Tuesday, July 03, 2007
Stock Market Criminals – NATO, No-Action-Talk-Only
The recent accounting irregularities could be the climax (or more to come?) as far as Malaysian corporate and stock market scandals are concern, at least within the tenure of Prime Minister Badawi. The crisis definitely has put the country in the global map, for the wrong reason obviously. So when Badawi issued the warning yesterday, 2nd July 2007, it didn’t actually raised my eyebrows simply because the contents of the speech lacks the main ingredients and juices to prevent such shameful incidents from happening again.
First of all, it’s disappointing to note that the prime minister, being the Finance Minister himself (yes, Malaysian prime minister holds more portfolios than any other premiers or presidents in the world) took such a long period to come out and express his concern on such an important crisis, not that the premier has other more critical issue on hand. Such a slow response reflects badly on his leadership as it’s a known fact that the rest of the government agencies only accelerate when there’re enough pressures from the man who walks the corridor of power.
Secondly, Badawi warned that the law will come down hard on those who violate the securities laws, a statement which could be constructed as a lame and normal statement which has been issued everytime crisis or incompetency occurs. Investors who have been long enough in the country should know that the warning will just dies off given time.
Thirdly, the prime minister said the regulators will maintain close surveillance to ensure rules are observed. He further added the government would continuously review and tighten existing regulations to deter corruption, graft and fraud. While the flowerish statements look good on newspaper, he stopped short of hinting for a severe punishment such as putting the top management of the listed companies who were happily cooking the accounting books on charges and be jailed as a deterrent to other potential culprits.
On the fun notes, Badawi said the Transmile Group Berhad (KLSE: TRANMIL, stock-code 7000) and Megan Media Holdings Bhd (KLSE: MEGAN, stock-code 7101) troubles are a timely reminder for everybody that integrity and good corporate governance must always be an ongoing effort with transparency and openness remain the best deterrent against corruption and fraud. The fact remains that top management of listed companies are normally immune from all possible corporate criminal charges (they’s criminals, aren’t they?).
The first no-brainer thing to do, if the premier is seriously concern about maintaining investors’ confidence in the country stock market, is to separate and make the judiciary independent from the executive’s power. Currently, the “Judiciary Pillar” is part of “Executive Pillar” and hence the judiciary couldn’t exercise their independent power on anyone found to have breached the law. And most of the top executives of listed companies are political-linked or has great influence to create a layer of immunity for themselves. A good example is Steel-Man Eric Acquitted - Are You Surprise?
How long do the minority shareholders need to wait for investment protection from the morons of public listed companies top executives?
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Stumble it!
Monday, July 02, 2007
Apple to Sell 1 million iPhones before end of 2007?
Since Apple Inc.’s (Nasdaq: AAPL, stock) iPhones launch on 29th June, everyone particularly stock investors are trying to estimate the number of the units sold as to gauge the successfulness of the revolutionary gadget.
StockTube rough estimate was that APPLE iPhone Sales Top US$100 Million on Day-1 based on 203,400 units sold. Today, Reuters reported that Apple Inc. had actually sold 525,000 iPhones at both Apple and AT&T Inc. stores. According to cnet.com, Piper Jaffray also estimated first-weekend sales of the iPhone at about 500,000, beating his original forecast of 200,000.
UBS analyst Ben Reitzes said, "Given strong initial demand, we continue to believe our unit estimates of 950,000 for 2007 and 8.1 million for 2008 could prove conservative.” Bloomberg reported about as many as 200,000 iPhones sold within first 24 hours in stores sales and the figure reached 520,000 by late Sunday after half of Apple's West Coast stores sold out.
However, JP Morgan analysts Bill Shope, estimates that Apple sold about 312,000 iPhones on Friday and Saturday. He further said “We believe initial demand may have been disappointing, but it's still early … We don't believe supply was much better than expected, so demand could be a bit light”
Tear-down specialist Portelligent (how I wish this is part of my job) opened up an iPhone, and estimated that it cost Apple $220 to make, making Apple's gross margin about 60 percent- high even by Apple's standards.
Everything seems to be going smooth and according to Steve’s plan except on hiccups whereby some new iPhone owners reported problems activating the device through exclusive carrier AT&T as the rush overwhelmed the company's servers. AT&T said it was working on fixing issues related to the delays.
Meanwhile Universal Music dropped a bombshell to Apple’s iTunes Store after the record label decided not to renew a long-term sales agreement, a move stemmed from tensions over song pricing and other issues. What a great timing to pressure Steve Jobs.
A check at iPhone availability check site minutes ago shows that iPhones aresold out at Nevada, Utah, Hawaii, and California stores. Washington, Minnesota and Florida stores are on the brink of sold-off as well. Going by the rate of the units sold, Apple could reach the 1 Million units target before even the end of 2007 (maybe end of the week dude), if the momentum is sustainable. So I’m long on Apple stock.
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MEGAN Overtook TRANSMILE for Gold Medal
In the race to see who is the greatest among all listed companies to be able to cook the most astonishing accounting books, it seems Megan Media Holdings Bhd (KLSE: MEGAN, stock-code 7101) might emerge as the winner after all, at least for now.
Megan Media Holdings Bhd, which reported accounting fraud at its subsidiary, posted a mind-boggling net loss of RM1.14 billion for the fourth quarter ended April 30, 2007, according to the unaudited results released on July 2. For the full year ended April 30, 2007, the net loss was RM1.26 billion compared with RM60.23 million net profits in FY ended April 30, 2006. Investigation however is still ongoing, according to Edge report.
In the meantime, Transmile Group Berhad (KLSE: TRANMIL, stock-code 7000), the runner-up for the gold medal in accounting irregularities in Malaysian stock market announced that it actually recorded net loss of RM369.56 million for the financial year ended Dec 31, 2005. So the figure is much higher than reported earlier.
While it’s no-brainer that investors should stay out of both stocks, the latest figure from Transmile does not augur well for Pos Malaysia & Services Holdings (KLSE:POSHLDG, stock-code 4634). I guess it’s true that it doesn’t matter who started the race fastest (Transmile was the heavyweight) but who finishes the line (seems the underdog Megan Media in this case) would be the ultimate gold medalist.
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Sunday, July 01, 2007
APPLE iPhone Sales Top US$100 Million on Day-1?
AppleInsider reported that Apple Inc.’s (Nasdaq: AAPL, stock) iPhones have largely been sold at AT&T’s (NYSE: T, stock) shops. AT&T reported on Saturday that the supply of the iPhones given for the launch just a day before had been “virtually” sold out completely. Apple’s own supply which had initially been healthy was also reportedly to be running low.
Claims are circling the net that the 1,800 strong AT&T stores received fewer devices compare to Apples’, making it logically to run out of stocks fast. Apple declined to say how many units have been sold throughout its own 162 US shops. Based on iPhone availability check, California was the hardest hit by the wave of customers with over 50% of stores' iPhones sold. Los Angeles, San Francisco, Miami and Las Vegas outlets are among some of the stores which have sold out all the iPhones supplied.
Some estimates put each AT&T’s store was given 50 units of iPhones while Apple Store was supplied with 500 units. Depending on city, some who were on the queue to purchase the gadget claimed there were about 800 people in the line, not to mention some of these people were seen buying two units each. So there could be a possibility that Apple Stores could have 1,000 units of iPhone stacked.
Simple mathematic will thus shows that AT&T could contribute about 90,000 units (assuming 50 units per store) while Apple Stores would have sold 113,400 units (assuming 700 units per store) giving a total of 203,400 units sold on Day-1. Assuming equal numbers of 4GB and 8GB of iPhones sold (although most of the customers preferred the 8GB), Steve Jobs had just made over US$ 111 million revenue for Apple Inc. in one-day. That’s pretty awesome.
Interestingly, most of the buyers who got their hand on the iPhone actually tried to make a fortune by selling it on eBay Inc. (Nasdaq: EBAY, stock). A search shows there’re over 12,000 iPhones are up for bid at eBay. You can get two units of iPhones for US$1400.
So, how would the stock price react if the official sales figure released top the above estimate? Your guess is as good as mine.
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MAHSING – A Must Have Property Stock in Your Portfolio
Talk about property stocks and Mah Sing Group Berhad (KLSE:MAHSING, stock-code 8583) will probably pop-up from everyone’s mouth. If you do not know this stock, chances are you’re living in the stone-age. It’s one of the darling stocks for property investors, and this stock has been blogged endlessly by bloggers out there. It was one of the low-profiled property companies until early this year when the spot-lights were aiming at the stock.
As for me, I don’t really have to dig much about this company to know that it’s one of the quality stocks to have in my portfolio (and so should you). Suffice to say thatMah Sing is one of very few property stocks which survived the 1997-1998 Asia Economy Recession without having to have a haircut (pity the barbers who couldn’t get any business from this fella). As the saying goes, if you can survive a crisis, you’ll emerge from it stronger than ever. And that’s precisely where Mah Sing is today.
Started as a plastic manufacturer in 1988 and ventured into property development sector (in 1994) building middle-range property, Mah Sing has transformed itself into a name synonym with quality in high-end products. Listed on Second Board of KLSE in Oct-1992, the company which was incorporated in Dec-1991 was transferred to Main Board in July-2004.
Two key projects
Property fanatics will tell you two dream-projects associated with Mah Sing, “The Icon” and “Southbay”. The Icon is a piece of architecture with Grade-A office development on Jalan Tun Razak in the heart of Kuala Lumpur with a target price of RM900 per sq ft. The group acquired a 23.25ha piece of land at the area with an estimated gross development value (GDV) of RM246 million in Oct-2006.
Southbay, on the other hand is the 34.7ha of land project in Batu Maung, Penang, which was acquired at the cost of RM 116 million recently. Targeted to be launched in the first half of next year (2008), the development of Southbay Penang is estimated to generate RM1.28 billion in GDV.
According to BusinessTimes, Mah Sing has also proposed to build a sea villa adjacent to the Southbay commercial development area since Penang attracts about three million tourists each year.
RoadMap
Mah Sing is exploring opportunities to tap markets abroad, especially in the Middle East and Vietnam, and has already spoken to some parties in the two countries. But the group is not in the rush for oversea expansion simply because it has 13 development projects mainly in the Klang Valley, Penang and Johor Baru, with a total GDV of RM3.9 billion, which is sustainable over the next seven years.
Currently, the group’s Klang Valley projects contribute 70% to revenue, with the rest coming from Johor. With the buzz of IDR, the group is scouting for land in Johor but the Mah Sing group managing director Datuk Leong Hoy Kum was fast to add that the group is studying how much value the group can create from the land and NOT the amount of land to have.
Corporate Exercise
The recent corporate exercise involving rights issue, share split and bonus issue will generate substantial amount of money for working capital and new development projects in the Klang Valley and Johor. The recent concluded one-for-four renounceable rights issue of up to 53.04 million shares at an issue price of RM3.30 per share had been over-subscribed by 56.24%. Together with the share split involving the subdivision of every one existing ordinary share RM1 each into two ordinary shares of 50 sen each, investors had gained good profit (if you’re a shareholder who benefited from the corporate exercise mentioned, you would know what I mean).
But that’s not all, the up coming bonus issue of up to 106.07 million new ordinary shares of 50 sen each on the basis of one bonus share for every five existing ordinary shares of 50 sen each could make you laugh a second time to the bank (depending on the market pulse). The ex-date for the bonus-issue is 5th July, 2007.
In summary, if you owned 1,000 shares of Mah Sing before the above exercise, you should have 3,000 shares ultimately. It’s a good move to bring the stock price to a more affordable level so that more investors can invest and potentially push up the shares price *evil grin*.
Fundamental and Technical Analysis
Since 2003, the revenue, net profit and shareholders funds have been on uptrend year-on-year. I particularly like the ROE (return on equity) whereby it has increased from 6% in 2002, 14% in 2003, 12% in 2004, 19% in 2005 and 21% in 2006.
Basic earning per share (EPS) – increased from 12.1 (2002), 16.6 (2003), 19.2 (2004), 33.3 (2005) to 43.9 (2006) sen. Mah Sing has been paying dividends from 2002 onwards till 2006.
Technically, the stock price has been on uptrend since early 2006 and the fact remains that it’s not easy to find similar stock which give you almost a 45 degrees chart-line. The stock price had appreciated about 165 percent since Feb-2006 and you simply have to give credit to the management for creating values to the company’s bottom line.
Looking forward, I’m pretty sure this stock will continues to perform and long-term investors would benefit from the prudent and competent management team.
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Friday, June 29, 2007
Hong Kong – 10 Years On and Nothing Change
It was as if only yesterday when Hong Kong became the Special Administrative Region of China. How time flies, it’s already 10 years since 1997 when Hong Kong was returned to the rightful owner, China. As Hong Kong prepares to mark a decade since Chinese rule, the local government's pulling out all the stops to make the celebrations a smashing success.
President Hu Jintao arrived here Friday at the start of three days of celebrations marking Hong Kong's historic first decade after returning to Chinese rule. The Chinese leader is expected to kick off his visit with an informal dinner with Chief Executive Donald Tsang on Friday before a packed weekend of events to mark the 10th anniversary of the handover on July 1.
Sunday's celebrations will be in stark contrast to those 10 years ago, when Hong Kong's former colonial governor Chris Patten fought back tears as the British flag was lowered for the last time, in the presence of Prince Charles and Britain's then Prime Minister Tony Blair. No foreign dignitaries have been invited to attend the carefully choreographed timetable of events. Instead, the events will celebrate Hong Kong's closer ties with the mainland, including the symbolic opening on Sunday of a new bridge linking Hong Kong with the booming southern Chinese city of Shenzhen, and the ceremonial raising of the Chinese flag on July 1.
Another highlight of the celebrations - 10,000 students from Hong Kong, the mainland, Macau and Taiwan will attempt to nab a Guinness World Record for the largest simultaneous percussion performance.
Many Hong Kong people talked about emigration since the the military crackdown at Tiananmen Square on June 4, 1989. Most people who can afford had migrated to popular destination such as Canada, New Zealand or Australia pre-1997, only to return later and found that Hong Kong was more or less the same after the handover, in terms of living standard, freedom, and many other areas. In fact the economy of China has great impact on the prosperous of the “One Country Two Systems” that majority of them have return to their hometown of Hong Kong in one way of another.
What about those people who had migrated out of Malaysia to elsewhere? If you’re reading this article, have you consider returning to Malaysia? If yes, what made you decided to do so at the first place? If no, why not consider coming back to your hometown?
How to become a Millionaire using MDV money?
It is so easy to get funding from Malaysia government, if you’re ambitious enough to become a millionaire. What you need to do is to prepare a fairy-tale proposal with a colorful promise that the local have the talents (don’t tell anything about importing foreign expertise, not that the government doesn’t realize it) to deliver world-class solution. The proposal has to be unique and you have to get a bumiputra participant in your overall plan. Voila, tens of millions would be deposited into your account. What would happen if things get screwed-up?Nothing, you read it right, in Malaysia nobody has ever been charged for being innovative in getting funding from Malaysia Debt Ventures (MDV) but didn’t manage to deliver it.
Such is the story (or rather “crisis” as reported by Edge) about online games publisher e-Games Global Sdn Bhd. It was reported that MDV had so far injected RM 61 million since four years ago but e-Games did not even succeed in its plan to set up the planned first English online multi-game portal. Formerly known as Terra ICT Sdn Bhd, e-Games is a joint-venture between Japanese technology-and-Internet-based solutions provider Terra Corp and Main Board-listed turnkey contractor Bintai Kinden Corp Bhd.
Terra Corp and Bintai Kinden hold 30% and 21% stake in e-Games, respectively. The remaining stake is collectively held by e-Games adviser and Terengganu exco member Datuk Abdul Latiff Awang and other individuals.
Sources alleged that following the disbursement by MDV to e-Games in late 2003,RM41 million was taken out of the company within two months (isn’t this a blatant and obvious case of criminal breach of trust or contract?). The money went to its major stakeholder, Terra Corp, in return for a binding contract for 60 game titles, while the remainder was then used to set up the online game portal.
Subsequently, e-Games has lost the publishing right of its money-spinning online game "RAN Online" to another online game publisher Gonzo Rosso Malaysia (Gonzo Rosso is the local arm of Japanese digital content powerhouse Gonzo Digimation Holdings KK). Interestingly the CEO of Gonzo Rosso is CS Chin who was the former COO (chief operating officer) of e-Games. Besides CS Chin, three other ex-senior management staff of e-Games had been alleged to commit cyber crime.
If the RM 61 million is not recoverable, will e-Games need to repay MDV for the loan? Even though MDV has a loan portfolio of RM1.6 billion, the money was actually borrowed from the Japan Bank of International Cooperation (JBIC). Will the country witness another untiring round of public money going into dustbin? You bet. So, what are you waiting for? Draft a creative proposal and put in all the required spices and you’re on your way to become another millionaire. It doesn’t matter if the proposed solution makes sense, you can even propose to make a better Challenger rocket traveling to Mars within two-years.
Blogging Comfortably with the Right Furniture
What do you do with the money you gained from stocks investing or option trading? Depending on the quantum of the gain, you might want to throw a small celebration, pamper yourself with great foods or probably think of buying some furniture to decorate your study or investing room.
Home and Living has one of the largest collection of Coaster Furniture. Coaster Furniture makes furniture for not only home office but also living room, baby furniture, youth furniture and other rooms. Every single item comes with affordable shipping so that you don’t have to worry about transporting the heavy furniture on your own back home.
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Squeezed by Tycoon - You should Squeeze IRD back
The longer I looked at the checks of Maxis Communications Berhad(KLSE: MAXIS, stock-code 5051) which I’ve received, the more I hate the way minority shareholders are being treated. Before Ananda was where he’s today, he sweet-talked the public into subscribing to his Maxis’s share (it wasn’t cheap then, mind you) so that he can use the shareholders’ fund to expand the business. And when he was in the comfort level making tons of money through his stake appreciation, he launched the privatization.
Secretly behind the curtain, he already secured Saudi Telekom (SAU: 7010) as the new buyer into 25% of Maxis for a whopping $3.04 Billion valueing each share at $16.40 while he forced the minority shareholders to sell the share at a pathetic $15.60 (exclude dividends) to himself. With a stroke of a bully-stick, he made more than 5 percent, instantly.
I’ve held to Maxis shares to the last minute and when other minority shareholders chicken out and decided to submit to Ananda’s command, the shares acquisition reached above 90 percent threshold. This prompted Maxis to be delisted on Monday, 25th June 2007. Hence I’ve no choice but to sell mine as well before the delisting. Due to the time constraints and the fact that the shares were being snapped up $15.40 in the open market, I decided to dispose mine at the same venue instead of the tedious way of filling up the form before submit it to the registrar.
Based on the dividend received, what can you do to earn some money out of it? Most of the shareholders who do not have huge portfolio normally do not care about dividends declared and received. But do you know that all dividends are being taxed to the maximum before leaving the left-over to you? They’re being taxed atmind-boggling 27 percent. So if your annual income falls below this bracket, you should declare it in your annual income-tax declaration. For example if your annual income is taxable only at 20 percent max, the Inland Revenue Department (IRD) should refund the 7 percent difference to you.
Can you imagine the extra amount of money you can gain back if your income is not taxable, not that I wish you belong to such a low income bracket, mind you?
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How to Compare Credit Cards Features
Either you’re a youngster who just graduated or a professional looking for a value-for-money credit card; you would be pampered (or bombarded) with tons of different offering from various credit card issuers. Together with multiple choices comes the difficult part in choosing which card actually suit you based on your priorities. Should Citibank, American Express, Bank of America, HSBC or other credit cards be your final option? How could you choose which one is which?
Your Credit Network has review information on Credit Card Offer which shows multiple features which you can research for your own use. The site offers easy rating in terms of points scored for numerous categories. For example, if you’re looking for low interest credit cards, you shouldn’t choose Citibank simply because the score rating is only 3.5 out of 5. Guess which card issuers who score the full 5 points? The Bank of America WorldPoints™ Platinum Plus™ MasterCard® Credit Card, Pulaski Bank Visa®/MasterCard® and MERRILL+® Card are the cards which have full scores.
When you click on the “Full Review” you’re presented with all the information such as:
On the other hand, you can get the comparison info from the site if you intend to get balance transfer credit cards which are ideal for the consumer looking to consolidate several credit cards onto a single bill. These cards are typically reserved for individuals with average to above average credit scores (transferring balances from one card to another will not have a negative effect on your credit rating). The MERRILL+® Card scores a perfect point in this category. You’ve a poor credit and wondering which card is for you? No problem, Your Credit Network has the right card for you under Bad Credit Credit Cards section.
The design of Your Credit Network site is simple yet with good navigation for consumers shopping for the right card. In fact, the combination colors used within the site are almost the same as StockTube. Recognizing the trend in blogging, the site provides Credit Card Blog that introduces various new cards launched or simply some tips and advices to card holders. You’ll learn what happens if the magnetic strip gets ruined, do you get credit for turning a payment on time or how does credit bureau conclude the scoring and many other tips. Too bad the blog does not allows comment or else consumer would be able to ask or contribute to it.
Overall, Your Credit Network provides the information required by everyone out there looking for a review on multiple credit cards with distinct features that is suitable for their taste.
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Thursday, June 28, 2007
Sumitomo Offered $1.5 Billion Deal by Malaysia
Kyodo News reported that Malaysia has offered Japan's Sumitomo Corp. (TYO: 8053) a $1.5 billion deal to lay a 700-kilometer long submarine cable which will transmit electricity from the Bakun hydroelectric dam in Malaysia's Sarawak State on Borneo to Peninsular Malaysia.
It was reported that Energy, Water and Communications Minister Lim Keng Yaik together with delegation comprise representatives of Malaysian conglomerateSime Darby Berhad (SIME: stock-code 4197) and state-owned utility companyTenaga Nasional Berhad (KLSE: TENAGA, stock-code 5347) met Sumitomo and made the offer during his recent visit to Japan.
The cable will run from Bakun in the interior of Sarawak, cross the South China Sea to Tanjung Lemang in southern Johor State that borders Singapore and link up with the Tenaga power grid on the peninsular. The plan for the undersea cable which has a capacity to generate 2,400 megawatts electricity had earlier been scrapped following the 1997 Asian financial crisis only to be revived again in 2003 by then Prime Minister Mahathir Mohamad.
The entire construction of the dam plus submarine cable project was estimated to cost 13.5 billion ringgit ($3.9 billion) in 1997 but recent local news reports have put the total cost now at between MYR16 billion and MYR17 billion. The question remains – does Malaysia really need to have such a huge electricity capacity considering the usage is only at 60% with excess un-used capacity of 40%? Obviously it’s another mega project to enrich certain political-linked companies shamelessly wasting public money again.
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Payday Loans – Cash Advance to Save Your Day
With current high living standard, our basic wages are simply insufficient to give us a comfort life. Of course luxury lifestyle is beyond most of employees who are employed in the general sector. With the pressure to deliver good quarter’s earning, most financial institution are pushing their mountain of cash to you to spend with the hope of tie you up as their customer and serve the interest plus the loan amount taken.
Welcome to the world of Cash Advance. Personal cash advance is perhaps the simplest way to obtain the cash to settle whatever your immediate problems. Nobody likes to be in debt as you would probably have sleepless night the moment you’re in debt. But if you’re so unfortunate to be in such situation that you desperately need short-term cash advance before your next payday, then you might want to scout for legitimate payday loans.
Some of the criteria to consider for payday loans include:
So, if you’re 18 years of age or older and a U.S. citizen, making at least $1000 per month, currently have a job and have checking or savings account, then you canapply for the payday loan. Personal Cash Advance does not obtain a credit bureau report to qualify you for a cash advance payday loan, so it does not actually check your credit rating. The only collateral is your job and paycheck.
Typically, consumers who applied for payday loans through the cyberspace are looking at short-term solution in the region of $100 - $500. Just like other businesses, the term for such method range from 4 to 18 days, coinciding with the subsequent next payday. If you’re in U.S. you should know that payday loans are the alternative to bouncing checks, personal property pawning or money-borrow from family or friends.
Despite all the bad perception about payday loan, it actually can help you to avoid late-payment penalties and negative credit ratings. However, it is advisable to only use payday loans if you’re facing real short-term cash shortfalls and not to rely on it as if it’s free-cash falling from the sky.
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Wednesday, June 27, 2007
June 29th – Apple iPhone's Judgement Day
June 29th 2007 – mark this date as it could be one of the most important day in the civilization of mankind, the revolutionary phone will arrives at the store near you (only if you’re in the States). The shipments of the iPhone from Asia (via a “Hong Kong-based air courier”) are accompanied by armed guards. It was such a buzz that when AT&T (NYSE: T, stock) and Apple Inc. (Nasdaq:AAPL, stock) announced the basic plan for iPhone yesterday, Tuesday, it generated headlines all over media and the stock took a plunge – the basic plan is $60 a month for 450 voice minutes, 200 text messages and unlimited Web browsing (ouch!)
At $500 or $600, depending on the amount of memory, the 4.8-ounce device is expensive by any standards – yet there’re people ready to queue to get hold of it,with sleeping bag, sleeping pad, camping chair, sweatshirt, sweat pants, and breath mints. Who can blame them? Remember when the video game addicts slept on sidewalks outside Sony (NYSE: SNE, stock) stores to be the first to buy the PlayStation-3? It was estimated that two-thirds of the population of the United States seem to be aware of the device.
Daniel Roberts, 27, a Web engineer, said he got three takers within hours of posting his offer to sit in line at the Apple store in San Francisco for $300. Such is the craze for the gadget and once in a lifetime for people like Daniel to makes pocket money.
Well, if you’re holding some shares which are in the profitable position, why not just take half of the money off the table. Alternatively, you can long the stocks by trading the option which has tons of time-value and wait for the next quarter earnings *evil grin*.
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Listed Co Not Trustable – Book-Cooking from Day-1
Iknew something wasn’t right when Hextar Holdings Bhd announced it was pulling out from the listing yesterday. Heck, why would someone just pull-out from the exercise that could potentially give you instant millions of dollars for your company? Something must be seriously wrong right? Furthermore Hextar told the exchange that it called off the listing to resolve tax matters that would affect its future performance. Noticed the highly sensitive word “tax matters”? What could come to your head when you read such news? Yet another accounting irregularity in the cooking pot of course.
If BusinessTimes exposure is anything to goes by, I’m sure you might wonder the effectiveness in the process of checking and verifying information submitted for the listing by Securities Commission (SC). Do you think SC is sleeping on the job again? I’m not amuze at all that it was an insider who actually blew the whistle into the ears of SC to wake them up. Can you imagine what could happen if the insider didn’t do anything at all and the listing was allowed to proceed and the accounting irregularity was found only after sometime down the road? The minority shareholders will sit along the shoulder of the road crying again.
Gratitude to insider whistle blower
According to the BusinessTimes, an anonymous letter tipped off SC officialswho called Hextar officials for a meeting a few weeks ago. The company then scrapped its listing on June 20, a day before the shares were due to be traded. The anonymous showed the sleepy SC officers step by step on how Hextar inflated its revenue, so detailed that it was definitely an insider blowing the whistle. I guess the insider already thought it will takes SC years to investigate how the accounting was inflated again, so might as well tell the SC the A-B-C on how it was done. SC should reward this insider for saving them tons of time to investigate, not that the SC is capable of discovering such a complicated matter.
Offenders let go and SC continues sleeping?
Hextar chairman and managing director Datuk Ong Soon Ho said he is unaware of such a letter “I don't know. Please call my PR (public relations) company. We've settled with the Bursa and SC. I think the issue is already closed”
But the SC has started a probe into the matter and said it would take action if necessary “The SC will review all circumstances surrounding the withdrawal and if any action is warranted, it will be taken"
Are you kidding me? Hextar already has laid the evil intention of cheating public’s money out of the inflated accounting figure, not to mention the company was also involved in the sale of illegal pesticides (according to the letter by insider). And the MD doesn’t blinks when he said the case is already closed? SC has just made matter worse by saying “if any action is warranted” only it will be taken. Goodness, the SC doesn’t think such an act is punishable and not serious enough to warrant the highest attention. Such statement could only encourage others to commit similar act. As long as you’re smart in inflating your figure and no whistle blower, you’re safe on your journey to make millions of public dollars.
Minority shareholders’ gatekeeper is toothless
Hextar would have raised some RM30 million from a public issue under its initial public offer. Major shareholders would have also made RM50 million from an offer for sale. All of the money would be returned to investors within 10 days, Hextar told the Bursa recently. Anyone care to question what will happen if this case was not discovered?
It happened before
In April 2006, Hospitech Resources Bhd called off its listing a day before the shares were due to trade - the funds were then refunded. In November 2006, the SC fined a Hospitech company director RM500,000 for falsifying revenue figures in its prospectus.
Doesn’t Looks Good
N
o matter which angle you take from such crisis, it doesn’t give a good projection to the business governance in Malaysia. Maybe if the stock market continues to plunge, StockTube might get the blame for such an article. Doesn’t it puzzle you that suchirregularities actually started from even “before” the company gets listed? Get real, would you like to have transparent and efficient authorities in safeguarding your hard-earned money or try your luck investing in stocks which you don’t have any idea whatsoever if the profit-loss figures are reliable? I would prefer qualities than quantities, don’t you?But then again, the authorities might just release a statement that says “Of well, if it can happen in U.S. it’s OK to have it in Malaysia.” Such is the pathetic mentality of the government as a whole in this country. Can you blame foreign investors for shying away from Kuala Lumpur Stock Exchange?
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Ananda Made Instant Profit from 25% Sold to Saudi
Immediately after Maxis Communications Berhad (KLSE: MAXIS, stock-code 5051) stocks stop trading on the stock exchange due to privatization, Ananda Krishnan found a new buyer for his cash-cow. Reuters reported that Saudi Telecom Co., the largest Arab telecom firm, is to buy 25 percent of Maxis in a $3.04 billion (11.4 billion riyals) deal to gain access to Indonesia and India, and complete south-east Asia's biggest buyout.
Saudi Telekom (SAU: 7010) said it would buy into Malaysia's largest mobile operator by investing in tycoon Ananda Krishnan's firm Binariang, Maxis Communications' biggest shareholder. The Saudi firm will also take 51 percent of Maxis's Indonesian unit and invest in its Indian network, 
getting access to 1.4 billion people in two of the world's four fastest growing mobile markets. The Saudi operator would consider increasing its stake in Maxis to a maximum 30 percent allowed in Malaysia, Chief Executive Saad al-Duweish said, declining to give the price it paid per share.
Earlier, Krishnan has teamed up with other Maxis shareholders to buy the 41 percent of Maxis they do not own in a $4.7 billion bid that priced the stock at 15.60 ringgit per share. Saudi Telecom, controlled by the government of the world's largest oil exporter, appears an ideal partner as the only Gulf Arab telecom operator with zero debt on March 31. Saudi Telecom has lots of cash which Maxis needs for operations that hold huge growth potential.
Based on the simple mathematic, 25% stake in Maxis should translate into $2.86 billion assuming Saudi Telekom is paying the same price Ananda paid for the 41 percent from the privatization which closed on Monday. So, Ananda made apaper gain of $180 million ($3.04 minus $2.86 billion) from the sale, a cool 6.3 percent instant profit. Not bad considering Ananda is free to buy and sell whenever he wishes to without have to go through the tedious process of getting approval. But is that what he wants from the privatization? I doubt so, this tycoon definitely has better evil plan for Maxis.
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Tuesday, June 26, 2007
Steel-Man Eric Acquitted – Are you Surprise?
Tycoon Tan Sri Eric Chia Eng Hock was acquitted on Tuesday by the Sessions Court of the criminal breach of trust charge brought against him more than three years ago. Chia had been charged with misappropriating RM76.4mil from Perwaja Rolling Mill and Development Sdn Bhd in his capacity as its managing director at Level 13, Menara UBN at 10 Jalan P. Ramlee on Feb 19, 1994.
He was alleged to have dishonestly authorised a payment for the sum to the account of Frilsham Enterprise Incorporated with the American Express Bank Limited, Hong Kong, for technical assistance provided by NKK Corporation Japan for the “Beam and Section Mill Plant project” in Gurun, Kedah, when in fact no such payment was due to NKK Corporation.
How the saga started?
Everything started when the former Malaysian premier Mahathir asked Eric, his close associate, to
take charge of the ailing industrial steel giant in 1988. Former Finance Minister Anwar Ibrahim once confirmed in parliament that the steelmaker had racked up debts of $975 millionunder Chia's stewardship. Unofficial numbers, based on figures reportedly derived from an earlier company audit, put the debt at closer to $2.3 billion, while oppositionists have claimed it may reach $3.9 billion.The plant, located in the northeast state of Trengganu, had to depend on a largelyuntrained, strongly conservative workforce of Malays, who were not used to making steel. In Dec. 1986, after its first year in business, it ended up with a loss of $51 million.
At first, Eric Chia seemed to make headway with increased production and even one of the local press reported in 1993 that Perwaja's Trengganu operations were so healthy that "it will produce one million tons in 1993 and it will have written off all its debts." The company even expanded, with the opening of a second plant at Gurun, Kedah (Mahathir’s home state). But these good signs hid the fact that the company continued to suffer from operating problems, dubious contracts issued without any tendering, and lots of debt taken on to ride out of earlier difficulties and finance expansion. Much of the leverage came from Japanese banks and trading companies, and was denominated in powerful yen.When pay back time arrived, there was no money to cover those investment loans since Perwaja, even with a protected home market, remained unable to turn a respectable profit. In fact, for the fiscal year ending in March 1995, the company reported a loss of $147 million. You can’t cover the dirty holes forever, the saying goes. So when the magnitude of the mess became apparent, the government stepped in. Eric Chia was sent packing, leaving behind not just a mountain of Malaysian and yen-denominated debt, but also evidence of an apparently fraudulent transaction.
Arrogance and Threat
Nobody seems to be surprise (are you?) with the outcome from the trial since the result already crafted on the stone since it’s heavily political-connected, not to mention the potential embarrassment to the government. Eric Chia once said “I will not talk unless I am forced to talk”. There were talks about the failure of the Perwaja Steel from the start, ranging from how the project should not be started at the first place due to insufficient know-how to the arrogance of Eric in running the company.
Malaysia-Today once reported how all the bankers in town were summoned to meet Eric and the guy just informed all the bankers that Perwaja needs a few hundred million Ringgit and that all of them were to all fork out the money. When one brave soul asked Eric Chia what he wanted the money for, Eric shouted at the guy “You want to know what I want the money for? Here, you phone the PM (Mahathir) yourself … if you have any questions or if you are not happy you can phone the PM”A banker who attended the meeting said “Eric Chia said that all he knows is Perwaja needs a few hundred million Ringgit. He does not know or care how it is shared out. We can discuss amongst ourselves which bank is going to take up which portion of the amount. He will leave us for awhile to discuss this amongst ourselves. He then walked out of the room … But we knew it was going to be a one-way street. We would never see the money back. But what could we do about it?”
Are you surprise with how businesses are being transacted in Malaysia especially when it involves political-linked companies? Don’t, because if you do, chances are your business will fail miserable before it even starts. So, as foreign investors, you’ve to adapt to the world-class culture of doing business in the country.
How can you Get $250 Gift Certificate?
American Express used to be the de-facto in the rich and famous life. When one showed his/her American Express card, the status symbol was immediately recognized. It will add to your ego if you can flash the American Express Gold, so much so that the advertisement on American Express Gold was portrayed as the ultimate richness you can only dream of. Those were the days when I was still a small kid. Apply for the Business Gold Rewards Card and make a purchase by 12/31/07. Upon the Basic Cardmember’s first purchase, a one time bonus of 25,000 points can be earned toward the Basic Business Gold Rewards Cardmember’s Membership Rewards® account and may appear as separate credits of 5,000 and 20,000 bonus points. The maximum 25,000 bonus points are available to first–time Basic Business Gold Rewards Cardmembers only; they are not available if you transfer an existing account. Welcome bonus points will be credited to your Membership Rewards account 6 to 8 weeks after your first purchase appears on your monthly billing statement. The bonus 25,000 Membership Rewards points may be redeemed for one domestic round–trip airline ticket.
Hustlermoneyblog has alert StockTube on how you can get 25,000 Rewards points after the first purchase from American Express Business Gold current limited promotion. The 25,000 points can be exchanged or redeemed for a free round-trip airline ticket anywhere in the U.S or $250 rewards gift certificate. You can choose the $250 gift certificate from stores such as Home Depot, Gap, Blockbuster, Barnes & Noble or Banana Republic (wondering if I could get my hand on the iPhone from these stores).
Another Credit card bonus includes the goodies whereby the $125 annual fee is waived for a year, so if you think the card is not worth it, you can just simply cancel the card without paying any fee whatsoever. Americans who are tied to credit report would normally think twice before spending using credit card but since this business credit card will not show on your personal credit report, you can actually max your credit limit without worrying about your credit report. Nevertheless, I hope you have the means to settle the amount you spent as part of the spending habit.
Here’s the fine print from American Express:
If you think you should belong to the rich and famous, then you can apply right away to benefits from the current limited promotion.
Stocks Volatility - Too Many Uncertainties
Initially investors were relieved to hear from the National Association of Realtors that existing home sales declined in May by only 0.3 percent to 5.99 million units. The tepid reading was expected, and indicated that the housing sector is still weak - the pace of existing home sales was the slowest in four years; housing inventories rose by 5 percent to the highest level since 1992; and the median home price fell for a record 10th consecutive month.
The data wasn't enough to keep the stock market afloat, so when crude oil prices rose back above $69 a barrel on news of U.S. refinery outages, many investors chose to take money off the table. High energy prices could translate to accelerating inflation - which investors fear the Fed may use as a reason to raise interest rates later in the year. The Fed is scheduled to meet this Wednesday and Thursday.
Central bankers are widely expected to keep the benchmark rate steady at 5.25 percent Thursday, but Wall Street is unsure if the Fed will alter its stance on inflation, which could mean a rate hike or decrease later in the year.
The 10-year Treasury note's yield fell to 5.08 percent from 5.14 percent late Friday failed to calm the stock market on Monday. Soaring yields have played a starring role in the stock market's volatility this month, because higher rates can slow down corporate activity.
On Tuesday, investors will be closely reading the Conference Board's June consumer confidence index and the Commerce Department's report on May new homes sales. So far, despite the weak housing market, the economy appears to be on the rebound. But even if economic data keep coming in strong, analysts predict high volatility in the stock market ahead of second-quarter earnings season, which begins in earnest in mid-July.
The Dow Jones industrial average fell 8.21, or 0.06 percent, to 13,352.05, after rising more than 100 points earlier in the day. The Standard & Poor's 500 index fell 4.82, or 0.32 percent, to 1,497.74, and the Nasdaq composite index lost 11.88, or 0.46 percent, to 2,577.08. The Russell 2000 index of smaller companies fell 7.29, or 0.87 percent, to 827.46.
Monday, June 25, 2007
Relook at GreenPacket Stock – Problem or Opportunity?
Since my last article on why I think Green Packet Stock Pattern Behaving like Google Stock, Green Packet Berhad (KLSE: GPACKET, stock-code 0082) has rebound from second support level of RM 4.00 to above $4.80 per-share (first support) and even touched the trend-line (refer to chart below). Subsequently the stock plunged back to the RM4.00 level and today’s closing saw the stock floating just above $4.00. Such is the power of support and resistance – hence the trading range (between $4.00 and $4.80) which was in question earlier on has been established.
Stochastic and RSI both shows the stock price in the oversold territory. Compare today’s closing (25th June) with previous low (18th May) will shows a similiarity – both occasions saw oversold position and touching the $4.00 level. Looking at the chart, it seems GreenPacket is set to rise above $4.00 level again giving an equal opportunity to investors to make money. As I have blogged about the fundamental of GreenPacket, I would not elaborate it again here.
Concern on Green Packet Stock
One of StockTube readers has asked me recently about this stock again. The reader is very concern about the yo-yo behaviour of the stock price. To me, I’ve been looking for such a chart’s pattern for years as it presents a great opportunity to make money again and again. Could you imagine how much money one can make from such trading range should the stock can be long (buy) and short (sell) as easily as in U.S. stock market. Too bad you’re seeing this stock in Malaysian stock market. Such a trend is perfect for traders to make huge profit. But am I very sure that GreenPacket will trades within the range as I mentioned above?
Technically and fundamentally, I’m very sure it will rebound above $4.00. So if I happened to have bought the stock at a higher price previously, I would definitely pinch some to average-down. For all you know, the stock could be establishing a nice double-bottom before giving you a surprise rocket boaster.
Problems with Green Packet?
The only problem seems to surface for GreenPacket is the high receivableswhich will affect the company as far as capital and cash-flow turnaround is concern. But according to market sector, such high receivables are common within telecommunication business due to the long-period of getting user-acceptance-test and users’ sign-off. The nature of such projects makes the full-payment quite lengthy. Also, foreign investors are not as “long-term” as before – since the 1997-1998 Asia Crisis, foreign investors are more sensitive to the region’s business and profit-taking is a norm.
Green Packet’s Expectation
If Green Packet can register another quarter of good numbers couple with a smooth roll-out of WIMAX which it has secured, chances are high that investors’ confidence would be strengthern further. As I’ve blogged before, I still favor a partnership between Green Packet and DiGi.com and I still believe both parties are talking about it (unless the government stir the water with the intention of rescueing TimeDotCom). Again, I would like to stress that stocks investing is a risky business if you could not take the heat and control your emotion.
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Sunday, June 24, 2007
AirAsia X to Finally Take-Off after Early Turbulence
British billionaire Sir Richard Branson of Virgin Group is reported to be taking a stake in Malaysia's new AirAsia long-haul budget airline. The Star newspaper which claimed it picked sources familiar with the negotiation reported that Branson would take a 20 percent stake in Fly Asian Express (FAX), teaming up with Asia's aviation tycoon Tony Fernandes to run flights from Malaysia to China, Europe and Australia.
Currently, AirAsia Bhd (KLSE: AIRASIA, stock-code 5099) chief executive Fernandes has a 50 percent stake while his deputy Kamarudin Meranum owns 30 percent in FAX. The same report
said Fernandes & Kamarudin would sell 20 percent of their stake to Branson, the founder of Virgin Group. Fernandes had previously denied Branson's involvement. Branson's Virgin group includes budget carriers Virgin Express and Virgin Blue.FAX recently signed a contract for 15 wide-body A330-300 airliners from Airbus, with the first new A330 to be delivered in the third-quarter of 2008. Each aircraft costs 175 million dollars, and the purchase would be funded with a combination of borrowings and equity. FAX is scheduled to begin its long-haul flights to China and Australia from September 8, using three leased planes from the low-cost carrier terminal at Kuala Lumpur International Airport (KLIA) after the earlier plan to fly to Britain and China by July 2007 was delayed.
Tony Fernandes was the architect who turnaround the sick and bankrupt
government-linked conglomerate DRB-Hicom's (KLSE:DRBHCOM, stock-code 1619) Air Asia back in 2001 into the most successful discount airline in Asia, to the jealousy of even Singapore’s aviation industry. Since then numerous low-fair airlines were being setup but not one has near the success enjoyed by AirAsia.If the news materialise, the plan by Tony to goes global will finally take off in a big way. To investors, foreign participation should be encouraged as a good sign to ensure AirAsia is in good hand and any sudden acquisition by certain government-link companies to eat-up a hard-built business entity (for easy fruits) could not be easily done, not that the government could not launch such action. But at least the government will think twice about “big-boy’s” retaliation should it decide to bully the owners. So, if Tony and Kamarudin sell 10 percent each to Sir Richard that would put Tony with 40% and Richard and Kamarudin 20 percent each. Tony-Richard team would hold a 60% stake which should be a comfortable management level to drive the company into the next phase.
But most importantly, with Richard’s entry, the Europe would be a smooth and easy market for FAX’s penetration. In fact Europe could be one of the most luxurious markets that would contribute to FAX bottom line. How would AirAsia stock react to the news after the opening bell comes Monday?Other Articles That May Interest You ...
- Jetstar Flying Off to Malaysia, AirAsia Next?
- Fly To London At Less Than 3 Dollars
- Fernandes To Fly LongHaul With FlyAsianXpress
- Does Fernandes Has Silver Bullet For AirAsia?
- Globalization of Low-Cost Air Giant?
- Tony Fernandes - The Truly Air Asia Hero (Part 1)
- Tony Fernandes - The Truly Air Asia Hero (Part 2)
Learning the right way to achieve prosperity
Two of the most promising investment instruments could probably be the stocks and real-estate. History has shown that people becomes millionaires and even billionaires by investing in either stocks or property or both. Do I really need to give you examples? Go and googled Warren Buffett and Donald Trump if you still do not know these two figures.
So it’s no wonder that wealth-coaching.com concentrate on above two topics for the prosper learning which most investors should know. Recognizing that most youngsters nowadays are actually having high interest especially when comes to making money topic but doesn’t have the financial means to proceed, the wealth-coaching also provides articles on how to eliminate your debts and some e-commerce tips for beginners. This Is hope to set the first level of preparation for the people to start their journey into financial investing.
The interesting thing to note is the multiple articles concerning stocks especially on some of the advices in investing stocks. One student even claimed that she made a whopping $137,645 within one month, although I’m not sure how much was the capital she used as the starting point. It made great difference if you’re cash-rich and can have more trades to work for you. Having said so, of course you need to do your own analysis or follow the set of methodology that works for you.
Another student claims he made tens of thousands from 58 trades, not something which is impossible with option trading especially if you can nails the right stock with the proven technique.
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Saturday, June 23, 2007
Locked Profit on Google – 20 Percent for 5-Days Trading
Boy, have you seen how Google Inc.'s (Nasdaq: GOOG, stock) stock performs today? Unbelievable, considering the new resistance of $525 was established about two-weeks ago only. It was on June-7th, 2007 when the highest of $526.50 per shares was recorded. What prompted me to enter the position (GOOG Aug $510 Call) on June-18th, 2007 was when the price-action (price and volume) triggered the “Buy” signal to me. If you happened to be monitoring Google on that day, you would know what I meant. Referring to the 9-months chart, you can see four important levels - $461, $475, $505 and $525. All of them have significant meaning during trading.
Looking at the chart, $505 resistance seems to have been converted into support (I’ve no idea how strong is this support though). Today, the stock tested the $524 when the stock zoomed into the territory since opening bell. So, when the stock crossed the $524 and trying to tease the $525 level, I’ve decided to ring the register and take profit. As of the writing time, 12:00pm EST, Google is still trying to breach $525 level numerous times. I’ve to admit this is too much for me to take, I can’t take it if the share decides to make a sudden U-turn at anytime the stock likes to.
Furthermore Dow Jones, Nasdaq and S&P 500 all are in red – couple with the fact that today is Friday, I’m going to have peaceful weekend and not to worry about the risks over the next two days if I sell today. I’m happy with the profit and money made, though not much in terms of percentage. It’s a mere 20% but it’s only for 5-days of trading, so I’m not feeling greedy *grin*.
In actual fact, you can roughly estimate the stock’s pattern for the day with the stock price’s indicator before the opening bell and the first 45-minutes as these are some of the factors which will determine the direction of the stock for the whole trading day, unless there’re sudden bomb-shells dropped which can change the entire course such as a war or instability in sensitive countries. Would I kick myself if Google continues the uptrend and breaches $525 today? Certainly not because I believe there’s always another trading or investing opportunity tomorrow. So, you got to learn to let go if the market is not on your side, don’t chase the stock. Having said so, should you consider shorting Google now it’s having difficulty crossing the $525 bar? What say you?Friday, June 22, 2007
Take a break and do holiday in New Zealand
New Zealand is a country which has been neglected by most tourists simply because it is a quiet and calm country which offers little entertainment compare with other metropolitan. People tends to know Australia more than New Zealand when comes to planning for vacation. But the box-office “Lord of the Rings” definitely has done a great and free marketing for this country since some of most of the spectacular scenes were from New Zealand.
The summer has just started in U.S. but it's not yet summer in New Zealand (I still like the winter season though). But should you have any plan to give this country a visit, go ahead and make the necessary booking. Contrary to what most people believe, vacationing in New Zealand will not cost you an arm and a leg, if you know where to scout for the deal.
Cheap Hotels in Auckland, the gateway to New Zealand offers some good accommodation deals ranging from NZD35.00 per night for a two-star hotel, NZD60.00 for three-star up to NZD152.00 for five-star hotel. Besides hotels, Auckland offers different types of accommodation such as guest houses, lodgings, serviced apartments, motels or hostels.
While hotel rates are usually priced per room, hostel rooms are priced per person. So you better remember to book and book the right type of accommodations. By the way, bed and breakfast is known as b & b in Auckland. So don’t just keep blogging and monitoring the stock market every minutes, go and get some rest in the peaceful New Zealand.
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PECD Stock - Why You Should Run Away, Fast
If there’s one thing you should consider before investing a particular stock, it has to be the profit and loss statement of the company. This is the easiest indicator to show how the company is performing and to tell investors how well it is being managed, or how great the management has been screwing up the shareholders’ fund. “Spokesperson Wahid Mirza said “We are now living in debt. Most of us had to resort to selling our personal belongings to pay creditors who are also chasing us for payments … We have met up with the management of the company. In fact, we have obtained a letter from the Ministry of Finance instructing them (PECD) to pay us … Unfortunately, until today, except for that small token received two weeks ago, we have not received any payment”
When you read about business news on the local newspaper, you’ve to actually go back to the history of the company especially when you’re investing in a country which transparency is a rare commodity such as Malaysia. Most of the times (more than 90%) you’ll be bombarded with good news about the company. Very rare you would be presented with the other flip of the coin unless it’s really bad news that cannot be covered anymore such as the recent accounting irregularities. You can’t cover 10 holes with only 1 cap, can you?
So, when construction firm PECD Berhad (KLSE: PECD, stock-code 5093) announced yesterday a tie-up with Dubai Investment Group (DIG) to strengthen its role in that region's construction sector, I took it with a pinch of salt. PECD’s Dubai-based unit, PECD LLC, is said to undertake construction and property development projects for DIG-owned companies as well as projects for Dubai Properties.
PECD – a poor paymaster or having cashflow problem?
On 14-May-2007, stock price of PECD Bhd took a plunge when it fell 15.5 sen (24.41%) due to winding-up petition on PECD wholly-owned unit, PECD Construction Sdn Bhd which owe over a small amount of only RM 880,000. 
Today, 22-May-2007, a group of small contractors hold a demonstration during PECD’s shareholders’ meeting carrying posters that read "Debt not paid. We have to go to loan sharks." They were among the 17 sub-contractors who have asked to be paid RM25.6 million, over the past two years, for work on houses and offices in Precinct 11, Putrajaya.
In response, PECD chief executive officer Rosman Abdullah said the company has no intention of running away. He further said "We are doing everything we can to resolve this matter … The problem right now is timing … We, too, have not been paid for the work that we have done … So how can we pay them if we ourselves have not received any payments."
These episodes points to how PECD's financial health has deteriorated over time, no doubt about it.
PECD bleeding profusely
The company registered a net loss of RM133 million in the financial year ended December 31 2006 and a net loss of RM8.9 million in the first quarter ended March 31 2007. PECD has sold its headquarters building and land for RM8.8 million and RM15.73 million respectively.
The company was doing quite well in construction but other sectors such as development and energy were failures. From 2002, net earning per share (EPS) was on uptrend till 2005 when the cracks appeared. All hell breaks loose in 2006 when the EPS was in the red of minus 39.41 sen per share.Rosman said that PECD aims to be in the black, hopefully by this financial year ending December 31 2007 or the next, with the execution of several key turnaround initiatives, including pursuing outstanding claims and the disposal of non-core assets. So if you read between the lines, the CEO isn’t sure himself if the company can actually turn around.
Government bailing PECD
It was the news where the Maalysian government tried to bail-out the loss-making PECD on the day of Valentine this year that the share price jumped more than 130% (refer to chart). Despite being a political party, UMNO, the main party party within the ruling government decided to buy 25 percent of PECD. The major loss was due mainly to project cost overrun in Sudan’s marine terminal.
PECD trying to suck more public money
What prompted me to write this article is when PECD proposed a renouncablerights issue of up to 345 million new shares together with up to 172.5 million free detachable warrants on the basis of two rights shares with one free detachable warrant for every two existing shares held.
The proposed rights issue with warrants would raise up to RM172.5mil and would be utilized for among others, repayment of shareholders’ advance, bank borrowings and working capital for the group.
Get real, the last thing you want to do is to feed the parasite who not only couldn’t get or manage the project right at the first place, but to shamelessly ask government to bail it out and has the guts to ask shareholders to pump in more money to “try” to turnaround (or to dries up more funds). I wouldn’t give it a second look, let alone to give more money to the incompetence management in running the company. Unless it’s Mah Sing Group Berhad (KLSE: MAHSING, stock-code 8583) to which I subscribe to the rights issue recently as I believe in the company’s management and performance.
# TIP: Run away from this stock if you treasure your hard-earned money. But I’m sure punters and speculators would like to put their bets on this penny stock as the main player, the government, is on the show. Punt at your own risk dude.
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Summer Starts - Watchout for Energy Stocks
Today marks the start of summer where the driving-season could push the demand for oil to a higher level (heard of summer holiday?). So, you better watch out for the oil price which could be sparked by a tiny instability news. Energy (+2.0%) turned in the best performance even as oil prices closed lower again on Thursday. Crude for August delivery, which was up as much as 1.5% and within 12 cents of $70 per barrel, fell 0.4% to $68.61 per barrel.
From the stock market perspective, it's a well-known fact that the months of May-October have produced essentially a net zero gain for stock investors over the past fifty years. Does that mean there's no more money to be made within this period? Not necessarily, it just mean you need to open your eyes wider and more thorough research and analysis (and reading) need to be done to filter the gold from the dust.
Among other economic data investors were considering was a weekly Labor Department report showing the number of workers seeking jobless benefits rose by 10,000 last week to a two-month high, marking the third straight weekly gain. While the increase wasn't large, the movement could suggest unemployment isn't quite as low as it had been. Wall Street might regard the report as good news, however, because overall unemployment remains quite low and wage inflation could result if employers have to fight for workers.
Automate your Investing Event Management
Ever wonder if you could integrate an online registration form into your website for a more efficient event management? RegOnline provides the solution to enable you to have an event registration template with simple and user-friendly interface. Simply register for free (not software installation is required) and start creating your registration form with the built-in builder. You can assign multiple types of attendee, pricing or discount type and many other functionalities into the form. You can even include video spokesperson on your form to make it livelier to the participants who register though the form.
Over time, you might want to hold a seminar or gathering for your readers to get together and exchange information about stocks investing, option trading, making money via affiliate programs or just for some analysis roundtable. And you want to open up the registration 24 hours around the clock to facilitate the event. What better way to have automated event management software that can handle payment, badges, email, lodging and to generate a comprehensive report.
The event management also gives your important statistic about your registrar as well as sending email for confirmation and receipt from the participants. The great thing is of course you don’t have to buy or install any software because it’s web-based. In short, everything is automated and this free up your precious time in managing the registration.
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Thursday, June 21, 2007
EU envoy Criticize Malaysia's Bias pro-Malay Policies
The European Union's top envoy to Malaysia on Thursday issued a rare and strong criticism against Malaysia's policy of favoring ethnic Malays, calling it protectionist and unfair to foreign companies - reported Kyoto News
Thierry Rommel, the EU ambassador to Malaysia, said Malaysia uses the excuse of "infant industry argument" allowed under the World Trade Organization to bar foreigners access into markets like the automotive, steel and public procurement sectors.
"In reality, however, it is the Malay-centered bumiputera policy that drives the protectionist policies. In a dominant part of the domestic economy, there is no level-playing field for foreign companies even when in partnership with bumiputera," he said in a speech to local and foreign businessmen. Rommel said Malaysia should take a hard look at the policy following many complaints of abuses, such as that it has benefited primarily a handful of politically well-connected Malays only.
Now it seems even the European Union who has been quiet and only mind their own business previously could not stand the very bias policies adopted by Malaysia who always try to champion human rights elsewhere but never care (or pretend not to?) to look at their own skirt. Former premier Mahathir was fond of starting mouth-war with United States, so maybe it's Badawi's turn now to do the same, only this time the target is European Union.
Those hypocrites from main ruling party component, UMNO, should come to the street with banners and probably burn a few flags in protest to show European Union to mind their own business, the way they always did previously. And you can guess who will lead the protest soon.
How to Write Check to Yourself Every Month?
Did you read those advertisements in the newspaper about how the specialists claim himself/herself to be able to help you make money for the rest of your life with his/her method or secret? The advertisements will further urge you to book a seat for a free preview in order to sell you the dream on how to write your own check every month without fail. During the free preview, chances are the specialists will show you how his/her students made X or Y amount of dollars by following his/her methodology. And if you want to do the same, you have to sign-up for the course (two or more days) which costs you a couple of thousand dollars.
Basically the method is pretty no-brainer, at least for those who’ve experience trading or investing in stocks option before. In a nutshell the juice of the method is quite simple and I’m going to tell you how it can be done within this article, free of charge. I’ll try to put it in laymen term as far as I can in order not to confuse the newbies. It’s all boils down to one of the many strategies in option trading. Do not fret out when the word option-trading is being mentioned as it’s just a name for another type of financial instrument, just like stock-warrants.
Mention stocks and chances are any Tom, Dick and dog will knows what it is. Option tied to stocks and without stocks, option can’t exist by itself. Option is just a contract that grants the owner (you) the right, without the actual obligation, to buy or sell 100 shares of stock at the strike price within certain expiration date. Why 100 shares? In U.S. one contract of option equals to 100 shares, as simple as that. Just like in Malaysia 1 lot of stock equals to 100 shares (previously were 1,000 shares though). Just remember that options can be “Call” or “Put”. You buy Call when you’re bullish about the stock and you buy Put when you’re bearish on a particular stock.
What I’m going to tell you here is the technique on how to write your own check every month the safe way (yes, there’s a risky way to it). It’s known as “Writing Covered Call” or “Writing Covered Put”. This is how it works:
- First, you need to own/buy the stock, 100 shares minimum because one contract of option equals to 100 shares. Example, you buy 100 shares of Guess at US$47.34 per share (that’s yesterday’s closing price) – your capital is US$4,734.00
- Now, you figured that Guess?, Inc. (NYSE: GES, stock) has been on the uptrend based on its 1-year chart. You also figured that $50 per share would be the strong resistance level for this stock and from you analysis, you might think the stock will not breach the $50 level, at least not for the next 29-days.
- If you already have a trading account, chances are you would have the option-chain data for the stock (diagram above). So based on the option-chain for Guess, you can actually write a Call option by selling 1 contract of Guess at Strike price of $50. Supposingly you sell at $0.70 per contract to the bidder, so you have just sold 1 contract of GES Jul 2007 50.0 Call. The very next day you would have US$70 less commission ($0.70 x 100)credited into your account.
- Congratulation, you’ve perform the role of a “Writer” by selling / writing Covered Call. If your prediction is right and by third week of Friday on July 2007 the Call option expires out-of-money (meaning the stock price closes lower than $50), you get to keep the US$70 less commission.
- But what will happen if the stock price closes above $50 (your prediction was wrong)? Now the concept is pretty simple, when you write/sell a Call, somebody on the other side is buying it (contrary to you, this fella is betting the stock will rise above $50). Holding this contract (or ticket), this fella will exercise his right to purchase the shares because it’s worth more than $50 per share and he/she would be stupid to leave the profit on the floor.
- In such case, you’re required to deliver the shares which you have in your possession. So you would be getting US$5,070 (US$70 + $5,000), giving you a profit of US$336.00 (US$5,070 minus US$4,734.00 capital) less commission.
I mentioned there’s a risky way. The risky way is called “Naked Call Writing” or“Naked Put Writing” whereby you don’t actually own the shares but you sell / write the Call or Put to the market. Some broker houses do not allow you to write naked simply because it’s too risky that your losses could be unlimited. How could that be? Based on the above example, can you imagine what will happen if the stock price of Guess escalates to $60 per share?
Assuming you’ve wrote a Naked Call of GES Jul 2007 50.0 Call. Comes expiration Friday your contract will be deep in-the-money and you’re “called” to deliver 100 shares, of which you do not have. So the broker house will issue a warrant-arrest on you (just kidding). Because you do not own the shares, the broker house will buy 100 shares from the open market and immediately deliver it. Supposing the broker bought it at $60 per share, you’re required to pay the amount of $5,930 (US$6,000 minus US$70) plus commission back to the broker house.If you have stocks on hand, you can simply write Covered Call every month and earn the money as if you’re writing a check to your ownself. Just imagine how much you can earn if you have 1,000 or 10,000 shares. But you’ve to make sure your shares are optionable, not all the shares have option associated with it mind you. You can check it for free at Yahoo Finance here. Besides, not all stocks have monthly option.
So, that’s what some of the specialists out there trying to market you the so-called method of writing check on monthly basis. Some of the irresponsible trainers do not even tell you the difference between the “Covered” and “Naked” way of writing the option. It’s always better to become a “Writer” (seller of the covered call) than a “Holder” (buyer of the call option) because you “get paid” for it rather than pay for it.
Please comment if this article is useful and benefits you, or you still do not understand the whole process of making money by selling the option in the stock market.
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Bond Yields Came Back Haunting
The 10-year Treasury note's yield soared to 5.15 percent late Wednesday from 5.09 percent late Tuesday, reigniting worries among stock investors that high rates could thwart corporate deal-making and further injure the limping housing market.
The stock market started reacting violently to Treasury yields two weeks ago when the 10-year yield surged past 5 percent for the first time since last summer. Wall Street had traded more mildly in recent days as yields retreated from last week's peak of nearly 5.30 percent, but Wednesday's yield advance stoked fears that they could resume their climb.
The Dow fell 146.00, or 1.07 percent, to 13,489.42, after bobbing in and out of positive and negative territory earlier in the day. The Standard & Poor's 500 index declined 20.86, or 1.36 percent, to 1,512.84, and the Nasdaq composite index fell 26.80, or 1.02 percent, to 2,599.96. The Russell 2000 index of smaller companies fell 12.16, or 1.43 percent, to 836.18.
Troubles at two of Bear Stearns Cos.' hedge funds also weighed on the markets, especially financial firms: Bear Stearns, JPMorgan Chase & Co. and Merrill Lynch & Co. all fell more than 2 percent. Despite posted a strong rise in quarterly profit the second-largest U.S. investment bank, Morgan Stanley, turned lower by 48 cents to $87.32 as rest of the financial sector got whipped. Expect more volatility on the stock market as long as the bond yields still has no sign of stabilizing.
Wednesday, June 20, 2007
Lottery Ticket Seller Goes into Hiding
This is what happen if you suddenly found youself with a sudden windfalland do not know what to do, worst still if you're staying in a high-crime area. It was reported that after a punter from Muar (a small district within Johore, Malaysia) won a whopping RM17mil in a Big Sweep draw, the person who sold the winning ticket has gone into hiding. In a lucrative deal, the person who actually sold the winning ticket stands to secure a certain percentage of the total money won.
The speculation in town is that the ticket seller is an old 
woman, who fears she would be a target of crooks. An official of the lottery company in Kuala Lumpur, identified only as Ye, said their Muar representative had scolded her for disclosing details of the winning ticket. She said that because there were not many lottery representatives in Muar it was easy to find out who sold the winning ticket.
Ye recalled that some years back a Big Sweep representative in Kuala Lumpur became a victim of robbers when it was found that he had sold a winning ticket. Furthermore, she added, when a person is known to have sold a winning ticket, many people would want to buy tickets only from that person. This is due to the believe that the person actually has the "luck" within his/her lotteries tickets. Where would you do or hide if you're that woman? You can have all the money you want but if you've a big mouth, chances are it will do more harm than good to you.
Why Would Someone Buy Maxis at $15.60
For those who are still holding to your baby Maxis Communications Berhad (KLSE: MAXIS, stock-code 5051), you should know thattomorrow, Thursday 21-June, is the last day for you to transfer the shares to Ananda - only if you decided to get full refund of $15.30 pershare from the tycoon. Ananda has already secured more than 90% supporters for his evil plan.
Yes, it’s only $15.30 and not $15.60 as the offer price of $15.60 actually“inclusive” of dividend amounting to $0.30 per share (of which have not reach your doorstep yet). I can’t blame you if you didn’t know that because it was stated in an evil way - “fine-print”. So it puzzled me that there were people willing to snap the stocks at $15.40 per share yesterday. And today, minutes before the market closes, I was even more amazed when the stock (63 shares to be exact) changed hands at the price of $15.60.
Unless I’m totally wrong with the above info, it seems there’re some ignorant investors who buy without checking the facts. But then again, it could be due to some other reasons beyond my imagination. Now why did I say tomorrow being the last day? Reason being if you wanted to secure the full $15.30, you need to fill-up the transfer form early in the morning tomorrow and it’ll take one day (Friday) before the transfer completes, upon which you can hand-deliver the release document to the Registrar to complete the process. Maxis shares will stop trading from next Monday onwards, hence the Friday being your judgement day.
Of course if you value your remisier or broker and plan to let him/her enjoy the commissions, then you can sell anytime between now till Friday in the open market but as the saying goes, you’re running the risk of possible stock-price pressure which might goes below $15.30 per share as no one would want to hold shares which are not tradable.
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Stock Market - Quantity Rules over Quality
How much does it costs Malaysian Stock Exchange from the recent sudden privatization of which quality companies were taken out from the listing? A whopping RM 46.3 billion has been wiped out from Bursa Malaysia's market value in the first half of the year from the 17 firms who opted to call it quit. The consolation - RM3.74 billion in market capitalization was injected from the listing of 16 new companies in the same period, a small figure of less than 10% compare to the withdrawal.
Nevertheless, you have to salute the local stock exchange when they are still adamant and believe its normal phenomenon and not something peculiar. Bursa Malaysia Securities Bhd chief legal officer Selvarany Rasiah was reported by BusinessTimes as saying that the privatisation of these companies signals a very mature and robust Malaysian financial market, with a favourable credit market.
She said the fact that no companies have de-listed to re-list on a new market also proves that Bursa Malaysia has not lost its attractiveness. That is indeed a bold statement considering that some of the companies which is undergoing the privatization actually has plan to re-list in other stock market and my bet would be on Maxis Communications Berhad (KLSE: MAXIS, stock-code 5051). No prize for guessing which equity market will the company be listing in the near future.
With the latest being AmInvestment Group Bhd being taken private by parent AMMB Holdings Berhad (AMMB : stock-code 1015) with the offer of RM 3.70 per share (a premium of 15.6 percent from the last traded price of 3.20 ringgit), the trend is set to continue for some time.
The fact remains that no matter how many new companies being approved for new listing, the quality of these companies are nowhere near the big-boys who decided to pull-out from the local equity market. Quantity might be the replaceable entity but the quality is something which is as rare as diamond when you talk about picking great stocks to invest.
How come I didn’t hear anything from the once outspoken Bursa Malaysia (KLSE:BURSA, stock-code 1818) chief executive officer Yusli Mohamed Yusoff? He’s still around alive and kicking, isn’t he?
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Tuesday, June 19, 2007
Will POS Smell What TRANSMILE was Cooking?
Now that the book-cooking is over (or has it?) for Malaysian air cargo carrier Transmile Group Berhad (KLSE: TRANMIL, stock-code 7000) with angry investors voicing their frustration over what seems to be obvious cover-up by the company’s top management, not to mention the role of external auditors who amazingly could not scrutinizing the accounting numbers after all these years, what’s next?
Minority Shareholders Watchdog Group (MSWG) has urged that the chief executive officer (CEO), chief financial officer (CFO), the audit committee, the company staffs that are involved in preparing the accounts to the 20 companies that are Transmile's clients/debtors be investigated. Has the MSWG forgotten theChairman of Transmile (come on, he can't possibly know nothing)?
After taking into account the adjustments to its retained earnings of RM649 million, analysts expect Transmile's net tangible asset per share to fall to RM2.88, compared with RM5.41 in its 2006 accounts. "Even after the report on special audit, we are no closer to gaining the full picture of Transmile's future earnings potential. Currently, there's no basis for us to upgrade our sell call," said another analyst.
Meanwhile Malaysia's market regulator said it has begun investigations into air cargo carrier which had reported financial irregularities and sharply revised down its results for the last two years – an action which is a little bit too late as far as“prevention” is concerned. Also, Transmile has made an official report to thepolice and Securities Commission today.
While everyone talks about the irregularities, one stock seems to be hiding in a corner waiting for its turn to be analyzed by financial investors. National postal company Pos Malaysia & Services Holdings (KLSE: POSHLDG, stock-code 4634) which has a 15 percent stake in Transmile might be affected by the crisis.
Pos Malaysia did not segregated the revenue from Transmile in its income statement but if the same principal of back-tracking previous years revenue basing on the latest audit report, probably we can come out with some interesting figure.For financial year 2006, audit found that Transmile posted a pre-tax loss of 172 million ringgit ($49.78 million) instead of profit of 207 million ringgit. By the same percentage of 15% equity, Pos Malaysia might have suffered a loss of 25.8 million ringgit instead of 31 million ringgit profit within the same period. Minus the 2006 pre-tax profit of 25.8 million and the fictitious 31 million from the group’s 211.8 million ringgit, it will yield Pos Malaysia 155 million ringgit only. That’s over 36% in indirect fictitious pre-tax profit. 
As for 2005, Transmile actually registered a pre-tax loss of 67 million ringgit instead of profit of 120 million ringgit. By the same quantum, Pos Malaysia would have registered a pre-tax loss of 10 million ringgit instead of 18 million ringgit profit. So the number should be re-written as 118.9 million ringgit (minus 18 and 10 million from 146.9 million reported pre-tax) in pre-tax profit. The result – over 23% indirect fictitious pre-tax profit. You can do the calculation for 2004 if you like.
But since some analysts said this could just be the tip of the iceberg, I wouldn’t want to skate on it, would you? Can you smell what the “Rock” is cooking?
# TIP: Stay sideline as far as Transmile and POS Malaysia stocks are concern at this particular moment. If you’re a gambler, you might be able to pinch some meats out of Transmile volatility.
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Are You a Blogger and Stock Trader Survivor?
The questions from USA Network's Burn Notice are pretty challenging to me especially when I’m making a small living investing stocks and trading options first and blogging second. What would I do if I’m stranded in an unknown city with no money or resources? I think stranded in an unknown city is always better that left-alone in a remote island by your own-self.
First of all, we’re in the information age and if you’re suddenly appeared in a strange city, you can always get help from your friends through internet. Yeah, you don’t have a single penny but if you just simply walk into an internet-café and ask for a favor to use their internet-link computer for 5 minutes (beg or nag them), you can do quite a number of things such as getting help via instant messaging or email.
Depending on which city you’re stranded, you might be able to find some kind-hearted people who’re willing to give you some bucks for a meal or two. You can sleep at the park, YMCA or get helps from social centers. So it’s not the end of the world if you indeed found yourself stranded in another city. But that’s just the immediate solution and not a long-term one. To continue surviving, I might leverage on my knowledge in making some decent money investing stocks or trading option. Yes, I know I don’t have money but I can transform my knowledge into some money.
As a starter I might approach the owner of the internet café to recruit me as an administrator (how hard can it be to trouble-shoot some of those computers and the simple in-house network system?), this will at least provides me the daily meals and maybe free internet access and place to sleep. With the cyber-connection I can do some research analysis on stocks during my free-time to further make some bucks. Eventually I might be able to make enough to afford my own shelter, put foods on the table and the valuable internet access plus the computer to continue blogging and trading. If you can survive in above scenario, chances are you are already in your way to become a good trader or investor making good money in your comfort zone.
But this is just me, what if you’re a spy working for the government and somehow you’re fired for no apparent reason? How would you survive? Starting June 28th Michael Weston, a CIA Operative on USA Network's new TV series, Burn Notice, will show us how he deals with a similar situation.
Monday, June 18, 2007
57 Percent Profit in Four Months for NVIDIA
Almost forgotten to blog about the position which I closed last Friday, June-15th, on NVIDIA Corporation (Nasdaq: NVDA, stock) which I entered back in Feb 13th, 2007, just before the earning announcement.
This is probably one of my longest trades so far, spanning four months since the date I decided to make a June 32.5 Call option on this company which designs, develops and markets graphics processing units (GPUs), media and communications processors (MCPs), wireless media processors (WMPs) and related software. You can read more about this in my previous post NVIDIA Should Beat Earning but Concern on Inventory.
Looking at the chart you can see how the stock took the plunge and decided to stay below $34 per share for the next two months. Should you invest and long this stock by trading its option, you would suffer huge losses if you do not have the time-value on your side. Looking at the date of the closing position, you can see that I actually waited till the expiration Friday, squeezing every drop of the juice out of it. Am I lucky on this trade? You bet, besides analysis together with strong fundamental, you need all the lucks you can get hold of if you want your trades to turn profitable.
But the most important factor in such trades is the value of fundamentals and if you’ve investing in such stocks, chances are your trades will return the favor by making good, if not excellent money for you. Also, study the price-action and you’ll be on your way to a better profitable trades. But again, investing stocks are always risky and if you can’t move on with your life after losses, you better think twice before pumping in your hard-earned money. Anyway, this is not a trade which I can be proud of.TRANSMILE in Loss since 2005, Lower 2004 Profit
The final words are out - Malaysian air cargo carrier Transmile Group Berhad (KLSE: TRANMIL, stock-code 7000) said today the company recorded pre-tax losses for fiscal years 2005 and 2006 instead of profits as previously announced.
The audit showed Transmile posted a pre-tax loss of 172 million ringgit ($49.78 million) instead of profit of 207 million ringgit in financial year 2006 and a pre-tax loss of 67 million ringgit in 2005 instead of profit of 120 million ringgit. In addition, it also reported a smaller pre-tax profit of 8 million ringgit for the 2004 financial year than the 87 million ringgit previously announced.
Transmile, which is controlled by Hong Kong-based billionaire businessman Robert Kuok, said the audit by Moores Rowland Risk Management Sdn Bhd had uncovered fictitious invoices and payments that were not supported by payment vouchers. Someone has to be held responsible as obviously irregularities had occurred in this case as fictitious invoices found means someone tried to inflate the accounting numbers.
So, it’s time to put those responsible for such a crime on trial and not just let them resign voluntarily. A crime has been committed and the authorities should take actions if it really means to walk the talk – enough of talking and sloganeering.
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Sunday, June 17, 2007
Weekend Update - StockTube's Minor Facelift
Regular readers of this blog should have notice some minor changes to the design (or rather repositioning) particularly the header and the logo (if you can call it logo at the first place) which I made yesterday. The minor facelift is to improve and simplify the header in order not to clutter it. I realized there’re more that I can do to further improve it and I need time and more comments on how to make it better. Just like a car’s model, you need to have a facelift after certain period of time.
I’m not a webmaster nor am I a web-designer, so if you happen to stop by this page and you think there’re some simple tweaks yet can enhance the overall page of StockTube, I would be grateful if you could drop a comment or email me directly. Having said so, you are welcomed to comment on other areas (if there’s any) that I should improve in order to bring a better presentation to the readers, which is you in this case.
Also, please let me know if you like the current design or the previous one of which I still have a backup, so reverting is not that difficult. As a user of Google Inc.'s (Nasdaq: GOOG, stock) Blogger, it’s wise to constantly backup your posts/articles and the template.Last but not least, I would like to wish all the fathers out there a “Happy Father’s Day” and I’m sure you have plans for the night. If you’re about to become a father, welcome to the world of changing pampers and if you’re not a father yet, you should be grateful how lucky you are.
Friday, June 15, 2007
Badawi is Still Dreaming – No Wonder Nation is Stagnant
This is what the Malaysia premier Abdullah Badawi envisages for 2057 - to see the nation achieve the unimaginable. He further added “But the more I think about 50 years of Merdeka, the more I start dreaming about what might be in another 50 years.”Abdullah said if Vision 2020 was about the foundation of a developed nation, 2057 would be about what it takes “to distinguish ourselves in all fields and the heights to which Malaysians will scale.”
1) Our students and professors will dominate Ivy League universities and our own universities will be citadels of excellence for international scholars.
- If the local professors can’t even master the lingua-franca of knowledge such as English within the last 50 years, what else do you expect the achievement to be given another 50 years? It’s more amuze to see the local education standard has dropped to a level slightly better to African countries while neighbors such as Singapore had marched and still marching ahead of Malaysia. Could Badawi meant the measurement above is against African countries instead?
2) We will be pioneers in alternative energy, drawing on our strength in biofuels. Our cities will be the most liveable on the globe, blending cosmopolitan facilities that are rooted in a tolerant and just societal ethos.
- Sounds like a paradise to me with those flowerish words but does such a place really exists? Maybe we've mistaken and what the premier actually meant was to build such fantasy island within the residential of the premier himself. Since 50 years of independence, the proudest achievement was the national-car project which is still bleeding and the twin-towers which was designed, architect and built by foreigners with the money sucked from the petroleum.
3) A hundred years of Merdeka would see this society, this nation achieve the unimaginable. We will have Nobel laureates, truly global corporations, respected and market-leading brands, internationally acclaimed poets and artists, among the largest number of scientific patents in the world and even the best football team in Asia.
- I’m surprise to hear the “dream” was only extended by another 50 years. It would be more enjoyable and meaningful if only the premier extends it by 500 years instead – at least the achievability percentage is higher. Forget about those Nobel and world-class high-tech patents. Let’s concentrate on the football team, if the quality has degraded to such a shameful level within the last 50 years, just imagine what’ll happen in another 50 years. For all you know, the football team might be only better than Brunei in 2057.
But it doesn’t matter what the premier dreams are considering he would no longer be a living human in the country by 2057, does it? So, no one can blames him should the dream remains “a dream”, the same way his predecessor, Mahathir dreamt of Vision 2020. Heck for all you know Badawi’s successor might sell you another dream of 2157 while other countries already settling in another planet. What the country needs is a good governance.
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Something is Brewing in LATEXX
Just a day after it bought the shares at a massive discount, Multi-Purpose Holdings Bhd(KLSE: MPHB, stock-code 3859) has sold a big block of shares in rubber glove makerLatexx Partners Bhd (KLSE: LATEXX, stock-code 7064). The block involved comprises 32.3 per cent stake at a slightly higher price of RM21.68 million, giving it a gain of about RM320,000. The transaction was done by MPHB's stockbroking unit, A.A. Anthony Securities Sdn Bhd, and the deals are said to be in the normal course of business.
According to the latest report from BusinessTimes, new shareholders have emerged in Latexx while an existing investor has raised his stake. Teong Lian Aik, based in Taiping, bought 14.85 per cent stake, or 28.5 million shares, yesterday through a direct business transaction.
Existing shareholder Low Bok Tek, who has about 5 per cent stake in Latexx, has raised his shareholding to over 20 per cent. He now has a direct and indirect stake of 38.94 million shares. Low is also the chairman of Gunung Capital Bhd, the company formerly known as Taiping Super Bhd. Last year, Gunung Capital sold off its coach building business, tour and travel business as well as its express bus business so that it can focus on its latex concentrates trading business. On Apr-20, Latexx Partners Berhad announced that Taiping Super Capital Sdn Bhd has an interest of 12.47 million shares representing 15.14% of shares in the Company.
Latexx is engaged in trading of healthcare products, manufacturing rubber gloves, property investment and marketing and distribution of rubber gloves. For the financial ended 2006, Latexx registered RM141 million in revenue compare to RM127 million in 2005. Profit however decreased to RM 3.937 million in 2006 compare to RM 4.28 million in 2005. Latexx is currently trading at price earning multiple (P/E/ ration) of 12.19
The question is how can MPHB bought the Latexx shares at the jaw-dropping price of 34 sen per share, a whopping 70% off the closing price of RM 1.24 per share on Wednesday, June-13 initially? Why would the seller (not identified) be generous enough to dump his/her shares to MPHB? Also, Citibank Bhd has emerged as a substantial shareholder of Latexx with 29.97 million shares or 15.4 per cent. The shares were issued to Citibank to settle debts owed by Latexx. So is something brewing within Latexx?
Government Stung by Its Own Bees
The stings must have been too painful, so much so that the Malaysian government finally has to raise the bar for bumiputra contractors to be placed in the various classes following public outcry over shoddy workmanship and leakages in public buildings. Entrepreneur and Cooperative Development Minister Datuk Seri Mohamed Khaled Nordin said the Government had no choice but to raise the standard because there was a need for quality and to ensure that bumiputra contractors compete in a globalised age.
“It is not a reactive move to the spate of leakages. It is part of our emphasis on constantly moving up the value chain. Our contractors must improve or risk being left behind by competition … To instil accountability, contractors must also undertake tenders allocated instead of sub-contracting it to third parties, who indirectly raise project costs” Mohamed Khaled said.
The minister said that among the new conditions to be imposed pending approval of licences was scrutiny of the applicants’ financial status, experience and qualifications. Are you kidding me? After decades of “experience” gained, the quality is still at such a level whereby the newly built multi-millions building could come down in rubble? The most ridiculous and outrageous things that can happen is nobody takes the full responsibility but chose to take the route of finger-pointing from one government agency to another agency. Worst still public money are being used (did I hear tens of million of dollars were required just to do another round of study on why the building collapsed in the first place?) unnecessarily when it should be channeled for a better usage.
Ever heard of “Once is accident, twice is coincidence and thrice is systemic government collapse?”. You have heard of how the brand-new administrative capital of Putrajaya, the RM270 million world’s second largest court complex and the famous RM100 million renovated Parliament came down with cracks and floods due to shoddy workmanship recenty. So, if you wish to visit Malaysian Government buildings, enter at your own risk.
Thursday, June 14, 2007
China's Monetary Policy Tightening to Continue
China's Premier Wen Jiabao said monetary policy needs a "moderate tightening" to prevent the economy from overheating, Bloomberg said today. However he didn't say when the country will do so.
The People's Bank of China has raised interest rates twice this year and ordered commercial lenders five times to set aside more money as reserves. It's four weeks since the central bank raised benchmark interest and deposit rates and banks' required reserve ratios and widened the trading band for the yuan.
Wang Qing, chief China economist at Morgan Stanley in Hong Kong said "Monetary tightening of some form is now imminent, or perhaps in a matter of days ... Measures could include an interest-rate or reserve-ratio increase ... Monetary policy needs to be "stable with moderate tightening" to prevent the economy from overheating"
Inflation accelerated in May to 3.4 percent, the fastest pace in more than two years. The benchmark Composite Index of Chinese mainland stocks has doubled this year amid warnings of a bubble. China's money-supply growth stayed above the central bank's 2007 target for the fourth month in May. M2, which includes cash and all deposits, rose 16.7 percent from a year earlier, after gaining 17.1 percent in April. The target ceiling is 16 percent.
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How I Wish I’m Blogging from Mediterranean
There’s this country by the name of Cyprus which is said to be the last idyllic region of the Mediterranean. Many retirees have since settle down in this country due mostly to the attraction of the rural charm and slow pace of life. North Cyprus Property is currently offering some latest development on the land of which the title is both absolute and unencumbered meaning the land is immune from claims for compensation or restitution. Apartments are said to be in the region of £30,000 while detached villas with pools can be bought for less than £100,000. Not cheap going by developing countries’ rate after the currency conversion but definitely a steal buy for the rich and famous considering you get to go to the beach within 5 minutes drive with the property on the scenic coastal strip with mountain views.
Have I mentioned the land is freehold and there’s no mortgage, loan or any other charge for the purchasers? How I wish I’m blogging from Cyprus now.
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Seven Billion Dollars Pipeline – A Rusty Project
The project which will cost seven billion dollars over seven years to build has the goal of transporting Middle East oil to East Asia (especially China) by diverting it from the congested Malacca Strait. The project's owner, Malaysian firm Trans-Peninsula Petroleum, last month said the 300-kilometre (188-mile) pipeline will cut across the north of Malaysia's peninsula with facilities for storage and transit of crude oil on both coasts. Malaysia's Ranhill Engineers and Constructors Sdn Bhd and Indonesia's PT Tripatra are to build the pipeline, while Al-Banader International Group of Saudi Arabia will provide the oil.
“The chairman of the Asia Oil and Gas Conference, Fereidun Fesharaki said "It saves you some money but it also costs a lot to build the pipeline … Studies should be done to see if it is really economical"
Fesharaki, an expert on Asia-Pacific energy markets and a former energy adviser to Iran's prime minister, downplayed rising energy demand in Asia as the justification for building the multi-billion project. His reasoning makes a lot of sense as the demand for oil in the rest of the region is slowing because of higher prices with the exception of China. From the business point of view, this is tantamount to putting all your eggs in one basket – if the China’s economy collapse or slows-down within the next couple of years (the project will only be operational by 2011, mind you) the seven billion dollars will be worth as much as the rusty steel pipes.Officials from Iran's state oil company said the firm will invest in the construction of one of the two refineries to be constructed in northern Kedah state. Iran will also put money into a separate pipeline to transport Iranian-supplied crude from ships berthed in deeper waters off Malaysia's west coast to the refinery. However Ghanimi Fard, the executive director for international affairs with the National Iranian Oil Company (NIOC), said the success of the trans-peninsular pipeline would depend on the amount of oil demand from East Asia but based on latest information, Iran is not sure of the feasibility of the project. Well, at least this guy has some business sense ant not simply invest in mega project without a proper cost-benefits justification.
The smartest of all would be the Saudi Arabia of which the involvement is to provide oil, without the new pipeline the kingdom will revert back to normal route – nothing to loose. Iran’s main intention might be to divert its’ oil commodity elsewhere with the threat from the U.S. but then it doesn’t mean the country does not do cost-justification for the project. So far Malaysia is the only country obsessed in pushing for the project to kick-off without much feasibility study. So who’s the stupidest of all?
Wednesday, June 13, 2007
Further Bond Yields Rise will Kill Stocks
It was a trading session that saw stocks tumble, claw their way back and then plummet again when the yield on the 10-year Treasury note soared to a five-year high of 5.295 percent. The climb in bond yields exacerbated jitters about mortgage rates rising, which could hurt the already sluggish housing market, and about the Federal Reserve hiking interest rates, which would slow down corporate dealmaking.
Now, why would a rise in Bond Yields bad to the stock market? Simply because a higher bond yield will attract investors from stocks. It was also further aggravated by confounding comments from former Federal Reserve Chairman Alan Greenspan, who said he is not worried about foreign governments selling their U.S. Treasury holdings, but added that yields will likely rise in the future.
According to Bankrate.com, the average 30-year fixed-rate mortgage was at 6.33 percent Tuesday, up from 6.07 percent a week ago.
PayPerPost Secured $7 Million New Funding
Charging only 10% to facilitate the transaction, it’s indeed one of the cheapest fees around but this didn’t stop it from being criticized as another copy-cat of ReviewMe business model and lack of marketplace. There were numerous heated debates on this but suffice to say that most of the advertisers who offers you via PPP-Direct program are actually already within PayPerPostadvertisers’ database. I know this because I’ve been approached by them, though not many. Get real, it’s near to impossible for advertisers to walk into your website and directly offers you opportunity without knowing who you are. So PPP as the middle-man fits well into this role, furthermore both advertisers and publishers do not have to worry about the credibility of the other party in delivering the meat. PayPerPost was founded in 2006 by Edward ted murphy. A serial entrepreneur, Murphy has founded or co-founded six other companies since 1994 which includes MindComet, a leading interactive agency. Today PayPerPost has announced that the company has successfully raised another US$ 7 million second round investment led by Draper Fisher Jurvetson. No wonder PayPerPost has a new design of its website several days ago – it was to mark the new funding, which is a good sign as no investors would pump in money to a business model which wouldn’t works with possibility of going bust one day. To the StockTube readers who have signed up for the PayPerPost program earlier, please take note that you need to “submit your blog” in order to be approved before you can start make money. Hey, with the current stock market sentiment, you can’t simply buy and sell stocks every minute. So what do you do with your free time? Selectively get some opportunities from PayPerPost that interest you and make some pocket money out of it. If you have not sign up for the program, you can do so by entering PayPerPost. If you want to earn US$7.50 immediately, search for the“Get Paid To Review My Post” tool-bar located at the end of this post. Below is the press release on the new funding for PayPerPost: The PayPerPost Revolution Accelerates, Sponsored Blogging Marketplace Secures $7 Million Series B Draper Fisher Jurvetson leads round and joins Board of Directors ORLANDO, FL – (June 12, 2007) – PayPerPost, the leading marketplace for advertisers to reach bloggers and other consumer content creators, today announced it has completed a $7 million second round investment led by Draper Fisher Jurvetson, an investor in the company's Series A and one of the world’s leading high-technology venture capital firms. The financing brings the total amount of capital raised by PayPerPost to over $10 million, giving the company considerable resources for further development as the industry’s leading Consumer Generated Advertising marketplace. Additional participants in the round include existing investors Inflexion Partners and Village Ventures as well as new investor DFJ Gotham. With this investment, DFJ Managing Director Josh Stein also joins PayPerPost’s Board of Directors. “PayPerPost created this exciting new advertising space and has established itself as the industry leader,” said Ted Murphy, chief executive officer of PayPerPost. “Although we’ve only used a portion of our first round capital, this added support from investors unlocks significant growth potential. Our content creator and advertiser ROI metrics clearly demonstrate the upside for PayPerPost’s model. We intend to use this capital to build the infrastructure, visibility and professional expertise necessary to reach and retain a greater network of advertisers and content creators than ever before.” Since its founding in June of 2006, PayPerPost has signed more than 6,500 advertisers to its groundbreaking service, which has enabled Consumer Content Creators to be compensated for their efforts discussing specific companies, products or services via blogs, videos or other media. The content creators are required to disclose relationships with advertisers on their blog, providing transparency for the end reader. Over 125,000 Internet postings, most in the form of blogs, have already earned money for their creators through PayPerPost’s innovative marketplace. PayPerPost recently released PayPerPost Direct, a disruptive new service that allows advertisers to contract and negotiate directly with individual bloggers they identify through a safe, managed system. “PayPerPost has laid a strong foundation for the future,” noted Tim Draper, founder and managing director of Draper Fisher Jurvetson. “It continues to attract a critical mass of participants from both the advertising and blogging communities. Analogous to Overture’s sponsored search model, we believe PayPerPost’s business model holds disruptive potential and will enable the company to thrive in the evolving paid-content arena.” To mark the $7 million dollar funding, PayPerPost has launched a new website detailing the company’s service offering at http://www.payperpost.com. Bloggers and advertisers can easily sign up at the site and begin leveraging the self service marketplace.
Tuesday, June 12, 2007
Investing Contest Cancelled Due to Cheating
David Morrow, the site’s editor in chief, said "Players employed trading strategies to achieve returns that could not be duplicated in the real world, thereby depriving other contestants of an equal chance to win."
Earlier, CNBC also ran into problems with a similar contest which has a prize of $1 million. The competition became a popular feature on the CNBC Web site with about 375,000 people participating. CNBC has hired outside investigators to determine if players rigged the system by, among other tactics, trading after hours. To tell you the truth when I was trading option last year, I made pretty good money using the same tactic (I'm talking about real trading). For those people who have been trading option in the U.S. stock market, you should know what I'm talking about. Previously you had extra two minutes to place your order because the option trading actually stops officially at 4:02pm while the stocks market close at 4:00pm sharp. How hard could it be to enter the trades within that two minutes opportunity window? And due to some reasons, the practice has been stopped and option traders will have the same trading window as the stock traders - how sad *with a grin*.
Rating Upgrade Refused by Moody for Malaysia
While Moody’s rating on Malaysia's foreign currency long-term debt remains as A3, the fourth-lowest investment level, Standard & Poor's has had an A- rating, the equivalent grade.
“Aninda Mitra, Moody's analyst for Malaysia said “Malaysia's sovereign bond ratings are somewhat constrained by general government finances that remain weaker than comparable peers”
The pay rise alone will cost the government a whopping RM8 billion a year and Standard & Poor's is“evaluating” the effect of the pay increase on Malaysia's credit ratings.
Mild Applause Causing Apple Stock to Drop
In that comment, Jobs noted that the iPhone would support third-party developers through is Safari Web browser, which was going to be incorporated into the product. Developers, however, would have to use so-called "Web 2.0" applications. Immediately after he finished, tech commentators appearing on CNBC called that announcement "disappointing" in that the company isn't offering Applications Programming Interfaces (API) to specifically support developers. On the other hand, programs written for the Mac should work on the iPhone.
This is how the stock behaves in a highly-sensitive market reaction to news. You can’t possibly find any flaw in the presentation by Steve, it just that the audience or more specifically the commentators need to be continuously feed with super-good news all the time. If they can find a small hole to squeeze in for a negative comment, people will just take the opportunity to start bashing the stock. And because the estimated 5,000 engineers and programmers were not given the red meat, some smart techies started to throw in spanners.
Earlier, I’ve mentioned that I was optimistic with Apple’s shares and I’m still having confidence with Steve’s leadership. To me the decision by Steven to give a little space for have for third-party incorporation into the iPhone is better than a total lock-down. Remember that Apple’s products have been very proprietary all this while and Steve didn’t promise open-system either during the first announcement of iPhone months ago. So why whine now? Yeah, I know it’s good to strip the iPhone operating system naked so that some geeks can get their hands on the cool gadget and do whatever they want. Get real, iPhone is not an open-system and it needs to ensure not every Tom, Dick and Geeks can load some un-verified software and possibly crash it (and point the finger at Apple’s stability).
Having said that, I’m a stock investor and I react to what I see. While I still long on Apple stock, I also opened some “Put” positions on this guy as the sentiments are so strong and everyone seems to be happy in seeing Apple collapse. When the stock traded at a lower point than the lowest of thefirst 45 minutes with huge volume and Level II against the odd, you better start doing something. You should see how the hell-break-loose and the panic-selling emerge out of a sudden – it was so exciting. So, if you can’t fight them, join them.
Other Articles That May Interest You …
Make Money Investing APPLE Stock – Not Too Late
It was only less than two months ago when skepticals were not very sure if it can hit $100 per share, the rest is history, so to speak. To StockTube readers who are trading option or investing U.S. stocks just like me, I’m pretty sure you still remember when I blogged on Make Money - Why You Should Invest Apple Stock Now (please click to read it if you’ve missed it) whereby the justification was quite simple. The data and statistic doesn’t lie and that’s the beauty investing in U.S. equities – you can pretty sure the statistic are reliable and should you be able to derive the conclusion from it, you can make money out of it.
June, the date that the first Apple iPhone will hit the street. So far, Apple has re-confirmed the date and the feel-good is in the air. If I read the latest news from AP with my right-mind, Apple is expected to present itsnew operating system at the weeklong Worldwide Developers Conference on Monday will further add spices to Apple’s stock. Piper Jaffray analyst Gene Munster is expecting the Leopard (the next Macintosh operating system) to be integrated into Windows operating system seamlessly.Other Articles That May Interest You …
Online Shoppers Should Get Online Coupon
The fact is you would have gotten a better deal and save more if you purchase things online as most companies outsource their front-end sales to company such as Coupon Chief to provide discount coupons in order to attract buyers. Overstock.com (Nasdaq: OSTK) which is an online closeout retailer offering discount brand name merchandise, including bed-and-bath goods, home decor, kitchenware, watches, jewelry, electronics and computers, sporting goods, apparel, designer accessories and travel services, among other products, actually receives tremendous revenue from such business model. For example one of the Overstock.com Red O Sale is giving away up to 80% saving in conjunction with Father’s day. So if you’re rushing for some gifts for him, why not benefits from some of the coupons?
Coupon Chief which is sponsoring this post has more attractive coupons to offer to online shoppers especially from Target, Home Depot, Best Buy and Sears. And to attract new customers, company such as Overstock.com is pampering them with free shipping on $50 orders, not to mention the normal shipping charges are only a few dollars.
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