results will be in after the N.Y market closes. If McCain is to upset Obama, he may have to seal a win in Pennsylvania first. 
4. Watch out for the outcome of the House and Senate elections, as the Democrats seem to be in control of both bodies, question would be whether they get 60 seats in the Senate. So what will happen to the stock markets if it is a Republican or Democrat win? Click here
5. Asian markets closed with uncertainty trading throughout the day, due to weak economic data, strength and weakness in the USD, and good data that could motivate a move on equity prices. Nikkei 225 closed at 9114.60 +537.62, Shanghai closed at 1706.70 -13.07, Hang Seng closed at 14,384.34 +39.97, Straits Time Index closed at 1829.69 -54.06.  
6. Major currencies are relatively stronger to the USD for the asian session, but GBP and JPY are relatively mixed for the day.
7. US Treasury said it will seek to borrow a record 550 billion dollars in Oct to Dec.

That's all on the market brief.

Trade: Singapore Exchange

Hi all,

An exit was made at $4.40 on SGX.

Good trades.

Trade: Singapore

Hi mates,

I have bought SGX shares at $4.28. 

Looking for an intraday retracement till mid-day.

Good trade. 

Review: New Trading Week

Japan is obviously in panic at this stage, as Nikkei extends decline to close at 7162.90 -6.36% from the previous close, as I am writing this. The Nikkei fell to new lows since 1989, at 38900ish, and still making new lows today. Do you think we could still see it happen in the next decade? Although Japanese banks have been relatively unharmed by the credit crisis, but a dip in the equity prices of Japan has caused a relative damage to their balance sheets. 

Over the weekend, China, Japan and Korea agreed to act together any day if and when it is needed, where Japan has a free hand on Yen with the support of China. 

Hong Kong on the other hand, as I am writing, is down by 12.16% at 11,083.63 -1534.75. I believe the double whammy may have been accompanied with Li Ka Shing's comment last week, in a declaration that Hutchison Whampoa will not move forward with further acquisition until June 2009, as he has always been a good indicator to many people in Asia.

Let's look at a series of financial news where we can access from one of the big newswire:

1. European banks will be in trouble next, as according to a news report from Telegraph, they are discovered to own 75% of debt from the emerging market economies. Will the Euro go into parity with the USD, as forecasted by BNP Paribas?. To read the article, click here.
3. HSBC and Santander are beginning to face pressures. Click here
4. AIG needs more money again, as $123B is not enough. Click here
5. Russia may default next. Click here
6. School in trouble due to failure of renowned hedge fund. Click here
7. Taiwan Dumps Fannie, Freddie and Uncle Sam? Click here

With the string of events mentioned above, we seem to be in a crisis that is very much worse than what I have personally encountered in 1997 (Asian Financial Crisis) and 1992 (ERM Crisis). 

Currently, all eyes may be eyeing on China to intervene into the stock markets, where in my opinion, that might only happen if the intervention is a global joint intervention. I believe a 10 billion dollar in HK and China stock markets each, could put a strong support to HK equities. 

For the Singapore markets, the climax may come about from further news on Las Vegas Sands, as most Singaporeans banks has lent them a huge amount to finance their projects. This could also pose a threat on Singapore property prices, as the housing bubble has been largely influenced by the  expectation that the Integrated Resort would prop up prices in the local property market. 

Let us just keep a good lookout at the US stock market tonight, it should be another spectacular one. 

Review:Challenges To Maintain Free Market Policy

Hi guys,

It has been awhile since I last wrote a review on the markets.

As I am writing this now, here is a summary of the asia stock markets:

Shanghai Composite 35.94 (1.92%) 1,839.621

Hang Seng 1,142.11 (8.30%) 12,618.38

Nikkei 225 811.90 (9.60%) 7,649.08

Straits Time 145.39 (8.33%) 1,600.28

Kospi 110.96 (10.57%) 938.75

Taiwan Weighted 150.89 (3.19%) 4,579.62

FTSE 100 290.02 (7.09%) 3,797.81

DAX 367.65 (8.13%) 4,152.05

SMI 347.22 (5.89%) 5,546.51

Currently, DJIA, S&P 500 and Nasdaq futures are traded at limit down. There are also talks in the market of possible intervention from major central banks tonight, IMF seeking funding from China and Japan to aid emerging market economies, where they take into consideration of high default risk from these countries.

What speaks for the strength of the USD despite liquidation from companies, hedge funds and the CDS, and for the weakness of other currencies over the past few weeks. Primarily, the cause was by a surge in demand from parties who are not part of G7 or G10 who do not have large swap lines with the Fed, e.g Korea, where they are not part of G7, their system at this moment would experience additional pressure on the won, as they do not have swap lines with the Fed, therefore, in order to obtain Dollars, they have to post their national currency (Won) as a form of collateral in exchange for dollars. Similarly, the similar situation is happening to many emerging economies like Pakistan, Russia, Kazakh, Emirati and etc banks.

With further job cut announcements, starting from a few institutions like Caterpillar, GM, Merril, Chrysler and Goldman, we may continue to see further evidence of a full blown recession, that the US dollar may have not factored in, in the next few weeks, after the liquidity squeeze gets resolved.

Watching the Banking Committee yesterday, where the Congress tried to grill Greenspan, Snow and Cox, was indeed an emotional moment for me. The ex-Fed Chairman was given utmost disrespect, as his speech was cut short, and he gets very rudely interrupted during his Q&A, I thought he deserved his stand to explain, as someone who had dedicated to serve as the Fed Chairman for more than 40 years. If you were his age, and given this time where you could be flying elsewhere for your retirement holidays, would you waste your time in front of a group of people whom you know that will grill you, and admit that your ideology of a free market system was flawed? In my opinion, I respect this chap for his honesty, and to be very honest, in my opinion, there are no flawless system in governing in the financial markets? Even nature does not give you a perfect forecast of any nature product's life cycle.

Continuing from the above emotional message, I personally feel that we will continue to face challenges in the financial markets, where the DJIA we may see a bottom at around 7,200. In view of Euro/Usd, the USD will likely begin to weaken on the mid term from 1.22ish. These views are just my personal views on the market, and they are not meant for professional financial advise, therefore I hope you could just view this with a small amount of belief.

Hope you guys have a great weekend. Good trades to all.

Video: Panic May Force Market Shutdown

Interesting video for your viewing pleasure. Please take your time to view these clips. It is pretty meaningful.

Part 1

Part 2

Part 3

Part 4

Part 5

Video: Jim Rogers Interview

Here is Jim Roger's view from yesterday's interview on CNBC. Enjoy!!

Video: Future of Capitalism

The market has been tough to trade for the past few days. I remain as a USD bear for the next 2 months to come, will continue to look for opportunities to short USD today. 

Here is an interesting video on the future of capitalism. Hope you enjoy it! 

 

Trade: Exit Eur/Usd With Losses

The two attempts yesterday were unsuccessful. A total of 50pips were lost on stops. 

Let's see if we could make better results today. 

Cheers

Trade: Long Euro @ 1.2860

2nd attempt to long Eur/Usd for the day. Will rest for the day if this trade does not turn out as desired. 30 pips will remain as my stop. First target remains at 1.2932. 

Good trades!

Trade: Eur stopped

All positions were stopped out at -20pips.

Looking forward to further opportunities.

Trade: Euro Long

Hi all,

I am long 50,000 Eur/Usd at 1.2851 with a tight stop placed at 1.2831. Will be looking forward to shift stops for the moment, initial target for this trade would be at 1.2931 for the inital 30,000 to be exited.

Video: Financial Crisis

I thought this may be an interesting video for everyone's viewing pleasure after a hard day's work. It is another video worth your time on.

Likely turn in for the day now.

Hope you enjoy the videos.

Good trades to all.

Part 1

Part 2

Video: Is the US dollar going to collapse?

I wonder if this has ever come across your mind during this period of slow growth.

Exit Ascendas at $1.68

Remaining holdings in Ascendas has been exited at $1.68. Reason for this exit is due to 'event risk' in tonight's Lehman CDS holdings announcements. I will continue to look for opportunities to go long in EUR/USD or GBP/USD over the next 24 to 48 hours.

Good trades to all.

Taken partial profit on Ascendas REIT

For your information,

I have already taken 70% profit on Ascendas REIT at $1.66. As there is no stop loss order for equities, remaining 30% will be targeted to exit if market gets near $1.57. 

Good trades to all.

Buying Singapore Stocks

Hi mates,

For your information, I have just bought Ascendas Real Estate Investment Trust at 1.55. This position is based on the expectation that the earnings announcement in the after hours will be better than expectation. 

My view is that there'll be growth in smaller industrial spaces, as most businesses will be looking at winding down large operations to keep businesses cost efficient.

Good trades.

Gold Short 500oz @ 799.68, Closed Short @ 797.91

Would like to apologies, as this came abruptly. I made a short term trade on Gold for 500oz, where  I was short from 799.68 and bought back at 797.91. 

Good trades.

Exit GBP/USD at 1.7214

All positions exited at 1.7214. +30 pips.

Will post trades further should there be opportunity.

Good trades.

Short GBP/USD @ 1.7244

I am short GBP/USD at 1.7244. Stop is at Breakeven. Initial target for 30,000 exit is at 1.7214. Stop currently at entry price. As market will be volatile on pre-news announcement.

Good trades

Exit 50,000 GBP/USD @ 1.3511

An early exit was made at 1.3511, as 1.3495 seems like a tough area to penetrate for the moment. This short term support may be the pivotal level for tonight's trend, therefore I feel it is worth to humble out.

There is a profit of 13 pips. Will be looking forward to further enter if situation allows. Looking forward to the next trade. 

Good trades.

Short GBP/USD @ 1.3524

Hi mates,

I have just made a short Eur/Usd position @ 1.3524. Target 1.3494 to exit 30,000. Remainder will be shifted to Breakeven once 1.3494 is done. By default, stops will always be at 30 pips from entry price.

Cheers

Bernanke's Speech

Seems like the US stock markets do not really like Fed Chairman, Ben Bernanke appearances most of the time. 

If you missed yesterday night's speech, here you go:

Part 1

  

Part 2

For a script on the speech, you can also access it from here.

Good trades.

Stopped Out of GBP/USD trade

I was stopped out of my GBP/USD order @ 1.7460. Down by 30pips.

Let's look for another opportunity again.

Good trades.

Trading Call & Price Forecast on GBP/USD

The above target is my target resistance for GBP/USD within the next few sessions.

As I was away for a little too long today, I missed my entry target for today. I will be looking for a 50,000 long entry into this market if my target price at 1.7490, with stops placed at 1.7460 if this order is done.

Let's look forward to it.  

Here's An Idea To Improve Liquidity

Funny comic. Thought this may interest you.

Is The Bottom Near?

Hi all,

I believe this will be in many people's mind after tonight. 

I will be back to post in my trading calls from tomorrow. Hope the comic above is entertaining for you as well. 

See ya tomorrow mates.

NYTimes.com: How This Bear Market Compares

So how is this bear market different from others? For more info, go here

Jim Roger's Interview

If you guys have been following Jim Rogers closely over this crisis, I thought this may be an interesting one for you.

Recommended Video

This video may last for more than 3 hours in total, but I hope you can finish them all, it will be meaningful.

Money as Debt

Hi all,

Great day.

The 5-part video below is an educational program for your information. It elaborates on how we have reached this stage in the financial system, I hope all this is informative for your reference.

Part 1

Part 2

Part 3

Part 4

Part 5

All positions exited

All positions exited at 1.3738.

Going for a jog. 

Cheers

Targeting 20,000 Eur/Usd for 1.3740

Hi all,

My exit target for 20,000 Eur/Usd will be 1.3740, and stops are at 1.3641.

I made a comparison between several brokers (I do not wanna name them) throughout this period, and found that most widely advertised brokers widened their spreads drastically (even up to 20 pips at times) for most major currencies, if you are ever keen on trying out a broker that maintains eur/usd consistently at 2/3 pips and gbp at 4/5 pips only, I would urge you to try out Forexyard. 

If you would like to find out more, Click here: Forexyard

Exit 30,000 Eur/Usd at 1.3675

Exit 30,000 Eur/Usd at 1.3675. Remainder 20,000 stops shifted to entry at 1.3641.

Good trades

Long 50,000 Eur/Usd @ 1.3640

Hi all,

I am long 50,000 Eur/Usd at 1.3640. Stops are placed @ 1.3610. Target for first 30,000 to exit at 1.3670.

Good trades!

Breakeven Stops Activated

Seems like the primary trend still remain doubtful. Let's see if we can ride any trends further tomorrow then. We are all square for tonight.

Cheers.

GBP/USD Stops Adjustment

Stops are adjusted to breakeven at 1.7405.

GBP/USD exit and Re-entry

GBP/USD stopped out at breakeven for the previous position. 

Re-entered long GBP/USD at 1.7404. Stops at 1.7385.

Good trades.

Long 50,000 GBP @ 1.7420

Hi mates,

I am long 50,000 GBP/USD at 1.7420. Stops at Breakeven 1.7421.

Good trades.

All order exited

All orders exited. Will be right back

Took 30,000 partial profit @ 1.7580

30,000 Partial profit taken at 1.7580

Stops Shifted to Breakeven

Stops are currently shifted to Breakeven @ 1.7526.

Long 50,000 GBP/USD at 1.7525

Hi all,

I am long GBP/USD at 1.7525. Stops will be placed at 1.7496.

Good trades...

Jim Cramer's View Post Bailout

I thought this might be an interesting view for people who are still on the stock markets.

Evaluation On My Bad Trading Streak

The last week has been another challenging moment for me, where I had encountered multiple setbacks in my trading. And yes, it was a challenging moment for me throughout the week, and in addition, it felt even worse when I knew I was making such lousy calls on the market. This experience has indeed humbled me a great deal, and I do hope I could share some experience of this short evaluation that I had done up over the weekend:

1. Allow the market to show its hand,  especially when it trade sideways.
2. Look out for the more liquid markets, as their volumes remains fairly thick even though volatility remains high. (e.g Eur/Usd)
3. See not trading as making money, instead of seeing it as 'not making money being the same as losing money', where to wait is not a waste of time.
4. Leverage should be greatly reduced, and stops should be widened to allow you a chance to allow your trade to work out. And that will greatly help the trader psychologically.
5. Stops must be used. In such volatile markets, there is nothing like denial (my GBP/JPY long). Admit that the trend has changed and continue with your next view. In addition, I have exited my GBP/JPY trade at 185.86. It has been painful, but I saw the rewards right after that. 

The above should suffice for the moment, and I am glad I have improved further on my trading by blogging. Over the next few days, I will be continuing to post my trades on the blog again. And for the moment, I am now left with no single opened position in the market, and all old positions have been closed.

Cheers.  

Hitler On the Bailout

Hitler strikes back on the bailout

Hitler's Having Another Margin Call

Some thrashing out this weekend

Hi all,

It's been a challenging week for me in trading. I will be going through some improvements over the weekend to thrash out the glitches on my trading system. Here's a small strip for your enjoyment. Have a great weekend.

Long Aud/USD at 0.7771

All positions closed out. 

long 30000 aud at 0.7771, stops at 0.7700. Should be all for today. Breakout of either side will definitely emerge as a new trend. 

Good trades to all.

Closed and Reversed

Reversed to short 100,000 AUD at 0.7747. Stops at 0.7777

Cheers

New Long AUD position

I am long 1,000 AUD/USD at 0.7780, 14,000 at 0.7779, and 35,000 at 0.7792.

Good trades to all.

Trading Losses and Adjustment to Methodology

 Dear mates,

The day has been challenging day for me where I have realised a few mistakes that I could have been on today's losses. Yes, I have to admit that both trades today were made with negligence and with little vigilance. I will thus avoid making this same mistake by not trading between SGT 0800hrs (0000hrs GMT) and SGT 1630hrs (0830 GMT) daily, as I admit that I am not very focused within that time of the day.

Trading time horizon may be in a matter of minutes. Trades are made in a manner that will consistently look forward to an exit on the short term, although it has a primary target that will be looking forward to stay on a trend for the long term. This method may not be a conventional strategy that you may agree with, but it is something that has worked for me for a period of time. 

I shall leave no stone unturned from my next trade, in addition, I would want to remind everyone who is reading this that there is no strategy that is fool-proof and free from losses, therefore, if you are viewing my calls on a consistent basis, please reminded that losses made like what happened over the past few days may re-occur on a consistent basis, therefore I hope you can only view this with a pinch of salt, and measure the result against the actual market.

My 50,000 long AUD/USD at 0.7903 is stopped out at 0.7803 with 100pips of losses. GBP/JPY remains opened from 189.49.

Now let's rock the markets today!!! 

Trade Update

30,000 GBP/USD was exited at 1.7721. 

Stops for 20,000 GBP/USD was shifted to entry price at 1.7682. 

Good trades.

Long 50,000 AUD/USD at 0.7903 and GBP/USD at 1.7681

Hi guys,

For your info, I am long 50,000 AUD/USD at 0.7903, as well as 50,000 GBP/USD at 1.7681. The stop level for both position will be 100 pips away from entry price. Existing long position of 15,000 GBP/JPY, remains open at 189.49. 

 

Will be looking forward to reduce my position before tomorrow's voting with the congress, and the NFP announcement. 

Good trades to all. 

Long GBP.JPY @ 189.49

For your info,

I have just made a 15,000 long position on GBP/JPY at 189.49. 

Global Economic Scorecard and Outlook

Hi all,

It has been another interesting week that will make history in the global financial markets where the US markets lost a total of $1 Trillion on the market bourse, as Dow was down 777 points closing 10,365.45, Nasdaq down 199 points closing the day at 1983.73, S&P 500 down by 106points closing the day at 1106.39, in the US market trading.

Asian bourses was pretty weak gaining what was lost from the opening at mid-day with STI closing down 2.43 points at 2358.91, Nikkei 225 closed down 483.75 points at 11259.86, Hang Seng closed up 135.53 at 18016.21 (where tomorrow will be a public holiday), and Chinese stock exchanges closing for the week for National Day.

The selling in the earlier session was sparked by a rejection of the bailout plan that was proposed by Henry Paulson, and his Fed aides, as many market participants held high hopes of the implementation of the proposed rescue package. In my opinion, a veto on the proposed bailout plan may not exactly be a wrong move for the US economy on the long term. I may not be a US taxpayer, but to be transferred an obligation, and to 'foot the bill' for mistakes made by others, would make me feel upset about it as well. 

These troubled institutions have, for the past decade adopted a loose system in assessing the credit-worthiness of their borrowers, and thus, lent out billions of dollars to NINJAs (No Income No Job or Assets Individuals). As a result, causing a vacuum in the credit system. With fear of further failure with banks, the Federal Reserve has, since March, spent on these items:

1. JP Morgan's takeover of Bear Stearns, brokered by the government ($29B)
2. Liquidity Injections such as Term Lending Facility and Term Auction Facility ($200B)
3. Economic Stimulus Package ($168B)
4. Refinancing of failing mortgages into new and reduced principal loans with a guarantee ($300B)
5. AIG's bailout ($85B), can be up to $400B due to AIG's CDS on CDOs, CMOs, MBS, and etc...
6. Fannie Mae and Freddie Mac $200B, can be up to $800B
7. Money market insurance (likely another $50B)
8. MBS purchases ($10B), up to $800B.
9. Global credit market injection $300B just last Friday.
   
10. Repayment to JP Morgan for providing liquidity to Lehman's bankruptcy ($300B)
11. What if the 2nd attempt of the bailout proposal succeeds this Thursday? ($700B)
12. Taken from an article in Reuters, US banks and money managers had to borrow $188B a day to keep afloat.
    

Do you think the Fed has been successful with such spending and injections? What is it about another $700B of injection, will the system stabilise because of these injections? 

As of 30Sep2008 Libor Fixing

        Tgt   O/N    1mo   2mo 3mo 3m chg
US  2.00% 6.875 3.926 3.966 4.053  17.0
UK  5.00% 6.781 6.075 6.156 6.300   3.9
EUR 4.00% 4.449 5.050 5.130 5.277   4.0
JPY 0.50% 1.031 0.926 0.950 1.015   5.4
CHF 2.75% 3.333 2.800 2.860 2.955   2.5
CAD 3.00% 4.500 3.997 4.100 4.208  0.8
AUD 7.25% 6.938 7.775 7.725 7.800 3.7

Taking a look at LIBOR (London Interbank Rate) which is a rate for interbank lending, is at a nervous state, as banks begin to lose confidence with one another, loans offered by banks to retail customers are also shorter, and do you think bulk cargoes that are shipped long distance by ship easily get their financing as well?  

Next, let's take a look at European banks, are they any better off than us? Here are some numbers:

• More than $300B of credit insurance were written by AIG to the European banks.
• Deutsche Bank leverage ratio is 50x, 80% of Germany's GDP.
• Barclay's leverage ratio is 60x,  100% of UK GDP
  
• Fortis's leverage ratio is 30x, 300% of Begium's GDP.

Scorecard: Avg Leverage Ratio (US Banks) 20x Vs Avg Leverage Ratio (EU Banks) 35x

The numbers speaks for itself. If you have read the contents that was written above, you would derive that we are currently in the phase of a global slowdown, also called a recession. Let's not deny that. 

As for my personal opinion as to where funds could be invested, for the moment, even though stock valuations are already at one of its lowest levels, I still believe cash is king, for those who are not involved in the forex markets. But if you are into trading forex, crude oil and gold for the week, I would suggest everyone to only try holding on to short term positions, as news of intervention and further injections from central banks may come anytime, causing the markets to be a little volatile at times. 

The Last Lecture

Before I end my last note for the week, I thought this video could be good for the soul. Let's pay a tribute to Dr Randy Pausch for his many years in education.

Have a great weekend.

Market Waits On

As the trading day ends for the week in a few hours, the world anticipates for news on Paulson and the members of the Treasury to disclose details on the bailout plan. The current market's  sentiment, judging from how equity indices are performing (volatile), indicate that market participants are running dry on patience, as they begin to doubt whether anything would be passed to restore liquidity in the markets, and save the sinking boat. 

In my opinion, restoring liquidity may not save all the firms from failing, but it is likely to calm the markets as well as those OTC derivatives creators who are still writing credit default derivatives.

Monday's market open would likely be another interesting one, as the markets will likely begin to discount the outcome, as it may no longer matter if the Bill is passed or not. Here is a short article of an enthusiastic party to this bailout plan:

UK banks hold 95 bln pounds of sour assets that could qualify for US bailout plan - Times of London

Times of London reports Britain's five leading high street banks have as much as 95.3 bln pounds ($175 bln) of distressed assets on their books that may qualify for the American bailout scheme. If the British banks tap the rescue fund being set up by the US Treasury and the Federal Reserve to the maximum, they could secure one quarter of the $700 billion being made available. Under the terms of an outline agreement that appeared to have been reached by US policymakers last night, Britain's lenders will be able to use the facility... According to analysts' estimates, and the banks' own recent filings, HSBC (HBC) has as much as 45 bln pounds in structured mortgage debt and other soured assets sitting on its balance sheet that it might look to exchange with the Fed under the plan. Next are Barclays (BCS), with 17.4 bln pounds; Royal Bank of Scotland (RBS), with 16.2 bln pounds; and HBOS, the UK's largest mortgage bank, with 13.3 bln pounds, analysts said yesterday. Lloyds TSB (LYG) follows some way behind in its exposure to the troubled mortgage securities, with assets of about 3.4 bln pounds.

Let's look forward to next week, where the Chinese exchanges will get an entire week's holiday for their national day. And I will be looking forward to this weekend's F1 in Singapore. Have a Great Weekend! 

What Will Happen If This Financial Uncertainty Persists?

Ever wonder what will happen to your stockbroker if the financial situation persists?

Trading Outlook

The world markets today will remain focused on further developments on the U.S. financial bailout program, that has just about worked its way through Congress. It now appears to be a done deal. The strongest reaction has been in equty markets, which have improved. The USD really does not know what to do with it, but its tone improved as the day wore on. It may indeed be a dramatic 

The major question now is whether interbank liquidity will start to improve once the bill officially has been passed as the interbank lending had dried up pretty drastically. As simply, banks who have cash do not want to let it go for credit/liquidity reasons. 

Next Monday will be an interesting day because on that date, markets will start trading the three month maturity over the turn of the year. Equity markets and the bond vigilantes will have the final word on the bailout program and have already rallied in anticipation of its passage.

The USD is trading steady to lower against EUR, CHF, JPY and GBP. Crude Oil starts lower at 106ish away from yesterday's high at $108 per barrel. Gold is also lower

Asian bourses traded lower with HSI 18771.02 -163.41, Nikkei 225 closed at 11893.16 -113.37,  STI currently trading at 2409.90 -34.26, and Shanghai 2293.784 -3.717. 10-yr JGBs were a touch weaker. European bourses rallied. E-Z bond prices have gained.

U.S. equity markets closed up stronger yesterday. Likely to follow with a weaker opening in the US markets today. Bond prices are also weaker.

EUR/USD and Crude Oil Relationship

Thank you for your kind support and encouragement. I am glad my info has been useful to some. 

Just last week, a reader asked, if there were any currencies that showed a correlation with specific commodities, so in order to answer this query, the above image may speak for itself. 

Little Tribute From George Soros

Paulson cannot be allowed a blank cheque
By George Soros 

Published: September 24 2008 20:28 - Last updated: September 24 2008 20:28

Hank Paulson’s $700bn rescue package has run into difficulty on Capitol Hill. Rightly so: it was ill-conceived. Congress would be abdicating its responsibility if it gave the Treasury secretary a blank cheque. The bill submitted to Congress even had language in it that would exempt the secretary’s decisions from review by any court or administrative agency – the ultimate fulfillment of the Bush administration’s dream of a unitary executive.

Mr Paulson’s record does not inspire the confidence necessary to give him discretion over $700bn. His actions last week brought on the crisis that makes rescue necessary. On Monday he allowed Lehman Brothers to fail and refused to make government funds available to save AIG. By Tuesday he had to reverse himself and provide an $85bn loan to AIG on punitive terms. The demise of Lehman disrupted the commercial paper market. A large money market fund “broke the buck” and investment banks that relied on the commercial paper market had difficulty financing their operations. By Thursday a run on money market funds was in full swing and we came as close to a meltdown as at any time since the 1930s. Mr Paulson reversed again and proposed a systemic rescue.

Mr Paulson had got a blank cheque from Congress once before. That was to deal with Fannie Mae and Freddie Mac. His solution landed the housing market in the worst of all worlds: their managements knew that if the blank cheques were filled out they would lose their jobs, so they retrenched and made mortgages more expensive and less available. Within a few weeks the market forced Mr Paulson’s hand and he had to take them over. 

Covered With Losses

Hi all,

As I write this, I have been stopped out of my short position in GBP/USD, with total damage of USD $105. My total damage is 1.05%, where I have already reached my daily limit to risk my capital on. The image above is a snapshot of the statement in the account.

Let's look forward to a better trading day tomorrow.

Cheers. 

Market Call

After much thoughts as to how my market calls should be made in order to create the best effect and authencity, here are some details that I would like you to know:

1. All trades made on this trading account no. 77104 will be 'real' live trades.
   
2. A report in the format (shown on the right) will be reported on a weekly and monthly basis.
3. Trades and market calls made by me, are only for the purpose of reference, and is no indication for you to trade and follow. 
4. Entry and exit of trades may be in a matter of minutes, therefore, I would urge readers to follow them closely or to backtrack the results with the use of their charts for authentication of results.

See ya soon on market call.