Plan not to fail and fail not to plan

Although investment methodology is easy to understand , still people are looking for something impossible. All in all, it's just an open secret "Buy low sell and sell high".

Next you may ask is this a good time to invest? Well there is no absolute answer for that.

Let put in this way for each of us, we need a different strategy. This is because everyone of us is unique. We need to know our very own strategy to suit our own strengths and weaknesses.

Having 10 million to invest is entirely different from having only 100 thousand. For those Warren Buffet wannabe, wake up hun it is essential that we understand ourselves first before we start our investment.

We are not millionaire!

Part 2: How many money you have?

As I promise my readers on the previous entry, here you go the second part. Please tide your seat belt to find out more from untold mystery "The Truth Is Out There"..

We had being taught at school about mathematics, accounting, general knowledge just too bad that the teacher never tell us where the hell money come from. (This is because the teacher also don't know how to explain to us sigh)

It would seem natural, that the money is created by the Government, and in fact most Central Banks seem to be owned by the Government and run by it. I say "seem" because when the Government needs money, it does not order the Central Bank to credit some money to the treasury's account. The Government only has two ways to obtain money. One is taxation of it's citizen, the other is borrowing from the bank.

Okie. If you are still with me from the Part 1: How can the banks "create" money? That is a good question. Is it not the Government's printing office that prints all the banknotes?

Most of the time, we are misleading by the movie that the Government can simply printing money when they need to do so. As I mention early money is create by credit. When the Government need some cash credit either budget from taxation or borrow from privates (through the banker) and that is has to pay interest for this. That is why Governemt's Bond interest rate is alway chepaer than banker :p

Now we start to see why the Government never has money, and why much of our taxes go "off the top" of the budget, towards debt service. As a strong prove of my statement, the Government budget alway showing negative which means using future taxpayer's money.

The important thing to know: Money is created just by inserting some numbers into a computer.

To be continue...

Part 1: How many credit you have?

In today context, credit card no long a luxury however is a must. We pay our air-ticket, Internet bill, phone bill, housing loan, car loan, student loan, personal loan, Ikea or Courts furniture, Pak Tohing expenses and many more to be mention. Just take out your so call Plastic Credit Card and someone will swipe your card on a machine. The purchase transaction is done when you signed on the doted line. Wola within a minutes magic does happen between you the buyer, the retailer and the banker. When you walk out loaded huge carrier with "wind" all party are satisfy and happy. This is because you are given 5-10% discount for the rebate. On the other hand the retailer get profit of 30-40% depend on case to case basis. Finally the banker earn 3% for the service provided or even up to 24%p.a. if you are minimum monthly paymaster. Don't be too surprise this happen everyday and who know you are one of them. Here are the clip of Money As Debt:
Enjoy the clips ^^
1. Money As Debt 1: what money is & why we are bankers' slaves
2. Money As Debt 2: what money is & why we are bankers' slaves
3. Money As Debt 3: what money is & why we are bankers' slaves
4. Money As Debt 4: what money is & why we are bankers' slaves
5. Money As Debt 5: what money is & why we are bankers' slaves

Without beating around the bush, here is the hot potato: Money is being created not by our governments, but by a private monopoly run by the (private) banking corporations.

How many credit cards you have? The more the merry :p To be continue..

Baltic Dry Index

Wondering how many readers will give supportive feedback to me after reading the title above. This is just another index as a world's economy growth indicator. Nonetheless the chart is heading to North with a sharp decline. I dare not to put the graph up over here to avoid any panic to my readers. This index is closely followed by all Wall Street Insiders because it is a good indicator of economic growth and production. In a nutshell, the BDI reflects how much it costs to ship raw materials (like coal, iron ore, cement and soft commodities like grains and sugar) by sea. The level of this index is also impacted by fuel costs, fleet numbers and seasonality but if the index rises, it means that demand is generally strong causing other ports to be congested. In short, BDI has a very strong correlation against oil price. Well until here I bet you will understanding why I insisted not to put the graph :p

P/S: Please google BDI yourself for more info. Thanks to the Internet ya~

Long or short?

This had been long time never login after the last entry. Here you go my sharing about the financial cirsis happening around us.

Financial advisors are like any other profession; some are very smart and talented, whereas others border on the edge of incompetency. In the middle is a mix of people who generally do a decent job managing their clients' money.The problem in bear markets is that many individuals let anger interfere with rationale decisions. Rather than stick with strategies that have worked in the past (and have been proven to work over the long-term), many investors look for alternatives. Often these changes do more harm than good.As an analogy, the same thing happens with dieting. Individuals who lose weight and then switch diet plans when the pounds start to come back are likely to gain even more weight than those who go back to the diet plan that originally worked for them. Investing is no different. If a diversified portfolio comprised of fundamentally-sound stocks with rising earnings estimate and attractive valuations has worked in the past, why change the strategy now?Bear markets are painful, but they are also temporary. Remember, investing is about the long-term. So stick to strategies that have proven to work over the long-term.

Happy Birthday!

Is good to be a blessing to other people around. Well I would like to take this opportunity to show my appreciation to my fellow brother Dr Lee.
Thank You to your generously invited me to join you as a blogger. (though I'm a poor and lazy 1)
Thank You to your professional advise on my father sickness.
Thank You to your brotherly concern during our short period of fellowship.
Thank You to your sharing never out dated game "Spy & Killer".
Thank You to your unconditional friendship lending to me.
Thank You to your photo shooting skill capture my vivid memories with love one.
Thank You to your sharing with me regarding insurances protection vs investment.
Thank You to your good example showing to us as Spiritual Elder.
Thank You to your godly leading in the cell. (never have chance to join you)
Thank You God I have you walk through my life with your very own creative ways.(yy said a very skillful friend to hint his friends he is getting older)
Haha cheers!

P/S Happy Delayed Birthday to my dear friend 'Little Weapon' on 26th.

Salute - I Love My Country

I must be admit sometime copycat is alright when doing for good deeds.



Origin from click here.

Important Investment Tenets

1. According to Warren Buffett, invest only in a business you understand, and not in companies you hear about at the hairdressing salon or at parties. If you don't know what the company does, then don’t invest. It's your hard-earned money. Do a little homework and research on the company in which you are planning to invest. There’s a plethora of free information and tools on the web to help you.

2. Buffett also believes in buying cheap. Sometimes the notion of cheap and expensive in the stock market is far from clear. In a bull market, the value investor could easily find himself or herself with nothing to buy. But opportunities are always out there. Think about it, if you shop around for the best prices on most things, why wouldn't you do the same with your investments?

During a period of stockmarket decline, Buffett was quoted as saying:

"I find nothing frightening about it at all. If I own a good business, I don't really care whether the markets open tomorrow …. I have no idea what business is going to do next month or next year ….. I don't think it's important whether you're confident about tomorrow or next week."

Buffett’s confidence comes from taking a long-term view of the economic fundamentals:

"If the economy does well over a long period, markets will do well over a long period. In the short run, the market's a voting machine and sometimes people vote very unintelligently. In the long run, it's a weighing machine and the weight of business and how it does is what affects values over time."

Moral of the story: Learn to buy a stock like you are buying the entire business. Do not let market emotions overcome you, and buy on the assumption that the stock market is going to be closed for the next 5 years.

Do not think that you can buy the lowest and sell the highest

Let’s say you start by investing $10,000 in the stockmarket and achieve an annual compound return of 30%. At the end of 10 years you will have a tidy sum of $138,000. Of course, if you were the average investor, you would probably think returns of 30% in the stock market are impossible over a long period of time.
Well, when you read about Warren Buffett you will see that he has been averaging around 30% in the stock market not for 10 years, but for 47 years! Not only that, he has been doing it with conservative, long-term investing.
Many people have tried to study Buffett’s investment techniques in detail. While Warren Buffett has written extensively on his general principles and methods, he has written almost nothing about the specific details. To invest successfully over the long term, it is imperative that we understand some of the key principles of long term investment through the experience of “the world’s greatest investor”.

MAS: Notes with "KF" marking have no value

The Money Authority of Singapore (MAS) says the $50 notes with the letters "KF" marked on them are considered to be deliberately mutilated and they command no value. According to some source, the letters "KF" which appear to be marking stamped onto the note, are not part of the design of the $50 note. Please don't be panic when you are lucky or unlucky getting some "KF" marked note during daily grocery shopping. However you are advise to bring them to the banks for one-for-one exchange. Just wondering is "KF" note correlation to KFC whereby the "C" for chicken eaten by hungry ghost. Hmmm..

Where Are You??

Mas Selamat bin Kastari where are you?
A massive security dragnet has failed to catch you indirectly cause a major setback that diminished Singapore's reputation. Please tell us where your hiding place is. I’m strongly believed you just have learned this to survive for so long if you are still in the jungle somewhere in Singapore.

Do you know that everybody is searching for you? And your picture is putting up around our neighborhood as such transit link, bus interchange, subway or even our lift main exit at every block. Although we are tired to blog about you, the causeway between Johore Bahru and Woodland have been jammed up to 2 hours or even worst for lorry driver because of you good work.

Hey naughty boy you have been playing hide and seek with the Singapore Police Force one and a half month since you escaped from detention on 27th February 2008. Dude Singapore is not a fugitive's playground for you. When you will get tired and back to your iron bar?

My Ultimate Idol - Warren Buffet

There was a one-hour interview on CNBC with Warren Buffet, the world's richest man who has donated $31 billion to charity. Here are some very interesting aspects of his life:
1) He bought his first stock share at age 11 and he now regrets that he started too late!
2) He bought a small farm at age 14 with savings from delivering newspapers.
3) He still lives in the same small 3-bedroom house in mid-town Omaha, that he bought after he got married 50 years ago. He says that he has everything he needs in that house. His house does not have a wall or a fence.
4) He drives his own car everywhere and does nothave a driver or security people around him.
5) He never travels by private jet, although he owns the world's largest private jet company.
6) His company, Berkshire Hathaway, owns 63 companies. He writes only one letter each year to the CEOs of these companies, giving them goals for the year. He never holds meetings or calls them on a regular basis.
7) He has given his CEOs only two rules. Rule number 1: do not lose any of your shareholder's money. Rule number 2: Do not forget rule number 1.
8) He does not socialize with the high society crowd. His past time, after he gets home, is to make himself some pop corn and watch television.
9) Bill Gates, one of the world's richest man met him for the first time only 5 years ago. Bill Gates did not think he had anything in common with Warren Buffet. So he had scheduled his meeting only for half an hour. But when Gates met him, the meeting lasted for ten hours and Bill Gates became a devotee of Warren Buffet.
10) Warren Buffet does not carry a cell phone, nor has a computer on his desk.
11) His advice to young people:Stay away from credit cards and invest in yourself. Remember money doesn't create man but it is the man who creates money.Live your life as simple as you are.
Don't do what others say, just listen to them , but do what you feel good.
Don't go on brand names, just wear those things in which you feel comfortable in.
Don't waste your money on unnecessary things; just spend on what you really need.

Hard Political Work

Last week my home country officially kick off election campaign marked the start of a 13-day campaigning period ahead on the March 8 ballot this coming Saturday. It's a five years a time kinds of big event for some of the big shoot to show their abilities. Popularity does play a part as the majority of the public vote for their dummy nation's leader.

As for this year, hundreds of political heavy-hitters and first-time aspirants filed their nomination papers to contest 222 parliamentary constituencies and 505 state legislature seats.
In case you haven't check your status for this time round event please do your last minutes check at http://daftarj.spr.gov.my/daftarbi.asp

Wrap up with this before endding this entry:

"My uncle ran for parliamentary constituencies last year."

"Really? What does he do now?"

"Nothing. He got elected."

Be a wise voter!

Even the dregs of society also have thier dreams

You must certainly remember this two golden rules until the fear of death takeover your life.

First, never ever forsaken your dreams even the dregs of society also never. They also dreams to be the best among all the dregs. Moreover we are far more better than them.

Secondly, do your best!

"In city of liveliness, there has a lot of trash which ultimately collected at trash collection whereby the city does not want. Therefore, who said trash has not been useful?"

This is a statement copy from a Korean's sitcom that a school teacher encourage her student to do whatever they like in future irregardless of attending University's education.

Four of her students graduated respectively have their different destiny. There is called real life after graduated. No matter how tough it will be, as long as we do our very best which own likes it's worth to chip in our effort.

Ask oneself, I have no regret for whether I have achieved so far. How about you, my friend?

Why my bussiness loan application get rejected???

There is a hundred thousand of reason to reject a loan application. One of the most common reasons is burst DSR. Some may wonder what DSR means is over here. Well it is just another abbreviation of Debt Serving Ratio. As a normal applicant the maximum DSR is not more than 75%.

Another common reasons credit operation using to reject an application may sound funny but it is true. Low credit bureau score or fails credit bureau score which means the applicant is not a good payment in all credit repayment.

A consumer credit bureau is a repository of factual information on the credit application and repayment records of consumers only. A credit bureau provides this information to its credit providers (banker), under authorized conditions, to help them to determine whether or not the person applying for credit is likely to repay. In doing this, a credit bureau helps lenders to make better lending decisions quickly and objectively. It also guards against fraud. Credit bureaus are a common feature of developed countries around the world, and this concept is not unique to Singapore.

Recently I’d a customer with CBS (again abbreviation) as low as 50. In another words he is consider bankrupts and black listed by banking sector. Normal credit bureau score is about range from 189 to 210. And my score definitely more than 230!

This means that the more credit you are using the lower is your CBS. The lesser credit card you hold on hand the higher chance you get out of rat race. So my dear friend, only spend under your means because the banker always win!

How to get rich?

If you’ve ever wondered how the rich get so obscenely rich, it’s not because it’s in their blood or because they attend the best schools. The reason is much simpler than that. You see, while you work hard for your money, rich people make their money work hard for them; they have the power of Passive Income!



There are three types of income - earned, portfolio and passive income. Most types of passive income are derived from real estate/property, while other types of passive income are derived from royalties from patents or license agreements.An income stream falling into passive income category is one where money is received usually on a regular basis, without continuing effort. This does not mean no effort at all; most passive income streams require great effort to start with.



Some Examples:
Automated web business.
Interest Income paid from bank deposits.
Rental income from real estate/property.
Royalties from writing a book.
Dividends from shares holding.
Selling digital files like software / ebooks or scripts or offering a service that doesn't require the merchant's intervention. In these cases, PayPal IPN may be used to achieve this.
Network marketing.
Have fun choosing your favorite way to financial success!

Why my housing loan application got rejected???

I believe there are more than a handful of people out there who have the same question on their mind when their housing loan applications got rejected by the banks. But how many actually know what goes on behind the scene in credit processing?Besides the normal credit checks, banks have a standard procedure to calculate your Debt Servicing Ratio (DSR) to check if you meet their internal criteria. i have summarized the steps require to tabulate the DSR (may differ from bank to bank):

Scenario:
Client A (40 yrs old) would like to buy a freehold private property with indicative value of SGD 1,000,000. He is planning to take a loan from the bank for 20 years. He has a CPF lumpsum of SGD 350,000 sitting in the OA account after working for many year. He also have FD Savings of SGD 200,000 with a bank. He has a outstanding car loan where he pays a monthly installment of SGD 700, and a monthly installment of SGD 300 on his Credit Card. If he earns $4,500 gross employment income every month, will his loan application be approved (for 80% financing package)?

Step 1:
Calculate Stamp Duty requirementStamp Duty
Calculation:
1st $180,000 – 1%2nd $180,000 – 2%Subsequently – 3%
For property worth more than $360,000, you may use the following short cut formula:
Stamp Duty = Property value * 3% - 5,400
For Property Value @ 1,000,000Stamp Duty= 1,000,000 x 3% - 5,400= 24,600

Step 2:
Calculate Maximum Loan Amount (80% financing)
Private Property VL = $1,000,000
Maximum loan amount = $800,000

Step 3:
Calculate Monthly installment for the loan after deducting CPF lumpsum
CPF lump sum available = $350,000
FD = $200,000
Stamp Duty = $26,400 (use CPF to offset)
Nett CPF available to use = $323,600
Loan Tenor required = 20 yrs
Income = $4,500 (Gross)Car Loan = $700
Credit Card Monthly
Installment = $300Generic 80% loan package @1 yr 3.50%2 yr 3.75%3 yr 3.98% (normally banks will take the largest to calculate)
Actual loan required= $1,000,000 - $200,000 (FD) - $323,600 (CPF Lumpsum)= $476,400 (less than 80% - ok )

For 20yr loan @ 3.98%, monthly installment:Loan required (PV) = $476,400
Tenor (n) = 20 x 12Interest (i) = 3.98/12
Compute montly installment (PMT) = $2881.87 (require amortization)

Step 4:
Calculate DSR (most bank uses 40% as benchmark)
Total Current Liabilities = $2881.87 + 700 + 300 = $3881.87
Debt Servicing Ratio (DSR)= Total Current Liaibilities / Total Gross Income= 3881.87 / 4500 * 100%= 86.26% > 40% (Loan will be rejected)

Options:
1) Get one Joint Applicant with income > $5204.68 (3887.87/40% - 4500)
2) Reduce loan amount
3) Increase loan tenor + joint applicant

Note: Most banks have age limitation on the applicant; they restrict the maximum age of applicant after the expiry of the loan to be at 65 years. In above scenario, Client A will be 60 years old after the loan expires, thus still within the age limit. Take note that legal fees not taken into account.

Save Now Not Later

When should one start saving?

Check out the follwoing examples to find out:
Scenario 1
Ali, 20 years old, saves $100 per month @ 5% p.a.
At 40 years old, Ali would have contributed $24,000, and earned an interest of $17,275

Total Savings = $24,000 + $17,275 = $41,275

Scenario 2
Billy, 30 years old, saves $200 per month @ 5% p.a.
At 40 years old, Billy would have also contributed $24,000, but only earned an interest of $7,186

Total Savings = $24,000 + $7,186 = $31,186

By delaying your saving plans, the same amount contributed would result in significantly lower returns!

Lesson of the day get a higher yield of return for your money. Let your money works harder for you.

Thought of the day - Winner VS Loser

The Winner Loser is always part of the answer;
The Loser is always part of the problem.

The Winner Loser is always has a program;
The Loser always has an excuse.

The Winner Loser says,"Let me do it for you;
The Loser says;" That is not my job."

The Winner Loser sees an answer for every problem;
The Loser sees a problem for every answer.

The Winner Loser says," It may be difficult but it is possible";
The Loser says,"It may be possible but it is too difficult."

When a Winner Loser makes a mistake, he says," I was wrong";
When a Loser makes a mistake, he says," It wasn't my fault."

A Winner Loser makes commitments;
A Loser makes promises.

Winners Losers have dreams;
Loser have schemes.

Winners Losers say," I must do something";
Losers say,"Something must be done."

Winners Losers are a part of the team;
Losers are apart from the team.

Winners Losers see the gain;
Losers see the pain.

Winners Loser see possibilities;
Losers see problems.

Winners Losers believe in win/win;
Losers believe for them to win someone has to lose.

Winners Losers see the potential;
Losers see the past.

Winners Losers are like a thermostat;
Losers are like thermometers.

Winners Losers choose what they say;
Losers say what they choose.

Winners Losers use hard arguments but soft words;
Losers use soft arguments but hard words.

Winners Losers stand firm on values but compromise on petty things;
Losers stand firm on petty things but compromise on values.

Winners Losers follow the philosophy of empathy: "Don't do to others what you
would, not want them to do to you";
Losers follow the philosophy, "Do it to others before they do it to you."

Winners Losers make it happen;
Losers let it happen.

Strike off losers.

Source Unknown

Room for Improvement

We always keep repeating the above phase from our mouth without any intention. Just wondering how many of us knowing the meaning of that common phases. Who will border about this unless this will feed our stomach. But who not cares?

Somebody throw out a few sentences to impress me by saying:
"Room for improvement is some kind of motivation for loser."Hurray!!
"Some kind of room or space that you can stretch to."(bullshit)
"Your form teacher's comments on your year end scorecard."
"A drive to self-motivation to be a better person."
"An excuses for poor performer to perform better next year."
"For whatever reason it is just mind your own business."!!@#$%

Well there is no standard answer for a common question. As long as you are happy with it just stick to your very own answer. By the way, what is the different between 95% and full mark? I rather be a 95% perfect than 100% as we know achieving is easy but hard to preserve.

What is 5% for???

I hate I want room for improvement! Did I mentioned I'm a loser?
p/s: However there is absolute case for religion related issue.

No $$ No Talk

Did anyone wonder the origin of money?http://en.wikipedia.org/wiki/Money

How to ask your Boss for a salary increase..?

One day you send a letter to your boss asking for an increase in your salary!

Dear Bo$$:
In thi$life, we all need$ome thing mo$t de$ perately. I think you$hould be under$tanding of the need$of u$worker$who have given$o much$upport including$weat and $ervice to your company . I am$ure you will gue$$what I mean and re$pond$oon.

Your$ $incerely,


The next day, you received this letter of reply :

Oh my dear:
I kNOw you have been working very hard. NOwadays, NOthing much has changed. You must haveNOticed that our company is NOt doingNOticeably well as yet. NOw the newspaper are saying the world`s leading eco NOmists areNOt sure if the United States may go into a NOther recession. After theNOvember presidential elections things may turn bad . I haveNOthing more to addNOw. You k NOw what I mean.

Yours truly,
Manager

The New Beginning

After being so many years of blog reader, finally I have my every own blog space. Don't judge me for I'm not a lazy person. Just that enjoy reading others people blog. Never think of this day will happen to me and the feeling are so superb. I bet you will sense my happiness if you are blogger too.

Here is the story of the new beginning 2008

Well not long ago I had taken up an offer from Standard Chartered Bank as Business Development Executive. Isn’t sound great the title? Actually it has a very sinful nick call 'legal loan shark'. *wink* Leaving my previous employee is not an easy decision. It's took me 2 months to consider the pros and cons. After all working three years with same colleagues at Metro is my most memorable working life in Singapore. However, life is still going on.

It's really stretch my confident to the highest level. As I'm quite satisfy working within my comfort zone. Out of the sudden, a revelation from above came upon me "Don't play safe - risk and you will be rewarded". He will alway give me guidance when all thing look like in the midst. And I'm alway grateful for this. For it is with your heart that you believe and are justified, and it is with your mouth that you confess and are saved. (Romans 10:10)

I'll try my best to up-date this blog as frequent as possible. Hope you enjoy my virgin entry. Until then, see ya!