2007-11-02

Thursday, November 01, 2007

Judiciary Rot - Let’s do what each Individual should Do

Guess it’s true what a MP (member of parliament) said today. The MP, Zaid Ibrahim, who is a member of the ruling party, UMNO, is perhaps the only one from the government who dare to go against the odds on the ridiculous happenings to the nation’s judiciary. He can choose to sit and watch quietly from the sideline but being a senior lawyer, I guess the mess is too much to bear so much so that he couldn’t take it anymore and need to express his opinion.

Instead of firing salvos at the government to which I believe he knew would not make any difference considering more than 90 percent of the MP are hopeless, he fired at the people. He said he’s depressed as the people had become too comfortable due to the country’s prosperity and don’t seem to care too much about the independence of the judiciary and separation of powers. What really pissed him off could be the fact that despite almost 2,000 lawyers’ recent marching which should be seen as a sign of threat to national security, people on the street and even the bench does not seem worried.

Sharing the same sentiment on Malaysian continuous gloomy state of Judicial is the senior constitutional lawyer Raja Aziz Addruse who said the checks and balances that were in the 1957 constitution did not exist anymore. He cited the reasons for this change as a failure of the courts to uphold fundamental liberties, executive interference and the amendment to Article 121 which meant that the courts' jurisdiction was now as that determined by Parliament. 

“Fundamental liberties no longer exist; this is a harsh thing to say but the courts don’t seem to think that fundamental rights are important … To me, the constitution now means nothing because it can be changed at any time” he said yesterday at a coffee table session on “What the Constitution means to me” on the last day of the 14th Malaysian Law Conference. 

Malaysia’s Sultan of Perak, Azlan Shah, one of the country’s most respected figures, has hit out at the country’s increasingly tainted judicial system and his speech appears to be dramatically deepening the divide between the country's nine hereditary rulers and the government. Sultan Azlan Shah was the former lord president of the Supreme Court is by far the most distinguished of the nine sultans and he is said to be the force behind the Conference of Rulers' denial of Fairuz’s 6-months extension. 

One of the most successful tactics adopted by ruling government is the creation offear, divide and rule. Most of the Malay-ethnic are being fed with subsidies, goodies such as NEP (New Economic Policy) and brain-washed withgovernment-control media’s propagandas. The NEP was also the greatest tool to separate the Malay-ethnic from other races. Chinese-ethnic especially the older generation on the other hand is constantly fed with “fear”, the government never fails to use 13th May incident to swing the Chinese votes whenever the needs arise. The younger generation however is either ignorant or simply too busy with their modern lifestyle. 

As long as the economy doesn’t end up like in Myanmar (Burma), the Chinese wouldn’t care. That’s the problem with most of the Chinese people. They’re too scared to rock the boat even though the boat is actually rocking hard now and it’s a matter of time before capsize. Probably the Chinese learnt the art of denial syndrome from some of the MPs and prefer to live in the denial world – everthing is still OK. 

Today also marks the “expiry date” of Chief Justice Tun Ahmad Fairuz Sheikh Abdul Rahim – his tenure ended yesterday. As with U.S. Federal Reserve Chairman Ben Bernanke who was expected to cut the interest rate (he did cut by 25 basis points), Chief Justice Ahmad Fairuz’s application for extension is expected to be rejected by the Yang di-Pertuan Agong Tuanku Mizan Zainal Abidin at the Conference of Rulers.

Ahmad Fairuz, who turns 66 (compulsory retirement age for judges) today, reportedly had his statement recorded by the Anti-Corruption Agency investigating the video clip controversy of which a lawyer was filmed talking to supposedly a senior judge on his handphone, purportedly trying to broker the appointment of judges. Let’s assume Ahmad Fairuz is history and his desire for extension will never come true. Then what? Who’ll be the next in line to take over?

Going by the Courts of Judicature Act 1964, the second judiciary man, the President of the Court of Appeal, Justice Abdul Hamid, will assume the role of the Chief Justice. However the rumors are circulating that someone dear to the ruling party might be given the helicopter ride. UMNO lawyer Zaki Azmi became the first lawyer in the history of Malaysian Judiciary to be appointed straight to the Federal Court, bypassing the convention of first serving in the High Court and the Court of Appeal back in early Sept 2007. Zaki could be the person in PM Abduallah Badawi’s backup plan to have someone pro-UMNO becoming the Chief Justice in case Ahmad Fairuz couldn’t make it.

So everything back to square one? The judiary continue to rot with the Executive squeezing Judicial’s ball to rubber stamp ruling government’s wishes. After the recent 2,000 lawyers’ recent marching now there’re talks to boycott the courts. Lawyer Haris Ibrahim had recently submitted a petition to the King containing 5,036 signatures from the public for a Royal Commission of Inquiry into the video clip. What else can be done to bring back the judiciary’s shine? 


Forget about former premier Mahathir who engineered the collapse of the Judiciary Pillar back in 1988 when he sacked Lord President Tun Salleh Abas and other judges. Mahathir’s dictatorship was partly due to the majority supports given by the same voters who might be suffering now, one way or another. Let’s do what each individual can do. Let the King and his comrades do whatever they are supposed to do. Let the Bar Council boycott whichever courts convenient to them. Let the oppositions scream and raise all the issues at parliament till their throat sore. Let the political bloggers continue to expose more interesting stories. And let’s vote more wisely this time else don’t cry for help. 

Other Articles That May Interest You ...

• Six more months of good time before Election?
• Malaysia Judiciary Scandal? Don’t bet on it

# Update: Court of Appeal president Datuk Abdul Hamid Mohamad has been made the acting Chief Justice while waiting for the post to be filled officially. Ahmad Fairuz's application for extension was NOT renewed.

From stocks to holiday cheer, enjoy it

Halloween is over but there’re still Thanksgiving and Santa Clause to greet you before the curtain is pull down for the year. This period is also the happiest for the kids as they’re looking forward to the long holidays, gifts and whatever their wish-lists drafted. Traditionally stocks investors, speculators, analysts and fund managers will be rushing to submit their leave applications (if they’re required to). Of course you still have some unlucky people staying put to monitor their portfolio because they need to perform window-dressing in order to show the customers their stocks are performing (hmmm, are they?).

Naturally sales will pick up during the last quarter of the year. Consumers need to do shopping and the shops need to clear their old stocks. That’s why year-end sales never fail to attract the customers, although sometimes the sales might be gimmick. The word “Sales” is enough to send high-voltage shock into shoppers’ mind to buy as if there’s no tomorrow. You might thought of just do a round of window-shopping and vowed not to buy anything (better save for the rainy day) but amazingly without you realizing it you’re inside the shop joining the crowds.

Despite the sales, it would be wonderful if you can get more from coupon codesand promotional deals in online shopping. With categories spanning from art, automotive, books & magazine, food, flowers, jewelry to office supply and others, you can find almost anything you like within your wish-list. The coupons available changes almost on daily basis whenever Coupon Chief able to scout for new deals.

The latest added into the list on the main site is 50% off at SpiritHalloween.com coupons clearance sale. I found the $13.46 offer for a wireless optical mouse with rechargeable batteries from Shop4Tech deals interesting and a bargain – it expires on Thursday. 

Last 25 basis points cut for 2007 amid soaring oil price

As expected the Federal Reserve executed the second rate reduction by one-quarter percentage point or 25 basis points to 4.50 percent on Wednesday. Ben Bernanke has cut 50 basis points from 5.25% to 4.75% earlier in September. The 9-1 decision to cut rates on Wednesday was opposed by Thomas Hoenig, president of the Federal Reserve Bank of Kansas City. He preferred no change in the funds rate.

"The pace of economic expansion will likely slow in the near term, partly reflecting the intensification of the housing correction," the Fed acknowledged in a statement explaining its action. In response to the latest cut, commercial banks including Bank of America, Wells Fargo and KeyCorp. announced that they were cutting their prime lending rate - for certain credit cards, home equity lines of credit and other loans - by a corresponding amount, to 7.50 percent.

Fed policymakers indicated the two rate cuts ordered so far may be sufficient to help the economy make its way safely through the trouble spots. They said the risks to the economy from inflation "roughly balance," or are equal to, the risks of a serious downturn in economic growth. Previously, the risks of a recession were seen as more of a threat to the country's economic health.

Lynn Reaser, chief economist at Bank of America's Investment Strategies Group and other economists think the Fed probably will leave the funds rate alone when its meets next on Dec. 11, the last session of the year. While the stocks cheer the announcement, the oil prices soared to a record $95 a barrel. This put pressure on Bernanke as increases in energy and commodity prices have put renewed upward pressure on inflation.

The Dow, which had dipped briefly into negative territory after the decision, rose 137.54, or 1 percent, to 13,930.01. The Standard & Poor's 500 index rose 18.36, or 1.20 percent, to 1,549.38, and the Nasdaq composite index rose 42.41, or 1.51 percent, to 2,859.12. The Russell 2000 index of smaller companies rose 11.87, or 1.45 percent, to 828.02.

Now that the interest rate has been reduced the gap has widen between U.S. and Malaysian. It would be interesting to see if the Malaysian Central Bank will be under pressure to cut the rate as well. If it plans to have stronger ringgit, then the governor does not have to do anything – just sit tight. However this would invite speculators and to intervene means the central bank have to buy dollars. Would it be more efficient to reduce rate then? Furthermore the inflation is going up regardless of the rate due to poor economic management.

On the side note, I blogger earlier how the Google amazingly leaps to $700 from $600 within 20-days of trading and I can assure you that this might not happen again anytime soon within your lifetime. The stock is just spectacular. It’s fabulous. For readers who have been following my journey to the Googleplex, my position has breached the 400 percent profit. However it weren’t with fear and greed along the way especially when you saw how the stock was trying very very hard to stay above the $700 level but slipped on various occasions.

Frankly there was a period on Wednesday trading when I thought of just sell and close the position as the heat was too much. But then the expectation was high that the Feds was going to cut the rate and this will send the stocks higher. So what I did to control my emotion? I closed all my trading session and did some other stuff. And when I checked the Google Inc. (as well as Apple Inc.) after the closing bell, I was smiling from left to right. Now I’ve told you how I did it, you might want to tell me how you control your emotion when you’re trading volatile stocks.

Other Articles That May Interest You ...

• Google leaps to $700 from $600 within 20-days trading
• Rate Cut’s effect – high Oil Prices and weaker Dollar
• Bernanke admitted defeat and Released the Pressure
• Reasons why U.S. rate cut is a Bad Idea

Google leaps to $700 from $600 within 20-days trading

Investors or traders who believe in Google have every reason not only to smile but laughing all the way to the bank. Since the Mountain View-based company reported a set of good earnings less than 2 weeks ago, it breached the $650 level and never looks back. And to think that the internet search engine breached the $600 level less than 20 days ago can easily put other internet and technology stocks to shame. Can you imagine that this guy could jumps more than $100 a share within a period of 20 days?

Today, Wed 31st Oct 2007, Google Inc. (Nasdaq: GOOG, stock) created history when its stock price past through the $700 a share barrier for the first time. At one time the shares traded as high as $704.79 in morning trading before falling back to the current $700 a share. In fact as time past, the stock seems to trade within a very tight range trying to put its foot above the $700 foundation.

With the latest stock price Google’s market capitalization reaches $220 billion mark, more than the second richest man on earth, Warren Buffett. However Warren’s refusal to split his Berkshire Hathaway's (NYSE: BRK.A, stock) means Warren still hold the trophy for owning the most expensive stock on earth - $130,000 a share. Larry Page and Sergey Brin, both 34, have been the biggest winners by far, with estimated fortunes exceeding $20 billion apiece.

The latest surge came after Google confirmed plans to become a bigger force in the Internet's social networking scene and amid reports that the company is about to unveil a long-rumored operating system designed for mobile phones so it can make more money by distributing ads to people on the go – reported AP. Pending the announcement from Ben Bernanke, it appears the market is in silent mode at this moment

Other Articles That May Interest You ...

• Stock Jumps, Google Phone on the Analyst Day?
• Bad News for You and Good News for Me
• Change in plan for Google, going for “Top Greed”
• Little Secret in Making Money trading GOOGLE
• Google and Apple stocks, my money making machine
• GOOGLE ready to blast off into the space of $700
• GOOGLE's stock price zoomed above $600 finally

Wednesday, October 31, 2007

Trading Options can generate 10% monthly returns

Whenever the Fed speaks, everyone stop trading and listen. Stocks markets will normally go to silent from busy mode, at least relatively. After the announcement, everybody will either scramble to buy or sell. That’s where the excitement is and it’ll be more exciting if the people freak out to the direction of your prediction. Today, Wednesday 31st Oct 2007, we’ll see if Bernanke is obedient enough to follow the crowds’ urge to cut the rate again. Most people think it’s likely. And what’s the quantum? It’s going to be a quarter or 25 basis points, so goes the speculators.

The Iron Condor

Besides long or short the stocks or options, there’re more strategies that you can adopt as far as options trading is concerned. Sometimes it’s quite fair in the world of equities trading or investing. The higher the risk the higher the return and vise versa. Iron Condor has a strategy that claims to make good money without costing you the whole day sitting in front of your computer monitoring your position(s) movement.

It’s easy because you only trade once per month with the objective of achieving10% returns every month using iron condors. Iron Condors what? Iron condors is the strategy adopted by Condor Options designed to help lazy *grin* investors generate consistent 10% monthly returns with just 10 minutes a week of your time.

Condor Options Performance

Before we proceed, let’s take a peek at iron condors performance. If you visit their site, the iron condor strategy actually generates an average return of 23.94 percent (based on the disclosed positions since June 2007). That’s not bad considering the fixed-deposit from the bank next to your house is only giving out a pathetic single digit return.

Iron Condor’s strategy in making money

It’s easy, convenient and profitable all right but what is this options tradingstrategy? After reading it I think its equivalent to the spread strategy. Everything boils down to the time-value of options. Just like warrants, options expire within certain period of time. Instead of beating (or control) the stocks price which you do not have the capability to, you instead concentrate on the time-value. The basic fundamental is quite simple. Instead of a buyer, you become a seller.

Assuming stocks or indexes normally trade within a range, you sell options at the top and bottom of the range with the hope that it will expire worthless (same expiration month) – and you keep the credit (the money). Multiply that with more contracts and you can make more money. A simple method but it does come with some risk. The risk is when the stocks or indexes make some huge movement up or down and infiltrate into the range predicted of which you might get assigned or exercised. To tackle this risk, the strategy is to buy options a bit further (out of money) above and below the predicted range.

Since I’ve deploy the same strategy before I know it works. But if you’re thinking of making 100, 200, 300 or higher percent profit trading options, this strategy might not be your choice. Furthermore I like the excitement of very volatile movement as demonstrated by Apple Inc. and Google Inc. because I can put my fear and greed to test (crazy me).

Forget about TMT stocks, here come the Replacements

For a very long time, foreign investors were fed with the limited choice of TMT whenever stocks investing are concerned in Malaysia. The abbreviation of TMT means Telekom, Maybank and Tenaga. The best of practice for foreign fund managers then was you must invest in these three heavyweight stocks since they constituted the biggest percentage in terms of Kuala Lumpur Composite Index (KLCI). And when these three musketeers move; the KLCI move. TMT was like the Great Wall of China and you can’t and shouldn’t claim to have been to China if you haven’t visited the Great Wall.

In layman term, it’s quite easy to justify TMT as the leader in the stock exchange. Telekom Malaysia Berhad (KLSE: TM, stock-code 4863) was the biggest and the only player who monopolized the telecommunication sector. Before the emerging of mobile or cell phones, the land-lines were the cash-cow of Telekom. Telekom ruled the land of the nation's telecommunication.

Malayan Banking Berhad (KLSE: MAYBANK, stock-code 1155) being the largest bank with the most number of branches throughout the country is synonym with national bank status of a nation. With limited and near to impossible for other banks to expand their branches, Maybank monopolizes the domestic market.Tenaga Nasional Berhad (KLSE: TENAGA, stock-code 5347) is the only electricity provider and the monopoly is obvious in the energy sector.

The latest report from theStar which picked the source from Bloomberg shows that foreign investors are slowly shifting the decades old choice from TMT to new candidates. The catalyst was indeed the surging prices in palm-oil. IOI Corporation Berhad (KLSE: IOICORP, stock-code 1961) appears to have beaten all the TMT candidates when its market capitalization has ballooned to RM47 billion compared with Maybank’s RM43.2 billion and TNB’s RM40 billion. Public Bank Berhad (KLSE: PBBANK, stock-code 1295) further put the TMT to shame when the company took the fourth place with market capitalization of RM39 billion.

IOI Corp which is headed by its founder Tan Sri Lee Shin Cheng has a weighting of 6.24 percent on the benchmark KLCI should thank global palm-oil prices for the wealth created. On the other hand the Malaysian version of Warren Buffett, Public Bank founder Tan Sri Teh Hong Piow, has shown that good management and the practice of meritocracy in running the banking operation will ultimately win the hearts of investors. Of course his latest expansion to China contributes to the soaring stock price of his baby Public Bank.

So, you’ve seen two examples of great companies run by great leaders. Why the TMT suffered and its performance deterioted over the time in spite of sitting on the throne of monopoly? Remember Malaysian Airline System Berhad (KLSE: MAS, stock-code 3786)? The company that despite the monopoly accorded had made multiple quarters of losses before the bleeding stopped recently.So what are the similiarity with TMT and MAS? All of them are GLC (government-link-companies). All of them have so-called social responsibility to put on gigantic number of employees on its payroll, regardless of the staffs’ productivity and performance. All of them are protected, one way or another by the government. And the moment the profits stop growing or in the red, all of them will scream and cry demanding price hike. . If only doing business and generating profits are so damn simple and easy.

If the other banks are given the liberty of setting up more branches, Maybank would surelydisappear from the banking map. Take for example a real case of a customer who reported that his Maybank credit card was used for unauthorized transactions worth hundreds of dollars. Long story short, thecustomer was asked to pay the“unauthorized transaction”nevertheless because Maybank couldn’t trace the culprit despite numerous appeals. Out of frustration, the customer paid and cancelled all business relationship with the bank.

Now the same situation happened to another customer whereby his credit card was being cloned for various transactions from multiple petrol stations. This time the bank’s (Citibank) system somehow detected abnormal transactions within one of its customers and alerted the respective officers. The customer service called the customer to verify the transaction and advised the customer to destroy and wait for the new credit card to be issued thereafter. The difference is this "lucky" customer was never asked to pay the unauthorized transactions, which is the only right thing to do, not that the customer purposely ask for his card to be cloned in the first place. So you’ve a frustrated and a happy (loyal) customer based on same scenario but from different banking institution.

Other Articles That May Interest You ...

• Why Can’t Public Enjoy the Benefits of Strong Ringgit?
• Middle-East Invading Southeast Asia for Biofuels
• Which Stocks to Invest - GENTING OR Public Bank?
• Malaysia Largest Bank's Racist Policy Under Fire
• Teh Hong Piow - Malaysian's Warren Buffett
• Plantation Merger & Acquisition Heating Up

Can’t trade stocks or options without calculator

When is the happiest time in an investor’s (or punter) life? When his / her stocks or options in the profitable territory of course. If you invest in equity markets such as Malaysia or Singapore stock markets, you can only celebrate when the stocks go up. On the other hand if you trade the more mature, transparent and fairer markets such as U.S. where the market makers competition actually offset the unfairness on small investors, you can cheer whenever the stocks skyrocket or plunge down from the 50-storey building (depending whether you long or short the stocks).

If you noticed, the next thing you’ll normally do when your trades are in the green is to whip out your best calculator and start punching some numerical keys to see what the profit is. Sound familiar huh? Yes, your trading platform might be able to tell you your precise profit but when you’re not in the rush to sell, then calculator is your best friend. I can never survive without a calculator, not that the Windows-XP doesn’t have the built-in calculator. Yeah, call me primitive or whatever.

But there’s another reason why I still depend on calculator. The fact that the types of stock options I trade every now and then are highly volatile and I’ve my objective to compete against myself in terms of percentage gain, I often use the calculator to determine if my target has been achieved. And talk about percentage gain, did you notice how Google tried very hard the whole day but fails to breach the $700 level?

According to Wize, the best calculator somehow produced from the country named Japan and the reason behind that is very obvious. Do you have a calculator close to you during your trading hours? What's your best calculator you've ever used?

Tuesday, October 30, 2007

Revisiting MAYBULK’s Stock after One-Month

Diversification, diversification and diversification – that’s one of the strategies in stocks investing if you wish to make money. Why diversify? To old birds (veteran investors) you should know what does that mean. To new birds (newbies) it simply means not all stocks will go up or down at the same time. And if you do not know which sector is going up then how can you possibly pick which stocks to invest? Well you don’t and won’t know but in order to get maximum exposure (if you can afford it) the best bet is always diversify.

A classic example was when the U.S. subprime crisis blew off. The dust of the housing explosion affected not only property sector within U.S.’s shore but also the United Kingdom, Europe and even Japan. If only I can transport you back to the future in say, 2005, you would be thrilled trading housing stocks. And if you’re one of investors trading or investing U.S. stocks or options, you would smile the moment I mention companies such as Eagle Materials Inc. (NYSE: EXP, stock) and KB Home (NYSE: KBH, stock).

Now you will probably show me your middle finger if I were to tell you to buy housing stocks. Really, it’s the perception of the public that the housing problem is not over yet. At least it will last for 2 years, so goes the saying. Does that mean you’re doomed (can’t make money anymore)? Weak in housing industry doesn’t mean the rest of the sectors are equivalent fragile. Let’s think it this way, where will you put your money if the housing stocks are cursed? The answer is other sectors be it technology or energy. So what if you got burnt (hope you practice stop loss and risk management) but you’re diversified into other sectors in the first place. Guess what, if you happen to have positions in Apple Inc. or Google Inc. but got screwed by KBH, you might still be able to smile, no?

A month back (25th Sept 2007 to be exact) I talked about Malaysian Bulk Carriers Berhad (KLSE: MAYBULK, stock-code 5077) and why it’s one of the stocks you can’t ignore. Read the article if you haven’t. If you were looking for fundamental stocks to add to your portfolio in align with the best of practice of diversification then you’ve every reason to smile with MayBulk. The stock breached the resistance level of RM4.40 on 4th Oct and the price-action-volume on 10th Oct should give you the signal to go in.

In fact, if you care to pull out the chart and plot the trend (refer to chart) you can see a very nice uptrend trading pattern. Maybulk seems to have traded out of the range for the last three-days and the bullishness looks to continue but not before a minor consolidation (started today?). The stock’s uptrend could be one of the easiest to understand and everything boils down to Baltic Dry Index. Since 25th Sept the BDI skyrocket from US$9.082 to US$11,033 – a whopping 21 percent increase.

Looking at the prices of commodities, can you imagine the potential uptrend of Maybulk stock if the BDI continue to increase by another 20 percent?

Other Articles That May Interest You ...

• MAYBULK, the Shipping Stock You Can’t Ignore

Another 25 basis points rate cut overshadow Oil Prices

Oil prices continue to surge but that is not going to stop investors fromfeeling optimistic about the stock market. At least the expectation from the Federal Reserve to cut interest rate again is high and strong. And this (optimism) is sufficient for the investors to ignore the fact that crude oil futures had soared above $93 a barrel for the first time in overnight trading, after Mexico's state oil company said it was suspending about a fifth of its oil production due to a storm. This will temporarily halt as much as 600,000 barrels of daily crude production.

The Fed begins its two-day meeting on Tuesday, and the market widely expects a rate reduction the following day after the 50 basis points cut last month (September). While Ben Bernanke’s team remains concerned about inflation it is likely to lower the target federal funds rate by a quarter-point (25 basis points)due to overriding credit worries. Earnings so far have shown weakness in the financial and housing sectors but strength in others.

The likelihood of the central bank in cutting rates again will further boost oil prices but will send more pressure to the US-dollar. I’ve wrote that Ben Bernanke’s team has ample room to play with the interest rate. He has 4.75 percent to toy aroundand if the new round of 25 basis points cut doesn’t make the investors happy he can continue to cut it in the next meeting. The ball is on his court and it’s up to him to do whatever he thinks will work for U.S. economy.
And to think of the potential of the funds rushing to find parking lots in the rest of the markets including Malaysia stock market, you should start drooling.

Other Articles That May Interest You ...

• Why Can’t Public Enjoy the Benefits of Strong Ringgit?
• Oil prices establishing $90 as the new base
• Minutes revealed more Rate Cuts at the doorstep
• Rate Cut, Financial Expectation & Window Dressing
• Rate Cut’s effect – high Oil Prices and weaker Dollar

Sunday, October 28, 2007

Why Can’t Public Enjoy the Benefits of Strong Ringgit?

It’s not difficult to become a Finance Minister, especially when you’re also holding the position as the Prime Minister cum Minister of Internal Security.Malaysian Prime Minister (PM) could easily be one of the most powerful positions in the world, holding the other two very important ministerships as he walks the corridor of powers. As the Finance Minister, basically the nation’s coffer is at PM’s mercy and disposal. As the Minister of Internal Security, basically the PM is empowered to arrest and detain anyone without trial for an indefinite period based on mere suspicion that one "may be likely" to commit an act deemed dangerous to national security.

Except for all the local Government-control media, almost all foreign media and local blogs (including StockTube) have wrote that somehow the snap general election is very near. Of course if you care to read other political blogs, then you won’t be surprise if the dates such as 25th Nov 2007, 15th Dec 2007 and 15th Mar 2008 are mentioned as the possible election date, at least those are the prosperous dates consulted from feng-shui masters by the ruling party – as the claims goes.

Election’s “feel good” factors

Feng shui or not, it’s no brainer that you need “feel good” factors, lots of them, to attract voters to put a cross on the voting paper. It’s not easy to get all the stars aligned. You should know that there’re couple of daily stuffs which will see price hike next year, 2008. Amongst them are the toll-rate, fuel prices, electricity rate and gas prices. No prizes if you can guess what else will be affected. As with the economic equation, the chain reaction could be unstoppable.

The ruling government is a hell lucky government. This doesn’t mean the government is effective in governing the small nation of only 26-million people though. It actually implies that the nation is blessed with too much natural resources, so much so that Singapore senior Lee Kuan Yew’s envy was obvious during an interview recently. The government naturally depends on these natural resources, one way or another, to spring fairy-tales and subsequently feel-good stories.

The stock market closed last Friday to a fresh high to 1,398.55, just an inch from the 1,400 mark, mainly due to gains from palm oil companies. Largely influenced by high crude oil, the prospect of demand for biofuels from palm oil lifted the composite index. The currency ringgit meanwhile strengthened to a 10-year high of 3.3480 against the US dollar.

Finance Minister who talks Myth

So, when the Malaysian PM cum Finance Minister cum Minister of Internal Security said that the strengthening of the ringgit is due to investors' confidence in the local currency, the expanding economy and strong foreign exchange reserves, you should take that with a pinch of salt and not putting an ounce of trust.Investors or currency speculators are not buying ringgit because they’re confident the ringgit will appreciate due to fundamental reason. They’re buying because theU.S. dollars are weakening. And there’s obvious difference between them.

People don’t buy in bulks your instant noodles because its value will greatly appreciate (and hence its price) due to the latest research that found your instant noodles contain newly found Omega-3 which is superior than salmon fish. But people are buying your instant noodles because the other country said their own produced instant noodles contain substance that could cause potential prostate and breast cancer. See the difference?

Now why I equate U.S. dollar to cancerous instant noodle? Because Bernanke had chop off a whopping 50 basis points (0.50 percent) in interest rate and he’s expected to cut more in the coming months. This means the value of U.S. dollar has greatly reduced and will continue to weaken. People don’t buy currency that depreciated by 0.50 percent if there’re better choice elsewhere. If this is not enough to scare you, remember that the Feds Chairman still has 4.75 percent to play around. He can still cut 0.25 percent for 10 more times to bring the rate to 2.25 to tame the likely-recession into submission (example).

And when Ben Bernanke continues to cut the rates (assuming he has to due to persistent housing problem and weak U.S. economic growth) what do you think of the U.S. currency? Where do you think the currency investors or speculators will take their money to? These people need to make money with their funds and if even Ghana or Namibia can give the highest interest rate, they won’t blink twice about parking their money there.

So, it’s a myth and definitely not true what the PM told you.Nevertheless you can bet that if U.S. dollar continues to show weakness, more foreign funds might decide to park in the local stock market. I said “might” because Malaysia is not the only choice for these cash-rich funds. There is still Singapore, Indonesia, Thailand or even Vietnam stock markets that are on the race to attract the hot money. In factevery major currency appreciated against the U.S. dollars after “Uncle Ben” cut the rate by 50 basis points to 4.75 percent on 18th Sept 2007, mind you.

Will the public enjoys the benefits of Strong Ringgit?

On the other hand, there’re hidden reasons why the government favors strong ringgit. It will heal some of their headaches, at least temporary until after the election. Both higher crude oil and strong ringgit will greatly reduce the fuel subsidy. Strong ringgit also will make import goods less expensive and in theory imported food and materials’ prices should be lowered. But you won’t see any price reduction in these goods as the chain of governance is simply too messy.
And you keep on wondering why you couldn’t enjoy a bit of the benefits of having stronger ringgit. Does this piss you off? When was the last time you heard of price reduction in finished goods because the raw materials were cheaper due to stronger ringgit? And you can’t simply believe the inflation rate figure released by the government, can you? If the opposition parties can pull a better result this time, it’s not because the oppositions are doing better but simply because the ruling parties screw-up big time in managing the economy of the country.

I wonder where’s the prepared text used repeatitively that justify weaker ringgit as stronger ringgit will make the nation’s export less competitive. Who says you need a PhD to become a Finance Minister?

Other Articles That May Interest You ...

• Oil prices establishing $90 as the new base
• If only Malaysia has leaders half of Lee’s Intelligence
• Six more months of good time before Election?
• Oil price hike – Badawi’s greatest Economic Challenge
• Rate Cut’s effect – high Oil Prices and weaker Dollar

Hope for bad credit consumers in U.S.

With most of the Americans do not really save for the rainy day, it only get worse when a housing problems hits. Just like any bubbles, after the technology dot com bubble burst a decade ago, the housing bubble burst this time around. It’s not that hard to spot if there’s any bubble that you should be aware of since the law says “whatever goes up must comes down.”

But does that mean Americans who do not have good credit rating should be left to rot? How can consumers with a less-perfect credit rating apply for facilities such as credit cards, housing loans, personal loans, auto loans etc? Get real; if these people have a good credit, they won’t be cracking their heads scouting for loans in the first place.

There’re multiple free consumer resources that you can visit to get the best bad credit offers. Not only can you get assistance on multiple loans, you also get to know how to repair your poor credit rating and consolidate your monthly bills into one lower payment.

*sponsored*

Anniversary Gift from Google to StockTube – PR 5

You might not know this but time really flies. I have almost forgotten that this month is actually StockTube’s “1st Anniversary” in the blogosphere. It was a year ago when I discovered the fun of blogging and immediately started with Google Blogger’s platform. Since then StockTube had blogged about 720 posts which translate into about 2 blogs per day. Am I sick and tired of blogging? Not for a single moment.

I might not be the specialist when come to bait-linking and marketing of this blog compare to bloggers such as Darren Rowse, John Chow or Shoemoney who made tons of money from blogging. But then my area is different from them. My focus is in stocks investing and options trading while at the same time introduce some alternatives in making pocket money of which you can leverage on while you’re too free doing nothing simply because the stocks do not present the opportunity for you.

And speaking of the above three top bloggers, if you read about the hoo-haa in the blogosphere about how Google’s PageRank, a trademark of Google Inc. (Nasdaq: GOOG, stock), created havoc when even Darren Rowse was slapped with the punishment of PageRank’s plunge from PR6 to PR4 days ago. However Darren’s PageRank has since recovered to its original PR6 (as of today). As for John Chow, Google’s servers are confuse which PR to award – still undecided whether PR4 or PR5. Still, not many people know what actually happens and why Google’s PageRank ran amok (guess what, youtube itself was punished with PR3 from PR8). The only speculation was that blogs were punished because if their involvement in links-selling.

When I checked for StockTube’s PageRank during the “all hells break loose” period, fortunately StockTube was still at PR4. About an hour ago when I rechecked again, I was surprised to find that Google was kind enough to upgrade this blog’s PageRank from 4 to 5. Wheee! This is probably one of the best gifts from Google besides the *ahem* great stocks performance that made me some good money (still paper gain as I’ve not close the position as yet)

StockTube first got its first PageRank (PR4) back in early Feb 2007 during Google’s quarterly update. Since then nothing happens till today (I suppose today, 27th October 2007, could be the day the actual PR is finally being assigned to most if not all the websites around the globe). And if you wish to check your PR, you can do so using PageRank Checker, Live PageRank or PageRank Checker. Simply enter your website or blog’s domain to get the result. I hope this round of update is for real and not another round of joke. Boy! Santa Clause does come early this year – Yip Pee!!

Other Articles That May Interest You ...

• Finally StockTube Has Been Assigned A PageRank

Saturday, October 27, 2007

Home buyers switching to home improvement

Another week ended with another achievement by none other than crude oil prices. Light, sweet crude for December delivery rose $1.40 to settle Friday at a record $91.86 a barrel on the New York Mercantile Exchange after rising overnight as high as $92.22, a new trading peak. Analysts can argue till the cow comes back that the underlying fundamentals don’t support such high prices and put the blame squarely on speculators but the fact remains one after another factor haunting the oil prices.

The factor being the markets are becoming increasingly uneasy and upset over the prospects of entering the winter high-demand season with inventories at too-low levels, hence driving the oil prices up. In the meantime, the housing problem appears to be still around for some time and it’s not out of wood yet. People who was hit by the recent sub-prime crisis are thinking twice about speculating on housing, at least for the time being.

Not far away business such as garage conversions to convert under-used space into a bigger and roomier area is picking up. Anglian home improvements for example could expect good business as more people are scaling down from expansion and instead concentrate on upgrading their existing house, probably to create better home while waiting for the right time (for the housing prices to pick up again in future) to dispose it.

*sponsored*

Friday, October 26, 2007

Scalped small profit from Akamai during boring time

Yesterday, Thursday, was rather a boring trading day as both my Google Inc. and Apple Inc. were not performing as expected. If you were monitoring both stocks yesterday, you will know what I mean. Anyway, you can always scout for some of the stocks and scalp some profit out of it. Really, there’re many way to skin a cat, not that I like to devour exotic meats in real person.

Akamai Technologies Inc. (Nasdaq: AKAM, stock) used to be my pet stock but since it disappointed me last year, I’ve totally put it in cold-storage. Obviously when you’re investing stocks especially trading option, you should be flexible to dump stocks that deviate too far away and fails to deliver according to your trading methodology. There’s nothing wrong in doing so.
I opened the position, AKAM Jan 2008 35 Call Option yesterday since I’ve all the time in the world as the trading pattern of both Google and Apple permitted me to take my eyes off them. Earlier on, Akamai announced it’s earning on Wed, 24th Oct after market and beat the earning estimate. And so the stock gapped-up. Based on the price-volume I thought of scalping Akamai but the overall market sentiment was on yo-yo – my target price didn’t trigger.

It only triggered this morning and the automatic mechanism made a small amount of money for me. You can’t be greedy with such trading strategy (scalping) as your intention is not to make huge but small profit and “Run”.

Oil prices establishing $90 as the new base

Oil prices closed above $90 a barrel for the first time officially Thursday, on news that Lebanese troops had fired on Israeli warplanes. Even though the new conflict will not affect oil supplies directly, it would however indirectly “invite” other Middle-East countries such as Saudi Arabia and Iran into the whole hostile situation. The NYMEX Crude Oil closes at $90.46 after reaching the high of $90.60 earlier of the day in U.S. 

During Friday Asian trading, the oil prices posted another new trading record at $91.10 on renewed concerns about oil supplies and news that OPEC won't further increase output. Organization of Petroleum Exporting Countries Secretary General Abdalla el-Badri told The Wall Street Journal Asia on Thursday that the cartel is not in discussions to boost production by 500,000 barrels. The comments counter rumors that Saudi Arabia is pushing for another production increase after pressuring the group into one of similar size that goes into effect Nov. 1.
The combination of supply worries and geopolitical concerns has pushed crude oil prices up more than 6 percent since Tuesday and the uptrend is expected to continue. With the crude oil prices closed above the resistance and psychological of $90, you have every reason to worry. It means the price is starting to build its foundation with $90 as the new potential support level. And when the foundation building is done, the next level is $95 or $100. I bet not many would imagine oil prices at $100 a barrel six or three months ago. 

But the reality is here to stay and you better prepare for the worst. Instead of worrying whether there’ll be fuel hike, why don’t you worry about the quantum of the hike? Hypothetically, I had blogged how the current administration might have found the solution to the high oil prices. But I stopped short of talking about the $100 a barrel possibility as I don’t think anyone can chew more than the $90 level then. Given the same hypothetically formula, now you might need to dig deeper into your pocket to pay additional 30 cents a litter to the petrol station to fill-up your fuel tank.
Talk about fuel hike of a whopping $1.20 on top of existing $1.92 a liter – that’s $3.12 a liter dude. Anyone care to quote government’s decade-long justification that Malaysia’s fuel price is still among the cheapest in the world? 

Other Articles That May Interest You ...

• Bad News for You and Good News for Me
• Fuel Price Hike of 90 cents to RM2.82 a liter next year?
• Reasons Why Oil Price might spikes to $90 and beyond
• Oil price hike – Badawi’s greatest Economic Challenge

Thursday, October 25, 2007

Monopoly No More, AirAsia to fly to Singapore

Tony Fernandes’s grumbling about the bias protectionism rule in favor of Malaysia Airline System (KLSE: MAS, stock-code 3786) appears to bring positive result after all. Today Malaysian Prime Minister Abdullah Ahmad Badawi said that budget carrier AirAsia Berhad (KLSE: AIRASIA, stock-code 5099) has won a battle to fly the lucrative Singapore-Kuala Lumpur route, breaking the national carriers' monopoly. 

Reports said the cabinet agreed yesterday to open the routes to budget airlines from the two countries under a reciprocal arrangement, starting in December 2007 or January 2008. The Cabinet has given approval for AirAsia to operate two daily flights each from Kuala Lumpur, Penang, Kota Kinabalu and Kuching to Singapore.
Earlier this week AirAsia's founder Tony Fernandes said (with great sadness) that with Singapore indicating it wants to open the sector to competition ahead of a January 2009 deadline, Malaysia Airlines remained the only roadblock. Tony who is reportedly to be in Singapore could not comment as he claimed he isn't aware of the government’s decision.

MAS, the government-linked company that has been pampered since its birth and never knows the word competitiveness and survival through-meritocracy had opposed the move, saying it needs more time to execute its recovery and that Malaysia and Singapore should adhere to the original timeline for liberalization – a reference to the Asean Open Sky Policy, scheduled to take off on Jan 1, 2009.

With this new development, it appears the rumorabout AirAsia’s possibility of getting the direct flight to Singapore in exchange for the goodies given to MAS’s own version of low-cost entity FireFly is true. FireFly which was allowed to operate from Subang and even fly the same routes as AirAsia (talk about copycat) in the latest local aviation news is said to emulate the business model of AirAsia.

Tony who is in Singapore currently might be there to finalize the details of the new route including logistic and fares. Already there’s news that prices for the Singapore flights are expected to start at RM9.90 for return trips. This will deal a severe blow to MAS which is currently serving the exclusive and lucrative Kuala Lumpur-Singapore route which together with Singapore Airlines fly 20 times a day between the two cities.

But what prompted Malaysian Government to become business-conscious all of a sudden? It can’t be the articles written by StockTube. Definitely it couldn’t be the continuos grumbling from Tony Fernandes. It could be a combination of several factors. On top of the table, it could be the “request” from Singapore Airlines itself to allow its Tiger Airways to fly direct to Kuala Lumpur. Tiger Airways’ profit is Singapore Airlines’s profit since the latter owns 49 percent stake in Tiger Airways.

It could also due to the fact that the tourists’ arrival during the current 2007 Visit Malaysia Year is bad, so bad that the Tourism Ministry is talking about extending the program into 2008 (of course the ministry could twist the fact that the extension is due to the overwhelming response so much so that it would be cruel not to prolong the program). Tourism is one of the industries that bring in good, easy and hot money into the country.

Whatever the reason, AirAsia is seeing the early arrival of Santa Clause as the profit from the new routes will definitely contributes to the company’s bottomline. The stock should rejoice with such a piece of news.

# Note: It’s been extreamely difficult to post articles, check Google’s gmail and moderate comments for the past 2 days. The performance is so bad (yes, the problem still persists till now) that I thought I’m connected to internet via 28.8kbps dial-up. It appears accessing Google’s products are taking ages – that’s the risk of putting all the eggs inside the same basket. Wonder what could be the problem(s). Heck if not for the reason that Google stock has made good money for me, I would start cursing it.

Other Articles That May Interest You ...

• How to do business if Meritocracy is not welcomed?

Wednesday, October 24, 2007

RHB needs to merge to stays Relevant

Rashid Hussain Berhad (now delisted) was started with a big-bang under the ambitious mission to turn the empire under the founder Tan Sri Rashid Hussain into a major financial supermarket in the 1990s. Although no longer the captain of the ship, Tan Sri Rashid should be able to smile as the RHB brand still survives until today. But given time and behind the door’s plan, it won’t be long before the name vaporizes into thin air. Furthermore there’ve been too many owners coming in and out the top executive’s door to make the RHB brand relevant anymore.

History proves that by putting the young Sulaiman, Sarawak Chief Minister Abdul Taib Mahmud’s eldest son, onto the chairmanship of RHB was a waste of time to the group. You can’t expect the multi-billion dollar company to move an inch if the chairman was buzy playing games while attending board’s meeting, can you? And now you’ve EPF (Employees Provident Fund) as the new owner. But pension-fund EPF knows very well that banking is not their forte and they’re rushing against time to put everything in order to realize their objective. And their objective is to make money.

You’ve have heard from both EPF-RHB and AmBank Group who denied that they’re talking over a nice cozy dinner about a merger plan. It’s a rather complex decision. On one hand you’ve foreign parties namely Kuwait Finance House, Bank of Nova Scotia and unidentified party who expressed their interest via Goldman Sachs Group Inc. Goldman Sachs was appointed by EPF to manage the sale of its equity interest in the financial services group.

On the other hand EPF needs to reduce its current 82% stake in RHB Capital as under the Malaysian’s Banking and Financial Institution Act (Bafia), an institution can only hold up to 20% in the holding company of a bank. In order to remains relevant and main shareholder in RHB Capital it appears EPF needs to sell its stake to at least two parties. It will be risky tosell the two blocks of stakes to foreigner. So you should take it with a pinch of salt about the denial of merger between both RHB & Ambank.

Today, RHB Group managing director Michael Barret said RHB is "highly unlikely" to achieve its own goal of becoming one of the top three banks in Malaysia by 2012 and in the region by 2020 without merger and acquisitions (M&As). It’s not easy to acquire foreign quality financial institution with RHB’s current strength. It had tried with PT Bank Niaga Indonesia and should know the potential rewards against risks. You need to have very deep pocket to purchase foreign banks which can contribute instantly to your bottom line.

Hence the best bet is still to merge with another strong local bank such as Ambank or even CIMB. If it materialized, the chances of seeing the RHB logo again could be slim.

Other Articles That May Interest You ...

• EPF finalizing steps to let go of RHB to KFH
• Will RHB Falls to Foreigners or Sleeps with CIMB?
• UBG Aye to EPF despite Higher Offer from EON Capital

Stock Jumps, Google Phone on the Analyst Day?

You might get sick and tired with me for being so obsessed about Apple Inc. and Google Inc. Forgive me but somehow I couldn’t think of any other technology stocks that grow as fast as these two mean machines. Contrary to the basic rule of fundamental investing that says you shouldn’t invest in stocks that have very high P/E, there’s exception to the fast growing stocks such as Apple and Google. 

Shares of Google Inc. topped $675 for the first time Tuesday, nearly one week after the company reported strong third-quarter results. The shares reached as high as $677.60 during afternoon trading session, before closed at $675.77, a gain of nearly 4%. The stock began to climb after 2:00pm EST. So what could cause the sudden jump? Rumors had it that it’s all boils down to the big day on Wednesday. 

Google Inc. (Nasdaq: GOOG, stock) is set to host an Analyst Day meeting on Wednesday, October 24, 2007 in Mountain View, California. The presentations that everyone is waiting for are scheduled to begin at 10:00 a.m. Pacific Time (1:00 p.m. Eastern Time) and conclude by 2:30 p.m. Pacific Time (5:30 p.m. Eastern Time). As the saying goes – when the internet search giant speaks, all of Wall Street listens. There could be some surprises which among others the announcement of Google’s Phone. 

Google’s stock was partly boasted by the news that Google and television ratings company Nielsen will announce a multi-year deal on Wednesday to provide demographic data to Google's system for selling television advertising. Google will combine the data it receives from television set top-boxes with information that Nielsen, the dominant TV ratings company in the United States, provides on viewers by gender and age.
Google's TV Ads system currently has access to about 14 million U.S. homes through agreements with satellite television operator EchoStar Communications Corp. and local cable provider Astound Broadband. Google CEO Eric Schmidt hadhinted the estimated $70 billion U.S. television market as an opportunity that "looks like it is going to grow very quickly."

So, I guess I’ll have to wait for a while more before I can post my profit on Google Inc. since the trend is still bullish. If you noticed my paper gain (my GOOG Nov 570 Call is still open) from the screenshot above, it’s my new record in terms of percentage gain – 315 percent profit. Yeah, call me greedy, crazy or whatever but I’m competing against myself on this trade.

On the other hand, Apple Inc. seems tostabilize above $185 level but traded below at $183.99 during after-hours trading. If you haven’t diversified into technology stocks then you should seriously consider Apple or Google’s stock or options in your portfolio – wait for weakness before jumping in. At this moment, it’s “wait and see” strategy for me.

Other Articles That May Interest You ...

• Knight Apple Saves the Day and the Tech-Stocks
• Bad News for You and Good News for Me
• Change in plan for Google, going for “Top Greed”
• Google and Apple stocks, my money making machine

Tuesday, October 23, 2007

Malaysian Casino King, Lim Goh Tong, passed away at 90

Malaysia’s third richest man and the founder of Genting Group(KLSE: GENTING, stock-code 3182), Tan Sri Lim Goh Tong, passed away at 11.20am Tuesday at the Subang Jaya Medical Centre. The tycoon who was 90, leave behind a diverse business empire worthUS$22 billion. He survived by wife Puan Sri Lee Kim Hua, and their six children and 19 grandchildren.

The fifth child in a family of seven children, Lim migrated from China's Fujian province in 1937 at the age of 19 with only a small suitcase and US$175. He battled against the odds to build Genting Highlands, a casino hotel resort that opened in 1971 and flourished into a Las Vegas-style resort. It is the country's only casino and includes five hotels (namely Genting Hotel, Highlands Hotel, Resort Hotel, Theme Park Hotel and First World Hotel), two apartment blocks (Ria and Kayangan Apartments), Awana Genting Highlands Golf and a theme park. 

He made his first fortune by trading in second-hand heavy machinery in the 1940s after the end of Japanese occupation, and later ventured into mining. While working on a hydroelectric power project in 1964 in Cameron Highlands, a popular hill resort patronized mostly by British colonials at the time, Lim dreamt of building a similar hill resort nearer to the country's biggest city, Kuala Lumpur, as a getaway for local residents. 

He found the remote 5,900-feet (1,800-meter) Ulu Kali mountain, just about an hour's drive from Kuala Lumpur. In 1965, he set up the Genting Group to transform the dense virgin tropical jungle into one of Malaysia's top holiday destinations that attracted 18.5 million visitors in 2006.

Besides the flagship casino in Malaysia, Genting group’s empire includes Singapore-listed Genting Interntional, Hong Kong-listed Star Cruise Ltd., 46 casino properties in Britain under the Stanley Leisure group and casinos in Australia and Philippines. Late last year (2006) under the stewardship of his son Lim Kok Thay, Genting International-Star Cruises consortium won the Singapore’s Sentosa integrated resort project and is set to open a casino resort by 2010 that will include a Universal Studios theme park, a giant oceanarium and film production facilities.
Genting group has since expanded and diversified from its initial hotel and resort activities to plantations, properties, paper manufacturing, power generation, oil and gas, electronic commerce and information technology development. With the smooth and successful transition to his son, Lim Kok Thay, who has proven himself with great business acumen, Lim Goh Tong can rest in peace knowing his empire is in good hand of a capable leader.

Other Articles That May Interest You ... 

• Which Stocks to Invest - GENTING OR Public Bank?
• Why You Should Investing Genting Stock - Perception Game
• Top Reasons Genting Is A Winner
• Genting International-Star Cruises Consortium Won
• D-Day For Genting's Sentosa Plan

Knight Apple Saves the Day and the Tech-Stocks

YES! Apple did it again. Apple saved the day. Apple is incredible. What a wonderful Apple stock. You simply got to love Apple Inc. and Steve Jobs. I might sound exaggerated with all the praises for Apple but it's simply lovely. Not only it re-injected the optimism into the stock market especially Nasdaq, it also revitalizes the rest of the technology stocks, especially Google Inc.

For the three months that ended Sept. 30, Apple Inc. (Nasdaq: AAPL, stock) said on Monday (after market closed) it earned $904 million, or $1.01 per share, compared with $542 million, or 62 cents per share, in the year-ago quarter. Revenue totaled $6.22 billion, compared with $4.84 billion in the same quarter last year. This easily beat by a wide margin the expectations of analysts polled by Thomson Financial, who predicted earnings per share of 86 cents on sales of $6.07 billion.

Apple said it shipped a record 2.16 million Macs in the quarter, an increase of 34 percent, while it sold 10.2 million iPods, up 17 percent. In the first full quarter of iPhone sales - a number many on Wall Street were waiting for -Apple said it sold 1.12 million units, bringing the cumulative total to 1.39 million since the product debuted on June 29. Sales of the iPhone picked up in September after Apple knocked $200 off the price of the 8-gigabyte model, bringing it down to $399.

I believe what actually excited the stock price was the fact that iPhone sales figure was fantastic considering that the highly successful iPod took Steve Jobs’ team a whopping two years to arrive at the number achieved by iPhones (within 3 months). I guess the tactic of slashing iPhone’s price worked after all. Investors now are upbeat that iPhone will be another lucrative cash-cow for the Apple Inc.

Apple reiterated Monday its previous target of selling 10 million iPhones in 2008, helped by the launch of the iPhone in Europe next month, then in Asia next year. Some analysts are betting that Apple’s earning might continue to grow materially at a 50 percent annually for the next three year. The higher guidance issued by Apple that said for the current quarter it expects earnings of about $1.42 per share on revenue of about $9.2 billion also help in pushing the stock price higher during after-hours trading. Analysts on average had been expecting earnings of $1.39 per share on sales of $8.58 billion for the current quarter.
Apple stock price rose $3.94, or 2.3 percent, to close at $174.36 and after the earnings report, the shares happily climbed about $12, almost 7 percent, in extended trading. So to the StockTube readers who have positions in Apple Inc. (stocks or options) – Congratulations!! I just hope there’re tons of short-sellers rushing in to cover their positions as this could push the Apple stock price higher when the market opens on Tuesday.
Now, do you think Apple can cross the $200 a share since it breached the $150 level on 26th Sept, the same way Google Inc. is aiming for $700 after breached the $600 level? 

Other Articles That May Interest You ...

• Anxiously waiting Apple’s earning announcement
• Google and Apple stocks, my money making machine
• Apple at 52-week high, Funds flowing into Tech-Stocks?
• Apple Slashes iPhone Price – Steve wants quantity

Anxiously waiting Apple’s earning announcement

Somehow I like this thing about bargain hunting. And I like the law of whatever goes up must comes down and vice versa. We saw the Dow plunged by 366 points last Friday and today we saw a slight rebound in the afternoon after a three-digit plunge in the morning trading. Traders are still nervous obviously. The Dow, Nasdaq and S&P500 are trying very hard to stay alive within positive territory.

This is good news especially when the market appeared optimistic about Apple Inc.'s earnings, which were scheduled to be released after the closing bell. Apple’s stock has been trading with gain throughout the whole morning and upon seeing this, Google Inc. and the rest of the technology stocks follow through. Fed Governor Randall Kroszner at a speech in Washington reaffirmed that the central bank will "act as needed" to calm the financial markets.

With such volatility I’m glad Apple is trading above $173 level and hopefully it’ll stays that way throughout the day. Google Inc. in the meantime is trading above the $646 level but fails to jump above the $654 resistance level. If Apple’s earning could not impress investors the stock could be punish to the price below $170 and below after-hours trading. But if Apple could impress the same way as Google’s then both Apple, Google and most of the technology-stocks could heave a sight of relieve.

Other Articles That May Interest You ...

• Bad News for You and Good News for Me
• Change in plan for Google, going for “Top Greed”
• Little Secret in Making Money trading GOOGLE
• Google and Apple stocks, my money making machine

Monday, October 22, 2007

Add chat functionality with LiveHuman

One of the reasons why MNC (multi-national company) are so successful and making billions of dollars in profit is due to the internet. A classic example would be Dell Inc.’s business model whereby to get the best price you’re encouraged to purchase their products from their website. When you have issues or problems you can either call their hotline or email their support team. Both method of getting support involves costs nevertheless.

For small and medium businesses looking for better support which is cost-effective, they can actually implement live chat within their corporate website, be it intranet, extranet or internet. LiveHuman offers support chat which could transform your boring looking corporate website into something that could potentially lock-in your existing customers while attracting new customers.

The live support software can be either web-based or hosted within your server. As far as broker firms that offer stocks investing platform out there, not many has this feature. I’ve tried live chat with one of the providers to solve some technical problems or getting some queries during the trading hours and I can safely say this feature would be the deciding factor when you choose which stock-broker house to choose. 

LiveHuman Chat which is at their fifth version could be started in three simple steps. First you need to register (it’s free), then you just download the software and finally insert one line of HTML code onto your website and voila your website has that distinct professionalism. You can try the trial version for 7-days and thereafter you can subscribe it for $13 per month.

*sponsored*

How to do business if Meritocracy is not welcomed?

Meritocracy is perhaps the last word a government would like to hear that practice nepotism, cronyism or racism policies. You can bet your last penny such government would have pathetic policies implemented in large-scale ranging from education to corporate business. There’s nothing wrong with such policy except that it generated and will continues to generate walking zombies demanding 30 percent stake in your businesses, putting hurdles to successful companies out of jealousy to hinder it from progress further and using intimidation to force you to submit in the name of M&A (merger and acquisition).

Government-controlled media and even Tony Fernandes might be too scared to report or express it but the fact that the successful story of AirAsia Berhad(KLSE: AIRASIA, stock-code 5099) was put into the chamber of torture by both the national airlines Malaysia Airline System (KLSE: MAS, stock-code 3786) in a cohort of the Malaysia government only proves that meritocracy is not welcomed in the country. And Tony Fernandes is no foreigner mind you – he’s a Malaysian citizen. 

MAS Hates AirAsia's Success

Government-linked conglomerate DRB-Hicom (KLSE: DRBHCOM, stock-code 1619) initially thought the low-cost freight business was an easy one and could create another success story and score another bumiputra point. They ended up with two Boeing jets and $37 million in debt. Tony Fernandes bought the bankrupt-airline for a token of 1 ringgit (26 cents), assumed $12 million of Air Asia debts and transformed it into the most successful low-cost airline in the Asia. But the more successful Tony is and the bigger AirAsia grows the jealousy of MAS runs deeper.

Long story short, AirAsia was proposing to use the old international airport Subang as the country’s low-cost carrier terminal. However the governmentrejected the proposal justifying that the government wanted to make KLIA (Kuala Lumpur International Airport) a regional hub which means both premiums (MAS) and low-cost (AirAsia) services should be centralized within KLIA. In actual fact KLIA was boasted with first-class infrastructure but couldn’t see the traffic commanded by first-class airlines such as Singapore or Hong Kong it dreamt of. The government further justified that Subang airport would be used as a hub for aircraft maintenance, repair and overhaul activities. 

Government's Evil U-Turn Policies

Subang airport was strategically located compared to KLIA and you can see people grumbling with the huge costs and the lengthy time required to travel to KLIA. And both MAS and the government knew that granting AirAsia the permission to operate from Subang is tantamount to sending MAS to gallows. After AirAsia was relocated (it didn’t have an option) to KLIA, somehow MAS launched its own version of low-cost carrier in FireFly. The purpose was to give AirAsia a run for its money. AirAsia couldn’t be bother with the new startup as it was busy with its ambitious AirAsia X, the long-haul service which could cause MAS to press the panic button. AirAsia also asked for two daily flights to Singapore but was rejected point blank.
But to beat AirAsia you need more than just another cost-carrier service provider. And so not to make it looks so obvious the FireFly was launched at Penang as its “base”. It proved to be a temporary base all right. To AirAsia’s astonishment,FireFly was granted Subang as the new base to fly from but with the conditions that it could only serve routes not handled by AirAsia. Tony Fernandes heaved a sight of relieve, not that he can do anything being bullied. But MAS didn’t plan to stop there.

To rub salt into the wound, the Malaysia Cabinet now ruled that FireFly can now fly to the same places that AirAsia Bhd serves, out of the Subang airport. It was reported that FireFly is planning to buy bigger planes to fly to 25 local and regional destinations, mostly the same routes being serviced by AirAsia. In the battle synonym to David against the Goliath, it appears MAS is out for vengeance and won’t blink twice about crushing AirAsia to pieces.

MAS's Jealousy & Government's Inconsistency

Why the government is contradicting itself with the whole affair? Why Firefly suddenly given all the priviledges and advantages not granted during AirAsia’s earlier requests? Why a father (the government) would give sweets and chocolates to the second son (FireFly) but directed the first son (AirAsia) to bed without sweets when the first son asked for it in the first place? Could the whole plan is to kill AirAsia although Fernandes has done a fantastic job in putting the country on the world’s map? One wonders if the government would treat AirAsia the same way if it was started by another bumiputra company such as DRB-Hicom.
It’s sickening to watch a successful local company being pulled by its nose not to move forward simply because MAS was badly managed. The simple plan was to reduce the success and failure gap and the easiest way is to see the other party collapse, never mind how the other party’s success was due to true meritocracy. But then nobody likes to see MAS suffered in losses in the first place. When you already decided to strip yourself naked and walk around the street then you can’t fault people for calling you cuckoo, can you?

Given choice, Tony would gladly sell off its stake at premium to MAS and watch with popcorns if the government-backed entity could further grows AirAsia, or rather bankrupts the company once again, the same way DRB-Hicom did it. I would avoid AirAsia stock for the time being.

Other Articles That May Interest You ...

• The first Airbus A380 for Singapore Airlines
• 50th Independence yet MAS Cannot Take the Turbulence
• AirAsia X to Finally Take-Off after Early Turbulence
• MAS Firefly - Will It FLY or Catches FIRE Midway?
• Tony Fernandes - The Truly Air Asia Hero (Part 1)
• Tony Fernandes - The Truly Air Asia Hero (Part 2)

Sunday, October 21, 2007

Bad Friday for U.S. but Black Monday for Asia

Call it coincidence, myth, haunted, eerie or whatever you wish but the fact is on 20th anniversary of Oct 19th 1987’s “Black Monday” crash that saw Dow Jones plunged by 26 percent, the same happened last Friday (19th Oct 2007). Only this time the Dow fell by a lower percentage which is 2.64 percent but the quantum of 366 points drop is nevertheless disturbing.

For the week, the Dow lost 571.06 points, or 4.1 percent, to close at 13,522.02. The Standard & Poor’s 500-stock index fell 61.17 points, or 3.9 percent, to close at 1,500.63. The Nasdaq composite index dropped 80.52 points, or 2.9 percent, to close at 2,725.16.

Many investors got worried when news emerged last weekend that the U.S. Treasury department had been involved in helping bring large banks together to rescue others that can't fund their off-balance sheet structured investment vehicles. But while technology stocks performed well last week, it was offset by earnings disappointments from Dow components such as 3M Co., Honeywell Inc. and Caterpillar Inc. on Friday. The biggest drag however was thebanking industry nevertheless.

Last week, two-month Treasury bills rallied the most since Sept. 11, 2001 - which shows that investors have re-embarked on a flight-to-quality trade, perhaps betting that the economy is weaker than expected and that the Federal Reserve is likely to cut interest rates again. The CBOE Volatility Index, often called the fear index, added 24% Friday to a reading of 23, its highest reading in a month.

This is what you can never control, the macro and external factor that created fears into the soul of investors. I believe if not for the fear across the board, my Google would have create another history with its gap-up – at least that’s what I hoped for. And the whole set of Nasdaq investors would shift their intention to Apple Inc.’searning announcement next week, Monday after market closes. Investors would be presented with other set of earnings thereafter from Motorola Inc., Boeing Co, Baidu.com Inc. and of course the infamous Countrywide Financial Corp.

To add fuel into fire next week, global economic leaders warned of inflation risksin advanced countries when IMF (International Monetary Funds) noted rising food and oil prices and other indications of inflation. Whether the bear from last week will continues to haunt investors this week is still unknown but you can be sure of a double-digit plunge when Asia stocks markets (including Malaysia) open on Monday.

Friday, October 19, 2007

Bad News for You and Good News for Me

First the bad news! You’re just inches away from having to pay the biggest quantum of fuel hike next year (I said next year because it would be silly for the Malaysia government to increase the rate this year), probably after general election. At the same time the government is just inches from announcing the prepared-memo that as much as the caring government would like to absorb the global oil increases, it can’t and the people need to brace themselves to become “smart consumers” (again). People need to change their mentality about subsidy and it’s better to start taking the bullet now than later, never mind that the 26-million populated nation is producing top-quality petroleum.

If you haven’t read the news yet, you should know that oil prices surpassed $90 a barrel for the first time with light, sweet crude for November delivery hit $90.02 in electronic trading Thursday evening before returning to around $89.60. The buying spree by foreign investors as well as speculators sent the oil prices up worsen by weakening dollars. I won’t bet a penny that it won’t continues charging up above $90 a barrel. And before you curse me with my article yesterday which I told you to prepare for 90 cents hike, you’ve to understand my arguments why oil prices might spike to $90 in the first place. Predicting where the oil prices will go is one thing. Doing something about it in order not to inflate unnecessarily inflation is another thing, which is what the government is supposed to do. I’m sure the government can think of something creative to justify the coming fuel hike. They’re good at that and the people should “listen”, furthermore they voted the current government in with 90% majority, no?

Now the good news! Google Inc. (Nasdaq: GOOG, stock) had just released its third quarter results that surpassed analyst expectations and demonstrated why Google has emerged as Silicon Valley's most prized company with a market value of about $200 billion after just nine years in business. Google might had surpassed Cisco Systems Inc. as Silicon Valley's most valuable company but it still has some running to do in order to beat Microsoft Corporation.

In the third quarter (three months ended in September), Google earned $1.07 billion, or $3.38 per share - up from net income of $733.4 million, or $2.36 per share, at the same time last year. If not for the cost of awarding stock to its steadily expanding work force, Google said it would have earned $3.91 per share – easily beat the average estimate of $3.78 per share surveyed by Thomson Financial.

Revenue for the period totaled $4.23 billion, a 57 percent increase from $2.69 billion last year and after subtracting commissions paid to its thousands of advertising partners, Google's revenue stood at $3.01 billion - about $70 million above the average analyst estimate. It simply means for every $10 bucks in revenue, the partners earned $3 bucks while Google earned the remaining $7 bucks – a 30:70 ratio of profit-sharing.
After I decided to change my plan on Google, I basically didn’t monitor the stock’s movement anymore as the resistance of $632 was breached with good volume. The stock ended up $6.00 to close at $639.62 in regular trading session. Itadded another $3.88 (or 0.61%) to $643.50 a share in after-hours trading, not a very good gap-up as I expected at least 1 percent surge. Can it gallop to meet its next hurdle, $700 per share? Slowly but surely!

Other Articles That May Interest You ...

• Change in plan for Google, going for “Top Greed”
• Fuel Price Hike of 90 cents to RM2.82 a liter next year?
• Little Secret in Making Money trading GOOGLE
• Oil price hike – Badawi’s greatest Economic Challenge

Change in plan for Google, going for “Top Greed”

Google Inc. stock was trading in a very narrow range and for the most of the morning session it was trying to breach the $632 resistance. It managed to do so at 1:45pm trading time (as of writing). So some crazy ideas pop-up into my brain and I’ve decided to let my little GOOG Nov 570 Call Options run till the end of the trading bell and leave it’s fate to the earning announcement.

Yeah, I know I said earlier that I’m gonna take the profits and let a small contract to try the luck and see if I can get the trophy of my own making. Well, screw the plan. Somehow I feel good about Google Inc.’s earning this round (heck, wish me luck) and I think the volume is picking up as we speak. Although the Nasdaq is struggling the whole day to enter the green territory, I just hope no more stupid speech, data or announcement to be released today that can affect the stock price.

So, I’m going for the “Top Greed” to maximize my profit (if everything turns well). It could be a disaster and this could be my biggest risk I ever take. Let’s wait and see.

Other Articles That May Interest You ... 

• Little Secret in Making Money trading GOOGLE

Thursday, October 18, 2007

Fuel Price Hike of 90 cents to RM2.82 a liter next year?

Oil prices dominated most of the businesses, stocks and economies discussion lately. Due to the fact that the fuel prices affect our daily life, we simply cannot ignore its impact no matter how hard we try. One of my friends who bought a brand new BMW 3-Series recently somehow didn’t looks happy after spending some weeks showing off his new toy. I found out later why. While he can afford the monthly installments, he didn’t put other hidden-costs into consideration such as maintenance and you guess it – fuel or petrol.

What surprised me the most was his grumbling about inflation which includes flour, foods, drinks, groceries or even hawker-style Char Kway Teow; a topic which shouldn’t comes out from the mouth of a person who didn’t know and care much about economy-101. So suddenly he became a genius. My guess is the economy is not that rosy after all (was it in the first place?) or the inflation in Malaysia was injected with a huge dose of steroids under the current administration.

Last month, I’ve blogged about the reasons why oil prices might spike to $90 a barrel and beyond. At the time of writing, oil prices dipped in Asian trading Thursday but held above US$87 a barrel thanks to U.S. inventory report that showed unexpectedly large gains in U.S. crude oil and gasoline inventories but not before the crude oil traded at a record high of $89 a barrel. While the consumers are waiting anxiously for the Malaysian government to announce another fuel hike, the administration of Abdullah Badawi is perplexing on how to deal with the situation.

Yes, the government had sweared not to raise the fuel price for the whole year 2007 after the infamous 30 cents per liter hike in Feb-2006. And it’s kicking itselves now for the promise. But when the fuel was increased then, the global oil price was slightly above $60 a barrel. If my memory serves me well, there was a period when the oil prices dropped below $60 to as low as $51.03 (refer chart) but the government was quick to dismiss any adjustment claiming that the government was still subsidizing the fuels.

If the crude oil that appreciated by about $10 a barrel from $50 to $60 had mobilized the government to increase the fuel price quantum by 30 cents a liter back then, could you imagine how much would be the next increase? Assuming the government has mercy on you and Abdullah somehow managed to recall the simple arithmetic he did during his school time. And assuming by end of 2007 somehow the crude price amazingly managed to plunged to $70 a barrel which is very unlikely, the quantum of fuel hike will be another 30 cents a liter (from the same arithmetic of $10 a barrel appreciation will translate into 30 cents increase).
But if the crude oil decides to stay above $80 and worst still charge above $90 a barrel then you better get ready psychologically for the 90 cents a liter increase.Regardless whether the quantum is another 30 cents, 60 cents or 90 cents a liter, one thing is for sure - the fuel price hike is imminent. What you can hope and pray for is the current high crude oil prices are largely due to speculators and the bubble will burst.

Of course you should stay away from stocks that rely on fuel price such as airlines and certain manufacturing sectors. On the local front, some of the companies to benefit either directly or indirectly from the bullishness of oil price include:

• Kencana Petroleum Bhd (KLSE: KENCANA, stock-code 5122),
• Scomi Engineering Berhad (KLSE: SCOMIEN, stock-code 7366),
• Wah Seong Corp Berhad (KLSE: WASEONG, stock-code 5142),
• Muhibbah Engineering Berhad (KLSE: MUHIBAH, stock-code 5703),
• Pantech Group Holdings Berhad (KLSE: PANTECH, stock-code 5125)

Other Articles That May Interest You ...

• Six more months of good time before Election?
• Reasons Why Oil Price might spikes to $90 and beyond
• Oil price hike – Badawi’s greatest Economic Challenge

Multiple loans mushrooming from subprime crisis

When the subprime crisis exploded, the U.S. largest mortgage lender, Countrywide Financial Corp was perhaps the most talked about company after Merrill Lynch analyst ticked off the possibility of a bankruptcy. And now The Securities and Exchange Commission is investigating the obvious insider-trading when Countrywide CEO Angelo R. Mozilo sold some $130 million in Countrywide stock in the first half of the year through a prearranged 10b5-1 trading plan.

Meanwhile, with the recent rate cut people are depending on the internet to findcheap loans after learnt their lessons (or did they?) All of a sudden the net was filled with companies that offer various types of loans, not something you should be surprised of considering the bulk of you money could be for the loans payment. DM Loans for example do not only provide cheap loans but secured loans, meaning the loans are secured because your home is used as collateral against the homeowner. This is a traditional but smarter way of reducing the risk to the lender, though it was ignored most of the time during the housing boom.

As saving is not the forte of most American as they prefer to spend, little wonder that most of them have multiple types of debts. And that’s how debt consolidation loans come into the market to adjust the liabilities. Depending on your credit history and overall credit rating, you might end up with different terms from the lending agencies. And you can be sure of other lending companies improve revenue canabalizing from Countrywide’s own problem.

Wednesday, October 17, 2007

Web applications require Citrix’s performance

It appears both Apple Inc.’s (Nasdaq: AAPL, stock) and Google Inc. (Nasdaq:GOOG, stock) behave very well in the morning trading session today. So I’ll just let it trade whichever direction it wish to. As blogged earlier, Google is expected to announce its earning tomorrow, Thursday 18th Oct 2007 after the market close. What would be my strategy this time around?

Although I’ve only small amount of contracts in GOOG Nov 570 Call Options, I planned to take some money off the table tomorrow before the announcement while leaving one contract as the gambling-chip to see if I can set a new record in terms of profit percentage. If the plan goes well, I’ll be a happy person as the stock will register another gap-up (and a trophy) but if things do not work accordingly, my profit (you will know by tomorrow of the quantum) should be enough to cover for any losses. Nevertheless the Nov Call Option still has some intrinsic value so I can take the risks.

As for Apple stocks, obviously it’s trying to establish a new support level of above $172 level this morning after tried for the last six trading days. Whoa! Go Go Go *crazy me*. If my strategy works for Google, I plan to apply the same to Apple Inc.
It’s been quite some time since I last pay a visit to Citrix System Inc (Nasdaq:CTXS, stock). The company is set to announce it’s earning today, Wednesday 17th Oct after the market close. An RBC Capital Markets Corp. analyst upgraded Citrix Systems Inc. on Tuesday from “Hold” to “Buy”, saying earnings should increase over the next two years as a result of its XenSource software and other products.

Historically Citrix had either met or beat the estimated earnings. Over the last 12-months it registered $1.24 billion in sales and $196.23 million in income, growing at 20% and 5.3% in terms of sales and income respectively. Net profit is at 15.8% with zero debt/equity ratio. Currently trading at a year high, it’s testing the $43 a share level. The price-to-sales multiple is significantly higher than the average for all stocks which is positive. The only concern is the P/E multiple (39.70) which is higher than other stocks in the same category.

I’m considering CTXS Jan 2008 40 Call Option which will give me 93 days before the expiration. Another stock that is on my radar is eBay Inc.

Other Articles That May Interest You ...

• Little Secret in Making Money trading GOOGLE

Little Secret in Making Money trading GOOGLE

StockTube has been bashing Yahoo Inc. (Nasdaq: YHOO, stock) whenever the opportunity presents itself in favor of Google Inc. (Nasdaq: GOOG,stock). While you might see me as a mean-creature just short of sexually abuse both Jerry Yang and David Filo, in contrast my intention was for “Yahoo’s own good” *evil grin*. I simply can’t live in a world full of monopolization, not that I can put all the blames on the younger brother Google for its effectiveness and innovative products that makes elder Yahoo looks like a sicko good-for-nothing company.

You should know that consumers will never benefit from any type of monopolization doctrine although I know Warren Buffett will definitely argue with me (how he hoped PepsiCo Inc. never exists). And when Jerry Yang kicked Chairman Terry Semel to drive the company himself as CEO, stock price had fallen by 5 percent in the months since then. Google's shares on the other hand soared by 20 percent during the same period.
To cut long story short, revenue for the 3rd-Quarter period totalled $1.77 billion and after subtracting commissions paid to Yahoo's advertising partners, revenue stood at $1.28 billion - nearly $40 million above the average analyst estimate, according to Thomson Financial. The company's third-quarter results exceeded the average earnings estimate of 8 cents per share among analysts surveyed by Thomson Financial. Investors cheered the news and sent Yahoo's stock price up by $2.39, or 8.9 percent, in after-hours trading
However the Sunnyvale-based company’s announcement that it made $151.3 million during the three months ended in September 2007 is 5 percent less than its net income of $158.5 million in the same period last year. And this sent its rival Google Inc. stock price up by almost 2 percent in after-hours trading or a whopping $12.00 a share after the stock was trading in the red almost the whole Tuesday.

And with this article you should know by now how to make great money by knowing the earnings performance of Yahoo. Still have no idea huh? Well, if you care to search for my past profit on Google Inc. you should be able to identify and determine my trading method in the U.S. options. I “never” trade Yahoo’s stocks or its options. The reason was quite simple – it wasn’t a leader in online advertising market and hence it tends to disappoints everytime. The second reason was Yahoo Inc. will announce its’ earning prior to Google Inc. I’ve blogged about the concept of Yahoo’s Weakness is Google’s Gain and vice-versa.

And by knowing if Yahoo has done well in its quarter’s earning you can make good money by trading the opposite way of Google. Meaning if Yahoo sucks (which were the cases most of the time), then you better long Google Inc. preferably trading its option. Why option? Two reasons - Google’s option is cheaper than the stock and due to the power of leveraging. So there goes my little secret in making money trading Google Inc. Of course sometimes I entered based on support-resistance and price-volume reasons. I’m still waiting for Yahoo to announce that its’ YPN is available worldwide and when that happens you can be sure Google’s stock price will plunge in double-digits.

Other Articles That May Interest You ...

• Google and Apple stocks, my money making machine
• GOOGLE ready to blast off into the space of $700
• Yahoo’s Weakness is Google’s Gain
• Payment via PayPal - YAHOO YPN to Goes Global
• Why Options Trading Is A Great Leveraging Tool?

Tuesday, October 16, 2007

Google and Apple stocks, my money making machine

Google Inc. might have breached the $600 level and currently floating comfortably above this level but the stock’s vulnerability has increased with the current market pulses. If Dow Jones keeps on dropping as if there’s no tomorrow, sooner rather than later the stock price will follows. Even though I’m still holding GOOG Nov 570 Call Option, somehow I’m undecided whether to let it go, take the money and run or let it takes its course with Google’s earning announcement scheduled on 18th Oct (that’s another 2 days on Thursday).

The first 5-minutes of trading this morning saw Google’s stock pricetesting the $612 support before regain consciousness and rebound thereafter. I’m pretty comfortable with its behavior although the Dow, Nasdaq and S&P500 seems to be in the red the whole morning.

On the other hand, I’ve taken new position this morning (just some minor contracts) on Apple Inc. by scoopingAAPL Jan 2008 165 Call Option after the stock showed price-volume behavior which met my entry condition. Apple Inc. is expected to announce its earning next Monday, 22th Oct 2007. If you’ve invested Apple before you know that this stock is almost sure to beat earning estimate by Thompson Financial again. The only things that nobody knows except Steve Jobs is how well did Apple perform from other perspective which includes revenue growth, iPhone’s sales, inventories etc etc.

While the earnings season had started, it’s too early to jump into the boat (except for Apple and Google). Furthermore the stocks which interested me are not up the list yet. After Ben Bernanke said the night before that the slumping housing market remains a "significant drag" on the economy, I hope the Feds chairman has no more negative news in his list.

Other Articles That May Interest You ...

• Inflation Risks - Stock Market split on Feds next move
• GOOGLE ready to blast off into the space of $700
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The first Airbus A380 for Singapore Airlines

In early Monday morning trade, New York's main oil futures contract, light sweet crude for delivery in November, was 16 cents higher than the US$86.13 a barrel amid mounting tension between Turkey and Kurdish rebels in Iraq.This is a bad news for airlines which are stupid enough not to hedge their fuel price but definitely good news for investors who long oil-related stocks.Thousands of miles away, a small but prosperous nation had a little celebration after waited for about two years.

Singapore Airlines, one of the most successful and profitable airlines in the world took the delivery of the Airbus A380 yesterday. Singapore Airlines which is the first carrier to take full commercial delivery of the long-awaited superjumbo will waste no time and is scheduled to flies the double-decker Airbus A380 into Sydney next week for the first time. In an all-economy configuration, the A380 can a maximum of 853 passengers.
Already been hit with penalties for late delivery and costs five CEOs head on the chopping board in two years, the Singapore superjumbo will nevertheless provides a new way of luxury traveling especially the first-class sleeping cabins - the sleeping suite can be transformed into a stylish office, with its 57.5-centimetre platinum screen and workstation.

A standard return fare for a suite will cost you around 10,500 Singapore dollars ($7,160) on the Singapore-Sydney route, which is about 20-35 percent more than the current top-class fare. Showers, mini-casinos, gyms and beauty salons won’t be available as earlier imagined. However a staircase at each end links the two levels and the business and first class areas have a self-service bar with food and drinks.
Singapore Airlines fitted its jet with 471 seats configured in three classes: 399 economy class seats on both decks, 60 business class seats on the upper deck and 12 luxury suites on the main deck. The good news is that all classes offer an in-flight entertainment system that offers language courses and word-processing and spreadsheet office software, besides regular movies and television channels - there is more leg room too, even in economy. Documents can be downloaded via a USB slot.
Part of the reasons for the purchase was to solve the problem of fuel prices which can only go up given time. Airbus A380 claimed it uses 2.9 litres of fuel per hundred passenger kilometres compared with the aviation industry average of about five litres per one hundred passenger kilometres.

Other Articles That May Interest You ...

• If only Malaysia has leaders half of Lee’s Intelligence
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• Reasons Why Oil Price might spikes to $90 and beyond
• Oil price hike – Badawi’s greatest Economic Challenge

Six more months of good time before Election?

Now that the Muslim festival, Hari Raya Aidilfitri, has entered its third or final day before the stock market re-open tomorrow, the shift has been on the sustainability of the bull which could see the charges gaining momentum towards the year-end window dressing. After that you have the Chinese Lunar Year celebration which falls on early of Feb-2008. Analysts, investors, punters and traders are equally excited with the stock market as almost all of them are optimistic the bull will be around - at least till the middle of next year, 2008.

Just like how the Chinese are damn sure their government will not let the stock markets crashing down before the Beijing 2008 Olympic event, Malaysian are doubly sure the current bullish sentiment will remains as any huge sell-off will not be "nice" for the current ruling government which is expected to call for snap election, rumored to be in the first quarter of 2008. Already, unpopular decisionswhich might backfire had been put in cold-storage temporarily although more and more scandals were trying to squeeze out from the Pandora box.

Pre-Election - play down problems, crisis and scandals

Malaysia's Petronas pushing for gas price hike was discussed but no concreate decision was made (or rather delayed?). The scandal of which Port Klang Authority has racked up debts totaling about 4.6 billion ringgit (US$1.3 billion; euro960 million) because of problems with the Port Klang Free Zone was quickly swept under the carpet. The announcement by Works Minister Samy Vellu that the nation will see yet another toll-hike on Jan-2008 saw a fast response from Deputy Prime Minister Najib who said it has not been approved (yet). With the global oil price above US$80 a barrel, the government can’t wait for the election to be over to announce a fuel-hike.
Mongolian model Altantuya Shaaribuu, a murder victim, whose remains were destroyed with C4 explosives, is seeing her case somehow crawling at snail’s pace now. Altantuya had an extramarital affair with Abdul Razak Baginda, a defence and political analyst who is a close friend of Deputy Prime Minister Najib Razak. Interestingly the involvement of the elite police, who answer only to Najib, has raised questions about whether the deputy prime minister had ordered the bodyguards to do something about Altantuya.

It appears the internet generally and the blogosphere specifically have accelerated the pace the internal crisis and scandals being exposed, one after another. The latest being Malaysia’s Judiciary was compromised with the video-clip abouthow top judges were brokered, not that the judiciary was any better with the action by former premier Mahathir to put the judicial pillar at the mercy of Executive a.k.a. Prime Minister back in 1988. You saw the lawyers marching to the Putrajaya pressing for “Save the Judiciary” only to be played down by government’s controlled-media.

“Feel-Good” propaganda machinery on the move

Of course in the process you saw Minister in the Prime Minister's Department Nazri Aziz took the express-lane to label the lawyers as pro-oppositionand “crazy lawyers”. I already talked about how this scandal can be twisted with ease – just demand the whistleblower to reveals him or herself or else the half-past-six government (term awarded by Mahathir himself) can declare the video-clip was a fake and there’s no case after all. Instead of focusing in determining the authenticity of the video-clip, the three-man panel is more interested to find out who’s the whistleblower with obvious intention to punish him/her.

Really, it’s not that difficult to check the authenticity of the video clip. Since the authority already flew their people to United States for a holiday trip to beg the FBI (Federal Bureau of Investigation) to help enhance the clarity of the blurred web-camera image of the person carrying the sports bag in which Nurin Jazlin Jazimin’s body was found, you don’t need a rocket scientist to ask for assistance from the same FBI on the video-clip’s authenticity. Furthermore if the United States can determine the authenticity of video-clips of terrorist Osama bin Ladin, how hard could it be to determine Malaysia’s own videp-clip?

Fortunately the government has something in their propaganda card – the sending of Malaysia’s first angkasawan (I refuse to use the term astronaut because the NASA Space Station Crew’s Profilesand even the Russia Federal Space Agencysaid Muszaphar was only “Flight Participant”) which caused some people jumping for joy thinking it was the Malaysia-made rocket that sent the Malaysian to the space. Never mind that Malaysian was blasted off as a space tourist – part of the arrangement for the $1 billion Russian arms deal. Never mind the Malaysian space tourist was wearing Russian-made pampers up there. There’s zero achievement but with the easily-illusion voters out there, the ruling government will not let the opportunity passed by without pumping heavy marketing around it. What better way to create “feel-good” factor by glorifying the “well-spent” $30 million dollars?

Oppositions Always Lose

No matter how hard the oppositions scream their voice out on nation’s mismanagement, corruption, unfairness and stupidness, the ruling government is expected to win again in the next general election. Even if all the Chinese and Indians vote for oppositions, the existing government will remains victory. One has to remember that in the 2003 delineation exercise, the Elections Commission (SPR), had added 26 new parliamentary seats and 63 state seats especially in the states where the BN had performed very well in 1999. This redrawing benefits the ruling party tremendously. It’s like within the same population boundary, its “1 seat for opposition, 3-5 seats for ruling party”. It’s a battle opposition can never win, even until the cows come home.

If the above is not enough, the Elections Commission (are they independent?) can always impress you with their creativity. Somehow, the DAP (one of the opposition parties) has discovered an influx of new voters in another one of its parliamentary seats. Checks showed here was a sudden increase of 1,835 voters in the Ipoh Barat seat held by DAP Vice-Chairman M. Kulasegaran. Not only that, secretary-general Lim Guan Eng claimed that on top of this increase, voters which were deemed supporters of the DAP had been transferred out. Earlier on, the Ipoh Timur parliamentary constituency held by Parliamentary Opposition Leader Lim Kit Siang had swelled by 8,463 new voters in three months. What was even strange was thesudden increase of 3,208 postal voters in the constituency even though there are no new army camps or police stations in the area.

With the country’s wealth, nation’s machinery and the media at their disposal, no wonder the ruling government won the general elections since independence and will always win the future elections.

Assuming the election to be held on Mar-2008 and give-and-take another 3-month for the feel-good factors to die off, you might have less than 9-month for the bullto chase its tail before the game is over.

Other Articles That May Interest You ...

• Malaysian first Astronaut? Not sure, but will he urinate
• Lawyers Long March to Save the Judiciary – Photos Talk
• Malaysia Judiciary Scandal? Don’t bet on it
• Malaysia 2008 Budget Rumbling
• Malaysia’s Biggest Scandal – Business as Usual

Saturday, October 13, 2007

Would you like to make 100 percent Trading Stocks?

Vincent Tan’s Berjaya Corporation Berhad (KLSE: BJCORP, stock-code 3395) has attracted punters and speculators for the last 2 weeks with great interest. The stock price more than doubled since end of September 2007 when the stock breached the resistance level of RM0.52 confidently and never look back. StockTube had blogged about the stock earlier as I was curious since the data from Bursa that showed Vincent Tan had acquired shares from Berjaya Corporation as well as Silver Bird.

Season-players were not surprised with the soaring share price since Vincent Tan was known to be a master in frying his shares up during former premier Mahathir’s rule. Just before the local stock market close for the long holiday, Berjaya Corp announced that it had successfully clinched the franchise to operate the US-based Wendy’s International (NYSE: WEN, stock) burger chain in Malaysia.
Berjaya Corp reportedly plans to open more than 70 Wendy’s fast-food outlets in Malaysia over the next 10 years. Vincent Tan’s group already operates food and beverages brands such as Starbucks Coffee, Kenny Rogers Roasters, 7-Eleven and previously McDonald’s (sold in 2006 to McDonald's Corp, NYSE:MCD). Of all his chains, perhaps the most successful and profitable is McDonald’s and Starbucks Coffee. In fact McDonald’s Malaysia is so successful that it surpassed Kentucky Fried Chicken as the most preferred fast-food place to hang-out for youngsters and families, at least me.

Die-hard fans of Vincent Tan would have made handsome gains if he/she had invested in Berjaya stocks. Supposing if you had bought only 3,000 shares of now-privatised Berjaya Capital which was traded at below RM1.00 a share, he / she would have ended up with over 18,000 shares of Berjaya-Corp-ICULS plus the over RM2,000 from the disposal of the remaining Berjaya Capital (720 shares to be precise) to Vincent Tan. That 18,000 shares of BJCORP-ICULS is today worth RM0.55 a share based on Friday’s closing stock price bringing the holding to RM9,900.00. Add this to the above RM2,000 and you ended up with RM11,900.00 – a whopping 296 percent profit.

But does the story of Berjaya Corporation stops here (with Wendy’s International)? I doubt so and I think Berjaya Corporation still has rooms for growth (punt). While the main BJCORP’s shares are still relatively cheap at RM1.08 per share, its ICULS is the one that attracted the punters since it costs only RM0.55 per share with the expiry only in 2015. Of course I’m talking without taking fundamental into consideration.
Another reason why I think the story has not comes to an end is the fact that Vincent Tan has continuously acquiring BJCORP shares, the latest being the filing on 12th Oct 2007, yesterday. It appears the tycoon had increased its direct stake to 31.92 percent. His acquisitions via conversion of ICULS are at the price ranging from RM0.908 to RM1.00 per BJCORP shares.

Let’s fantasize and assume Vincent plans to achieve at least 100 percent profit. That means somehow BJCORP stock prices need to be pushed up to RM2.00 a share and with such the ICULS will worth at least RM1.00 a share. Who said stocks punting is difficult? Trade at your own risk.

Other Articles That May Interest You ...

• Stocks Frying 101 with the Iron Chef Vincent Tan

Friday, October 12, 2007

Inflation Risks - Stock Market split on Feds next move

Now you know which position is the most powerful in the global economy. Although you might not command the same salary or wages as those of CEO that rewards you with millions in stocks option, basically everyone is at your mercy, if you’re the U.S. Federal Reserve Chairman. It’s funny that the only barometer that dictates mostly on how the global economy will spins is the U.S. interest rate. That was why Alan Greenspan and now Ben Bernanke is the celebrity in the financial market.

Any single internal or external factor(s) or data that may influence the decision of Federal Reserve Chairman (and his team) could send the market turns 180 or 360 degrees. And so on Thursday, when a European Central Bank governing council member Axel Weber pointed that the rising inflation in the euro zone may require additional policy action, the market immediately reacted in the opposite direction.

The comments appeared to raise concerns on Wall Street that European growth could slow and that in the United States, inflation could prevent the Federal Reserve from making another rate cut. Spontaneously the Dow Jones turned from green to red and traders took profit and run. That’s a huge movement for future traders.

It didn’t help to notice that JPMorgan Chase & Co. lowered its revenue expectations for Baidu.com Inc. (the China's Google) at the same time and what else to expect beside the technology stocks took the beating. While Baidu tumbled $34.39 (10 percent) to $308.78, Google Inc. which saw its stock going upwards towards $640 level in the morning trading session plunged to $620 level – a whopping $20 price difference within the last 2 hours of trading. That’s what I call a true “Volatility”. Excited, isn’t it?

Hence with the news above the investors are now split on whether Ben Bernanke will cut the rate again as the risks of inflation seems real.

Other Articles That May Interest You ...

• GOOGLE ready to blast off into the space of $700
• Minutes revealed more Rate Cuts at the doorstep
• Rate Cut, Financial Expectation & Window Dressing
• Rate Cut’s effect – high Oil Prices and weaker Dollar

Thursday, October 11, 2007

If only Malaysia has leaders half of Lee’s Intelligence

This is what you call a world-class leader, a person who can debate and argue with perfect common sense. What surprises me was how this 84-year-old Singapore former premier Lee Kuan Yew keep up-todate information using IT-technology and I bet he bring along his own PDA where-ever he goes. If only Malaysia has leaders with intelligence half this old-man, the country could do better than Singapore as admitted by senior Lee. And you don’t have to wait for the year 2020 (or 2050?) to become a developed country.

You just got to admire how knowledgable this Lee Kuan Yew is when being put on stage to answer questions ranging from world economy, country’s administration, super-power U.S., China and India, cultivating and attracting foreign brains into Singapore, regional politics etc. Heck he even read MalaysiaKini and knows about Malaysia’s latest scandal on the video-clip about how top judges were brokered.

The part which you should read is as below:

“When [Malaysia] kicked us out [in 1965], the expectation was that we would fail and we will go back on their terms, not on the terms we agreed with them under the British. Our problems are not just between states, this is a problem between races and religions and civilizations. We are a standing indictment of all the things that they can be doing differently. They have got all the resources. If they would just educate the Chinese and Indians, use them and treat them as their citizens, they can equal us and even do better than us and we would be happy to rejoin them.

You can read the full transcript of the Tom Plate and Jeffrey Cole interview Lee Kuan Yew publiched on the Web site of the UCLA Asia Institute research centre; but in case you’re too lazy, I’m re-produce the whole transcript below. Have fun reading and judge yourself if current Malaysia’s Prime Minister could rival Lee Kuan Yew given the same scenario (interview). Maybe it’s time to put the transcript as a case study to educate all Malaysia’s ministers on how to quantum leap themselves to next level.

By Tom Plate Pacific Perspectives Columnist
Tuesday, October 9, 2007

Q: How are you?

Lee: Ageing rather fitfully as we all do, but when you're past 80, it's a pretty steep climb.

Q: The thing is you have not retired?

Lee: I think if you retire, the idea of just reading books and playing golf ... you just disintegrate.

Q: There's such a high correlation between people who retire and play golf and die, right? If you don't play golf and don't retire … follow the logic!

Lee: You have to have something more than that. You have got to wake up every morning feeling there's something worth doing and you're not just lying back and coasting along. Once you coast along, it's finished.

Q: It's great to be in Singapore right now because it's so bustling!

Lee: It's partly just sheer luck. I would say 60 percent hard work, 40 percent luck. Sixty percent because we put ourselves into this position, went through some very hard times starting with the Asian crisis, SARS and so on -- but we have got onto the right track. We could see China growing, India coming on. We're just at the junction of the two and placed ourselves to take the tailwind of both of them -- but keeping all our other bases intact, our connections: U.S., Europe, Japan.

Q: You even have good relations with Taiwan?

Lee: That's crucial. That's part of the old -- our past.

Q: But that's not all that easy to do?

Lee: It's still tough, but it doesn't matter. The mainland knows these were the terms on which we established relations with them.

Q: One of the first questions I asked you roughly 10 years ago when I started the column on Asia and America was what would be the one thing you would say to the American people about the United States' role in Asia. You thought for a few minutes and then you said: "Tell the American people that America must get the relationship with China right, because if that relationship is gotten right, it benefits everybody in Asia. And if it's not gotten right, it's going to create problems." Have we more or less got the relationship right?

Lee: I think it's not bad. Congress is in a fractious mood looking for excuses for what's gone wrong, believing China's exchange rate offers unfair advantage. Yes, the Chinese should up the value of their yuan -- maybe 10 percent, 15 percent -- but it's not going to help you. It's not going to solve the problem. It might create problems for them if they do it so suddenly. But if they do it gradually, I think it shouldn't be a problem.

Q: They probably will do it?

Lee: They'll do it gradually. They're scared of unemployment. They're scared of what happened to Japan when the factories relocated. They need their low-end jobs, making shoes, garments, whatever. If these factories move, you have got unemployment -- that's a real problem for them. They're scared of it as they're moving up-market. It's a new game for them and they're nervous. Their legitimacy depends upon solving the economic problems and not having riots in the cities even as their old state-owned enterprises retrench.

Q: What would you say to Americans who say if China rises, America has to fall?

Lee: No, I do not see a win-lose, zero sum game here. It was the U.S. that brought China into the World Trade Organization (WTO). It was George W. H. Bush that opened the door, invited China to start selling to America. That was carried on by President Clinton. Clinton finally, with his then Treasury Secretary Rubin, got the Chinese into WTO.

You have got two choices with China. Keep them out -- but the U.S. must have done its calculations, because if you keep them out, then you have them as a spoiler. They're going to do reverse engineering, steal your patents and where is the profit in that? You slow them down, there's no doubt about that. You slow down their transformation but at the same time, you are not benefiting from that transformation. If you go back and remember the 1980s and early 90s, you needed that market to grow but you never factored in the speed at which they would grow. That's scary. That's happened and I think they know that it's a difficult transformation for them. It's not easy. They have got enormous problems -- internal problems, disparity within the cities, between the cities and the countryside, and now with cell phones and satellite TV, they have to change track, instead of just going helter-skelter for gold … now they're talking about achieving a harmonious society.

Q: Do we on the whole know pretty much what the real picture inside China is?

Lee: I think your China-watchers are well briefed, they know.

Q: There shouldn't be any big surprises? We pretty much know where the tensions are?

Lee: [Nods affirmatively]

Q: You mentioned Bob Rubin and Clinton. The genius of their approach was they convinced the Chinese that it was in their interest to join WTO. They weren't doing anybody any favors, was it going to be good for China?

Lee: No, I think they had [Chinese Premier] Zhu Rongji to deal with and that made the difference. Zhu Rongji was the man who pushed the Chinese side. He was backed by [President] Jiang Zemin. He did the sums and decided that if China was going to catch up with the world, they had to open up and this will force a continual opening-up, joining WTO and having to abide by the rules -- and now they're in.

Q: You see them still going there -- going in that same opening-up direction?

Lee: Their problem now is convincing the world that they're serious about a "peaceful rise." These are thinking people. You're not dealing with ideologues.

I don't know if you've been seeing this or heard of this series that [the Chinese] produced called The Rise of the Great Nations. It's now on the History Channel. I got our station here to dub it in English and show it. It was quite I would say a bold decision to tell the Chinese people this is the way the European nations, the Russians and Japanese became great. Absolutely no ideology and they had a team of historians, their own historians. To get the program going, they went to each country, interviewed the leaders and historians of those countries.

You should watch the one on Britain, because I think that gives you an idea of how far they have gone in telling their people this is what made Britain great. I was quite surprised. The theme was [doing away with] the Divine Right of Kings, a Britain that was challenged by the barons who brought the king down to Runnymede and then they had the Magna Charta, and suddenly your "Divine Right" is based on Parliament and [the barons] are in Parliament. That gave the space for the barons to grow and the middle class eventually emerged. When the King got too uppity, Charles the First got beheaded.

Now this series was produced in a communist state, you know. In other words, if you want to be a great nation, so, if the leader goes against the people's interests, you may have to behead him! They also said that because there was growing confidence between the people and the leaders, the country grew. It is in fact a lesson to support their gradual opening up and their idea of how they can do it without conflict -- the "peaceful rise." They have worked out this scheme, this theory, this doctrine to assure America and the world that they're going to play by the rules.

Q: You think they'll be able to do that fast enough to accommodate the middle class who want clean air and so much else?

Lee: I cannot say what they will do. I go there once in a year, I spend one week. I get reports, I read it but I'm not a China-watcher. I have got many other things to watch, I'm a Singapore-watcher! My guess is they're going to move pragmatically one step at a time and the first thing they are trying to do right at this moment is to get the succession to the next Standing Committee right. [The chairman will] have his team and the next five years will be his policy.

I think the policy will be let's grow, let's have more equality in the country and keep the country as one. Let's have no trouble abroad, let's make quite sure that Taiwan doesn't do stupid things which will force the mainland to act. Let's have a successful Olympics and then we are into a new age, one step at a time.

The first problem is blue skies for the Olympics, and the way to do that is the way they did it in 1999 when I went there for the 50th anniversary and I found blue skies. I asked our ambassador about this: He said they stopped all factories for the last two weeks. I think they're going to do that, maybe the last four weeks before and the cars will be cut down by half, odd and even numbers and so on. But to go and clean up properly will take umpteen years, retrofit coal mines and so on. That's a very costly and slow business.

They are engaging us in Singapore, and we're going to do an EcoCity with them, choosing the site now. They have agreed. They've offered us several sites and we're choosing one where there can be sustainable growth. What we've done in Singapore, we recycle water, you keep your air clean, you do this, you do that, higher costs, more social discipline, more engineering, sewers, recycling water, et cetera and so on. It's a slow process but they want to learn how it can be done. That's important.

Q: If we could move to the other superpower, the United States. I know you're reluctant to give out advice, unlike American journalists who always try to tell you what to do, but for America, since you've been a friend of America and you've seen it over decades, what are two, three things, that you worry about in America?

Lee: I think in the next 10 years you have got to extricate yourself from these problems in the Middle East. It may take you five years to get it stabilized and then after that, you gradually have more time and energy to think about the other big problems in the world. This is sucking up too much of your resources. To solve this, you have got to tackle the two-state problem in Israel because as long as that's festering away, you're giving your enemies in the Muslim world an endless provocation from which they can get new recruits for crazy adventures to try and knock you down, to blow themselves up and blow the world up. How you're going to do that, I don't know.

Q: Did you follow the Israeli lobby debate in the U.S.? Two professors -- from Harvard and the University of Chicago -- did this paper about the alleged extreme influence of the Israeli lobby in American foreign policy. Even if the paper overstated or used some unwise language in making its case, is there something to this?

Lee: You have got to settle this issue with the Jewish lobby. If you have this as a festering sore, you get Muslims entangled in hate campaigns. I'm not saying if you solve this, everything will be sweet and harmonious -- but if you solve this you will remove a cancer in the [international] system. Then you can better tackle the other problems. You are alone in this [Middle East policy] because the Europeans are not with you. Nobody helps you, but everybody doesn't want to openly oppose you.

Q: What about inside America itself? Do you see any indices that worry you, whether it's education?

Lee: For the next 10, 15, 20 years what you have will keep you going as the most enterprising, innovative economy with leading-edge technology, both in the civilian and military field. You have got that already.

You will lose that gradually over 30, 40, 50 years unless you are able to keep on attracting talent and that's the final contest, because what you have done, the Chinese and other nations are going to adopt parts of it to fit their circumstances and they are also going around looking for talented people and wanting to build up their innovative enterprising economies. And finally this is now an age where you will not have military contests between great nations because you will destroy each other, but you will have economic and technological contests between the great powers.

I see that as the main arena of competition by 2040, 2050 and it'll be the U.S.; China for sure; Japan, keeping up with the U.S. and trying to retain its separate position from China, closer to the U.S. and hoping to maintain a special position; India, somewhat behind China, trying to catch up. I don't know about Brazil.

Q: Charles de Gaulle had a great comment about Brazil. His advisers said to President de Gaulle that he had to go to Latin America -- Brazil. He said why? They said Brazil has great potential. De Gaulle said, "Ah, yes Brazil has great potential ... and always will."

Lee: I put my money on China, India and Western Europe. If Western Europe can get past the welfare approach to society and get their unions modernized, I think they have got the technological basis and the talent to rise again, not as a military power because I don't think they got the stomach for that, but as an economic power which they can do. I think they'll give the world a run for their money.

Can they do it? I don't know. Their history is so deep, you never know. Under pressure, as they feel they're being left behind by history, they may decide to do it. I mean, you look at [French President] Sarkozy, he may or may not succeed, but he's convinced himself and he's convincing quite a group of the French elite. The CEOs of the big multinationals in France don't need convincing. They know it. It's the broad think-tanks, the media, the intellectuals who still feel that they have a superior system. They loath having to give that [welfare approach] up, but they may, you know, because that's the only way to catch up.

Russia may become a player if they are able to find a way to convert the oil and gas into a more enterprising economy. I don't know if they can get out of their corruption and the mismanagement of the resources, but they have got talented people.

But long-term for America, if you ask me, say, project another 100 years, 150 years into the 22nd century, say, 2150, whether you stay on top depends upon the kind of society you will be because if the present trends continue, you'll have a Hispanic element in your society that's about 30, 40 percent. So, the question is do you make the Hispanics Anglo-Saxons in culture or do they make you more Latin American in culture."

Q: That is exactly the right question.

Lee: I mean, if they came in drips and drabs and you scatter them across America, then you will change their culture, but if they come in large numbers, like Miami, and they stay together, or in California, then their culture will continue and they may well affect the Anglo-Saxon culture around them. That's the real test.

But on the [China] side, you can be quite sure that their numbers are so great -- the Chinese Hans -- they can take any number of new migrants, they will be absorbed. So, long-term, I think the Chinese have figured this out. Then, if they just stay with "peaceful rise" and they just contest for first position economically and technologically, they cannot lose. If they are not Number One, they will be Number Two. If they are not Number Two, they are Number Three. They have figured that out.

Q: Singapore is one of the world's most wired countries, far ahead of the pack. How do you imagine over time that this will change Singapore? What will be your sense of what happens in an educated country with high standards, when anyone can get anything on the Web, videos and blogs so that the role of a centralized media become less and less dominant?

Lee: Well, it is already on its way because the print media here is not growing the same way, they are stagnating. It's not declining as fast as, say, it is in America or Britain ... And this is happening here.

The young, they read things on the Internet. I mean, I am part of the older generation. Yes, I read some stuff on the Internet, but at the end of the day, I say, well, let's see what the proper analysis is. So, I look up, I look at the editorial pages and the op-ed pages. I am not sure that the young will do that anymore, but the way the print media can stay in the contest is not to be the first with the news because that's not possible, but to be the first with the background and the analysis and the ones with the high credibility will stay in business.

You must have credibility because you get so much on the Internet. Whom do you believe? Finally, you've got to say, who is saying this? And you don't know. But if you say, this is The New York Times, this is the Washington Post or the L.A. Times, then you say, well, that is the standard.

I mean, that goes for every country, I think, but we have a different problem here because we are bilingual. English is our first language, well, for the younger generation. The older generation, Chinese was their first language, but the ones below 30 now, below 35, the majority, English is their first language and Chinese or Malay and whatever will be their second language. But with the rise of China, we are already seeing more and more going to China doing business and more Chinese coming here doing business. So, they are going to start reading the Chinese blogs, the Chinese news. It's already happening. So, the trend will be from print to screen.

Q: China has not given up hope in terms of trying to control the content on the Internet. But my sense since the last time I talked with you and with some of your brightest people, is that you have a sense of inevitably, that this new technology is going to overwhelm efforts to control it, is that right?

Lee: Right, it is not possible. Look, you are going to have a PDA that is also running video and you can have your servers blocked. But if you've got a 3G phone, you use another server, and so then you are through.

No, it's not only going to happen, it's already happening. Otherwise, how do you get all these pictures of the monks in Myanmar or Yangon or Mandalay coming out? It's all on cell-phones. Now, there are areas which are blocked out now. They are blacked out, sure, but they are still coming out because you've got a 3G phone and I am quite sure Reuters or whatever news agency must have given their correspondents and stringers, saying, here, use this. You take it and you use this and you get it through. Otherwise, how can you get it through because the government is already blocking out [communication]. Many of the areas are now non-functioning, you can't use the cell-phone. But images are still coming through. I just saw something this morning. So?

Q: Right. So, that the role of the centralized media is less important. Even if you can control the centralized media, that's less and less valuable than before.

Lee: I don't know if you've caught up with this story. It's a bit of scandal going on. [Former Deputy Prime Minister] Anwar Ibrahim leaked a video, an old video, way back in 1980, of an Indian lawyer talking to a top judge about how he can arrange to get him promoted to be the "Number One" or whatever. I think it was an eight-minute video and Anwar has now put it on the Internet and it's on YouTube! So the Malaysian bar -- which have already been dismayed at the degradation of their judiciary and the corruption and judge-buying and case-buying -- they have demanded a royal commission to inquire into the facts.

So, the government, under pressure now, has appointed a committee of judges and one eminent person, to check on the authenticity of this tape. So that's bought them some time, but in the meantime, 2,000 lawyers, following what the Pakistani lawyers did, have marched on to the prime minister's office to deliver a petition to investigate this matter. Now, this would not have happened without the Internet and without YouTube. I mean it is so simple, you see.

Q: That's a changing world.

Lee: But at the same time, there is the problem of credibility. So, you have a website called Malaysiakini. That means "Malaysia Now" and it's got some very good articles in it and some of them are signed regularly by the same person. So when we get that, we read it and then we say, okay, circulate it. But you get a lot of rubbish, too, and you have got to filter it. It's a waste of time.

Q: Well, your earlier point about the credibility of serious newspapers and serious magazines is more important now than ever.

Lee: You've got to go by them. You know, it's like the ratings agencies which put a lot of financial institutions down.

Q: This is the future of professional journalism, if there is any?

Lee: No, you'll always have it. But if we don't use this [new technology], then we are just one hand tied behind us: Should we allow our opponents to have that advantage? This is a highly competitive world. But the flood of information leads to overload. Therefore, you've got to have somebody filter it for you.

Q: Can I go back to your comment about Myanmar and the video that's getting out from the hand-helds, where, unlike Tiananmen in 1989, you cannot just pull the plug on all visuals. With regard to Myanmar -- and I realize anyone's guess is as good as anyone else's -- but did you see that it's plausible to ask China, as it did at the Six-Party Talks, in some way to work skillfully and work behind the scenes to assume a role in moving Myanmar forward out of the Middle Ages and maybe into the real world?

Lee: I'm not sure the Chinese have got that power. And in Myanmar, these are rather dumb generals when it comes to the economy.

Q: They are!

Lee: How they can so mismanage the economy and reach this stage when the country has so many natural resources?

Q: It's a gift!

Lee: It's stupid. So I'm not sure. The Chinese, they've tried, and, in fact, we have tried to talk them out of isolation. I tried through a general called Khin Nyunt. He's the most intelligent of the lot. I sold him the idea, or at least he bought the idea, that the way for them to go forward was to get out of uniform and do it like Suharto, form a party -- Golkar -- and then take over as a civilian party. But halfway through, Suharto fell. So, it ended up as the wrong advice, they back-tracked. Then they chucked Kyin Nyunt out.

Q: Timing is everything!

Lee: Meanwhile, I had advised several of our hoteliers to set up hotels there. They have sunk in millions of dollars there and now, their hotels are empty. But, you know, you've got really economically dumb people in charge. Why they believe they can keep their country cut off from the world like this indefinitely, I cannot understand. And you know, you need medicines -- they smuggle in from Thailand. It doesn't make sense.

We will see how it is, but whatever it is, I do not believe that they can survive indefinitely. Look, the day they decided to close down the government in Yangon and go into this Pyinmana, or whatever the place is called where there's nothing and they are putting up expensive buildings for themselves and a golf course -- and the top general had a lavish wedding for his daughter which was then out on YouTube -- the daughter was like a Christmas tree! Flaunting these excesses must push a hungry and impoverished people to revolt. But what will happen, I don't know because the army has got to be part of the solution. If the army is dissolved, the country has got nothing to govern itself because they have dismantled all administrative instruments.

Q: You have a candidate in the coming American presidential election that you prefer? You'd like to endorse whom? I have my candidate, but you've got to get American citizenship!

Lee: Who's your candidate?

Q: You! You've helped run this pretty well country for so many years.

Lee: You need to have an American who is not only good on television but he must have the networking that can raise him the funds and the grassroots support.

Q: I notice you said "him".

Lee: Well, her, him/her. No, [Hillary Clinton is] leading, she's leading. Will she be good for America?

Q: I don't know.

Lee: Sorry?

Q: What do you think? I'm too close to her.

Lee: What do you mean you're too close to her?

Q: I'm right there. I'm American, I'm right in the middle of it. I don't like any of them. She may be good enough, though she's not the best that we've got.

Lee: She's good enough?

Q: She's probably good enough.

Lee: Well, we have to live with whoever wins.

Q: I read somewhere recently that you actually have a bit of a worry about your country's survivability over the long run? Are you serious?

Lee: Singapore is not a 4,000-year culture. This is an immigrant community that started in 1819. It's a migrant community that left its moorings and therefore, knowing it's sailing to unchartered seas, guided by the stars, I say let's follow the stars and they said okay, let's try. And we've succeeded and here we are, but has it really taken root? No. It's just worked for the time being. If it doesn't work, again, we say let's try something else. This is not entrenched. This is not a 4,000-year society.

Q: You really have a sense of the country's endangerment.

Lee: Yes, of course.

Q: It's amazing, you come in here and you walk around here in one of the great cities in the world. Yet you are worried about survival.

Lee: Where are we? Are we in the Caribbean? Are we next to America like the Bahamas? Are we in the Mediterranean, like Malta, next to Italy? Are we like Hong Kong, next to China and therefore, will become part of China? We are in Southeast Asia, in the midst of a turbulent, volatile, unsettled region.Singapore is a superstructure built on what? On 700 square kilometers and a lot of smart ideas that have worked so far -- but the whole thing could come undone very quickly.

For this to work, you require a world where there are some rules of international law and there is a balance of forces of power that will enforce that international law and the U.S. is foremost in that. Without that balance of power and international law, the Vietnamese will still be in Cambodia and the Indonesians will still be in East Timor, right? Why are they out? Because there were certain norms that had to be observed. You can't just cross boundaries. This little island with four and a half million people, of whom 1.3 are foreigners working here, has got to maintain an army, navy and an air force. Can we withstand a concerted attempt to besiege us and blockade us? We can repel an attack, yes.Given the armed forces in the region and our capability, we can repel and we can damage them. Three weeks, food runs out, we are besieged, blockaded.

Q: Who will come after you? Who would come after you?

Lee: There are assets here to be captured, right?

Q: Some unnamed bad regime?

Lee: When [Malaysia] kicked us out [in 1965], the expectation was that we would fail and we will go back on their terms, not on the terms we agreed with them under the British. Our problems are not just between states, this is a problem between races and religions and civilizations. We are a standing indictment of all the things that they can be doing differently. They have got all the resources. If they would just educate the Chinese and Indians, use them and treat them as their citizens, they can equal us and even do better than us and we would be happy to rejoin them.

Q: Do you think it's healthy for the citizens of Singapore to feel that pressure, that tension that it all could change quickly? Do you think that makes them run this country more effectively, be better citizens by not getting complacent?

Lee: My generation, the ones above 50, who have lived through the first part, they know. The ones under 30 ,who've just grown up in stability and growth year by year, I think they think that I'm selling them a line just to make them work harder but they are wrong. The problem is they don't believe. They think I'm wrong. That's a problem that all countries face. You look at the Japanese, I remember their parents. After their defeat, they had great leaders not just in politics but in business at every level. They travel, they work, and they sold their goods like mad to rebuild Japan. Now you look at them ... You look at the younger generation, will they work like some of the fathers did? I don't think so, but in a corner will they do it again? I think yes because it's a deeply-imbedded culture. They will fight. That's the difference between an ancient culture and a new one. Theirs is embedded, ours is not. At the same time that ancient culture is preventing them from making rational decisions about migration, immigration and meeting the problems of ageing.

Q: Singapore's armed forces are in pretty good shape, right? So when are you all planning to invade neighboring Indonesia?

Lee [laughing]: All we want is a quiet peaceful world. We have made something of our lives and we'll be quite happy to carry on like this and help them get along and do better. We started this LKY School of Public Policy, giving them scholarships to prove to them it's done by good governance. It's not by robbing you.

Q: I (Plate) graduated from the Woodrow Wilson School of Public and International Affairs at Princeton. And so I'm a big fan of public policy schools. I think you all are doing a great job at the Singapore policy school. I think you chose a wonderful dean [former U.N. Ambassador Kishore Mahbubani]. I was recently there to offer a humble seminar. The quality of the students knocked me out.

Lee: I think that's an investment worth making because [students from the region] will go back and they will tell their media chaps and their leaders and say, look this country works because it's working like this: first, it's honest; second, it's rational; third, it makes decisions and follows through on those decisions. The decisions are made after very careful consideration of all options and consequences.

Q: I agree with you and if you look at the course list, it's a very impressive course list. Now, you were educated in England and many of your top people were educated in America or England, so Western education for a long time has been the cutting edge, has been the leader, the place you wanted to go to. Is it your sense that American higher education is still terrific?

Lee: It will stay like that for as long as you keep on getting talented people into your country and staying on, but will you do that? I think yes for 10, 20 years, but 30, 40, 50 years, I'm not sure because other countries will become more attractive or as attractive. It is the extra inputs you get.

Let me explain how I see it. If Singapore depended on its own domestic talent, we wouldn't have made it, but we were the center for education in this region from British days and many came to be educated and many stayed behind. Our top layer was drawn from a larger base and in my first Cabinet of 10, there were only two of us who were born and bred in Singapore. The others came from Malaysia, China, Ceylon, from India and elsewhere. It's a talent pool that was drawn from a bigger region, and that's the secret of your success. You drew in first your talent from Europe because you offered them opportunities. In the last few decades, you've been drawing your talent from all over the world, including Asia. If you can continue to do that, you will continue to succeed.

Not only must you attract them, you must get them to stay.

Q: How are you doing on that?

Lee: We give a lot of scholarships to Chinese and Indians. If one quarter stay on here in Singapore, we're winners, especially with the Chinese. They come in here, they get an English education, they get our credentials and they're off to America because they know that the grass is greener there. The Indians, strangely enough, more of them stay here in Singapore because they want to go home to visit their families, America is too far away. We are net gainers for how long? I think in the case of China, maybe another 20, 30 years and then the attraction is gone. We can't offer them that difference in opportunities and standards. India, maybe longer -- 50, 60 years before their infrastructure catches up. Anyway, this is not my worry anymore!

Q: On India, there's been a lot of hype in America, in foreign affairs publications and so on, about India becoming the next superpower. I was in New Delhi about three months ago -- it seems to me India's got a long way to go.

Lee: They are a different mix, never mind their political structures. They are not one people. You can make a speech in Delhi; [Prime Minister] Manmohan Singh can speak in Hindi and 30, 40 percent of the country can understand him. He makes a speech in English and maybe 30 percent of the elite understand him.

In China, when a leader speaks, 90 percent will understand him. They all speak one language, they are one people. In India, they have got 32 official languages and in fact, 300-plus different languages. You look at Europe, 25 languages, 27 countries, how do you? The European Parliament? Had we not moved into one language here in Singapore, we would not have been able to govern this country.

Q: Minister Mentor, thank you very much.

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Malaysia 2008 Budget’s Poll Result

After about a month since Malaysia Prime Minister Abdullah Badawi announced the 2008 Budget, the result of the poll is finally out. You’re one of the voters who contributed to the end result of “What do you think of the Malaysia 2008 Budget?” and generally it reflects the opinion of the cyber-public pertaining to the budget presented on the first week of Sept-2007.

There was a surprise in the result as it appears not a single vote was casted to support the budget. Here’s the result in summary:

• It’s a great budget, Bravo to PM – 0 percent votes
• It Sucks, Crap & Insult my Intelligence – 66 percent votes
• It’s an Election Budget for lower income people – 18 percent votes
• I don’t know and don’t care – 5 percent votes
• Huh? Budget? What budget? – 11 percent votes

A whopping 66 percent of people think the 2008 Budget simply sucks and it was a crap that insulted their intelligence. Not a surprise, if you can recall how the prime minister seems to rush against time simply reading the prepared budget out of it. Some people even thought the prime minister didn’t have a single idea what was he presenting during that day.

18 percent of the people believed it was an Election Budget specially tailored to cater for lower income people who coincidently constitute the bulk of the voters. Seems people are getting wiser in reading between the lines. I’m sure the 11 percent of readers who voted for the “Huh? Budget? What budget?” were generally sarcastic *grin* while the remaining 5 percent of voters are youngster who did not really know the impact of the budget on them.

However if the above result reflected the majority of actual voters who are expected to vote in the coming general election, the ruling party is doom. Fortunately for the government the rural citizens are still computer-illiterate who can be convinced to vote for the existing government with probably some cookies and instant-noodles as incentives.

Moving forward, StockTube has created the next poll with the intention to gauge readers’ perception on Malaysia’s Astronaut project which saw the first Malaysian being blasted into the space yesterday. So, what do you think of the Malaysia’s Astronaut project? Are you proud of the achievement (was there one in the first place?)? Maybe it’s just another wastage program that has nothing to do with aerospace exploration. Maybe it’s just another attempt to cover the over-priced jet-fighters deal with Russin.
If you have your own opinion other than the options provided, feel free to type it out under the “Other” option. What are you waiting for, take a break & votes. It’s on the right-side of this blog’s navigation bar.

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GOOGLE ready to blast off into the space of $700

Iwas watching two screens in front of me yesterday with different feeling. On one screen I was monitoring the stocks movement of Google Inc. - smiling from left to right. On the other screen I was watching with mixed-feeling the model-like so-claimed Malaysian first astronaut (or tourist) sitting anxiously with his left arm bearing the Malaysia flag obviously positioned and targeted to the onboard camera. There was this fanatic announcement – “that’s it, that’s the Malaysia flag … the Jalur Gemilang” (refering to the flag stitched on the spacesuit) and everyone went hysterically.

Heck, what is so great and proud about being a space tourist? I’m sure the “Spaceflight Participant” Sheikh Muszaphar Shukor didn’t bring a single made-in-Malaysia thing onboard the spaceship, not even his underwear *sorry for the word* as I believe the Russian has their own version and type of underwear for the space journey. So why claim victory when in fact it was a tradeoff for the Russian jet fighters deal to send a tourist up into the space? As long as you’ve $30 million you can book a seat to the space. It’s not a big secret that space exploration has taken another level into tourism to earn some revenue. 

Back to Google’s story, someone asked me if Google Inc. stock could reach $700 a share by end of 2008. Looking at how Google’s stock blasted itself into the new space frontier of $625 a share after the closing on Wednesday, this stock might reach $700 sooner than that (the stock rose another $5.00 to $630 a share during after hours trading). Google share is a different beast, it didn’t and do not intend to release any earnings estimate for investors. Its search engine captured about 70% of the market. It’s getting mature and repeatitively humiliate investors who claimed the stock is too expensive. Its brand is just too powerful. It’s one of the handful stocks with 30% growth.

My crazy buddy Jim Cramer agreed with me. He even asked you to ignore the financial advice from anyone who doesn't recommend Google. Cramer raised his target price to $750 a share – added the figure is an unequivocal lowball estimate. He justified that if Google earns $20 a share next year and continues its trend of 30% growth, it should hit $750. Cramer’s non-conservative but rational price estimate would be $900 *ouch*.

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Wednesday, October 10, 2007

Malaysian first Astronaut? Not sure, but will he urinate

When the news broke in late 2006 that Malaysia's first astronaut will do what no one in space has done before: play traditional Malay children's games ("batu seremban'' or "five stones'') without gravity, spin traditional Malay tops in space, do batik painting and making “teh tarik”,it created the sensation and about to become the laughing stock of the century. While some were giggling in amusement, lots more were frustrated and puzzled with the way how the hard-earned nation’s money was spent though this same frustrated group can’t help with a smile out of the government’s silliness.

Today, Wednesday 10th Oct 2007, Hospital UKM’s Dr Sheikh Muszaphar Shukor will goes into space on board the Russian Soyuz TMA-11 spacecraft together with American Peggy Whitson, the space station's new commander, and Russian cosmonaut Yuri Malenchenko at 9.22pm (Malaysian time). Out of criticism, the embarrass Malaysian government had scrapped the plan for the Malaysian first astronaut to play childish game in space. Instead he’ll carry out four experiments drawn up by Malaysian scientists to study of the effects of microgravity and space radiation on cells and microbes, as well as experiments with proteins for a potential HIV vaccine.

Not sure if the experiments would carry any significant benefits to the nation (it might be an obsolete task done before) but you can be sure the Malaysian astronaut will definitely performs something admirable – sharing loads of Malaysian food such as satay and festive “kuih Raya” with others on board, though I’m curious how the astronauts plan to taste the satay’s gravy in space.

Malaysian religious authorities have prepared guidelines adapting religious rules to life on the ISS (International Space Station), which circles the Earth 16 times per calendar day. This means Malaysian astronaut would be obliged to pray a mind-boggling 80 times in 24 hours without the new set of guidelines drawn. With the new guidelines, he needs to only pray five times a day.

The $25 million agreement for a Malaysian astronaut to fly to space was negotiated in 2003 along with a billion-dollar deal for Malaysia to buy 18 Russian-made Sukhoi 30-MKM jet fighters. However not every Malaysian blinks in pride when Malaysian Prime Minister Abdullah Badawi said earlier that “it would be the first step by Malaysia to prove its capability in the field of aerospace” considering the country does not have any technology whatsoever in the field of aerospace in the first place.

In fact a visit to NASA Space Station Crew’s Profiles indicated that Sheikh Muszaphar Shukor is merely a “Spaceflight Participant” and not as astronaut, cosmonaut or other “naut”. Sensing another round of potential embarrassment, Russian ambassador to Malaysia Alexander Karchava was roped in to tell the local media recently that Sheikh Muszaphar Shukor is not passenger or tourist but a researcher (wow I’m impressed). But still that didn’t stop people from having the perception that the Malaysian is indeed another passenger or tourist wearing a spacesuit.
Maybe the refusal by NASA to recognize Malaysian Sheikh Muszaphar Shukor as a full-fledge astronaut is due to the fact that he was there because of the jet fighters for a space-trip deal, and nothing else. Maybe Sheikh has not met the criterias to be called an astronaut. Whatever it is, Malaysia will definitely change their school text-book claiming Sheikh as the country’s “First Angkasawan”. What he did in the space is immaterial. As long as he is up there in the Russian spaceship, he’s qualified as the Malaysian version of astronaut.

On the fun note, it was reported that halfway on their bus trip from their hotel to the launch area, primary crew will conduct some sort of ritual that has been practiced since the time of Russian astronaut Yuri Gagarin (the first man to go to space on April 12, 1961) – to urinate on the bus tyres. It would be fun to watch Malaysian Angkasawan perform the same “important task.” For all you know he might come back a hero and a “Datuk” title are within his reach.

You can bet your last penny that the government will utilize this blast-off as one of the propagandas to instill feel-good factor into the voters with the general election not far away. Anyway, let’s pray for his safe space journey.

How to make US$20 instantly with PayPerPost

If you’re one of the bloggers in the blogosphere who are already making money or intend to make some pocket money online, chances are you’ve heard of PayPerPost and other making money programs. During the old days of internet, people especially the business owners were already crazy about the prospect of making huge money in the borderless world. The commodity was the eye-balls, a term used to tell how many visitors are visiting your virtual shop from anywhere anytime. It made perfect sense as the business model was thought to be a viable way to enhance sales.

Stocks IPO was launched hysterically in great numbers. People just chased up the stock prices of any company that has anything to do with dot-com. P/E was at all time high and before you know it, the bubble burst. Warren Buffett was severely criticized for not wanting to understand and jumping into the dot-com boom but he persevered and he was proved to be right again.

PayPerPost is the concept whereby you get paid to blog on your own blog – an excellent idea for bloggers who wish to earn some loose-change to probably pay for the hosting and domain name. If you’re using Google’s Blogger, of course you’re making the net profit. In the fair market of supply and demand, the advertisers are desperately wanted you to take their money as they’ve been allocated a huge sum of money to create awareness. And you as the owner of the blog would like to get paid for a little work of blogging about certain services, products or simple some latest happenings.

What you need to do it to sign up as PayPerPost Blogger, submit your blog for approval, complete an opportunity and get paid via PayPal. And to add more honey onto the bread, now you can earn US$20 for your first post. What better way to monetize your blog than this? I signed up because I needed to see if PayPerPost is a viable mean of making money online as what everyone had claimed. So far, I’ve not read anyone being rejected of their payments for opportunities approved. 

I believe payperpost is here to stay; after all they’re the de facto when comes to make money writing posts. And I don’t have to tell you the number of friends I made from PayPerPost forum who are very friendly and helpful in extending their advices to newbies, not to mention some of them who’re making great money from PayPerPost alone.

Syed Mokhtar only interested in RM597 million

After months of speculation, the low-profile Syed Mokhtar AlBukhary finally announced the plan to split its plantation and sugar refining business from the group to focus on its hotel and property businesses. The re-organization involves Tradewinds Corportion Berhad (KLSE: TWSCORP, stock-code 4804) that owns 53.02 per cent of Tradewinds (M) Berhad (KLSE: TWS, stock-code 4421), which in turn holds 69.76 per cent of Tradewinds Plantation Berhad (KLSE: TWSPLNT, stock-code 6327).

Under the proposal, TWSCORP will sell all its shares in TWS to its shareholders and raise about RM597.34 million of which 60 per cent of the proceeds will be used to repay debt (estimated RM355 million) and the rest as working capital and to fund the land purchase of 363 hectares (valued at RM145 million) of land in Bandar Nusajaya. TWSCORP will offer 1 (one) TWS share for sale for every 4 (four) TWSCORP shares held at the offer price of RM3.80 per TWS share.

Syed Mokhtar's Perspective Lane (M) Sdn Bhd, which holds 32 per cent of TWSCORP initially, has raised its stake to 62 percent after it converted its loan stocks, triggering mandatory general offer for the remaining shares of TWSCORP, TWS and TWS Plantation. The offer prices are as follows:

• Tradewinds Corportion: RM1.36 a share (pre-suspension price: RM1.36)
• Tradewinds Malaysia: RM3.80 a share (pre-suspension price: RM3.52)
• Tradewinds Plantation RM2.73 a share (pre-suspension price: RM2.74)

However, analysts are not sure if investors are equally excited with the offer price as with Syed Mokhtar’s enthusiasm in wanting to settle the debts and cash to purchase the land. The offer prices are obviously not attractive at all. According to Bloomberg who has been following up with the company, the fair values for the above three companies varies.

As for Tradewinds Corportion, Merrill Lynch and SJ Securities have a price tag of RM2.55 and RM2.30 respectively. Meanwhile Tradewinds Plantation has a fair-value of RM4.70, RM4.50, RM2.95 and RM2.40 a share estimated by Merrill Lynch, Aseambankers, AmResearch and Kenanga Investment Bank respectively. Hence, existing shareholders might ask Syed Mokhtar to fly kites instead. But then Syed Mokhtar might not have the intention to do a full clean-up of the above three companies in the first place. He just wanted the RM597.34 million cash.

Minutes revealed more Rate Cuts at the doorstep

Curse, condemn, criticize, slam or burn the flag as much as you like but it appears United States is perhaps the most democratic country you’ve ever seen, for the time being. At least the investors and people get to study the“minutes” of Federal Reserve’s meeting and I can’t possibly think of any country that did the same thing in the name of transparency, at least not in Malaysia. While the U.S. government believes it’s important and necessary to disclose the contents and be open about the economy data and vital meeting’s minutes, other countries think otherwise.

It was reported that Wall Street advanced 120 points on Tuesday because the investors interpreted minutes from the Federal Reserve's last meeting as indicating the central bank is ready to keep cutting interest rates to boost the economy.The minutes from the Federal Open Market Committee's Sept. 18 meeting among others stated that while officials were concerned that the weakness in the dollar could lead to higher inflation, it also said the economic outlook was uncertain because of the credit crisis and that there were still risks to growth that justified lower rates.

Such disclosure was enough to push the Dow up by 120.80 points, or 0.86 percent, to 14,164.53, a new record high after the previous record close of 14,087.55 reached on Oct. 1. The S&P 500 rose 12.57, or 0.81 percent, also to a record close of 1,565.15 after it surpassed the previous record close of 1,557.59, reached last Friday. The Nasdaq composite index rose 16.54, or 0.59 percent, to 2,803.91 and this is the first time the technology-index closed above 2,800 since January 2001.

Okay, I know I had sold off *kick myself* my Apple Inc.’s Call Options when the stock was trading just below $160 per share and the stock was trading at $167 a share after Tuesday closing. I thought the $160 was a strong resistance but I guess that’s how you’re being played by the stocks market. You simply won’t know when the stock will surprise you. As long as you’ve made your profit and take the money off the table, there’s no reason to regret. At least I’m right about Google Inc. and it’s trading above $600 a share now *yip-pee!!*

Malaysian Central Bank didn’t follow Feds’ step in cutting the rate, in fact the central bank was almost in the mood of celebration as it meant their job in attracting foreign funds were made easy by simply “do nothing”. The U.S. dollar was instantly hit with the recently announced rate cut and this prompted investors to take their money elsewhere, including Malaysia although the quantum is not known.

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Tuesday, October 09, 2007

GOOGLE's stock price zoomed above $600 finally

Google Inc.'s stock price sailed past $600 for the first time Monday, extending a monthlong rally propelled by the lofty expectations surrounding the Internet search leader's upcoming third-quarter earnings report, espected to be released on Oct 18.

The Mountain View-based company's shares traded as high as $610.26 before slipping back to $609.62, a gain of $15.57, or 2.6 percent. It marked the sixth time in the past 12 trading sessions that the stock has reached a new peak, indicating investors are confident Google's third-quarter profit will be impressive.

The shares have increased more than sevenfold from their initial public offering price of $85, bringing the nine-year-old company's market value to $190 billion and possibly on its way to become a mature business that might attracts the attention of investors such as Warren Buffett. It took 10 1/2 months for Google's stock to leap from $500 to $600 and more than a year for the journey from $400 to $500.

Analysts began predicting Google's stock would reach $600 at the start of 2006 when the shares were still hovering around $420. Some analysts already arepredicting Google's stock will hit $700 within the next year, but the average target price for the stock is $614.64 among analysts polled by Thomson Financial. Google Inc. founders Larry Page and Sergey Brin look set to climb the ladder of Forbes Richest Americans list from their current ranking of number 5 now. Already hundreds of other Google employees are millionaires.

Analysts, on average, are expecting the company's earnings to rise by more than 40 percent to $3.75 per share, excluding expenses for employee stock compensation, according to Thomson Financial.

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MASTEEL, the Southern Bank of Steel Stocks

There’re reasons why certain stocks within a certain sector are trading at alower P/E (price earning ratio) than other sectors. The steel is a tough industry and it doesn’t help to know the fact that the steel industry has gotten a bad reputation from many stocks investors who often associate it with huge capital outlay, long payback period, giant pension costs, competition, crushing debt loads, bankrupt firms and industry overcapacity.

You need to have great global economy with great demand for the metal in order for the sector to sustain. Fortunately you have China or else you can bet your last penny that the recent U.S. subprime crisis will bring the steel industry to its knee. As comparison, steel companies in U.S.are not trading at a very low P/E as compare to other sectors such as technology whereby Apple Inc., for example, is trading at P/E 45 times. Let’s take a look at some of steel stocks’ P/E:

• United States Steel Corp – P/E: 9.80
• Nucor Corp – P/E: 10.70
• Reliance Steel & Aluminium Co – P/E: 10.60
• Allegheny Technologies Inc. – P/E: 15.50
• AK Steel Holding Corp – P/E: 32.30

Picking Steel Stock amongst the crowd

In Malaysia if you happen to be one of the veteran stocks investors, chances are the past scandal of Perwaja Steel might flashes in between your mind when you’re thinking of such metal stocks. Anyway, to fulfill the rule and best practice in stocks investing, you need to diversify. Amongst the steel stocks you’re pampered with choices such as Southern Steel Berhad, Kinsteel Berhad, Leader Steel Holdings Berhad, Amsteel Corporation Berhad, Ann Joo Resources Berhad, Malaysia Steel Works Berhad and others.

And if you talk about low P/E stocks, Malaysia Steel Works (KL) Berhad (KLSE: MASTEEL, stock-code 5098) is perhaps the stock that you should pay some attentions. The principal activities of Masteel are in the manufacturing and marketing of high tensile steel bars, mild steel bars and prime steel billets. Besides domestic market (about two-third), MASTEEL has a wide network of customers internationally as well.

MASTEEL’s Fundamental attracted LTH

Recently, Masteel posted a 73% growth in revenue in the second quarter ended June 30 to RM148.4mil. Net profit more than doubled to RM21.7 million from just RM10 million in the previous corresponding period. EPS expanded to 10.79 sen from 4.86 sen a year ago. In a filing with Bursa Malaysia, the company said it was on track to achieving RM500mil worth of revenue, adding its earnings were likely to grow 10% to 15% by the end of FY07.

Since 2002, MASTEEL has been consistently registered revenue growth. Net profits are at admirable level, not to mention the good EPS (earnings per share) and the dividends declared since 2005. But what made this stock mouth-watering is the fact that it’s trading at the low P/E of only 6.65 based on today’s (8th Oct 2007) closing price of RM1.50 per share and 2006 EPS of 22.56 cents per share. If 2007’s estimated EPS of 25.8 cents is taken into calculation, the stock is actually trading at mind-boggling 5.81.

Even if you do not wish to compare this P/E against U.S. same stocks category (which you shouldn’t in the first place), MASTEEL is still cheap compare to local steel stocks such as Kinsteel Berhad, Southern Steel and Ann Joo Resources Berhad which are trading at the range P/E of 8 to 9 times.

Based on the latest filing dated 5th Oct 2007, it appears MASTEEL has attracted the attention of Lembaga Tabung Haji (LTH) which emerged as a substantial shareholder with a 5.22% interest. The pilgrim management fund had acquired 407,000 shares in the company on 3rd Oct 2007, increasing its shareholding to 7.62 million shares. The argument that LTH was interested in Silver Bird Berhad might make sense that LTH could leverage on the food (bread) for its thousands of pilgrims but for LTH to buy into steel company could only signal that MASTEEL’s stock price is too cheap to ignore.

Technical Analysis says Resistance is very strong

Based on the latest 3-years stock chart, the RM1.50 level seems to be a very strong resistance to any stock investors, punters or traders looking for some fast bucks. This guy is not an ordinary fellow to beat. It’s really stubborn and you need some time for more accumulation and huge-size wrestler to move it.
If you’re a bit greedy and would really like to maximize your profit, you might want to wait till the stock price to drop to below RM1.35 to accumulate it. At RM1.35 you’re paying 5.98 times (2006 EPS) and 5.23 times (2007 estimated EPS) P/E and unless China and Malaysia’s infrastructure comes to a sudden halt, your investment’s risk should be at its minimal.

MASTEEL’s Risk

The company’s risk is mostly on the fact that two-third of the revenue derived from domestic market. Hence most analysts who are upbeat on the stock is due to the outlook that more projects under the ninth Malaysia Plan (9MP) will materialize especially on the ambitious plan for the IDR (Iskandar Development Region). Another news that was expected to have impact on steel companies was from the China’s recent measures to not only remove export rebates but alsoraise export taxes on steel products which could reduce the profit of MASTEEL.

Nevertheless MASTEEL, the smallest steel makers in the country is a very well managed listed company and has stayed profitable even through the most difficult periods. Together with the stable steel price and the long-term contract price for iron ore that has doubled in the past three years, this stock might just be theSouthern Bank (which was acquired by Bumiputra-Commerce Holdings) in the banking sector.

Already there’re rumors that there might be increase in steel price locally due to global demand and price escalation.

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Friday, October 05, 2007

Made Money from two Apples, 134 and 52 Percent Profit

There’re thousands of stocks listed on the Wall Street and unless you’re one of the multinational fund managers who have literally an army of researchers or analysts who can input you with information at a click of a mouse, it’s not possible for you to cover every corner of the stocks. Even fund managers only concentrate on some of the most promising stocks with great fundamentals.

Frankly in the U.S. stock markets you’re looking for more than normal fundamental stocks. You should position yourself to be in another level searching forinnovative companies that can continuous creating values for shareholders. Competition is tough and only the best company can survives in the cruel world of “only the best will not be wiped out”. Readers who have been with StockTube long enough knows that there’re only a handful of favorite stocks that I keep trading or investing.

Apple Inc. (Nasdaq: AAPL, stock), one of my favorites was mentioned repetitively within this blog simply because it had and hopefully will continue to make money for me. If you still remember, I mentioned about Apple Inc. and Google Inc. yesterday (read here) and how I decided to let my profit run since I want to take profit only at the border of resistance which was at $160 and $600 respectively. Guess what, Apple Inc. was nearing the $160 level at 11:20 am trading time and I decided to lock-in the profit.
Yesterday I mentioned that I had 2 positions - AAPL Oct 135 Call Option and AAPL Oct 140 Call Option. I closed both positions before noon since the market has been kind enough to be in the green today. Furthermore I only have 2-weeks before the Oct-expiration. What better things to do than make money and run while the positions have met the profit target? I’m still letting my GOOG Nov 570 Call Option survives on its own at this moment.

Okay, first thing first, AAPL Oct 140 Call Option position was opened back in 24th July 2007 before the earnings announcement. Apple Inc.'s fiscal third-quarter profit soared more than 73 percent and it sold 270,000 iPhones in the first two days on the market. Everyone was jumping in celebration and sent Apple stock up by more than 9 percent or $12.92 in extended trading hour. However I didn’t close my position as the result was simply fantastic and there should be some follow-through. But the global market didn’t think so, first when Dow Jones plunged by 300 points then followed by subprime crisis and the rest was history. Apple went on to breach the support of $132 and even $125. I was saved once again as I bought the option call with tons of time-value, the main ingredient in option trading.
Another reason why I bought Oct Call Option was because Apple will be reporting its’ next earnings before the expiration and so the stock should recover nicely by then. Looking at the chart above you can see how it plunged and took more than a month to recovers and once it was trading above $140, that’s when the rock and roll started. For this contract I only made 52 percent profit, not something that I’m proud with considering that it’s been floating for more than 2 months. Anyway it’s still profit nevertheless.

The second contract on AAPL Oct 135 Call Option was entered because of theprice-volume which signal a possible breakout from the $140 resistance level. And when it closed on 18th Sept 2007 above $140, Apple was on its way to rock and roll together with my earlier position above. And within 16-days of trading, I made 134 percent profit, better than the position discussed above.
Looking at the chart above, you can see how Apple consistently and confidently traded above $140 and $148 before it stopped at the new resistance of $160. Seriously, the pressure is on Steve Jobs’ shoulders to continue deliver another set of mind-boggling result in days to come. I wish I can say Apple will have no problem at all delivering yet another set of great earnings in October. Considering the stock price of Apple is now hovering at $160 level, Apple Inc. is not cheap. Given chance I would whisper to Steve Jobs and tell him to announce “stock-split”. That would give the much needed catalyst to push the stock price again. So, will there be a stock-split announcement from Steve? Most probably, I hope.

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Stocks Frying 101 with the Iron Chef Vincent Tan

StockTube has to admit that the greedy part is slowly creeping into the mind and it’s dangerous as I’m stubbornly wanted to hold on to my Apple Inc. and Google Inc. even though my target has been reached. While my AAPL Oct 135 Call Option has well passed its profit target, the AAPL Oct 140 Call Option and GOOG Nov 570 Call Option have both crosses my satisfactory profit target. Frankly I’m trying to push myself to the limit to see if I can sell at the nearest border of the resistance established recently.

What I’m talking about is the resistance of Apple Inc. at US$160 a share andGoogle Inc. at US$600 a share traded two-days ago. I was thinking that since my positions are in the profitable level, I might just let it run. But I’m playing the game of risk as both stocks are highly volatile. With Apple Inc.’s earning announcement set to kick in real soon, I think the chances of Steve Jobs announcing a stock-split are quite high considering the share price of Apple is currently quite expensive. And as long as the expectations are there, Apple Inc. would not “game over” so fast, at least not until it announce its’ earning.

Hence, I’m taking my eyes off from monitoring the above stocks to talk about two highly explosive stocks that you might know – Silver Bird Group Berhad and Berjaya Corporation. I’ve talked about Silver Bird last Thursday 27th Sept 2007 (you can find the link at the end of this article) and coincidently two days later theStar Saturday business section carried an article on the same stock. So I guess there’s really something brewing on the way Lembaga Tabung Haji buying crazily into the stock.

In fact, the rush into the acquisition of Silver Birds shares got even crazier based on filing yesterday. Besides Dato' Tan Han Kook continues his acquisition of another 500,000 shares, we’re seeing Vincent Tan together with Berjaya Corporation, Berjaya Capital Berhad, Bizurai Bijak (M) Sdn Bhd and others playing the active role in the acquisition since Monday.

And talk about Berjaya Corporation stock price which exploded today, the filing indicated Vincent Tan has been buying his own company’s shares aggressively since the end of September. Just what is this Vincent Tan thinking stepping his legs not only in his Berjaya Corporation but also Silver Bird? Anything frying in the kitchen that he knows but we don't (recently great EPS aside)? Or will we see the man who was once one of the“stocks frying” kings making an elegant comeback to the scene?

I’ve said before Vincent Tan was the undisputed king of “bonus and rights issue” and it’s been ages since this man last cooking up his shares. Investors who had invested in his now-privatised Berjaya Capital are now laughing *evil grin* all the way to the bank with the special dividend in the forms of BJCorp-ICULS, not to mention the earlier ICULS received during the restructuring before the privatization. And since Vincent Tan himself is holding tons of it, it’s time for him to heat up the “wok” and today’s stock movement might be the scene of “adding spices” to the wok before the actual frying starts.

The return of Vincent Tan to the stock market scenes might be more interesting than the bull-run on both Apple Inc. and Google Inc. combined. For the newbies, let’s start learning stock frying lessons 101 from “Iron Chef” Vincent Tan, shall we?

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Thursday, October 04, 2007

Holy Cow! The Rich and Famous now Fly and Dive

Days ago the young millionaire from Sabah, Malaysia, who created his fortune by listing his company in the Kuala Lumpur Stock Exchange was sued by Securities Commission (SC) for allegedly using the company money for his own gain. I’m sure you remember the glory days when this FTEC Resources Bhd chief and founder Kenneth Vun made instant multi-millions from floating the shares of his company when the stocks skyrocket to unbelievable level – above RM2.00 per share.

Punters and short-term investors both loved and hated the stock. The stock was fried up, reheated and reheated again by some syndicates. Many people rejoiced for making good money but many more people cried for losing tons of money. That’s the price you need to pay for speculating (more like a gambling) such stock. Seriously, there’s not much value in FTEC’s business model although the vision to duplicate the success of Michael Dell should be applauded.

While some compliments should be extended to Securities Commission, isn’t such action a little bit too late? The money was raised in FTEC’s initial public offerings (IPO) in 2003 and only now the SC is taking action? Yeah, SC is not auditor and should not be blamed and so the story goes. The SC filed a landmark civil suit against Vun on September 26 2007 to make him pay back RM2.5 millionto the company that was allegedly used for his own benefit. Vun resigned on 2nd Oct 2007 after the suit. 

You want to know how he used the money, maybe you should check out what’s inside his garage – a Ferrari. Not that I’m surprise considering his love for high-speed sportscar but if he had misused company’s money for personal benefit, then that’s something not acceptable. But then there’re many un-listed companies out there that actually bought cool multi-million cars to shrink their company’s profit to pay less tax. It’s a common practice. Guess that’s the price you’ve to pay when you’re the owner of a public listed company.

Owning Ferrari is not a big deal if you compare the wealthy people in Monaco. Did I hear Singapore is on its vision to turn the tiny dot into an equivalent Monaco in years to come? Well, in Monaco’s recent yacht show, the new “in things” is the new concept of luxury yacht. Wealthy tycoons own yachtes so no big deal. But the appetite of the rich or famous has changed. They want to be different and they want to show it off to everyone. They want more accessories besides the yacht – how about helicopter and submarine?
Basically that’s how the rich and famous spend their money – a car, a yacht, a helicopter and probably a plane. Many made good profits from stock markets but nothing beat the oil tycoon such as Russians Roman A. Abramovich who owns at least three mega-yachts and has another under construction, the 540-foot Eclipse, which according to Monaco newspapers will be outfitted with twin helicopter landing pads and a submarine. That’s what I call the super rich. On the side note, I’m wondering if Badawi’s yacht has helicopter landing pad, if he indeed owns one. If not maybe he should upgrade it or maybe he bought an obsolete model.

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Wednesday, October 03, 2007

Did a Blog cause RM37 million losses to StemLife?

Behold the power of blog. If used wisely by business communities it could enhance the customer relationship and indirectly increase revenue as the substance of loyalty and trust would be cultivated. But if somehow a blog was written in such a way that it could bring disaster to your business, then you might have sleepless nights. More so if the author claimed to be your former employee and he / she could tell to the public information pertaining to the insiders as if it’s real. 

Real or not, it appears that StemLife Berhad (KLSE: STEMLFE, stock-code 0137), the specialist and the largest stem-cell bank provider in Malaysia that saw its’ stock price skyrocket to RM5.80 before consolidated to the current RM4.28 per share is not taking the blog’s article lightly. Hit where it hurts the most (obviously the shareholders’ pocket) and it will retaliate. And if you wish to read how you could have made more than 400 percent profit investing stocks within less than one year, StemLife is one good example (stocks being fried aside).

StemLife adopting bad business practices?

Now according to this individual claiming to be a former employee of StemLife, he resigned because he / she couldn’t stand all the lies and nonsense that was and still going on - bad business practices such as storing infected cord blood with clean samples.That’s what greets readers who managed to find the blog, not so difficult if you googled “10 Reasons Why You Shouldn't Use Co. X” as reported by Business Times. It also mentioned that a Singaporean cord blood service provider, which had initially invested in StemLife, had sold its shares in 2003 after finding out the latter's alleged practices.

And today StemLife has filed police report to clear its name. Assuming that it was true that CordLife Ltd was the party mentioned in the blog that sold off its 20% shares in 2003, its CEO Steven Fang only mentioned that the company sold out due to difference of opinion on strategic direction in business and operations, after he was contacted by Business Times. Interestingly while StemLife’s managing director Sharon Low was mentioned as the operations director for CordLife Pte Ltd., Steven Fang said one of StemLife's founders was only a staff of CordLife.

How StemLife competitors won an easy battle?

However that’s not important. What are important are the damages that have been done to the reputation of StemLife and potentially it’s bottom-line.Just how critical was the havoc? StockTube happened to have the luxury of time in visiting some of the booths during the recent Baby-Fair at MidValley recently. It was crowded alright and amongst the booths which were aggressively courting the customers were the major players in the stem-cells storage – StemLife, CyroCord and CellSafe International (CSI). Basically just like buying laptops computers all the brands were trying to push their offering to you. Seriously, the packages offered from three of them are almost the same. The only differences were the discounts, free-gifts and lucky draws depending on the package you’re interested.

Of course StemLife being the listed company and the proudest of all offered the least incentive but not before throwing something which looks weird. You see, if you wish to store your baby’s stemcells you’ve the choice of either store it in bag or vials. You can debate until the cows come back on which method is better but in short StemLife prefers bags and threw in a very low price for you if you preferred vials. CyroCord for some reason only offered vials while CSI offered both bags and vials. But how did the two competitors beat StemLife in closing the deals?

Simple - by giving potential customers the website of the “10 Reasons Why You Shouldn't Use Co. X” blog. If you still couldn’t find the blog, it’s hosted under wordpress blog platform and the site name is the same as StemLife minus the “f”. I’ve to admit the author was creative with the naming of the blog of which I bet he / she spent some time thinking of it. So far based on the statistic from the blog, it has attracted more than 15,000 hits since. While one concreate reason would scare the shit out of me, just think of the potential reputation damage to a listed company if there’re 10-reasons – it will definitely scare a lot of shits out of potential customers.

How severe was the damage?

Assuming only 50% of the readers are potential customers that would sign-up with StemLife’s top-package which is about RM5000 (for 20-years storage). That’s a whopping RM37.5 million in potential losses in revenue. And based on the 50% profit margin as the guideline (as published in StemLife’s IPO documents) the company had just lost RM18.75 million in pure profit. No wonder StemLife is crying high and low and is considering taking legal action. However if StemLife is clean, there’s nothing to be afraid of. After all, it’s just a blog, unless what the blog claimed was true.
The multi-million question – did the blog actually caused business losses to StemLife? I believe so but it’s hard to quantify the dollars and cents. The rumor in the market was that some shareholders within StemLife itself were selling when the stock reached RM5.80 in early August. Hence the value losses could be due to both factors – the blog as well as internal selling. 

And talk about latest shareholders changes, it appears Goldman Sachs International had been busy acquiring StemLife’s shares to the current 9.03% stake or 14,894,000 shares. From what StockTube knows, there would be a total of 7 players in the stemcell market in 2008. While the competition could spell tougher business with potentially lower profit margin, a lower package-price could attract more customers provided the right awareness and marketing are launched. Heck, for all you know Sharon could be on her way to cash-out with the emergence of new strategic shareholder(s).

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Mobile service providers should look offshore for ideas

SMS is perhaps the most successful application or service used by mobile users in most of the countries, including Malaysia. Telecommunication companies actually made tons of money during its’ booming period. As with almost every products, the birth will followed by the peak cycle and almost instantly the revenue from SMS became so competitive that the saturation level actually ate into the service providers’ profit. Hence the 3G was said to be the next killer-application. However more failures were recorded than success when comes to 3G’s rollout. The main problem was and is still the contents.

Recently Ultimate Pros, a leading mobile marketing agency for the sports industry and GoLive! Mobile, a provider of mobile content technology solutions in the U.S. launched a comprehensive mobile strategy for Ultimate Fighter Rich Franklin and the American Fighter brand. What this means are those fans of Rich Franklin will be able to download exclusive and directly from Rich Franklin Mobile Storefront the content to their cell phones - including ring-tones, videos and wallpapers. 

So, maybe local providers such as Maxis Communications, DIGI.com or even the soon to-be-relisted Celcom could approach GoLive! Mobile to help them to maximize their infrastructure and offerings in creating compelling sms marketing, mobile content, mobile marketing and other marketing campaigns. Furthermore GoLive! Mobile has experience in marketing text-to-screen, sms voting or polling and even reverse auction services.

Tuesday, October 02, 2007

Dubai Investment Group realized their mistake, finally

Have you been going against the tide by investing in cheap but not performing stocks? Did you buy for the sake of buying without doing any homework to study a company’s fundamental, technical and its management team? If you try to argue that you’re actually trading or investing the contrarian way by doing so, then you might want to find out the real meaning of contrarian investing.

Whatever it is I hope you didn’t get yourself into trouble by trading junk stocks. Just which stocks are junk stocks? You need to do indepth study to find that out, although I hope there’re more useful tools or comprehensive and integrated databases which can retrieve relevant information for investors who wish to have a high-level glimpse of a particular stock. It would be fun to have such system at our disposal so that we can make intelligent investing decision - with lightning speed, don’t you think so?

PECD – Junk Stock to Avoid

Anyway, one of the junk stocks that StockTube had identified back on 22th June 2007 was PECD Berhad (KLSE: PECD, stock-code 5093). If you missed that article, go and find out why you should run away fast from PECD stock. When even PECD’s contractors cried foul over debts not paid, you should think twice about investing in this stock. And if PECD’s own CEO (chief executive officer) Rosman Abdullah himself is not too sure when and if the company can actually turn around, you should think thrice.

StockTube wasn’t impressed when PECD reported that it was tying up with Dubai Investment Group (DIG) back then to undertake construction and property development projects. Slightly more than 3-months after the tie-up, DIG announced today that it is not proceeding with the proposed tripartite 200 million dirham (RM184.94 million) joint venture project to recapitalise PECD Bhd’s Dubai outfit, PECD LLC.

DIG-PECD partnership broken, finally

PECD confirmed it had received the intention letter from DIG but the obviouslysurprised-PECD is seeking clarification on the termination as no reasons were given. What could be the main reason(s) that prevent DIG from working together with PECD? Although StockTube would not blink once in surprise of whatever actual reason(s) resulting from DIG’s latest move, the basic fundamental of how the company’s (PECD) business was being drive does not augurs well for any partnership.

To think of how Malaysian ruling party United Malays National Organization(UMNO) trying to bailout PECD by pumping money for a 25% stake is simply outrages. And when even state-controlled and cash-rich Petroliam Nasional Bhd (Petronas) couldn’t stand how PECD tried to claim US$200 million (RM700 million) from it in cost overruns for a project to build a marine terminal in Sudan, there’s no single reason why DIG should even spend a minute talking to such company in the first place. Fortunately its’ better to discover such problem now rather than late as it would equals to "dumping the money into the sea."

Anyway for Punters to make money?

Regardless of how junky a junk stock is, there’re always punters flying around it.While the return might be good, the risk is equally high. One of the method to trade or punt around such stock is to study their technical chart.
From the 200-day moving average, PECD is still in bearish mode - meaning professional or long-term investors are ignoring it, not that there’s any justification to go long in the first place. However from the resistance and support level, you might be able to scalp some profits in between provided there’re volume.