The Switzerland of Asia Shines
In many respects, Singapore is the Switzerland of Asia.
Begun in 1819 as a British trading colony, the Republic of Singapore was founded in 1965 under the leadership of the current Prime Minister’s father, Mr. Lee Kuan Yew. While it is only 1/5 the size of Rhode Island and three times the size of Washington D.C., it is perhaps the most strategically important global trading, finance and service nexus in Asia.
Here is why you should consider investing in Singapore.
While Hong Kong and Shanghai will argue, Singapore is the busiest port in Asia situated next to the vital trading channel, the Straits of Malacca.
Unlike South Korea and Taiwan, which are heavily dependent on the cyclical electronics industry, Singapore has a well-diversified economy. 70% of its GDP is attributable to finance and services.
Singapore’s accounting rules and regulations are amongst the most conservative in the world. For example, its rules on inventory accounting and the expensing of stock options are more conservative than those in the United States.
Trade Surplus
Despite only 1.6% of its land being suitable for agricultural activities and having to import almost everything including water, Singapore manages to have a trade surplus.
Use this Simple Trick its to Buy $100 Bills Direct from your Bank for only $97
Most People just don’t understand the power of using their home as a Wealth Creation Tool. How many people do you know who have lived in the same house for 10, 15 or more years and have virtually no mortgage, You know the Type ‘House Rich Cash Poor’. There are strategies these homeowners can use to put that House Rich Part to work Building Wealth.
Did you miss the Going out of Business sale at the Bank Last Week? They were selling $100 bills for only $97. Darn you missed it. Ok the Bank didn’t have a going out of business sale but if they did how many $100 Bills would buy? I’d back up the SUV to the bank and see how many Bills I could get in and then go back for as many Trips as I could. Your Bank is Selling $100 Bills for $97 Back up the SUV.
The Equity in your Home is like that Bank. If you Qualify you can Borrow money at 2% or Less and turn around and Achieve Returns of 5% or More fairly safely with Equity Indexed Annuities. In Most cases the money you borrow is Tax Deductable while the money you place in the Equity Indexed Annuity is Tax Defered.
Chinas Inscrutable Currency Strategy
Purpose: Expose Opportunities for Smart Investors
The move by China’s central bank to drop the yuan’s rigid peg to the dollar on the day of my return after a three-week trip to Asia left a host of questions unanswered. The basket of currencies that will allegedly determine the value of the yuan going forward was not disclosed. What sort of band the currency will be allowed to fluctuate within is not at all clear. The 2% revaluation in the currency on Thursday followed by a slight strengthening on Friday week may actually encourage further short-term speculation since most economists believe the yuan is undervalued by roughly 10% to 20%. With $1 trillion of trade transactions each year and hot money capital inflows equivalent to 5% of its GDP, the uncertainty concerning the Chinese currency is high.
Not In the Mainland
In the near term, this uncertainty gives investors an opportunity to benefit not just from the expected strengthening of the Chinese currency but the overall rise of Asian currencies against the dollar. In early 2005, I advised clients that the Euro’s rise against the dollar was over and that Asian currencies would be the next area to appreciate versus the dollar. It may turn out that many of your best China investment options don’t involve investing in mainland Chinese companies at all.
Chinas Great Missed Opportunity
While a U.S. Representative to the Asian Development Bank Executive Board of Directors during the first Bush Administration, I consistently called for China to "bite the bullet" and privatize its state-owned companies as soon as possible. Representatives from European and other Asian countries would just shake their heads and mutter about impatient Americans while counseling that China adopt a slow, incremental approach to privatization.
Here we are more than twelve years later and this bullet has turned into a time bomb that could derail China’s impressive economic growth and a better life for its people. The fact that a majority of China’s large companies are still owned and controlled by the Chinese government has three negative economic consequences.
First, it has stunted the growth of China’s financial markets and prevented many companies from tapping equity capital markets. Almost 70% of the shares of China’s 1,377 listed companies are substantially owned by the state and cannot be traded. This is the dreaded "overhang" which bedevils the Communist Party leadership and bureaucrats anxious for private Chinese shareholders to have share prices mirror economic growth. The Shanghai Composite Index recently dipped below 1,000 for the first time since 1997. The problem is that when the government sells these shares, private shareholders are diluted and share prices decline. The use of public funds to compensate private shareholders for this dilution has been considered and rejected as too expensive.
The High Price of Oil
In less than four years, the price of oil has risen about 300%, or over $50 a barrel. The Light Crude Continuous Contract (of oil futures) hit an all-time high at $67.80 a barrel Friday, and closed the week at $67.40 a barrel. Persistently high oil prices will eventually slow economic growth, which in turn will cause oil prices to fall, ceritus paribus.
The two charts below are same period daily charts of SPX (S&P 500) and OIH (an oil ETF, which is a basket of oil stocks). Over 15% of SPX are energy & utility stocks. The two charts below show SPX started the recent rally about a month before OIH. Also, the charts imply, non-energy & utility stocks fell over the past week or so, while energy & utility stocks stayed high or rose further.
SPX held its 10 day MA until just over a week ago, while OIH continues to hold its 10 day MA. The Parabolic SARs (red dots) indicate SPX is on a sell signal, while OIH continues to maintain the buy signal. SPX would need to rise to about 1,242 3/4 to trigger a buy signal, and OIH would need to fall below 115 3/4 to trigger a sell signal (see upper left corner of chart).
How to Buy to Let
Find out everything you need to know about buy to let. Learn what to buy, where to buy and what not to buy. All this information about buy to let won’t cost you a penny.
buying
? If the area is full of buy to let property investors the supply of property to let might outweigh tenant demand and create pressure to reduce rents.
? Consider established areas with good communications links
? Research tenant demand as your highest priority. Find a letting agent to discuss this.
? Consider ongoing costs, e.g. maintenance, service charges etc.
? Be prepared to buy tired investment properties and refurbish them.
? Build a team of reliable tradesmen so that you can react quickly.
? Find a good buy to let mortgage provider. Finding the correct buy to let mortgage is crucial to your success when you are buying and selling investment property.
To Buy or Not to Buy an investment property for sale?
? As soon as you find a property you would like to buy, run a To Let advert in the local press. If the phone rings a lot buy it. If not walk away.
Investing Psychology Today Requires All Traders to Awaken Their Speculator Minds
Stock trading strategies are as rampant today, as they were during the Great Bull Market. Yet, can you truly master the stock market like so many investing books propose?
Consider this: When you can’t even trust the financial reports of analysts, and the company bean counters that feed them with data, how can you? What’s needed are robust, stock trading strategies; the type that enables you to think above the crowd, but not apart from them! The kind of strategies in touch with your speculator mind response!
Witness the Enron fiasco. It is a classic case of corporate character gone sour. The accounting firm that assigned to do the books also got paid to advise. Even the board members failed in their fiduciary responsibilities to guard and plead the cause of the stock holders. Result: The crowd got lied to and cheated!
That’s what causes many to follow technical analysis whereby the fundamentals are considered reflected in the market action, and leads the investors to never have to trust anything beyond the tape itself. So, what if you developed a dynamite system that would track such reflections? Would that be sufficient?
Investing in Car Dealerships: How to Do It Right
The financial characteristics of the automobile dealership are attractive:
". . . moderate growth and risk and high returns. Franchised new car dealer revenues have grown at a 7.2% annual rate since 1992, about twice the rate of GDP. Moreover, this growth has come with only moderate risk, as the dealer body didn’t lose money (on a pretax basis) for a single year in the last twenty ? even during the 1989-1991 industry down-cycle. Finally, despite major changes in the auto industry’s structure, dealer returns have remained high, with pretax ROE averaging 26.1% over the last twenty years". [MerrillLynch, April 19th, 2004 Report on "Automobile Dealers".]
Athletes from almost every major sport have invested in new car dealerships: Rick Hendrick, Roger Penske, John Elway, Troy Aikman, Evander Holyfield, Arnold Palmer, Michael Jordan, Scottie Pippen and Alex Rodriguez to name a few.
The idea isn’t new. Johnny Lujack, 1947 Heisman Trophy winner and Chicago Bear Pro-Bower, started a business in 1954 that would eventually expand to 16 franchises; spread over 40 acres, with sales of over 10,000 vehicles and $150 million, per year. Lujack retired from the auto business after almost 50 years as a successful dealer.
Investing in Car Dealerships: Doing Your Homework
This article attempts to help give the investor a broader basis upon which to decide whether a dealership merits their time, money and attention.
Interviewing Factories and Financial Institutions
Lenders have an affirmative duty not to promiscuously disclose the financial condition of their debtors. In addition, most Sales and Service Agreements contain confidentiality agreements, with respect to the unauthorized disclosure of a dealer’s business. Consequently, questions directed to factories and finance companies should be limited to pertinent, non-confidential questions.
The Buyer’s Responsibilities
230 Kan. 684, 640 P2d 1235 held that not only was a bank under no duty to disclose information to a borrower intending to purchase a dealership, but that the investor could not avoid responsibility of exercising reasonable diligence for his own protection. See too: 387 NW2d 373 (Iowa) and 773 F2d 771 (7th Cir.) A buyer may not abandon all caution and responsibility for his own protection and unilaterally impose a fiduciary relationship on another without a conscious assumption of such duties by the one sought to be held liable as a fiduciary. 724 SW2d 343
Finding False Gold in Penny Stock
As far as traders go, many do not see the penny stock as a solid way to do business. Many believe that dealing with penny stock is a risky business. And it really is. Some traders think that the next Microsoft and Walmart stock is buried in a penny stock, which is why they stick around trading unknown stocks over the market.
What is a penny stock? According to the Securities and Exchange Commission (SEC), any stock under $5 is a penny stock. Definitions can vary; some set the cut-off point at $3, while others consider only those stocks trading at less than $1 to be a penny stock. What makes a penny stock risky? Certain issues must be considered before you decide to buy a penny stock:
1. Lack of Information Available to the Public - the key to any successful investment strategy is acquiring information to make informed decisions. In dealing with penny stock, information is much more difficult to find. Much of the information available about a penny stock is typically not from a credible source.
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