MONEY MASTER

Buy Insurance

2012-01-27T09:44:00.000-08:00

Financial planning is probably the most important thing that we must be aware of. Most young adults find it difficult to plan for their financial condition because of the "yum cha" and cool cultures....most young adults are probably pampered way too much by their parents...their studies and everything are planned out so well....honestly, I am envied of those students who have their parents sponsored everything. Anyway, I appreciate what I have as well and I believe the first step to financial planning is protection.

Some of my friends told me that they are going to buy insurance but now is not the right time....as they are just starting out, they need more time. I am not an insurance agent but working in an insurance company, I come to realize that protection is probably the first thing that we get for ourselves. It is not about the profit from these insurance policies but the protection that comes with it. Of course, one should not buy too many insurance policies either...it will be ridiculous to do that....don't trust that insurance agent if he or she persuade you to buy a few policies...haha!!

Anyway back to the basics...get a protection, something that covers your life and medical expenses should you have any critical illness. I have just bought one for myself (a month ago) and together with my sister, get one for my mom. (medical card purpose).

This is not a sales pitch but the first thing to financial planning for me is about protection. Protect yourself and then you can start looking at other things.

Ways to Cut Budget: Buy Only What You Need

2012-01-24T07:43:00.000-08:00

In financial management, in order to keep our financial in healthy condition, growing money via investment or increment is not always the best solution. Many times we need to spend below our means rather than spending within our means. But then again, of course everyone is asking to increase income because by increasing income, you do not need to sacrifice a lot of things.

Well, I have been quite free the last few days that I managed to read Reader's Digest and find out one article which is very suitable for this. It also serves as a good reminder for myself as well, as I will be cash strapped throughout this year as big portion of the money will be used for house renovation as well as to pay the house down payment.

The following are the ways to cut budget:-

Buy only what you need
This one sounds obvious, but how many of us really buy what is truly necessary? A lot of us often buy in bulk in order to reduce our costs but sometimes we ended up wasting what we might not be using it after all. This happens a lot on products which have expiry such as food. Of course, if you intended to buy in bulk, make sure you share the cost with family or friends as this is part of the smart spending strategy to cope with the inflation.

Another thing is, majority of us usually buy expensive gadgets with additional features, although we seldom use the feature when we actually can get the same gadget with about all the feature that we wanted for a whole lot less money. In the end, we are actually paying for the research and development of the features that we might not be using it throughout the lifespan of the gadget. What I would suggest is, rather than getting the highest end segment of the product, why not look into the mid range? Of course I will not encourage getting the gadget from the lowest end segment as most of the time the replacement parts of the gadget might even end of life or we are staring at the product which might already not in production anymore and there is no support for the hardware or even the software.

Finally, we always buy something that we deemed cheap - actually I was one of the victim as well until I realized that last year I actually bought a lot of clothes for Chinese New Year, and the total of the whole purchase could be even more than thousands. The fact that I bought those clothes during cheap sales or buy one free one season made me think I actually save a lot, but in actual fact I am spending a whole lot for clothes that I might not even wear it throughout the year. Should I have not spend it, I will be having additional savings or cash for other purposes.

Guess that's all I have to share now. I will post more on ways to cut budget moving forward.

2012 CLSA Feng Shui Chart

2012-01-21T07:45:00.000-08:00

As we are entering the Chinese New Year season, let's look into what the Feng Shui master said about the overall market sentiment for the Water Dragon Year. Last year CLSA Feng Shui chart was not that accurate especially towards the end of the year, so we'll see what will happen this year. The Water Dragon is supposedly to be good for the stock market, it seems, but we will see what will happen. Anyway, the chart is just for reference and it is not for one to follow blindly.

The More You Trade The Less You Earn

2012-01-17T04:34:00.000-08:00

After about a month since my last post, this will be my first blog post in this blog for the year 2012. Well, it has been like a crazy and busy weekends for me to keep following up on my house renovation back in Ipoh. Anyway, while I was reading some articles from the Internet related stocks trading, there is one article that really open up my mind. I mean the article is not about easy way to get rich with stocks or something like that. And if one is to notice my blog post title, one would realized that it is not about making money with stocks, but losing money with it.

While this blog is all about becoming the money master rather than to be the slave to the money, we need to know that earning money with money is not easy. In fact, it is easier to lose money if we are trying to earn money with money without some basic knowledge or skills. Even some of the most reputable fund managers in the world also lose big bucks in the stocks.

Back to the blog post, do you realized that the likelihood that we as retail investors or traders lose money is higher that profiting from it? The article from the following will explains the theory behind it.

Behavioral finance researchers have studied the performance of stock market traders in both America and Asia. Interestingly, they discovered that traders in both countries under-perform the world’s broad markets by significant amounts. One study analyzed 66,400 accounts at a major Wall Street firm over a seven-year period. Another studied all the active traders on the Taiwan, China exchange.

In spite of the cultural differences, the results were virtually the same. Why? Due to the high transaction costs, taxes and bad decisions, the bottom line is simple: “The more you trade the less you earn.” In fact, about 80% of all day traders lose money. In researching the Americans, the study found that the active investors who turned over their portfolios 258% annually made less than 12% on their money. Passive investors who bought and held, with only 2% portfolio turnover, had average returns of roughly 18%, which is about fifty percent higher than the returns of the active investors. Still, investors believe they can “beat The Street,” simple because the Wall Street “Hype Machine” has programmed them to believe that myth.

It was billed as a “debate,” on a nationally syndicated show. Me, a buy’n’holder to the core, versus John Mauldin, author of the Bull’s Eye Investor and Millennium Wave Investments, a newsletter publisher and investment adviser. John’s a guy who’s not only pro-trading, he hates a buy’n’hold strategy with a passion. So why’s he against buy’n’hold? Well, a good part of the reason is he believes the market’s going nowhere for the rest of this decade, maybe longer. Volatile, risky, unpredictable. But, he ‘s convinced that by using active and aggressive strategies, you can beat the market.

Mauldin is so thoroughly convinced that if you don’t give up on a long-term buy’n’hold strategy and actively engage in alternative strategies (such as hedge funds, gold stocks and trading in value stocks), you’ll lose a lot of money and retire a pauper. So, who won the debate? Buy’n’hold or the hyper-active Bull’s Eye Investor? Nobody! In fact, nobody ever wins this debate. Nobody. Ever!

Different DNA? Then you better play a “different game”

Why? Probably because over ninety percent of American investors are born with a buy’n’hold gene. They are born as passive investors who instinctively tend toward well-diversified portfolios of low-cost index funds. They don’t have the time, or money or the interest in active portfolio management, nor do they trust in the market or in professional market experts.

Meanwhile, the DNA of other ten percent or less—those macho “Bull’s Eye Investors”—contains a rare over-confidence gene that pumps an “I’m-convinced-I-will-beat-the-market” drug directly into their veins and brains. Of course the odds are against them beating the averages, but that gene also contains a blocker that suppresses contrary negative information—even when they’re on a losing streak. The brain chemistry and psychological profiles of these two types of investors are world’s apart. If you listened to a debate between passive Main Street investors and Bull’s Eye Investors you’d think you were talking to two aliens, one from Mars, the other from Venus.

Warning, 82% of all day traders are losers! But deny it!

Moreover, never the twain shall meet. Each type of investor is as dogmatic as the other. DNA-based ideologies control each one, not rationality. Why? Their minds are made up in advance. Their opinions and beliefs were already cast in stone long ago. To each, facts about the other are totally irrelevant. Indeed, that was a given from the start, as I found out once again in our so-called debate. Here’s why: Just before this little debate we discovered some interesting new data from a BusinessWeek article.

The bottom line is simple—most traders are losers. Earlier, Forbes reported on a study that the “North American Securities Administrators found that 77% of day traders lost money.” Now comes more evidence, BusinessWeek was reporting that 82% of all day traders lose money. That data comes from a recent study by a couple professors at the University of Taipei working in conjunction with University of California behavioral finance professors Terry Odean and Brad Barber. And yes, that is the same Odean and Barber who researched 66,400 Wall Street investors a decade ago and concluded, “The more you trade the less you earn.”

In fact, their earlier study proved that the returns of passive buy’n’hold investors (with just two percent turnover) were a whopping 50 percent higher than the returns of the most active traders (averaging 258 percent annual turnover). Why? Very simple, transaction costs, commissions and taxes were killing returns.
In the new study four behavioral finance professors had access to all the records of the Taiwan Stock Exchange (TSE) for the 1995-1999 period. Not just 66,400 randomly selected accounts in Wall Street’s huge database of millions of clients, but all 100 percent of the traders on TSE, including their identities, a total of 925,000 investors. Assuming the DNA of a Taiwanese trader is essentially the same as the DNA of a trader at Goldman, Morgan or Merrill, the new Odean-Barber study results actually confirm what we already know, that market timing and day-trading are a loser’s game.

Dumb and dumber—and yet, they can’t stop losing

All this research also shows that the most active traders—a small group equaling about one percent of all traders—actually accounted for over half of all the exchange’s volume. However, while those guys did make money in their trading—after transaction costs were deducted they were net losers. The study actually went much deeper: Listen to this new bit of information about the strange self-sabotaging obsession traders have to lose money: The study separated the traders into six groups depending on their past successes. The researchers wanted to see if past winners repeated. The answer was yes, but at a very high cost:

– The average winning trader did in fact repeat as a winner, netting $251 a day after transaction costs. But overall, things were so bad that 82% of all the traders lost money, for an average loss of $45 a day.
– That’s right: Out of 925,000 traders in the study, about 750,000 of them were losers. And assuming 250 trading days a year, each trader lost roughly $11,250 a year for a total loss of about $8.4 billion annually.
– On the other hand, the 175,000 repeat winners each made an estimated $62,750 a year after transaction costs, for a total annual gain by the winners of roughly $11 billion. So even the small number of the top-performing traders made only $62,750 a year for all their risk-taking.

Big deal? It gets even worse. Remember, those study covered the manic trading days of the late nineties. Those were the heady go-go days of the great bull market when even 30 percent returns on funds were considered so-so. Those were the days when over a couple hundred funds generated returns in excess of 100 percent in 1999, many over 300 percent—the days when few lost money.

Chimp makes chump of best day-traders

Let me remind you of one very unique “competitor” in the trading world at the time: Raven the chimpanzee! Raven created a winning portfolio by throwing darts to pick stocks—regularly beating even hot portfolio managers returning 300% annually on the Monkeydex portfolio. So the joke’s on all of America’s hot-shot traders. And just in case you think this is just a cute joke, for several years The Wall Street Journal ran a regular contest pitting dart-throwing versus picks based on a comment made by Princeton Professor Burton Malkiel in his classic, A Random Walk Down Wall Street: “A blindfolded monkey throwing darts at a newspaper’s financial pages could select a portfolio that would do just as well as one carefully selected by the experts.”

In short, the new study is a huge embarrassment for the online discount trading firms, for example, who hype the payoffs from trading. Unfortunately, their trader-clients are not only big losers, the 82 percent who are repeat losers are so blind and dumb that they stay in this loser’s game, in denial, and just kept on losing. That’s the trader’s DNA at work!

Dumb, dumber … now the dumbest

Worse yet, the “winners” were the dumbest of all. The so-called winning traders were not only making less than Raven the monkey, they were making less than a buy’n’hold investor would have made from a portfolio with a thousands just sitting passively in tech funds and stocks in the 1995-1999 period. So once again our hat’s off to Odean and Barber, their two studies confirm the truth about trading, that … trading is a loser’s game.

The only people who really make money trading on a regular basis are the service professionals, especially the commission brokers. These pros make their commissions no matter how much investors and traders lose. Even in bear markets their ads paint a deceptive picture aimed at the wannabe trader’s super-confident but addictive and self-sabotaging genes—ads designed to convince naïve wannabe traders that the pros have some special secret that’ll beat the market—secrets they’re willing to share for a fee, naturally.

The truth is: They can’t … they never do … and they never will beat the market … no matter how long they try … trading’s a loser‘s game. But as I found out one more time in this “debate,” as I do in every “debate” with an expert who may be making a living selling trading secrets … I may as well have been trying to convince Raven the chimpanzee that eventually he too would lose, and lose big.

In that respect however, chimpanzees are superior to human traders. The trader’s DNA control their brains, they have no choice but to keep chasing the impossible dream that they can beat the market. The truth is, they’re addicted to losing. The pros know this, so they can take advantage of the wannabe traders never-ending delusional “winner’s fantasy.” And the game goes on ad infinitum, with the pros having a big laugh as they rake off big fees and commissions and get rich off the 82 percent of all traders who are repeat losers.

Quick Check on FY2011 Before Moving to FY2012

2011-12-31T04:01:00.000-08:00

Well, in just less than 25% of a day, it will be 2012. It also means that we should all have our mind set on what are the financial goals that we are expected to achieved and proper execution plans to meet those financial goals.

Like last year in my Looking Back 2010 Before Setting Financial Goals for Year 2011, I will also start have a quick check on my financial year 2011 and what I have achieved and what I have failed to achieve and the reasons for failing to achieve the financial goals that I have set for the year.

I have very simple 2011 financial goals and it is sort of generic as well. The generic goals were to

Continue tithing

Clearing 10% debt

Stocks portfolio to grow another 15%

I am pretty sure that I have successfully completed the three financial goals that I have set.

Tithing requires discipline and I always ensure that I set aside the money to tithe. Debt repayment is also the same. I always set aside the same amount of money to pay my car loan and this year, I again managed to reduce the car loan to another 16%. However, the same cannot be said to my education loan as I only managed to pare down 6%, due to I need quite amount of money for my property renovation.

My stocks portfolio grow 17% - which is about 2% better than my financial goal. But overall I feel that the stocks are doing good considering that the index actually gained less than 1% throughout the whole year. What I like most about the growth is that 32% of the stocks growth actually came from dividends and now I actually have 11% from the stocks allocation are cash which means I can go on shopping spree if the market doesn't look good and at the same time, I can continue to grow the cash via dividend.

Overall, it is another great year for me although I feel like cash strap due to the renovation cost.

Disclaimer: This blog post only serve the purpose of updating the financial goals progress which I've set last year, and nothing for show off, which is why I only do a short review rather than posting everything in details.

Pats Jets Steeler

2011-11-20T04:07:00.000-08:00

The American football fans will be delighted as the Ticketamerica.com has tickets for new england patriots and the new york jets and pittsburgh steelers tickets. Buying the new england patriots tickets will be as easy as just a click of the mouse click right in front of the monitor. Not only that. Fans from other clubs can also buy the new york jets tickets as well.

How a Financial Pro Lost His House

2011-11-14T07:23:00.000-08:00

As we all read it from the news everywhere that the household debt in Malaysia is on the rise and the household debt has been going from 66.7% in 2009 to 74.6% end of 2010.
What this is actually telling us is that for every RM1,000 that we earn, RM746 is used to serve loan (source).

While I have been thinking of promoting debt or loan in this blog, but finally kill the idea of doing that as I know there are many people who cannot control once they stepped into the world of debt - even a financial pro.

Below is the story of How a Financial Pro Lost His House. I find that this article can serve as a reminder to us that excessive leveraging has its danger as well.

ONE night a few years ago, when the value of our home had collapsed, our debt was out of control and my financial planning business was shaky, I went to take out the trash.

There was this enormous window that looked right in on the kitchen table, and through it I could see my wife, Cori, and our four children eating dinner. It was dark outside, so they couldn’t see me, and I just stood there looking at them.

After a while, I pulled up a bucket and I sat on it, just watching my children eat. I found myself wishing that I could get back there, connected to the simple ordinary stuff of my family’s life. And as I sat and watched, filled with longing and guilt, two questions kept arising:

How did I get here?

And how am I going to get out of this?

There are many stories these days of people who lost their financial bearings during the housing boom and the crisis that followed, but my story is a bit different from most.

I’m a financial adviser. I get paid to help people make smart financial choices, and I speak and write about personal finance issues for this publication and others. My first book comes out in January, “The Behavior Gap: Simple Ways to Stop Doing Dumb Things With Money” (Portfolio, a Penguin imprint).

The thing that few people know, though, is that I learned a lot of this from experience. I made a bunch of mistakes, the very same ones that I now go around warning people to avoid.

So this is the story of how I lost my home, the profound ethical questions that arose along the way, and what my wife and I learned from the mistakes that led us to that point. It made me better at what I do, but it wasn’t much fun getting there.

Like most financial stories, this one is personal. It starts with me getting into the financial services industry more or less by accident. I answered an ad in 1995 that I thought was for a job related to “security” (as in security guard) but was in fact related to “securities.” That’s how little I knew about the stock market. A few months later I found myself working a phone at a Fidelity Investments call center.

Things went well, and by 1999 I was a Merrill Lynch financial adviser and a certified financial planner. By then, we also owned a house in Salt Lake City. We’d bought it two years earlier, with a $25,000 down payment.

A few years later, an opportunity arose to form a partnership with a successful Merrill adviser in Las Vegas. The place was on our top 10 list of never-move-to cities because we had always associated it with the Strip. But Cori and I were looking for an opportunity to have an experience somewhere else, and we met some great people when we visited the city. I took the job, and we moved down there.

That was May 2003. Housing prices were already crazy, so we rented. But our neighborhood had zero character and lots of cookie-cutter houses. Within a few weeks, we were looking for a place to buy.

I felt we could afford around $350,000. We called a real estate agent named Mitch, who had signs on all the bus stops: Talk to Mitch! He picked us up in a gold Jaguar, and suddenly we were looking at houses that listed at $500,000 or more.

It felt a little crazy to be shopping for houses that cost half a million dollars, but my income was growing rapidly. Everywhere I looked, people were being rewarded for buying as much house as they could possibly afford, and then some. There was this excitement in the air, almost like static. I started to think that if I didn’t buy a house right then, I would never be able to afford one.

At moments during our house hunt, I felt in my gut that something wasn’t right. We’d go to open houses for $400,000 homes and see lines of couples in their late 20s — younger than we were — waiting to get inside. I kept wondering where all the money was coming from. How did all these people make so much?

But prices just kept rising, and when people kept buying, that made it seem safer. I knew from my work as a financial adviser that following the crowd could be costly. But like everyone else, I felt safer in a crowd.

We didn’t find anything we liked with Mitch, but one day in September 2003 Cori spotted a for-sale-by-owner sign in a really nice neighborhood. We ended up buying the house and paid the asking price of $575,000. (When we tried to negotiate on price, the owners were amused; it just wasn’t that kind of market.)

We borrowed 100 percent of the purchase price. In fact, I was told I could borrow even more if I wanted. I had perfect credit and a solid income that was growing. But even so, when the lender approved us at 100 percent, it was more than I had expected. I remember thinking something like “Wow. I guess if they’re willing to lend it to us it must be O.K.”

I should have known better. No matter how well things are going, borrowing 100 percent of the purchase price of a home is not a good idea. I shouldn’t have relied on someone else to make that calculation, let alone the guy who was making money putting me in the loan. I was a financial adviser, and I never sat down to figure out what it would take to make this work. I just wanted to believe him. And it was so easy to believe he had been right, at least at first. We loved living there. The children went to an awesome public school, and we made some great friends. I could ride my bike to Red Rocks, the wilderness area outside of town. And for a time, the real estate market erased any doubt I may have had. It just kept going up.

One evening in 2006 comes to mind. My sister-in-law was thinking of moving to Las Vegas, and a real estate agent told me about an open house for a new Toll Brothers community. This wasn’t a come-by-for-cookies type of open house; it was held at a Las Vegas hotel ballroom. I arrived to find a line that led down a flight of stairs and out of the front door. Before I got to the front of the line, they stopped admitting people. Then people rushed the door, like it was a rock concert.

The market’s continued strength meant we could borrow even more. It was easy. In late 2004, a year after buying the house, we refinanced our mortgage with World Savings Bank, which later ended up in the hands of Wells Fargo, using one of the pick-a-payment loans that let you choose your own payment each month.

We picked the lowest possible payment, the one that added to our balance each month instead of subtracting from it. And we added a line of credit with Wells Fargo.

The extra borrowing power was important, because while my income was growing rapidly it wasn’t enough to support all our expenses. Around that time, I left Merrill Lynch to become an independent financial adviser, so it was easy enough to convince ourselves that we were borrowing to pay for the start-up costs.

There was some truth to that, but we were also borrowing against the house to finance our lifestyle. The line between business expenses and personal ones is sometimes hard to draw when you run your own business, and during those heady times it seemed even harder. But in hindsight it is clear that we were spending more than we should have on things like recreational gear and family trips for ourselves and our four children.

It was extravagant, but it seemed modest compared to what some of our neighbors were doing. Our house was the smallest model in the neighborhood (though at 3,500 square feet it was hardly tiny), and we drove a Chevy and a VW. Cori and I and some of our friends had a lot of conversations comparing our spending habits to those around us. How can so-and-so afford a boat? How are people buying new trucks and four-wheelers and 5,000-square-foot homes? Do they know something we don’t know?

At times, it seemed as if maybe they did. I knew a builder of custom homes who urged me to buy one of his houses for close to $2 million. I told him there were at least a million reasons why I couldn’t do that. He looked at me like I just didn’t get it. He assured me the house was appraised for $200,000 more than the asking price, and that after I lived there I could take out a line of credit to live on while the house went up even further.

The crazy thing is, he was right. The place eventually sold for more than $3 million. When I heard that, I felt a little silly that we hadn’t taken that risk.

As for our spending, we told each other that we’d catch up later, as my income and the value of our home continued to rise. As late as February 2006, a comparable home in our neighborhood sold for $998,000. We made the classic mistake of projecting recent trends — even extreme ones — into the future.

But slowly — and then increasingly — we began to have a different kind of conversation, “When are we going to stop and just get on top of this?” The solution was always making more money, not cutting back. The fact is, it’s much easier to set a goal of making more money in the future than it is to buckle down and cut back today.

We never really worried that things would go to pieces the way they ultimately did. But then came the collapse in the stock market. I had clients calling in tears and breaking down in my office. People who had never worried about their portfolios were calling me from their vacations. It was like talking people in off a ledge virtually every day, maybe three times a day, for maybe 90 days in a row.

The range of potential outcomes had gotten so broad in people’s minds that it now included the end of the world. What they wanted and needed more than anything was reassurance that things would be O.K. and that they should stick with the investment plans we had created together. Providing that reassurance had been my job for 10 years or more, but this was the first time that I really wondered if my advice was right.

It was my job to assist them, but I found it incredibly stressful. It didn’t help that we were in increasingly dire straits ourselves. My income fell about 20 percent because my take-home pay depended on the amount of money I managed. At the same time, our cost for health insurance and property taxes kept increasing, and the payment on our mortgage reset higher as well.

By then, housing prices in Las Vegas were falling quickly, and the bank had cut off our home equity line of credit. We quickly got rid of a car and stopped taking trips. I moved into a smaller workspace and cut back on my administrative and marketing costs. Even so, we found ourselves using credit cards as emergency stopgaps.

Then, the sickness set in. The pain would start in my stomach, and then I’d spend six hours vomiting. It happened once, then three months later it happened again, then one month later it happened yet again. Eventually, it was happening every couple of weeks. The doctors couldn’t find a physical cause.

Right around that time, it became clear that we might need to get back to Utah, where 90 percent of my (still nervous) clients lived. We spent the summer of 2009 living in my in-laws’ basement in Salt Lake City, while I tried to stabilize my financial planning business. By that fall, I was convinced we had to move back permanently to save the business. But that meant we faced the question of what to do about the house.

By then, we owed over $200,000 more than our original loan balance.

Borrowing that much had seemed to make sense when the value of the home was still rising substantially every year, taking our net worth higher with it. But at that point, there was no way we could sell the home for anywhere near what we owed. Some of my friends were already doing short sales, where the bank agrees to let you sell the house for less than your loan balance. I was also aware you had to be three months behind in your payments before the bank would talk to you about the possibility.

At first, I dismissed the idea of a short sale. Late that summer, I sat down with a really close friend in Las Vegas, someone I looked up to. He cut to the heart of the matter right away: Why, he wanted to know, were we still making the payments?

Because I have a moral obligation, I said. You pay your debts.

He proceeded to explain that I didn’t have a moral obligation to the bank. I had a moral obligation to my family. I had a contractual obligation to the bank, along with a clear moral obligation to be honest in my dealings. What he was asking was this: Which is more important? Your contractual obligation to the bank or your obligation to your family to preserve your ability to make a living?

I had never thought of it that way. But it made sense. I summed it up to myself like this: I have a contractual obligation to the bank (as well as a moral obligation not to skirt the consequences of breaking it: losing my house and wrecking my credit score). But my moral obligation to my family trumps the contractual obligation to the bank.

Cori and I thought about this for months, but we finally decided to let the house go and stop making payments so we could pursue a mortgage modification or a short sale. The fact was, we didn’t have a choice. We simply couldn’t afford it.

I remained troubled by the ethical implications of what I was doing, but I soon started seeing some of my friend’s arguments echoed in the work of Brent T. White, a law professor at the University of Arizona. He and others were arguing that homeowners should act more like companies — taking into account legal and economic reasons for stopping a regular payment rather than “perceived moral obligations.”

That was reassuring in the dead of night while I sat in front of the computer trying to make sense of the world financial markets and my own personal situation. I remember being relieved at discovering a way to frame my decision.

But we didn’t know what would happen in the harsh light of day, and we were scared to death. Would we be kicked out of our house? What would the neighbors think? What would the children think? We worried about the stress on our relationship and even the survival of our marriage. I felt like a complete failure.

We looked into a mortgage modification, thinking it might let us keep the house and rent it out after we moved. But the offer from Wells Fargo, which owned our loans by then, was too modest. That meant we could either walk away from the house or work with the bank to do an orderly short sale.

A bank representative came to the house and met with us. He was such a nice guy. Cori had treated it like an open house, and the place was spotless. The guy said he’d never met anyone more qualified for their short sale program.

Somehow, even in that horrid market, we sold the home for $531,000. That was in late August 2010. In exchange, the lender released us from both our first and second mortgages. Today, Zillow estimates the home’s value at $505,000.

We were pretty low when we packed up to leave. We hadn’t told anyone about the short sale — not family and only one or two friends. But we sensed that people knew anyway.

We borrowed a truck from a friend who owns a wood mill to move our belongings. Back in Utah, we found a house to rent— much to my relief and after months of being terrified that we’d never be able to find a landlord willing to take a chance on us. I had to tell the owner what had happened. He looked at our personal references and let us lease the house anyway.

We love where we live now. Still, there are consequences. We lost our home. It’s not clear when we’ll be in a position to become homeowners again.

But the worst thing was my sense of complete failure and powerlessness when I realized that things were out of control and that it was my fault. These days, there is still a sense of genuine regret that I screwed up and hurt myself and other people. I still worry about what others think of my behavior, which is one reason I haven’t shared this story with many people until recently.

We have a friend who is under water on his mortgage even though he has lived within his means and done everything right. He’s sticking with his mortgage for as long as he can.

Someone recently asked me what I’d say to people like him. I guess I’m saying it now. As I was writing this article, I pulled behind a truck with a bumper sticker, “Honk if I’m paying your mortgage.”

I thought about that for a while. I guess one of the ideas behind that bumper sticker is that people like Cori and me who couldn’t afford to pay off our mortgages are to blame for the financial crisis and the bank bailouts that followed. This isn’t the place to explain the causes of the economic slump, and I’m not the guy to do it.

Still, the questions linger. As I ponder all this — and I think about it a lot — it occurs to me that we are a nation of risk-takers. Some of us were overoptimistic; some were ignorant; some were deluded; some were greedy; some just had bad timing. We erred to different degrees. Our experiences varied; each story is different. Now you know mine.

The experience has changed just about everything about how I do financial planning and the advice I give in public. For one thing, I am less quick to judge other people’s financial behavior. I’m also more inclined to take into account personal factors that determine how people behave around money.

I have a friend who is going through a tough time financially. He has a high income, but is burdened by debt from a few real estate deals that went south. He continues to take fairly expensive ski trips. That would seem irresponsible in his situation, and maybe they are.

But I now realize that it is not that simple. Maybe those trips are keeping the guy alive, or saving his marriage or keeping him sane enough to work.

I have another good friend who borrowed against his house to pay for a therapist. Unless you were walking in his shoes you might think that was stupid, but it saved his life and changed his career. It ended up being one of the best investments he ever made.

The process of making financial decisions is about more than building a spreadsheet to calculate the answer, because life rarely fits cleanly into a spreadsheet. Our decisions often appear irrational until we understand the whole story.

I’ve also learned some things about risk. Risk is an arbitrary concept, until you experience it. And I’ve noticed myself focusing more on the consequences of something going wrong than just the probability of that happening. As a result, I tend to urge my clients to make decisions that err on the side of caution.

As for Cori and me, things are much better now. Moving back to Utah clearly was the right choice. The business is doing well, and we’ve managed to pay down most of our debt. It would be easy to say that we’ve learned our lesson, that we’ll never screw up again.

But it’s not that simple. At times I’m absolutely clear about what makes sense. Then ordinary life choices arise, and things can get cloudy. Should our children play sports that cost money? What kind of family vacation is O.K.? How much is enough?

We’re still working on that last one. But we are asking the question, repeatedly. And the temptation to overspend, to go for it, to tell ourselves that things will work out in the long run, is tempered by a feeling that something big is at stake.

All I have to do to remind myself of that is to remember what it felt like to stand outside the kitchen window two years ago, looking in on my life, and thinking I might not get it back.

Malaysia Budget for the Year 2012: "National Transformation Policy: Welfare for the Rakyat, Well-Being of the Nation"

2011-10-10T06:54:00.000-07:00

The followings are the key take away from the Malaysia Budget for the Year 2012 which was tabled by the Malaysia Prime Minister, Dato Seri Najib Tun Razak last Friday in the Parliament.

- The theme for Budget 2012 is “National Transformation Policy: Welfare for the Rakyat, Well-Being of the Nation”

- Last year our FDI growth was the strongest in Asia and in the first 6 months of this year have already reached RM21.2bil

- In 2012, private investment is forecast to climb 15.9%, supported by foreign and domestic investment

- GDP in the first 6 months of 2011 was 4.4%, driven by strong domestic consumption

- In 2011, the economy is forecast to grow by 5-5.5%

- Private and public investment are forecast to increase by 15.9% and 7%, supported by foreign investment, the ETP and 10MP

- In 2012, the service sector is expected to grow 6.5%, the construction sector 7% and GDP is forecast to be between 5 and 6%

- Budget 2012 allocates RM232.8bil for Government plans, including RM181.6bil for management and RM51.2bil for development

- RM29.8bil has been allocated for investment in infrastructure, industrial and rural development

- RM13.6bil has been allocated for the social sector, including education and training, welfare, housing and community development

- Total revenue for 2012 is forecast to increase 1.9% to RM186.9bil and the deficit to decrease to 4.7% of GDP from 5.4% in 2011

- We will focus on accelerating investment and further liberalise 17 services sub-sectors, in places enabling 100% foreign equity.

- RP2 will be implemented in 2012, and it will be allocated RM98.4bil, to be split evenly between 2012 & 2013

- RP2 main projects will include the East Coast Highway from Jabor to T'ganu and road upgrades from Kota Marudu to Ranau

- RM18bil of the RM20bil PPP Facilitation Fund will be used for high impact projects, with RM2 billion for bumiputera entrepreneurs

- In 2012, the Government will allocate RM978mil to accelerate the development in five regional corridors

- The Treasury Management Centre will be established and offer incentives to develop M'sia as a competitive financial centre

- We will develop the Kuala Lumpur International Financial District, with incentives including income tax exemptions for firms

- We will develop the Kuala Lumpur International Financial District, with incentives including income tax exemptions for firms

- Income tax exemptions for non-ringgit sukuk issuance and transactions will be extended for another 3 years

- To promote the development of Exchange Traded Funds products I-VCAP will provide RM200mil for Shariah-compliant ETFs

- Felda GVH will be listed on Bursa Malaysia by mid-2012 to raise funds for the company to become a global conglomerate. Felda settlers are expected to receive a windfall, and the amount will be announced before listing

- A RM2bil shariah-compliant SME Financing Fund managed by selected Islamic banks will be established in 2012

- A RM100mil SME Revitalisation Fund offering loans up to a maximum of RM1mil for entrepreneurs will be available from Jan 2012

- Full exemption of import duty and excise duty on hybrid cars and electric cars will continue to be given until 2013

- To promote tourism, the Langkawi Five Year Tourism Development Master Plan will be launched with an allocation of RM420mil

I personally think the budget benefits the civil servants while at the same time, the budget neglect the needs of the middle class society in Malaysia. But what do you think of the Malaysia Budget 2012?

Price Is What You Pay. Value Is What You Get.

2011-09-10T08:12:00.000-07:00

"Price is what you pay. Value is what you get." This is one of the famous Warren Buffett's quote that I like most. In fact, this has become one of my motto whenever I do shopping, be it in the stocks exchange, or in my day to day shopping routine like groceries, buying clothes or investing in transportation mode and expensive gadgets.

Ok. Why do I think this quote relates to the blog until I put it as the Quote of the Day? Well, let just say I just want to remind myself that price is only something that I will need to pay and it is the value that I should look into on something that I wanted to invest, be it stocks or clothes or food or many other more. So, in other words, this quote can apply to almost everything in our daily life.

Let me give an example over here. Hmm....let me see, well, I have few pairs of sport shoes, different brands and price range as well. I usually will get a pair of shoes made locally, price range about RM60-RM70. Here is what value and the lesson of price and value comes about. At the same time, I have few pairs of Nike shoes, price ranging from RM250-RM600. The value I'm talking about is my Nike shoes can last me for years, while the local brand shoes last me about a year. If I'm comparing a pair of RM60 shoes with a pair of RM250 shoes, the more expensive one certainly more comfortable and it last longer than the RM60 one and the fact that the Nike shoes are more durable means that I can save more in the long run. I am not saying that cheap certainly means bad, but just merely a lesson of price and value. Price wise, the Nike shoes seems more expensive, but after comparing overall, the shoes do have the kind of value. The good thing about buying cheaper shoes is that I have every reasons to change it every year, whereas if I just buy "slightly" more expensive shoes, I won't be able to do give myself reason to get new one - also might be way out of budget :p.

Sometimes, cheap can give one more value than the expensive one. It's all depends on one need. Back to the shoes example. Trust me, if there is a budget for it, I will still buy local brand shoes if needed as extra pair so that I will not feel bored wearing the same shoes over and over again. Doing this might prolong the lifespan of the shoes as well giving me time to clean the shoes that I might not be wearing for that whole week. The value here is that the cheaper pair of shoes is used as the buffer while not draining up much cash.

Surely, when Warren Buffett quoted this, he did not mean something so simple as deciding to get a pair of shoes. I like this quote especially when it comes to deciding what price range of the stocks that I would like to buy.

Trust me. I do not believe in investing in cheap stocks although the return could be lucrative say maybe 100% per bit of transaction, but I might buy into penny stocks, if the value is there.

How do I define the value of each stocks then? Is it based on the price? Not actually. I usually prefer to buy stocks within RM1 to RM3 range, because this range is the most affordable to me - simple saying, I prefer to buy middle cap stocks. However, the price alone does not dictate the value of the stock. Stock A might be RM1 but it is already overvalue, while stock B might be priced at RM10, but still undervalue. How I tell whether a stock is overvalue or not, well, I'm not a technical analysis person, so, I just perceive a stock value based on the financial strength and earnings of the company and the nature of the business.

This does not mean all these "undervalue" stocks will surge but at least by screening out based on the financial reports of the stocks, it will reduce the chances of one getting a stocks at high price.....well, overpriced stocks.

I will not talk on some of the criteria that I looked whenever I filter out the stocks selection at this post, but I might be sharing that in the near future. Or maybe sharing out why most of us ended up buying stocks at high price even though the stock is deemed "cheap" finally trapped when the sentiment turn sour.

Equipping One With Personal Injury Insurance Before Traveling

2011-08-05T18:12:00.000-07:00

Traveling to Honolulu, Hawaii is fun, but it is best for us to equip with Honolulu Personal Injury insurance before venturing to a new place that we are not familiar with. By getting Honolulu personal injury insurance, it will be easier to get compensation should we face any problem like auto accidents or pedestrian injuries.

How to survive for a fresh graduate? [Part 2]

2011-06-28T19:50:00.001-07:00

It wasn't a habit of mine to blog long post when I'm outside but the excitement and enthusiasm of mine looking ahead of my first job takes over.
I realize that being a fresh graduate, the income is not a lot and at times, it feels that it's not enough...but as my previous post mention, I believe the key is to follow the old phrase: "Spend less than you earn"
The first part on savings has already been posted and now I'm going to continue with my second part: earning extra income while keeping your day job.

If you are very much like me, freelance writing will be very suitable.
There are a lot of ways to be a freelance writer...writing for magazines, newspapers and even for others...you could also consider blogging if you are into it...using Adsense, nuffnang and others will help you to earn the extra cash you need for leisure and luxury...imagine cashing out on this money for the usage during Christmas or other events...

Tutor, this is what I did during my University days to support myself...and amazingly, I had extras to save for investment as well...and if you are a fresh graduate now like myself, you could even command for higher pay...try applying as part time tutor with open universities as well...the pay and experience will be quite rewarding as well...

Baking? If you are into baking cakes, cookies, you could also consider showing off your talents on the Internet. You could also consider contacting the local coffee place, cake shops and show them your work...If it is delicious and the decoration is attractive, you might just land yourself a good deal.

Most people are into social network these days...and if you are reading this, I believe there is a 90% that you have a Facebook account and that you check it almost every 2 hours at least. And don't forget about Twitter...if you are the social networkers, consider social media ads...you can do it through churpchurp in Malaysia and I'm sure there are more companies out there in other countries...

And what about Internet business?? Now most people are afraid to venture into business because of the cost...I'm very much afraid as well but Internet business has its benefits...you get to do it at a low cost...and I'm starting a supplement business on the Internet using blogspot for now. The cost is low and the risk is lower but it also helps me to be exposed into the business world.

There are of course many more ways to earn income, using your skills and your knowledge...freelance photographer, setting up computers, gadgets and etcetra...the good thing about this is doing what you enjoy and earning money at the same time...Take some time and jot down what you are good at...the reward is better than you can imagine...

- Posted using BlogPress from my iPhone

Location:Coffee Bean, Jusco Ipoh

How to survive for a fresh graduate? [Part 1]

2011-06-26T18:26:00.000-07:00

I was preparing myself for work and I realized that it is quite difficult to survive for most of the fresh graduate in Malaysia. So, as I was thinking about it, I realized that there are only 2 logical answers to this:

Save more money
Make more money

If you're observant enough, both of it also have to do with money and more money in fact.

So, I'm going to divide this post into 2:

ways to save more money
ways to earn more money

I need to say that these are not not too difficult ideas but one requires discipline to do so and I'm still very new into this so I'm more of experimenting with it.

Ways to Save more money

Now, it won't requite a genius to realize that in order to do that, one will have to eat more at home. Now it is not going to be easy given that I'll be staying in KL on my own with my housemates and that it will be tiring by the time I reach home (I suppose). Given this condition, it is probably difficult to suggest cook at home. Nevertheless, this is the key. One need not have to cook at home daily but by making it at least a day in a week, it will help to make a difference.

Secondly, we all know that coffee is an addiction and Malaysia is so popular with OldTown, Starbucks, Coffee Bean or even Mamak...Now, I know that leisure time is important and the Latte Factor is important but try to make it only once in a week where you drink outside...it will make a lot of difference when you make coffee at home instead of drinking outside.

Then, we also have the LUNCHTIME...we all know that lunchtime is the best time to connect with the people at work, heard about the latest juicy news and this connection is important. However, you don't have to do that all the time. Try bringing your own lunch for like a day or two in a week. Then make the other 3 days to connect. The balance is important.

SHOPPING SPREE....NO!! This is an important part for both men and women. It is important to make a shopping list before you decide to do so. Impulse buying is what people call it. And you must not get into it. There are going to be a lot of "PROMOTIONS" and by making simple plan, you'll avoid overspending.

PAYING BILLS ON TIME and avoid fines!! This is important. Whether it is your electric bill, water bill, credit card or etcetra, you must avoid these unnecessary additional charges.

If you are a book lover like I do, then you'll probably need to opt for a second option: BORROWING BOOKS. This is possible to do so by going to Novelhut, a secondhand bookstore that buy, borrow and sell books. Of course, another alternative would be to go to the library. I still have my university matric card and since I'll be staying nearby UM, I plan to head back to that place for books.

Transportation is probably a major issue in Malaysia so I'll suggest carpooling more often. Since I'll be taking the LRT to work, I'll most likely consider using the RapidPass RM100 that could be used for 30 days...that's a month usage and I think it is reasonable to consider that since it'll be much cheaper. Without the need to worry about parking and petrol, one could save about RM200 and more.

Get a credit card and use its' benefits. We all know the danger by owning a credit card but having it will also make your life easier if you plan well. For example, if I go to Starbucks, I could use the AmericanExpress to buy 1 free 1. By sharing with your friend, you could get it much cheaper. Or you could use the HSBC card for a 10% discount there. If you use Postpaid, where most fresh graduates do, you can consider using AutoBilling (this comes with using Digi iPhone package) with more points and rewards. And there are many benefits in using the credit card...utilize the benefits and you will find yourself saving more even as you spend. There are also times that you could use the monthly installment when buying something. Most of these monthly installments are with 0% interest. (of course, it is important to spend wisely).

Bottled your own drinking water. We all know that water is important but we neglect it most of the time. I learn this habit from my girlfriend, YenLeng where she would always bring a bottle of water with her when she go out. This could help you save money on buying other drinks when you go out.

Price Check. Now, this is important when you are buying stuff. Most of the time, the promotion might not even be promotion. Now, I'm not saying you do that all the time (otherwise, it will be a waste of time) but I'm saying that it is important to do so especially with expensive products.

Well, there are of course many other ways that you could save money, but just saving money alone is not enough...after all, what's the point of having money if you can't enjoy it. The most important is: BALANCE...
Coming up next, ways to earn more money for working fresh graduate...

The Myth of Bankruptcy

2011-06-19T07:39:00.000-07:00

While the consumer debt has skyrocketed over these few years, many believe that the only way to get out of debt is by declaring bankruptcy. Bankruptcy has always become a major decision in many of the people who are struggling with the debt.

Although at times debt may seems overwhelm one, but he or she should have consulted a financial advisers or free Sacramento bankruptcy attorney to be advised with the options that are still available for one to take to avoid bankruptcy. Planning can prepare you for a bankruptcy that causes the least amount of financial disruption.

Xbox 360 consoles sold passed 55 millions

2011-06-03T21:01:00.001-07:00

If you are a big fan of gaming console, you'll realize that Wii, PS3 and Microsoft Xbox 360 are the top contender...

But when I read about the news of 55 millions consoles of Xbox 360 sold in the United States, we have a clear winner...it really tempt me to buy it as well since my brother will be moving to his new house soon...all the more with Kinect...

But I guess now is not the right time...this is because I am just starting to work...I'll need to spend a lot on working attire...then I want to spend more on investment and studies in the coming years...

Haha!! Suddenly thought of blogging bout this while sitting in the car...anyway guess that's it for now...

- Posted using BlogPress from my iPhone

Sell in May and Go Away

2011-06-02T06:25:00.000-07:00

The stock market adage “sell in May and go away” is based on the historical tendency for stocks to generate most of their positive returns during the six-month period from November 1 through April 30. Since 1950, the Dow has appreciated 7.4% on average during this favorable period, versus only a 0.4% average return in the May 1 through October 31 interval. It is not difficult to imagine this seasonal pattern playing out again this year. The stock market was very strong in the favorable six-month period just ended. The Dow gained 13% from November 1 through April 30. The same cannot be directly applies to KLCI, but eventually all stocks will move in the same direction at about the same pace.

However, should we really sell in May and go away.....only return to the stock market in November? I have been seeing that indeed May is not a good month to trade, but surprisingly my stocks portfolio (paper) gain actually increased another 3% from the peak in January, but after all the ex-dates of bonus issues and dividends, it drops 4%, which is just 1% from the peak.

So, if you are asking me, should we sell in May and go away.....I would not really agree. If we actually wanted to liquidate our holdings, we should do it ahead before the massive sell off which is a month back, on April. Technically, we should not be selling when everyone else is selling, right?

Judging by the previous years, from May until end of October, the volume usually not high, and retailers and getting more and more hopeless about the stocks recovery, thus selling even at discount as cash is preferred. On the other hand, I feel some stocks are worth to be accumulated during this time frame, and come November, the stocks portfolio might be benefited from the stocks rally (assuming there is a rally coming soon :p)

In the meantime, I will just hold on to stocks, which fundamental is still intact and stocks that continuously generate income via dividend to me replenish the cash that was already used to accumulate some growth stocks. This strategy works for me quite well last year, so, hoping to achieve the same thing this year although I lowered my financial goal this year to have stocks portfolio grow another 15%, while at the same time building healthier cash ratio.

Inflation and How We Can Cope With It

2011-05-11T07:55:00.000-07:00

The recent surge of all the prices of the commodities has make me recall about the same situation that has happened globally three years back. Back then, the price of the crude oil surge beyond USD100, the same thing that what we are seeing now.

The surge of the crude oil price and other commodities can have serious effect to a lot of things especially in business. Cost of the raw materials used for manufacturing will increase, subsequently impact their earnings until these companies passed the cost to the consumers - which I assume asap.

Nevertheless, global inflation is real and it is going to stay for quite some time, so we better get used to it until the Fed decided to stop printing the money......or put it in this way, until the US economy recovers.

None of us would want to have reduced purchasing power, but it will happened. There are several things that we can do to cope with the global inflation, rising prices of the goods, properties and many more.

The first to to do to cope with the global inflation is by spending smart. This means that you still continue to buy the NEEDS, while eliminating the WANTS from the shopping list. One good way is to buy goods in bulk in hypermarket like Tesco and share with family or friends and then pay according to the portion that you requires. This can be done by taking turns to do groceries during the weekends. Buying goods in bulk usually turns out to be cheaper. Not only we can save from the groceries, we get savings from less car usage, petrol and car maintenance cost.

Next, we can try increase our income by a lot of ways....rental income, free lance jobs, dividend income, FD income. This is where invest wisely comes in as FD usually is not enough to offset the inflation, so it is not wise to put all the savings in FD. Just save enough for emergency use in FD, and invest in either properties for rental income or dividend stocks, as these two can give you something to offset the inflation.

In summary, to cope with global inflation, we need to spend smart and invest wise. There are a lot more examples from smart spending and invest wisely, but I think this post is long enough, so maybe I will just leave it for the next post.

2011 Financial Goal

2011-04-15T09:37:00.000-07:00

Previously by the end of 2009, I would already have the 2010 financial goals, but I did not manage to post my 2011 financial goals by the end of 2010. A lot of reasons behind, but mainly due to laziness. :p

Anyway, I don't expect this year financial goals will have much different compare to the 2010 financial goals mainly because there are not much changes in my current financial status.

The generic financial goals would be:-

Continue tithing
Clearing 10% debt
Stocks portfolio to grow another 15% (why I lowered it this year is because market been going up a lot last year, so, it would be not to grow so aggressively)

I am thinking to clear more loan and keep more cash in hand rather than putting more in the stocks as the direction of the stocks become more volatile. Last year besides growing about 30%, I also inject about additional 20% of my annual income to the stocks - however this year, I'm thinking of injecting maybe about 10%-15% of my annual income.

Other thing that I would like to achieve is to build a healthier cash ratio in my portfolio and who knows, maybe add in property in my portfolio by the end of the year as well.

MYR to Other Major Currencies Exchange Rate

2011-03-01T05:12:00.000-08:00

Currency exchange rate is also one something that we should always look up on to gauge whether import goods from certain countries is getting cheaper or getting more expensive. Another reason for monitoring the currency exchange rate is so that we can know whether the economy in a country is getting better or worse, although nowadays currency exchange rate has slowly become speculative rather than fundamental.

As Malaysian, I am always curious how the country currency perform against some major nations like the United States.

Malaysian Ringgit Exchange Rate

Currency Exchange Rate

Smart way to lose weight

2011-02-22T05:26:00.000-08:00

If there is a need for you to lose weight, you could opt for a smarter and more economical way, the HCG diet. It only cost about 69USD in comparison to those who go for injection that might take up to 700USD. With the HCG treatment, it is much more cheaper and the effect is as good as those who go for injection. There will not be any fear of pain as well.

If you are not sure about the effectiveness of HCG, here are some of the information that you should take note of. HCG is a natural hormone or protein substance that helps burn off unneeded excess fat. It also alter your diet and preference of food in a healthy manner.

For those of you who are afraid of side effects, the HCG drops are homeopathic, so they are safe and have virtually no side effects. If you are in need of a weight loss method and exercise and strict diet doesn't seem to work for you, the smartest and economical way to do so would probably be going for the HCG diet.

EPF declares 5.8% dividend

2011-02-21T05:56:00.000-08:00

Well, guess what....the long awaited EPF dividend annoucement for most Malaysians is finally over. EPF declares 5.8% dividend in a year. Read more for the explanation from the EPF. I will blog a post that will again compare EPF vs KLCI maybe by end of this week.

PETALING JAYA: The Employees Provident Fund (EPF) has declared a dividend of 5.8% for 2010, up from 5.65% declared the year before.

It will pay out a total of RM21.61bil to members, an increase from the 2009 dividend payout of RM19.37bil.

EPF declared that the rate, which was approved by the Finance Minister, was the “highest dividend payout amount ever”.

EPF’s total investment assets stood at RM440.52bil as at Dec 31 last year while its gross investment income was RM24.06bil.

“The dividend rate underscores an impressive year in which gross investment income reached a historical high of RM24.06bil, reflecting a 39.76% increase over the RM17.22bil recorded in 2009,” EPF chairman Tan Sri Samsudin Osman said in a statement yesterday.

Samsudin said last year’s investment income was especially driven by the performance of equity investments boosted by improved financial and economic conditions.

“The dividend amount paid out is derived after deducting net impairment allowance on financial assets, investment expenses, operating expenditure and statutory charges as well as dividend on withdrawals,” he said.

Equities, the statement said, was EPF’s largest investment income contributor at 45.45% or RM10.94bil, followed by loans and bonds, Malaysian Government Securities, money market instruments and property and miscellaneous income.

According to the statement, two-thirds of EPF’s total investment assets last year remained in low risk fixed-income instruments with stable streams of income.

“As a retirement fund, our primary objective is the preservation of capital while adding value to members’ retirement savings.

Members may check their EPF account statement for the crediting of the 2010 dividend via EPF Kiosks, counters or i-Akaun, from today.

Cash Loans

2011-02-11T20:02:00.000-08:00

A good financial planning will involve saving ahead few months of expenses in order to have enough whenever there is a global financial crisis which might impact the job for some of the working adults.

Having said so, it is possible that any of us might come to a situation where we have financial difficulties no matter how perfect our financial plans and goals would look like.

Take an example, most financial planners will advice on saving up to six to a year of salary before getting into any investment. What if you are out of job in less than a month or two and suddenly your family might need some financial help from you?

Getting a personal loan might be too time consuming and there are a lot of procedures and documentations required by the financial institution in which the applicant might not passed due to the lack of working experience and low credit rating.

A solution to this would be the cash loans which can be certain to be approved, although it bears higher interest than most of the loans that are available. Taking up cash loans mean that the applicant must be committed to repay the loan as soon as he or she gets the first paycheck.

2011 CLSA Feng Shui Index: Watch the Metal Rabbit Bounce

2011-02-09T07:22:00.000-08:00

As we are still in the Chinese New Year mood, let's look into what the Feng Shui master said about the overall market sentiment for the Rabbit Year. I even have a post on Investing With the help of CLSA Feng Shui Index last year, so this year we can even review some of the prediction to see whether any of the prediction comes true.

The following is the excerpt from CLSA website on the 17th CLSA Feng Shui Index:-

17th CLSA Feng Shui Index: Watch the Metal Rabbit bounce

Hong Kong - Wednesday, 19 January 2011 - CLSA Asia-Pacific Markets (“CLSA”), Asia’s leading independent brokerage and investment group, publishes the 17th CLSA Feng Shui Index (‘CLSA FSI’) report today with a tongue-in-cheek look at what 2011 holds for equities, commodities, property, celebrities, and the zodiac signs in the year ahead.

The year of the Metal Rabbit promises plenty of luck and material gain for investors, with many signs favouring the accumulation of indirect wealth. But, with a continuation of last year’s conflict between heavenly metal stem and earthly wood branch, get set for more volatility (though less than we had with the Golden Tiger).

This year’s CLSA FSI report includes the all-new ‘Sector-Vector Detector’ with the outlook for 10 key investment areas, including gold, as well as: our feng shui guide to Hong Kong; fates of the famous such as Ben Bernanke and Kim Jong-un; tips for getting luck to flow your way and much more.

The 2010 Year of the Golden Tiger CLSA FSI predicted the performance of the Hang Seng Index (“HSI”) so precisely that even we were a little surprised. Although past performance is no guarantee of future returns, we are confident that the HSI will provide great opportunities for investors to buy and sell their way to profit over the months ahead.

For the market, February 2011 should see a slow start to the year, with the Rabbit reluctant to emerge from its hole for fear the tiger still lingers. March calls for patience as opposing forces test investors’ metal. As the Rabbit finds his feet, wealth will come from the West in April and prove a great month for those with stamina.

May begins with one of the year’s four most auspicious dates (14 May), but we expect a tumble in June, providing a great buying opportunity for the savvy. Investors may want to rethink their summer-vacation plans: we see markets rising sharply over July and August. Money will flow.

With Fall comes a fall: the CLSA FSI predicts a sharp decline in September – but not for long. October marks a sustained market rally with money flowing abundantly through to the end of November. However, investors should remain focused as markets decline during December. Come January 2012, the Bunny bounces back to close the year on a high.

Sector-focused investors should pay attention to the five elements: Metal is hot, water is bubbly, fire is on fire, wood would if it could and earth is soiled. So where to invest? It will be a great year for Financials, Gaming, Gold, Resources and Transport. While gold didn’t break US$2,000 per ounce as we predicted in 2010, we are confident the Rabbit will provide the carrot this year. It will be a good year for Oil and Gas, Technology, Telecoms, Internet and Utilities, but an unexciting time for the earth-related Property sector.

In terms of the Zodiac, 2011 most favours those born in the years of the Cow, the Sheep, the Dog and the Pig, while Tigers and Roosters will experience a bumpy year. We foresee a great year for HK Tourism Board Chairman James Tien Pei-chun, a fire dog, and Kim Jong-un, North Korea’s well-fed heir apparent, a water dog whose birth date has been amended to make it more auspicious.

This year’s most auspicious dates are 14 May, 4 August, 15 November and 16 January, while the least auspicious are 16 June, 22 June, 23 September and 15 December.

All in all, the year of the Metal Rabbit provides great opportunity for investors to reap the rewards of astute investing, but they should be forewarned: those who chase two rabbits will not catch one.

source: CLSA

Wishing Everyone A Healthy and Prosperous Rabbit Year

2011-02-02T06:29:00.001-08:00

Wishing everyone a Happy Chinese New Year :D. Hopefully everyone will be healthy and prosperous in this year of this Rabbit year.

Becoming a millionaire..

2011-01-26T18:40:00.000-08:00

Ever wonder why some people make it to the top so easily while some others work hard day and night only to earn for survival. Well, it is not just a matter of the hardwork poured in. It is also about the way one live their lives, use their money and also the type of work that they do. But if you are indeed willing to struggle for it, it is possible for you to be a millionaire.

The first step besides all the hard work put in your work is the willingness to create a personal expense account.
You will need to open a checking account just for your household expenses. Then you will need to figure out the amount needed for monthly usage from electricity, food, right til entertainment. After that, put the rest of the paycheck that you are about to receive into savings account for it to accumulate. This is for budgeting purposes and if you felt that you are using more than you earn, it is time to consider cutting on some of the expenses. The money put into savings account will need to be used wisely...if you're under 30, put all those money into stocks...At 30 and above, it is time to consider drizzling in cash, bonds, and other safer investments.

Secondly, manage your debt well. Debt is important as it helps us to make use of future money. For example, it will be quite impossible and ridiculous for you to fork out the entire 200k plus amount of money to buy a house. However, it is important to make sure that you know your debt and that it is manageable. Credit card could be used for this purpose as well...the ability to use future money and manage your debt will help you gain benefit as most products could be buy on easy payment basis these days. You could also consider the credit balance transfer for purpose of managing your debt and using future money. However, all of these require proper planning and one of the best way is to write it down. By using paper and pen, you will be able to have a clear idea on your debt situation. It is important to be realistic and open about your spending when you write it down. Only when you are honest about your own weaknesses that you could start managing your debt properly.

Third, become a PREDATOR. While this might sound bad, but you shouldn't really feel guilty about it. It's all business after all. During the bad times, many people will seek to sell their properties at a lower price because they are not able to manage their debt. Here is your opportunity to buy these at a bargain. DO NOT FEEL BAD about it because you are actually helping someone to get into a fresh start. In fact, the economy ought to thank you for helping to boost it.

Be steady and DON'T PANIC!!
In investment, there are good times and there are bad times. It is important to look at the fundamentals of the company you are investing. Don't be panic just because of the news and the crowd that seems to be panicking. Hold steady and know when is the right time to let go if necessary.

Last but not least, be INNOVATIVE and always looking for better opportunity. The world is a battle and survival of the fittest and if you are innovative in your approach to work, chances are you will see a better opportunity and grab hold onto it.

Flowers for home decoration?

2011-01-10T21:41:00.000-08:00

Well, in my planning for the new house renovation, my family and I were talking about setting up lightings like those that we see on AVATAR....if you remember the 3D movie that somehow earn a lot of money for the beautiful scenery.

Anyway, I went to look for some people who are good at these and they told me it would actually cost me quite a fortune. I wouldn't want myself to be financially tight down due to these. Instead, I am planning to look for beautiful artificial flowers that could help set a greenish environment, something that I love after watching Avatar. The lightings that would be needed will then be much cheaper. These artificial flowers will be long lasting, beautiful and I plan to look for those that could give an elegant outlook.

After some discussion, the idea of buying artificial plants come into mind as my mother was telling us it would have been better to set up some lightings around these artificial plants instead. It will cost much lesser and the house could still have the design that I wanted. I am really thinking deep into this because I wanted the house to be comfortable and beautiful but I wouldn't want to spend too much on it alone as I have other plans for the usage of my money. I believe this is important because it will be very burdensome to my sister and I if we invested too much on renovation and accessories alone.

The idea was appealing to both my parents and siblings. I have look for some professionals who could probably help us with the floral arrangement and it won't be too difficult to maintain it. This will help lessen my mom's work in gardening. These plants will not only help to maintain the elegant look but it also help to create a warm atmosphere at home. Hopefully, some of my readers who might have more experience in floral arrangement and interior design could give me some of their opinions.

Looking Back 2010 Before Setting Financial Goals for Year 2011

2010-12-28T07:15:00.000-08:00

The year 2010 has almost come to an end. Like I mentioned just a year back in Setting Financial Goals for Year 2010, we should also start setting financial goals for the year 2011. Again the same advice, financial goals are needed so that we can control our day-to-day financial affairs which will be executed by creating and following a budget. Good financial goals are usually realistic and achievable and will give satisfaction to one. Good financial goals also come with good execution plan, without this execution plan, no matter how good financial goals are, these goals will still remain as goal.

However, before moving to the year 2011, let us start looking back on what are the financial goals that we set for the year and gauge the overall performance. For the year 2010, I have set 3 major financial goals:-

Continue tithing
Clearing 10% debt for both car loan and education loan
Stocks portfolio to grow another 20%

Out of the 3 financial goals, two of the goals are to be done habitually - tithing and debt repayment, so the two financial goals are easily achievable with discipline.

I managed to reduce 16% of the car loan balance and 11% of the education loan balance, both of the balance include the interest as well (financial goals only 10%). Besides that, I managed to have realized gain of 30% out of my stocks portfolio and reinvest (financial goal is to grow 20% while the index only up by about 19.3%). Overall it is not a bad year for me.

Disclaimer: This blog post only serve the purpose of updating the financial goals progress which I've set last year, and nothing for show off, which is why I only do a short review rather than posting everything in details.

Blessed Christmas and Happy Holidays

2010-12-24T02:27:00.001-08:00

During last year's Christmas, my advice was for everyone to spend wisely and some tips to cut spending without missing the point of celebrating Christmas, which is to give. This year, the advice is still the same, spending wisely during the Christmas. As I was quite busy for the whole preparation, I will be blogging more on financial stuff after this Christmas. So, Blessed Christmas and Happy Holidays!

Financial Bailout

2010-12-15T08:00:00.001-08:00

Here is an inspiring story on financial bailout that I get from a forum and thought of sharing it in this blog while planning my financial goals for the year 2011 since for the past two years, we heard a lot of financial bailout, but do we really know what it is and how it works?

I hope the story can provide more knowledge for us on the financial bailout which is happening over the past two years.

It is a slow day in a damp little Irish town. The rain is beating down harshly, and all the streets are deserted. Times are tough, everybody is in debt and everybody lives on credit.

On this particular day a rich German tourist is driving through the town, stops at the local hotel and lays a €100 note on the desk, telling the hotel owner he wants to inspect the rooms upstairs in order to pick one to spend the night.

The owner gives him some room-keys and, as soon as the visitor has walked upstairs, the hotelier grabs the €100 note and runs next door to pay his debt to the butcher.

The butcher takes the €100 note and rushes down the street to repay his debt to the pig farmer. The pig farmer takes the €100 note and heads off to pay his bill at the supplier of animal feed and fuel.

The guy at the Farmers' Co-op takes the €100 note and runs to pay his drinks bill at the friendly neighbourhood pub. The pub owner slips the money along to the local prostitute drinking at the bar - who, in spite of facing hard times, has always gladly offered him her ‘services’ on credit.

The hooker then rushes over to the hotel and pays off her room bill to the hotel owner with the €100 note.

The hotel proprietor quietly replaces the €100 note back on the counter, so that the rich traveler will not suspect anything.

At that moment the traveler comes down the stairs, states that none of the rooms are satisfactory, picks up the €100 note, pockets it and leaves town.

No one has produced anything. No one has earned anything. However, the whole town is now out of debt and looking to the future with a lot more optimism.

And that, dear ladies and gentlemen, is how a basic financial bailout package works!

Claiming Blog for Technorati

2010-11-21T06:00:00.000-08:00

I'm claiming the blog for Technorati with this token HF24JHX4RBHF

Getting Term Life Insurance

2010-11-21T05:18:00.000-08:00

Every one of us know how important it is to cover ourselves and protect the people whom we loved dearly, our family with a good term life insurance that has sufficient coverage. There are few things that we need to consider when we buy life insurance. One of the most important things that we need to consider before taking up the insurance premium is the premium price and the coverage that we are going to get from the insurance company. A rule of thumb is that the premium price that we are going to pay annually should not end up becoming our burden in our financial goals making it looks as if we are over insured.

There are some problems with buying life term insurance that is time consuming. These are like filling out medical questionnaires and getting the life insurance medical exams from a list specified panel doctors.

However NoMedExamLifeInsurance.com offers one term life insurance - without the need of going to medical examination and without the endless paperwork! It is one of the first companies in America licensed to sell Life Insurance No Exam and it does not matter where in the country you live, it can quote your life insurance for FREE within a matter of minutes.

One will just answer a few short, simple questions, then click GET A FREE QUOTE and voila, you will get the free quote of the life insurance and if you are happy with your free quote then you can purchase your policy right here online and even print it out. Questions shall redirect to the licensed agent by calling 1-800-939-0710 toll free number.

Advantages of Using Credit Cards

2010-11-18T06:27:00.000-08:00

Credit cards as we all know is one of the payment method that we can use when we pay for goods and services. The issuer of the card creates a revolving account and grants a line of credit to the consumer (or the user) from which the user can borrow money for payment to a merchant or as a cash advance to the user.

As discussed earlier in Credit Card - Friend or Foe (Part 1) and Credit Card - Friend or Foe (Part 2), credit cards are like fire or water whereby when it is used under our control, it can be friend and if we lose control of it, it will become nightmare which could be fatal. There are many people who lose control of the credit card usage ended up going to the pit of debt and needed a lot of financial assistance from many different sides.

Let us discuss about the advantages of using credit cards. The first advantage of using credit cards is you do not have to bring along a lot of cash when you go shopping or dining outside. This is indeed very apparent advantage that the credit cards have over cash given the high crime rate in some of the places in this country.

One can always argue that we can always use debit card instead, but this is where the second advantage of using credit cards come about. By using debit cards, it means that we are using the money we have in our savings account where as if use credit cards, we will be using money in one month time. This is also the danger of using credit cards if you do not know how to exert proper usage and control.

Spending the money from future is a good way to hedge inflation, but at the same time it will be the first step to step into the pit of debt. A good way to avoid getting deeper into the pit of debt is to have the cash to pay the balance of the credit card in full and not the minimum payment that is stated in the statement. Once you start paying only the minimum payment, this is where the debt will go uncontrollable. The way I use to ensure that I have sufficient money to pay the credit card is keeping track on the amount whenever I swipe this plastic - even coming down to every penny that I swipe. I mean if you swipe 23.20 now and you consider the transaction as 23, imagine every 10 times of the same amount swiped will lead to additional 2 - not much but when it snowballs, I cannot really imagine how much the amount will totaled up to, could be huge.

Anyway, let's go back to the advantages of using credit cards. The next advantage of using credit cards is the loyalty reward points and the cash rebates. Some credit cards not only offer loyalty reward points or cash rebates, but free gifts if swiped during promotional period. In fact, I got my free Ipod Shuffle by using credit cards as well.

Think I gotta sign off for now and discussed about the advantages of using credit cards in some other time. Watching Jackie Chan's Wheels on Meals.

How To Be Financially Savvy

2010-11-08T05:30:00.001-08:00

I read a newspaper article in The Sun regarding the lack of financial literacy among the Malaysians. The survey done by MoneyTree (M) Sdn Bhd shows that many Malaysians are not financially savvy and have no retirement plan or know how to manage their finances.

This does not come in surprise to me as I have come across some people who has no knowledge on this subject. However, financial literacy is an important aspect of life and with the knowledge on how to manage the personal finance properly, one can actually plans out his or her own retirement plan.

To gain more knowledge in financial, one need not have to be a Degree holder or a financial analysts - as a matter of fact, reading materials on financial management can educate one in this aspect. Magazines like Personal Money or even Reader's Digest will have more than sufficient information on the basic financial knowledge that one will ever needs.

Let us not talk about investment first, as to be financially savvy not necessary means that you can invest or knowing the investment terms like stocks and commodities.

One of the most important terms in order to be financially savvy is budget. Budget literally means the plan on how to spend your income - sounds simple, but having the discipline to follow the budget is another matter.

Many of us actually failed to plan a proper budget due to a number of reasons. One of it is because there are ups and downs in our monthly expenses and lack of the information on what is our expected income in like maybe next year due to increment. Besides that, many people are actually put off by the fact that there are some unexpected expenses like medication, friend's wedding, accident and stuff like that. Sometimes or shall I say most of the time, it is due to impulsive shopping nature of one that he or she ended up buying stuff that is not needed.

Budget is important as the budget will be direction on where the money should be going and to be financially savvy, one should really takes some time and plan a proper budget and execute accordingly. A budget without proper execution means nothing as we can all be sitting down writing what we are suppose to spend and then throw the piece of paper into a rubbish bin. Knowing the term without execution is also the same as not a financially savvy person.

Guess I'll stop here right now to watch Stephen Chow's Fight Back to School. Will continue to post in this matter in near future.

What Does the Malaysia 2011 Budget Has In Store For Us?

2010-10-24T06:48:00.000-07:00

It has been more than a week since the Prime Minister of Malaysia, Dato' Seri Najib Tun Razak has tabled the 2011 budget for the nation. The 2011 Malaysia Budget is based on the theme Transformation Towards a Developed and High-Income Nation. The budget might seems ambition, but does it really relevant to most of the rakyat (citizen) of Malaysia?

From the long list of the Malaysia Budget for the Year 2011: Transformation Towards a Developed and High-Income Nation, there are actually few things that is actually relevant to us. True that some of the construction work like the construction of the highways or greater KL MRT will provide better transportation system in the near future, but will it really ease the burden or the citizen? We are not sure about that.

Anyway, back to the topic What Does the Malaysia 2011 Budget Has In Store for Us, one of the thing that I see that most Malaysians might be anticipating is the introduction of GST (Goods and Services Tax), but the government has choose to postpone the introduction of GST. This might be a political play, however, the government has increased the current service tax rate from 5% to 6%. It is surprise to see that when the Government "promise" the rakyat the GST rate will be lower, the Government actually defers it and increase the current service tax.

Toll rates will not be increased over the next five years which seems like a good news to most Malaysians, especially those staying in KL area, but this will also mean that it is the Government using the taxpayers' money for this subsidy although I do not see any justification for PLUS to keep raising the toll rates every now and then? Or the Government will push towards PLUS privatisation? We never know.

There are actually other goodies that is in store for us in this budget which I will discussed in the next post, but overall it seems to me that this is just another budget like others from previous years.

Malaysia Budget for the Year 2011: Transformation Towards a Developed and High-Income Nation

2010-10-15T09:07:00.000-07:00

Malaysia budget for the year 2011 was tabled by the Prime Minister of Malaysia, Dato' Seri Najib Tun Razak earlier today. The 2011 Budget is based on the theme of Transformation Towards a Developed and High-Income Nation and will be centre on four key strategies.

These are the highlights of Budget 2011:

The Govt took into consideration views from the public and private sectors, focus groups, media, 1M blog and lab sessions.

Govt expects 7% growth for Malaysia in 2010 over previous estimate of 6%.

Govt aims to achieve 6% growth in 2011, supported by private investments, expanding 10.2%, private consumption 6.3%, exports 6.7%.

Income per capita will increase 6.1% to RM28,000 while income in terms of purchasing power parity to USD16,000 (RM49,440).

Will emphasise on efforts to transform the nation into a developed plus high-income economy plus sustainable development.

With the theme "Transformation Towards a Developed and High-Income Nation", Budget 2011 will centre on 4 key strategies.

Several PPP projects identified under the 10MP will be implemented in 2011 through private investment of RM12.5bil PPP project: Construction of highways such as the Ampang-Cheras-Pandan Elevated Highway

PPP project: Construction of a 300-megawatt Combined-Cycle Gas Power Plant in Kimanis, Sabah

PPP project: Development of International Islamic University Malaysia Teaching Hospital in Kuantan; Women and Children’s Hospital

Another PPP project identified is the Academic Medical Centre. This project involves private investment of RM2 bil

Greater KL MRT to be implemented from 2011. When completed, public transport utilisation rate is expected to rise to at least 40%

Another major project is the development of the Malaysian Rubber Board land in Sungai Buloh covering an area of 2,680 acres

A new landmark, Warisan Merdeka, is expected to be completed in 2020. It will include a 100-storey tower, the tallest in Malaysia

The Govt will implement bold measures to revitalise the domestic capital market

Efforts will be taken to strengthen Malaysia's position as a premier Islamic capital market

The Govt will provide Entrepreneurship Enhancement Training Programme to train 500 technopreneurs and attract more angel investors

The Malaysian Technology Development Corporation will be provided a startup fund amounting to RM100mil to provide soft loans

To revitalise capital market activities, the Govt will launch a Private Pension Fund in 2011

Existing income tax relief of up to RM6,000 for employees contributions to EPF will extend to Private Pension Fund contributions

A sum of RM857 mil is allocated for local E&E companies to compete at the international level

The Govt will allocate RM146 mil to support the oil, gas and energy industry

The Govt is committed to develop green technology to ensure sustainable development

Pioneer Status, Investment Tax Allowance for energy generation from renewable sources plus energy efficiency activities extended til 31 December 2015

To further encourage ownership of hybrid cars, import duty and excise duty exemption will be extended until 31 December 2011

Tax exemption on income from trading of Certified Emission Reductions certificate to extend until year of assessment 2012.

The Govt will implement the Programme on Blending of Biofuels with Petroleum Diesel (B5 Programme) in June 2011

The Govt will allocate RM3.8bil in 2011 to increase productivity and generate higher returns in the agriculture sector

Infrastructure facilities to be allocated - RM85mil to facilitate construction of hotels and resorts in remote areas

RM3bil eco-nature resort Nexus Karambunai, Sabah, to commence 2011

To support the tourism industry, the Government will allocate RM100mil

The Govt proposes that import duty on approximately 300 goods preferred by tourists and locals, at 5% to 30%, be abolished.

In efforts to propel the palm oil and related products industry, several measures will be implemented

Measures include encouraging replanting activity to replace aged trees with high quality new clones through RM297mil

RM127mil to be allocated to support domestic oleo derivatives companies plus RM23.3m to expand downstream palm oil industries

Multimedia Development Corridor programme is allocated RM119mil. Focus is on creating an innovative digital economy

Import duty and sales tax exemption on broadband equipment are also extended for two years until 2012

The Government proposes that sales tax be exempted on all types of mobile phones

Corridor and regional development will be accelerated. The Government allocates RM850mil for infrastructure support

For Iskandar Malaysia, a sum of RM339mil is allocated.

The Northern Corridor Economic Region is allocated RM133mil.

East Coast Economic Region is allocated RM178mil for projects

For Sarawak Corridor of Renewable Energy, RM93mil is allocated for facilities

A sum of RM411mil is allocated in 2011 for R&D&C activities

For 2011, a sum of RM71mil is allocated for Special Innovation Unit UNIK

A sum of RM200mil is allocated to purchase creative products such as high quality locally-produced films, dramas and documentaries

The Government proposes that the rate of service tax be increased from 5% to 6%

RM29.3bil is allocated for Ministry of Education, RM10.2bil for Ministry of Higher Education and RM627mil for Ministry of Human Resource

The Govt will establish a Talent Corporation under the Prime Minister’s Office in early 2011

RM6.4bil is allocated for development expenditure to build and upgrade schools, hostels, facilities and equipment

RM213mil is allocated to reward high-performance schools

The Govt will increase pre-school enrolment rate to a targeted 72% by end-2011 through an additional 1,700 classes

The Govt will also strengthen the curriculum and appoint 800 pre-school graduate teachers

RM250mil is allocated for development expenditure to schools: religious, Chinese-type, Tamil national, missionary, Government-assisted

RM576mil is allocated in the form of scholarships for those wishing to further their studies

RM213mil is allocated to enhance proficiency in Bahasa Malaysia, strengthen the English Language

RM20mil is allocated to increase PhD qualified academic staff to 75% in research unis plus to 60% in other higher learning institutions

RM60mil is allocated to further intensify the Industrial Skill Enhancement Programme in State Skills Development Training Centres

The Govt will also allocate RM50mil to the Multimedia Development Corporation to train graduates in ICT

RM474mil is provided to enhance productivity and skills of non-graduates

The 1Malaysia Training Programme will commence in January 2011 with an allocation of RM500mil

RM200mil is allocated to conduct part-time training in the evenings and weekends in selected training centres nationwide

RM200mil from the Human Resources Development Fund to be used by companies to fund specific training programmes for their employees

The Govt will enforce basic minimum wages for security guards, to between RM500 and RM700 a month depending on location

RM30mil is allocated to introduce the Single Mother Skill Incubator Programme and the Prime Entrepreneur and Women Activist

The Govt will provide 40 1Malaysia TASKA to assist women to obtain quality childcare and early education for their children

The Govt will allow flexibility to self-determine fully-paid maternity leave, not exceeding 90 days from the current 60 days

For sports development and management, a sum of RM365mil is allocated to the Ministry of Youth and Sports

To develop football, the Govt will establish a Football Academy in Pahang with RM20mil to produce quality football players

In 2011, the Government will allocate RM1.2 bil to the Ministry of Women, Family and Community Development.

The Govt will launch assistance programme to benefit 80,000 disabled individuals with an allocation of RM218mil

Government will extend tax relief of up to RM5,000 to help parents with expenses such as daycare, caretakers & other daily needs

First-time house buyers will be given stamp duty exemption of 50% on instruments of transfer on a house price not exceeding RM350,000

RM6.9bil is allocated to implement basic infrastructure such as water and electricity supply as well as rural roads

Build and upgrade rural roads in Sabah and Sarawak with an allocation of RM2.1bil and RM696mil in Peninsular Malaysia

RM974mil is allocated as price subsidy for padi, fertilisers and padi seeds. RM230mil for production incentives, increasing padi yield

Govt to establish a 1Malaysia Smart Consumer portal to help the rakyat keep abreast with price movements of retail goods.

Effective January 2011, the monthly allowance of Imam will be increased from RM450 to RM750

The monthly allowance for KAFA teachers will be increased to RM800, an increase from RM500, starting Jan 2011

RM100mil is allocated to implement various programmes, including resolving Orang Asli land rights and border settlement issues

Toll rates in four highways owned by PLUS Expressway Berhad will not be raised for the next five years, effective immediately

RM15.2bil is allocated to build new hospitals, increase the number of doctors, nurses, obtain supplies of medicines and equipment

Since 2009, 51 1Malaysia Clinics are in operation. The Government will provide an additional 25 1Malaysia Clinics

RM350mil is allocated to implement various programmes to combat crime, including burglary, motorcycle and car thefts

RM70mil is allocated for programmes with select NGOs to help Govt strengthen family institution and address social ills eg baby dumping

RM1.9bil is allocated to environmental preservation, including implementing the River of Life Programme and KL greening

To assist children, particularly the low-income to excel academically, the 1MDB will provide multi-vitamins for primary school pupils

1MDB will provide RM20mil to the 1Malaysia Youth Fund. This fund will be utilised to instil the 1Malaysia spirit

The Govt agrees to abolish the Competency Level Assessment/PTK and replace with a more suitable evaluation system by June 2011

Civil servants burden in coping with schooling expenses to be reduced by providing a Special Financial Assistance of RM500

RM212bil is allocated for Budget 2011, which is 2.8% higher than the allocation for 2010

RM45.6bil will be allocated for Development Expenditure, RM15.5bil for the social sector

Government revenue collection is estimated to increase 2.3% to RM165.8bil in 2011, up from RM162.1bil in 2010

The deficit for 2011 is expected to further decline to 5.4% of GDP, compared with 5.6% in 2010

So, what do you think of the Malaysia 2011 Budget?

A CHANGE IN PERSPECTIVE TO FACE THE CHALLENGES AHEAD FOR ASIANS

2010-10-03T20:41:00.000-07:00

Asia is the region that contained approximately 60% of the world population, which accounts for about 4 billion people. Over the last decade, the economic growth in Asia has been fantastic. This is partly due to the macroeconomic and structural reforms and management as well as the growth seen in emerging China. On average, Asia has recorded a growth of 6% per year. This is quite a remarkable feat as Asia’s share in the global economy is now one third. This economic growth has helped to lift a lot of people out of poverty and improve their livelihood. Today, the leading region in the economic recovery is Asia. All of these are because of the strong fundamentals and quick and forceful policy responses to the crisis implemented by the leaders of the countries. The ability of most Asian countries to respond to the recent crisis is due to the significant structural changes made in Asia’s financial sectors after the 1997/98 crisis.

However, there is still a lot for Asia to learn before emerging as the leader for the post-global crisis economic world. Here are some of the crises that Asia will face in the near future. The rising standard of livings in China and India will eventually lead to a slow down as both the countries are currently providing cheap and amply labour in the region. There are also political issues between countries such as Pakistan and India that constantly pose threat to one another which prompt the government to invest heavily on military force. Japan is also another country that is finding it difficult to find new innovation and move beyond stagnation. The Dubai debt problems is also another warning and indication that more changes are needed. You could actually feel that each country face a different challenges in the days to come and emergent Asia needs to move beyond modernity into postmodern world to face these challenges.
Postmodernism in this context does not mean that Asian countries to linger around the uncertainties of the world but it means the need to deconstruct the old thoughts before constructing new ideas and image of the future for the world. As mentioned above, there might be a lot of different challenges faced by different countries in Asian countries but the biggest challenge faced by countries in this region over the next decade is the need to emerge into a new mindset. This is why Asia must learn to move beyond modernity into postmodernism. The old thinking needs to be replaced with new ideas, visions and stories just as no one pours new wine into old wineskins. If he does, the new wine will burst the skins, the wine will run out and the wineskins will be ruined. The new era has come and we could not contain growth and development with old perspective. This is an important part of growth because there is a need for transformation in adapting to the new challenges. With new risks within and across borders, it is necessary for Asia to maintain a strong supervisory regime going forward, including by building up risk assessment capabilities and adopting a macro-prudential approach to supervision.
There are many people who wonder why the need for a new perspective while Asians are heading the right direction. The problem is that most Asian countries have been so used to being colonized that it seems awkward and impossible to lead in the global economy recovery. One of the countries in Asia that is showing the right frame of mentality is Korea. In fact Korea represents the success story in Asia far better than most countries. Let us not forget that at one time, Korea was the second poorest country in the world, second only to Niger but it is now the 4th largest economy in Asia and the world’s 15th or 12th if according to the purchasing power parity.
The innovation and willingness to redefine the image of their country has helped South Korea to where it is today. Even though the nation was not recognized for their ability to grow, Korea had been determined to create local competitive countries that would be recognized worldwide. In the mid 1960s, Korea was an export-led developing country and the Korean firms supplied big multinationals with components or even the entire products. However, the Koreans had the determination to manufacture products under its’ own brands instead of the brand of other companies. Initially it was a very difficult journey for the country and the efforts and struggles put in were often painful experiences. Most people would remember Hyundai’s first disastrous foray into the U.S car market back in the late 1980s and early 1990s. However, they have not given up on their dream and with financial and government backing for the private companies, Korea has been able to achieve its’ feats today.
However, many other nations are lacking on the mindset to strive to achieve in Asia. A lot of the countries in Asia are comfortable with where they are at. Middle East countries are happy with the oil resources that they have but for how many years will these resources last? What will happen when green technology is being developed as replacement for petroleum fuel? Japan is finding it hard to get away from their “savings” mentality regardless of the low interest rate in the bank. There is a looming mood in the nation especially since deflation, the curse of the "Lost Decade" of the 1990s, is back with a paralyzing bite. Prices and wages are falling as aging consumers save their pension checks and wait for still-lower prices. Even as Korea might have seen so much improvement in the last few years, there is indication that the work ethic in the country might have caused the workers to burn out. The lack of consumer culture and burn out of employees are issues that must be taken seriously. The leaders of the country must also be aware not to move into the direction of Japan where it is hard to move further ahead. On the other hand, China is the force that must be reckoned in the near future but there is still a lot of work to be done especially in developing their domestic markets further. The change in mentality will help to drive innovation and creativity in Asian countries.
The lack of professionals in the technology industry should also be a warning and indication that more work must be done to help Asia connect with the world. Globalization has been helped largely by the existence of internet but until today, there is no well-established technology company from Asia in the internet field. The recent issues regarding the censorship of internet search results had resulted in a long-running-stand-off between Google and China. At one point, Google even threatened to pull out of China. This is one of the important changes that must be made. Censorship on the internet could result in manipulation of information and this is not a good sign for China. The search engine in China, Baidu might be quite popular in China but had recently been sued by 8848.com, another Chinese Internet Portal for launching DDOS attacks on their servers. While it is not an issue for Asian countries to depend on the companies from other countries, the lack of knowledge workers in this field is something that must be considered given that most of the masterminds behind Google, Microsoft, Apple and many others are from the Western countries.
All of these could be overcome with the right mindset. It is important that Asians learn to be more innovative and creative. Instead of always looking into the products and success of other countries, Asians need to come out with something of their own. It is just like how the Japanese and Koreans being able to establish themselves as well known car manufacturers. The leaders in the countries need to spend more money and invest heavily on research and development to bring about the positive results. Instead of struggling with politic issues and corruption such as those happening in Thailand, Philippines and many others, Asians should set the right direction. Singapore has been very successful at this as the country is very stable politically and has seen positive results in fighting against corruption. With all the unnecessary distraction set aside, the country could focus the funds on research and development, building proper infrastructure and providing the support to the private companies. Singapore is on the right track in this issue and the country has one of the best and most efficient public transportation in the world. If you want to know how much should be spent on research and development, one example is Microsoft which spent 8 billion US dollar on research and development in 2008 alone.
Other areas that Asians are lacking in include the development of clean energy. This is probably one area that the Asians need to work on. Science has identified black carbon as one of the elements that impact the regional climate. In fact, several studies and research have identified Asia as the largest source of black carbon emissions globally. All of these are from contained combustion such as combustion in engines, stoves, and kilns, accounting for more than half of all such emissions. Other than that, open combustion such as forest fires, land clearing through fire, and burning of agricultural wastes also lead to the omission of black carbon. There are some efforts in developing clean energy such as the Asia Clean Energy Forum (ACEF) 2010, which was held in Manila on June 23-25 this year. It is Asia’s premier event for policymakers, technical experts and investors to share knowledge and up-to-date developments in clean energy in the region. However, given the vast potential in this region to develop the clean energy, more efforts should be taken in developing green technology.
It is also important to take note that the environment issue will also be another important challenge that will be faced by all Asian countries. The change of perspectives and thoughts will help Asians to prepare themselves and plan the development of their cities and countries. This is important to allow emergency help to be provided to rural areas when there is a need such as flooding that occurs frequently in some countries such as China. Besides Singapore, most of the other countries in Asia do not have proper infrastructure development. This will lead to the dependence on vehicles that use petrol that contribute to the air pollution. If the infrastructure development could be planned in advance, this could help to encourage the citizens to use public transportation. This effort could reduce the release of carbon dioxide into our environment. Other important steps would be proactive participation in recycling and other environment friendly activities. The new set of mindset will help Asian to prepare for all these uncertainties.
From all of these, we could easily recognize that the most important challenges facing Asia over the next decade is to emerge into a new set of thinking. The new thinking and mindset will help the Asians to form new ideologies, ideas and all of these will lead to innovation and restructuring of the fundamentals in the countries. However, it is not easy for one to find solution to these changes. After all, it takes a long period of time for transition of thoughts and perspectives especially since most Asians are tied closely to their culture. For example, the Chinese believe strongly in hard work and discipline, which is a good characteristic in any individual. However, it is important for Asians to learn to work smart as well. Flexibility in working hours is also important to avoid burn out workers. Although the Chinese form one of the most hardworking and discipline group of workers, most of these people are not able to think out of the box in their working environment. They are trained to do the same work repetitively.
This is why postmodernism is important in this context. While the characteristic of hard work and discipline are important for all skilled and knowledge workers to have, it is also important for these group of people to learn to be more flexible, see things from a different perspective and learn to think outside the box. This will help to generate new ideas and innovation. One of the ways to encourage this thinking among the workers in Asia is to organize motivation talks, provide a better and more comfortable working environment as well as encouraging independency at work. Instead of judging the performance of the workers by their hard work, more values should be placed on the results and ideas given by the workers. It is also important to allow exposure to cultures from other countries and regions. While it is important to maintain the culture and hold firm to the beliefs of one culture, it is also necessary to look at the positive attribute from other cultures and apply them into our daily lives. All of these should be stressed in education as well as through the media.
Transparency is also an important concept that must be implemented so that Asians could see things from different perspectives and not just through the eyes of their government. Internet transparency is important as we can see from the conflict between Google and China. If the leaders of Asian countries are able to see the need for transparency in all areas of their administration, the citizens will have more faith in their work. Trust and integrity is important because people only practice honesty when they see the value in trust and integrity. One country that has been very successful in Asia at this level is Singapore.
It is also important to look into the work force of the country and make sure that it is balance in terms of age group and qualification. For example, it is very dangerous if the work force is full of people who are at the age of 60 and above. This group of people might be able to provide stability and with their experience, they could provide insights into the possibility of what might happen in the future but they are also the group of people that find it difficult to think outside the box. Due to years of training over the same thing, they are not capable of looking at new ideas and thus eliminating innovation in the process. This could be seen in the case of Japan as of now. The right mixture of young and old will help to provide this balance for innovation and development. These will help both the young and old to learn from one another and thus, enhancing their knowledge and perspective.
The journey towards the next decade is still a long way to go but if Asia is to be the leader in the post-global-crisis world, they must take a giant leap of faith for new ideas and perspectives. There will definitely be more challenges ahead but the most important challenge is the perspective and mindset of Asians. Asians must no longer look at others for ideas and perspectives. They should learn to look within and think of a bigger picture. IMF’s Dominique Strauss-Kahn states that Asia should play a leadership role in guiding the global economy to a new, more sustainable path for growth. Minister Mentor Lee Kuan Yew said in Washington that a changed world order is upon us. All of these are possible but it could only happen if Asians are willing to move forward with the new perspective.

Bad Customer Service Experience From the HSBC Credit Card

2010-09-25T03:02:00.000-07:00

I have been in dilemma on whether to post my bad experience with the customer service from HSBC but in the end I decided to post my story here so that more people are aware of some of the bad services by certain banks, and this is not limited to HSBC. If I have bad experience with other credit card issuers in the future, I might post it here as well.

I know that not all customer service are perfect, but at least what they should do is to provide the best customer service that can satisfy their customer.

Being the HSBC credit card user for about four years, I feel that HSBC has been doing alright to retain and to satisfy their customer. Why? Because there was once that my dad has lost his wallet and we called to block the card, and immediately the CS offered to send a replacement card and he received his card within three days. However, my experience with the replacement card is totally contrast with what my dad has experienced.

Ok, the following is what I have been experiencing and I am actually still waiting for my replacement card when I am posting this. The whole fiasco actually began somewhere in mid of August, think it was 19th of the month if I can recall properly.

First of all, there was a fraud transaction which HSBC manage to catch, which is good and leads to my credit card blocked with the promise of delivering me a new credit card within few working days (three working days was what I heard on the phone conversation). Granted, it did not happened and so I called the CS and was told by another CS rep that my card was not issued and will issue it and deliver to me in about another few working days.

Few days past, I called again as I have yet to received my replacement card, and the CS told me that I have to wait for another few more days and if I still have yet to received the replacement card, call back to the CS to check on the status. This loop goes on for like few weeks, I keep calling and getting the same reply over and over again and in the end one month past, and guess where is my card - answer is still in hyperspace.

I know that there is a holiday season during the Hari Raya and the Malaysia Day. But the holiday season is just one week, and it has been a month since this thing started. If I got my replacement card a week later than expected, then it is understandable, but now it is a month and best of all, I still don't have the replacement card.

I am really curious on what are the actions taken on Pos since the CS are talking that the Pos people are responsible for it? Is it the correct way to ask the customer to keep waiting and calling and there is no action taken?

I'm not saying that I am a big user of the HSBC credit card, and that I am desperate for the card, but, I am most worry that someone has took it and start charging it without my knowledge. Does it really make sense for the credit card issuer to use a normal mail that is without tracking to send out credit cards to their customers? Is this one of the cost cutting measure by HSBC? If the card was sent via courier services, the CS would have know where the credit card is, now, all of them are not sure.

Ok, let me do a comparison here. I am also credit card user from another bank, say the bank is XXXX, and what I like about XXXX is that the credit card was sent via a courier service. What I like best is not just that, when the card actually sent out from XXXX, I got a message that the card was sent and I should be expecting the card anytime.

Now people, we know that credit card is an important stuff that should not be sent using a normal postal service that the issuer or the customer cannot track on the status of the delivery. What if the card actually landed to the wrong hand and people starting to charge the card? Who is going to pay for it? The CS told me that we have to call the CS to activate the card, but what if the "hijacker" is very good in social engineering and manage to crack out the activation process?

In my opinion, credit card should be delivered via courier services no matter how costly it is to do so. It is just plain stupid to use normal postal service and just plain dumb reason saying that most customer prefer to get their credit card via the normal postal service instead of courier service. I'm saying this because when I asked about why it is not delivered using courier service like last time when I first have my card, the CS reply me with the dumbest reason that anyone could have think off.

So, after reading my story, one might asked, why not just terminate the card? Well, that is because I am waiting refund from another merchant which is why I cannot terminate it at will and in fact this is also the reason why I do not want to have the replacement card re-issue as what the CS just told me recently. In the meantime, I have no choice but to wait for weeks after weeks for my card that is still in hyperspace, until the merchant has refund me.

Anyway, this has really prompted me to think twice in renewing the credit card service in near future and in fact prompted me to start blacklisting the credit card issuer, although it used to have the the best service among all the credit cards that I have been using.

With other banks' services and privileges are slowly catching up and higher credit limit, given a choice now, I definitely have no qualm in terminating the HSBC credit card.

I seriously hope those customers that are facing the same issue as me will do the same, though I will educate potential credit cards user not to select HSBC as their choice through my blog and word of mouth to all new hires in my company.

How The Global Competitiveness Index Is Calculated?

2010-09-14T05:39:00.000-07:00

I posted something on The Global Competitiveness Report 2010-2011 last week and get a comment from a reader named Aaron asking on how the Global Competitiveness Index is calculated by the World Economic Forum. The following is his comment

aaron said...

So how is the Global Competitiveness Index calculated and what does this say about the economy, as I see that Canada has slipped down one place too?

As we all know, all these reports and indexes are just number that the World Economic Forum put in based on their perception using some of the guidelines from the forum.

To me, the drop of a country in the Global Competitiveness Index means one and only thing - too many red tapes which makes it difficult to do a business with the nation. Well, that is just my opinion. Anyway after getting the comment from Aaron, I feel that it is also good for me to learn new stuff by learning how the Global Competitiveness Index is calculated by the World Economic Forum, thus I do a search from the World Economic Forum website.

The following is what I get from the World Economic Forum FAQ regarding how the Global Competitiveness Index is calculated:-

The Global Competitiveness Index or in short GCI is made up of over 113 variables, of which approximately one two thirds come from the Executive Opinion Survey, and one third comes from publicly available sources. The variables are organized into 12 pillars, with each pillar representing an area considered as an important determinant of competitiveness:

* Institutions
* Infrastructure
* Macroeconomic stability
* Health and primary education
* Higher education and training
* Goods market efficiency
* Labor market efficiency
* Financial market sophistication
* Technological readiness
* Market size
* Business sophistication
* Innovation

The impact of each pillar on competitiveness varies across countries, in function of their stages of economic development. In order to take this reality into account in the calculation of the GCI, pillars are given different weights.

The Global Competitiveness Report 2010-2011

2010-09-09T07:42:00.000-07:00

The US which has just lost the pole position to Switzerland in the Global Competitiveness Report not long ago slips another two places in the latest report by the World Economic Forum, overtaken by Sweden and Singapore. Malaysia also slipped 2 places while the United Kingdom which has recently slipped move back up by one place to 12th position.

Click on Read More to get the full list of The Global Competitiveness Report 2010-2011 by World Economic Forum.

Country/Economy	GCI 2010		GCI 2009	Change 2009-2010
Country/Economy	Rank	Score	Rank	Change 2009-2010
Switzerland	1	5.63	1	0
Sweden	2	5.56	4	2
Singapore	3	5.48	3	0
United States	4	5.43	2	-2
Germany	5	5.39	7	2
Japan	6	5.37	8	2
Finland	7	5.37	6	-1
Netherlands	8	5.33	10	2
Denmark	9	5.32	5	-4
Canada	10	5.30	9	-1
Hong Kong SAR	11	5.27	11	0
United Kingdom	12	5.25	13	1
Taiwan, China	13	5.21	12	-1
Norway	14	5.14	14	0
France	15	5.13	16	1
Australia	16	5.11	15	-1
Qatar	17	5.10	22	5
Austria	18	5.09	17	-1
Belgium	19	5.07	18	-1
Luxembourg	20	5.05	21	1
Saudi Arabia	21	4.95	28	7
Korea, Rep.	22	4.93	19	-3
New Zealand	23	4.92	20	-3
Israel	24	4.91	27	3
United Arab Emirates	25	4.89	23	-2
Malaysia	26	4.88	24	-2
China	27	4.84	29	2
Brunei Darussalam	28	4.75	32	4
Ireland	29	4.74	25	-4
Chile	30	4.69	30	0
Iceland	31	4.68	26	-5
Tunisia	32	4.65	40	8
Estonia	33	4.61	35	2
Oman	34	4.61	41	7
Kuwait	35	4.59	39	4
Czech Republic	36	4.57	31	-5
Bahrain	37	4.54	38	1
Thailand	38	4.51	36	-2
Poland	39	4.51	46	7
Cyprus	40	4.50	34	-6
Puerto Rico	41	4.49	42	1
Spain	42	4.49	33	-9
Barbados	43	4.45	44	1
Indonesia	44	4.43	54	10
Slovenia	45	4.42	37	-8
Portugal	46	4.38	43	-3
Lithuania	47	4.38	53	6
Italy	48	4.37	48	0
Montenegro	49	4.36	62	13
Malta	50	4.34	52	2
India	51	4.33	49	-2
Hungary	52	4.33	58	6
Panama	53	4.33	59	6
South Africa	54	4.32	45	-9
Mauritius	55	4.32	57	2
Costa Rica	56	4.31	55	-1
Azerbaijan	57	4.29	51	-6
Brazil	58	4.28	56	-2
Vietnam	59	4.27	75	16
Slovak Republic	60	4.25	47	-13
Turkey	61	4.25	61	0
Sri Lanka	62	4.25	79	17
Russian Federation	63	4.24	63	0
Uruguay	64	4.23	65	1
Jordan	65	4.21	50	-15
Mexico	66	4.19	60	-6
Romania	67	4.16	64	-3
Colombia	68	4.14	69	1
Iran	69	4.14	n/a	n/a
Latvia	70	4.14	68	-2
Bulgaria	71	4.13	76	5
Kazakhstan	72	4.12	67	-5
Peru	73	4.11	78	5
Namibia	74	4.09	74	0
Morocco	75	4.08	73	-2
Botswana	76	4.05	66	-10
Croatia	77	4.04	72	-5
Guatemala	78	4.04	80	2
Macedonia, FYR	79	4.02	84	5
Rwanda	80	4.00	n/a	n/a
Egypt	81	4.00	70	-11
El Salvador	82	3.99	77	-5
Greece	83	3.99	71	-12
Trinidad and Tobago	84	3.97	86	2
Philippines	85	3.96	87	2
Algeria	86	3.96	83	-3
Argentina	87	3.95	85	-2
Albania	88	3.94	96	8
Ukraine	89	3.90	82	-7
Gambia, The	90	3.90	81	-9
Honduras	91	3.89	89	-2
Lebanon	92	3.89	n/a	n/a
Georgia	93	3.86	90	-3
Moldova	94	3.86	n/a	n/a
Jamaica	95	3.85	91	-4
Serbia	96	3.84	93	-3
Syria	97	3.79	94	-3
Armenia	98	3.76	97	-1
Mongolia	99	3.75	117	18
Libya	100	3.74	88	-12
Dominican Republic	101	3.72	95	-6
Bosnia and Herzegovina	102	3.70	109	7
Benin	103	3.69	103	0
Senegal	104	3.67	92	-12
Ecuador	105	3.65	105	0
Kenya	106	3.65	98	-8
Bangladesh	107	3.64	106	-1
Bolivia	108	3.64	120	12
Cambodia	109	3.63	110	1
Guyana	110	3.62	104	-6
Cameroon	111	3.58	111	0
Nicaragua	112	3.57	115	3
Tanzania	113	3.56	100	-13
Ghana	114	3.56	114	0
Zambia	115	3.55	112	-3
Tajikistan	116	3.53	122	6
Cape Verde	117	3.51	n/a	n/a
Uganda	118	3.51	108	-10
Ethiopia	119	3.51	118	-1
Paraguay	120	3.49	124	4
Kyrgyz Republic	121	3.49	123	2
Venezuela	122	3.48	113	-9
Pakistan	123	3.48	101	-22
Madagascar	124	3.46	121	-3
Malawi	125	3.45	119	-6
Swaziland	126	3.40	n/a	n/a
Nigeria	127	3.38	99	-28
Lesotho	128	3.36	107	-21
Côte d'Ivoire	129	3.35	116	-13
Nepal	130	3.34	125	-5
Mozambique	131	3.32	129	-2
Mali	132	3.28	130	-2
Timor-Leste	133	3.23	126	-7
Burkina Faso	134	3.20	128	-6
Mauritania	135	3.14	127	-8
Zimbabwe	136	3.03	132	-4
Burundi	137	2.96	133	-4
Angola	138	2.93	n/a	n/a
Chad	139	2.73	131	-8

Effective Business Website

2010-08-29T08:32:00.000-07:00

As the chances of double dip recession is getting higher, keeping the cost down is one of the key to a successful business - which is why it is important to get cheap vendors and suppliers for business.

This includes choosing effective business website and the business website developer for outsource. Rotorua Web Design keep the cost and overhead down, thus these overheads are not passed on to their clients.

Rotorua design business websites effectively by using clear design that can attracts the target audience but at the same time keeping the website as simple as possible. To get organic traffic, Rotorua Web Design applies SEO technique effectively.

How To Withdraw Money From Paypal Account

2010-08-28T09:18:00.000-07:00

Just past few weeks, a friend of mine just started to use his Paypal account. The purpose he opened a Paypal account is to sell stuff at some auction websites, which I'm not sure, though I strongly believe it could be Ebay. Anyway, he told me that he got a problem getting the money and it will serve no purpose if the money can only stay in the Paypal account and use for online business as he might want to cash out anytime soon. Anyway, I told him that there is actually a way to withdraw money to his bank account and then tell him step by step how to do it while we were on the phone.

Anyway, due to the phone conversation, I know some of us are not aware that we can actually withdraw the money to the banks in Malaysia.

Below are the step by step on how to do it beginning from registering a bank account to the Paypal account.

1. Login to your Paypal account. You should be getting something like the following screenshot.

2. Next, click on the Withdraw tab and you will see that you can withdraw money either direct to the bank account and to debit card or credit card. Click on the Withdraw to your bank account link to withdraw direct to the bank account without any charges, provided the amount is more than RM400.

3. After you click on the Withdraw to your bank account link, you will be directed to the following page.

If one withdraw money from Paypal account for the first time, he or she will need to setup a bank account to the Paypal account. To do so, click on the Add bank account link on the page. You will be directed to the page as shown below after you click on the Add bank account link.

4. Fill in the details required in the setup bank correctly. The MEPS bank routing code is actually the Malaysia bank Swift code. Double check the details so that you will be getting the money instead of the money going here and there. Click continue once filling in all the details. Confirm the details and then repeat step 2 (this is my shortcut way of getting to the right page). This time you can enter the amount in USD and if you have only one bank setup to the account, it will appear in the To column. If you have more than one bank account setup, just choose the correct bank account. Click continue when done.

5. Review your withdrawal information and click Submit to confirm the withdrawal information.

6. Finally, you will be directed to the following page stating that "Your funds will be in your bank account in 2-3 business days" as shown below. An email will be sent to your Paypal email account as well for your reference.

If I remember correctly, I always withdraw on Monday and get my money before Friday on the same week. Hope this helps.

The "Middle Income Trap"

2010-08-25T08:50:00.000-07:00

I come across this article and thought it would be nice to share it out here to see what are other people's opinion on the Middle Income Trap that are facing by some of the developing nation like Malaysia currently.

China, Malaysia, Korea And the Middle Income Trap

I just learned a new term today that I know I will be using frequently in the future. The term is "middle income trap" and it crystallizes some of my previously discombobulated thoughts I have had regarding economic development. Let me explain.

This new term (for me) comes from a post by Michael Schuman on Time Magazine's Curious Capitalist blog, entitled, "Escaping the middle-income trap." The post focuses on how Malaysia's economic growth has been so consistently strong since World War II, yet has been slowing over the last few years and of how Malaysia just cannot seem to break into the league of developed nations. Schuman defines this "trap," as follows:

I returned a few days ago from Kuala Lumpur, the capital of Malaysia, where the talk of the town – well, at least among economists -- is the “middle-income trap.” What's that, you ask? A developing nation gets “trapped” when it reaches a certain, relatively comfortable level of income but can't seem to take that next big jump into the true big leagues of the world economy, with per capita wealth to match. Every go-go economy in Asia has confronted this “trap,” or is dealing with it now. Breaking out of it, however, is extremely difficult. The reason is that escaping the “trap” requires an entire overhaul of the economic growth model most often used by emerging economies.

The concept behind the “middle-income trap” is quite simple: It's easier to rise from a low-income to a middle-income economy than it is to jump from a middle-income to a high-income economy. That's because when you're really poor, you can use your poverty to your advantage. Cheap wages makes a low-income economy competitive in labor-intensive manufacturing (apparel, shoes and toys, for example). Factories sprout up, creating jobs and increasing incomes. Every rapid-growth economy in Asia jumpstarted its famed gains in human welfare in this way, including Malaysia.

However, that growth model eventually runs out of steam. As incomes increase, so do costs, undermining the competitiveness of the old, low-tech manufacturing industries. Countries (like Malaysia) then move “up the value chain,” into exports of more technologically advanced products, like electronics. But even that's not enough to avoid the “trap.” To get to that next level – that high-income level – an economy needs to do more than just make stuff by throwing people and money into factories. The economy has to innovate and use labor and capital more productively. That requires an entirely different way of doing business. Instead of just assembling products designed by others, with imported technology, companies must invest more heavily in R&D on their own and employ highly educated and skilled workers to turn those investments into new products and profits. It is a very, very hard shift to achieve. Thus the “trap.”

Schuman sees South Korea as "probably the best current example of a developing economy making the leap into the realm of the most advanced." Schuman sees Malaysia as a long way from making that same leap:

Malaysia, though, is quite far from where it wants to be. That's a bit surprising based on its remarkable recent history. Malaysia has been among the best performing economies in the world since World War II, one of only 13 to record an average growth rate of 7% over at least a 25-year period. The country has an amazing record of improving human welfare. In 1970, some 50% of Malaysians lived in absolute poverty; now less than 4% do. Yet Malaysians also feel that they've become somewhat stuck where they are. GDP growth has slowed up, from an annual average of 9.1% between 1990 and 1997 to 5.5% from 2000 and 2008. Meanwhile, other Asian economies have zipped by Malaysia. According to the World Bank, the per capita gross national income (GNI) of South Korea in 1970 was below that of Malaysia ($260 versus $380), but by 2009, South Korea's was almost three times larger than Malaysia's ($21,530 versus $6,760). Malaysia is getting “trapped” as a relatively prosperous but still middle-income nation.

Schuman does not see Malaysia making the leap. Its companies are not innovating. Its private investment is declining and it spends almost nothing on R&D. "If Malaysia is going to break the “trap,” it has to reverse all of these trends."

So what has made Korea so different from Malaysia?

Why has Korea jumped so far ahead? I think the reason is embedded in the different methods the two countries used to spur rapid growth.

Both countries relied exports to create rapid gains in income, but they did so differently. South Korea, from its earliest days of export-led development in the mid-1960s, had been determined to create homegrown, internationally competitive industries. Though Korean firms supplied big multinationals with components or even entire products, that was never enough – Korea wanted to manufacture its own products under its own brands. The effort was often a painful one – remember Hyundai's first disastrous foray into the U.S. car market in the late 1980s and early 1990s – but Korea is where it is today because its private companies have been working on getting there for a very long time, backed in full by the financial sector and the government.

Malaysia, on the other hand, relied much, much more on foreign investment to drive industrialization. That's not a bad thing – multinational companies provide an instant shot of capital, jobs, expertise and technology into a poor country. MNCs, however, aren't going to develop Malaysian products; that has to take place in the labs and offices of Malaysia's private businesses. But those businessmen have been content to squeeze profits from serving MNCs and maintaining their original, assembly-based business models.

I have for years viewed Korea as THE success story of Asia. In fact, whenever people tout China and act as though democracy is wholly incompatible with growth, I respond with Korea. You can see me making this point in this Commonwealth Club of San Francisco video of a "Doing Business in China" panel. Korea was at one time the second poorest country in the world, second only to Niger. Now, Seoul is more dynamic than Tokyo and Korea just continues to grow both economically and in terms of its political freedoms. Why is that? And why are countries like Malaysia and Thailand stuck in the middle ground? And what about China and Vietnam, will they be able to make "the leap?

Japan and Korea are important because they have spending power. Vietnam and Cambodia are important because they have very low wages. China is the most interesting because just three or four years ago, companies were going to China because of its low wages, but now, companies are going there to make money (mostly on the Coast) and going there to make things (more and more inland).

Where do Malaysia or Thailand fit into all this?

Malaysia and Thailand remind me a bit of the mid-size law firm. I can understand hiring the big firm for the big deal or the big case requiring a massive number of associates or legions of highly specialized partners. And I can understand hiring a highly efficient and focused small firm. But I rarely understand hiring the mid-sized firm, which usually tries to price itself along the same lines as the big firms, but without the corresponding depth or expertise. Why bother? And nothing against either Malaysia or Thailand, but I think many businesses have asked themselves this very question.

Source: China, Malaysia, Korea And the Middle Income Trap

What do you think?

How Rich Is Rich?

2010-08-11T07:41:00.000-07:00

I come across one very interesting article from Personal Finance News from Yahoo! Finance - How Rich is Rich and think it might be suitable for me to share it out here and let us really ponder about the article and think how much does it need for you to feel rich?

How much money do you need to feel rich?

Wealth is a subjective concept, but one thing is universal in most definitions: being able to live a comfortable life without having to work.

"I'd like to have enough money so my family and I wouldn't have to work anymore or worry about the necessities, and maybe travel a bit," said Deborah Veale, a Southern California resident visiting New York City.

Veale said she'd need about $10 million to consider herself set.

One woman from Seattle put it at a "couple thousand dollars a month." Another from New York City wanted a billion (although she'd still fly coach.)

Experts peg the figure to be somewhere around $2 million to $12 million in savings.

On the high end of that range, a single person living in an expensive part of the country (say, New York City), wanting to retire at 35 would need at least $300,000 a year to feel rich, according to Steven Kaye, president of Watchung, N.J.-based wealth management firm American Economic Planning Group. He based that number on real-life figures his clients tell him they need.

A yearly income of $300,000 would allow for taxes, a $3,800-a-month apartment (the average price in Manhattan), and a monthly spending allowance of around twelve grand, he said. Not too bad, especially since you could do this all without a pesky job.

To generate $300,000 a year beginning at age 35, you'd need a nest egg of just under $12 million. That assumes a conservative investment portfolio generating a return of 5% a year, an inflation rate of 2.5% a year and Social Security benefits of $25,000 a year starting at age 62.

Over time, the shape of your nest egg would resemble a bell curve, growing in the early years, and then declining as inflation required you to withdraw more money to maintain a lifestyle equivalent to $300,000 in 2010. The $12 million would finally dwindle to $934 when you turned 100.

If you live in a low cost part of the country, $100,000 a year should be enough, said Kaye. In that case, you would need savings of about $4 million to retire at 35.

But if you're willing to stay in the workforce until age 65, a mere $2 million would be enough.

Jon Duncan, a financial planner at Tacoma, Wash.-based Seneschal Advisors, gave numbers similar to Kaye's, and agreed that for most people, the figure would be somewhere in the multi-millions.

"I'm from an era when we'd talk about millionaires and say 'Whoa, he's got it made for life,'" said Duncan. "But that's not the case anymore."

Indeed, few experts think a million is enough to quit your day job.

"Don't retire at 35," he advised this reporter, "you'll need a ton of money."

Keeping Up With the Joneses

Of course, there are other ways of determining wealth besides just what you'll need to live well in retirement.

Although decidedly not recommended by financial planners, one is relativity. Basically, you're rich if you're making more than your brother-in-law.

That appears to be how the government measures affluence. The Obama administration wants to extend tax cuts for all but the wealthiest Americans, which it defines to be those families making more than $250,000.

But that only includes about 2% of the population, according to the Census Bureau.

Kaye cautions not to confuse wealth with income. Some people can make a million a year, but be spending a million and a half. They are not rich, said Kaye.

"Income relates to lifestyle," he said. "Wealth relates to balance sheets."

Oil Watch

2010-07-28T17:22:00.000-07:00

the $600billion challenge

2010-07-03T21:10:00.000-07:00

If you have heard about it, then you will probably know that the $600 billion challenge is an attempt to change the world. That is the challenge and campaign kick off by one of the most influential person on Earth in the technology era, Bill Gates. Bill Gates, Melinda Gates and Warren Buffet are asking the billionaires in the country to give away at least half of their net worth for charity, whether while they are alive or at their death.

Through this, I also learn about the term philantrophy, which is an effort to change and increase the well being of mankind. I think the effort made by the trio are worth mentioning in this blog because even though money is important for usage, we must learn the need to share with those in need. Hopefully, this will help to inspire more of us to see beyond our own environment and look into the lives of others.

World Market Watch

2010-06-30T21:34:00.001-07:00

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How To Calculate PCB or Scheduled Tax Deduction (STD) for Salary and Bonus

2010-06-12T08:51:00.000-07:00

While watching World Cup and with the pay day coming in within a week, I'm thinking maybe I should do some write up on how the PCB or STD (Scheduled Tax Deduction) is calculated monthly as this has been a question mark for me whenever I am planning the budget for the subsequent month.

Most people will have doubt on how the PCB or STD is calculated especially during the bonus month. In fact, most of us will be anxiously to know the tax deduction to have proper view how much we can spend during that month. So, it is always best for us to know how the PCB are calculated so that we can plan ahead.

Here is how our STD or PCB are calculated.

Assuming person E is single and is drawing monthly salary of RM3,000 and contributing 11% from his monthly salary to EPF.

Salary = RM3,000
EPF deduction = RM330
(Note: The maximum total EPF deduction allowed for PCB or STD calculation is RM500 (RM6,000 / 12 = RM500))

Salary for PCB calculation
= Gross salary - EPF deduction
= RM3,000 - RM330
= RM2,670

According to PCB 2010 rate, the PCB for RM2,670 is RM24

So, every month E will be getting
= Gross salary - EPF deduction - PCB (or STD)
= RM3,000 - RM300 - RM24
= RM2,676

Now, assume that E is getting RM3,000 in bonus, how much would his PCB on that month?
Bonus = RM3,000
EPF deduction = RM330
Maximum available EPF deduction for PCB calculation = RM500, so the EPF deduction for bonus PCB calculation = RM500 - RM330 = RM170, instead of RM330

Bonus for PCB calculation
= Gross Bonus - EPF deduction
= RM3,000 - RM170
= RM2,830

The amount for bonus PCB calculation has a formula like the following:-
= (1/12 x net_bonus) + net_salary
= (1/12 x RM2,830) + RM2,670
= RM235.83 + RM2,670
= RM2,905.83

According to PCB 2010 rate, the PCB for RM2,905.83 is RM42

PCB for bonus = (RM42 - RM24) x 12 = RM216

Total PCB for the month with bonus
= PCB for salary + PCB for bonus
= RM24 + RM216
= RM240

So, during the bonus month,
Gross salary + bonus = RM3,000 + RM3,000 = RM6,000
EPF deduction = RM660
PCB (or STD) = RM24 + RM240 = RM264

E will be getting
= Gross salary + bonus - EPF deduction - PCB (or STD)
= RM6,000 - RM660 - RM264
= RM5,076

Why not try out the calculation with your salary and let me know whether the calculation and formula is accurate by checking your payslip. I am sure I will check it this month :D

Credit to The 8th Voyager

Scheduled Tax Deduction (STD) or PCB for the Year 2010

2010-06-12T08:15:00.000-07:00

When you look at your payslip every month since the second half last year, do you realized that the Scheduled Tax Deduction, STD (or Potongan Cukai Bulanan, PCB) is higher compare to previously? I, myself realized that and after doing some research I realized that the Inland Revenue Board (IRB) of Malaysia (or Lembaga Hasil Dalam Negeri, LHDN) has come out with higher rate back then.

This year again, we will have new PCB rate and the rate is lower compares to the 2009 PCB rate. Click the links below to get the rate for both PCB 2009 and PCB 2010 and do some comparison.

Click here to download the PCB 2009 rate

Click here to download the PCB 2010 rate

I might be posting on how to calculate the PCB or STD in the future.

Privacy Policy for Money Master

2010-06-11T22:59:00.000-07:00

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INTC Share Watch and News

2010-06-05T00:41:00.001-07:00

Stock Info Market Monitor

Company Profile

Intel Corporation designs, manufactures, and sells integrated circuits for computing and communications industries worldwide. It offers microprocessor products used in notebooks, netbooks, desktops, servers, workstations, storage products, embedded applications, communications products, consumer electronics devices, and handhelds. The company also offers system on chip products that integrate its core processing functionalities with other system components, such as graphics, audio, and video, onto a single chip. It also provides chipset products that send data between the microprocessor and input, display, and storage devices, such as keyboard, mouse, monitor, hard drive, and CD or DVD drives; motherboards that has connectors for attaching devices to the bus, and products designed for desktop, server, and workstation platforms; and wired and wireless connectivity products, including network adapters and embedded wireless cards used to translate and transmit data across networks. In addition, Intel offers NAND flash memory products primarily used in portable memory storage devices, digital camera memory cards, and solid-state drives; network processors used in networking equipment to manage and direct data moving across networks and the Internet; software products, including operating systems, middleware, and tools used to develop, run, and manage various enterprise, consumer, embedded, and handheld devices, as well as software development tools that enable the creation of applications; and healthcare products designed to connect people and information to improve patient care and safety.

Further, it offers platforms that include a microprocessor, chipset, and enabling software. Intel sells its products primarily to original equipment manufacturers, original design manufacturers, PC and network communications products users, and other manufacturers of industrial and communications equipment. The company was founded in 1968 and is based in Santa Clara, California.

Think Before you Buy

2010-05-30T21:47:00.000-07:00

There are a lot of people who buy without putting much thoughts. However, this buy, buy, buy mentality could be dangerous and bad for our society as well as the environment. This is because we are a very consumer driven generation.

However, if you could stop for a minute and think as well as ponder, your wallet and Mother Nature will be very grateful.

REDUCE

Give yourself some time to think and ask if you can use less than what you are using. Sometimes, it is possible to make do with less of what we are using. For example, toiletries are the perfect example. If you do not waste shampoo or detergent, you will help to save a lot. This is all day-t0-day products that could make a huge difference.

Another good example would be the mobile phones. How many of us are changing phones every year? There are a lot of us who change mobile phones every now and then as we chase after the latest model. If we could save money from all these products, we will be saving a lot more. Besides, it also contribute to saving the environment.

REUSE

There are a lot of us who would invest in a new hobby only to find that we are not really into it. For example, I used to be very eager about the prospect of learning guitar. I bought a guitar only to find it collecting dust. Therefore, one of the ways would be to borrow from a friend and see if you are serious about learning it. If you can't borrow, then you can consider buying a used or refurbished version. Do not take things for granted.

RECYCLE

If you think that recycling is by putting your items into the recycle bin, you are wrong. You could also exchange items with someone or your friends. You could check and see if there are people who might be interested in exchanging or trading with your for something you want in return. For example, there are people who might be interested to exchange a barely used tennis racquets for a pretty new pair of skates.

RETHINK

Before you purchase anything, always ask yourself over and over again the reasons for buying it. It is important to think properly before purchasing something that could be wasted. Planning on your shopping will help you to save a lot of money in the long run

REFUSE

It is important to refuse to buy something. Despite of the cool factor of obtaining or buying something that is new, it is important that you are able to resist the temptation of buying something new.

The reason that I am blogging about this is because of the temptation that i face each time I go shopping. No doubt, it is great to be buying something new that is nice. I remembered the feeling of excitement when I first got hold of my HTC Trinity and the ipod shuffle.

With news and rumours about the upcoming iphone 4G and HTC Evo 4G, I always have the tendency to consider buying these new phones...or I might even consider HTC Desire.
The desire for something new is common and most of us find that in us. However, it is actually important for us to look beyond "Cool" and following with the trend.
If you are thinking about yourself only, buying these cool gadgets make sense since it helps to enhance your cool factor as well as your popularity in a way but what about people outside your world. People who are suffering because of our spending spree.
I think it is important to save every penny, not just for our sake but also for those around us.
Partly influenced by reading the One Foundation by Jet Li.
Therefore, instead of buying a new phone, I might consider reusing the Sony Ericsson of mine (quite an old phone) for my DigiCampus and continue using HTC P3600i for my Digi Postpaid...(in need of a new battery, I already order one)

Lasik Patient Advocacy USAEyes

2010-05-16T01:29:00.000-07:00

If you are wondering what is the USAEyes, it is the Council for Refractive Surgery Quality Assurance, a nonprofit Lasik patient advocacy organization. USAEyes has helped patients to learn about important issues regarding Lasik and similar vision correction surgery.

LASIK or more commonly known as the laser-assisted in situ keratomileusis is a type of refractive surgery for correcting myopia, hyperopia, and astigmatism.

For more information, you could look at the USAEyes.org as the website complies with the Health on the Net code for trustworthy health information.

You could also find recent LASIK news from this website as well.

Time to rebound for the market

2010-05-09T23:59:00.000-07:00

We all heard rumours about the market struggling with some others talking about the recovery coming. So which is which? Well, the news in Greece lately has not been too encouraging as well.
Of course, we all know that the International Monetary Fund (IMF) has approved a three-year, 30-billion-euro ($38-billion) loan to Greece, the IMF said at its headquarters in Washington.
The loan is part of a 110-billion-euro, European Union-IMF aid package to help Greece out of its financial woes.

This news seem to be good news for some but just recently we also heard about the Dow Jones Industrial Average to lose almost 1,000 points (about 9-percent of the total index value), and later regaining most of the losses back prior to the closing bell. Of course, if you are one who follow the news, you will know that this was due to an error in the transaction.
It is believed an equities trader at an unknown financial intermediary accidentally executed a trade position with a “b” (indicating billion), instead of what was supposed to be with a “m” (indicating million) on a futures trade executed on the Proctor and Gamble stock.

Nevertheless, the situation shows a very shaky market still with people afraid of buying stocks or shares. People are still afraid of the market...they are still afraid of another "recession".
Just as Warren Buffett says, "When fireworks go off now, people are expecting that it's a nuclear bomb."

Such is the state of mind of the people at the moment...always afraid of the worst. But according to people like Buffett, Dimon and Welch, the time has come for the economy to rebound. This conclusion is made because of the statistics and data that show the business is coming back.

Warren Buffett has been focusing on the data from the BNSF Railway, which he recently acquired. At the start of the recession three years ago, Burlington Northen felt the pain early when retailers stopped ordering goods, automakers stopped shipping cars, and homebuilders stopped needing so much lumber. The railroad started storing thousands of idle railcars. But now, these railcars are being called back into service. And that's an incredibly important sign. There are other data such as from the Buffett's Berkshire Hathaway conglomerate encompasses some 80 different businesses and this is definitely a positive sign.

Well, there are many out there who are still afraid but if you are one of those who are bold, calculated and rational risk, you might be able to make use of the recession to be an opportunity for you to be successful.

Monthly Spending Guidelines

2010-04-16T08:16:00.000-07:00

People will always ask whether there is any monthly spending guidelines so that they can tailor their budget according to the guidelines. In fact, there is no such thing as perfect monthly spending guidelines as every one will have different priorities and each time will have different priorities as well. Monthly spending guidelines also change according to the financial goal that one has set every year.

Nevertheless, I come out with my own budget which was based on the following spending guideline and it's been about four years and the guideline still stands true. One thing for sure, as I'm still single, thus my commitment towards household (in Housing category) will be less but at the same time, my commitment towards servicing my car loan will be higher. I make it a point to save at least 9% of my income and make sure I do not skip meals. I do tweak my budget on and off, but that is if I have extra income coming in from my investment.

Category	%
Housing	16.00
Transportation	23.90
Food	10.80
Insurance and EPF	12.00
Tithes	10.00
Entertainment	2.00
Apparel products and services	4.30
Health care	2.00
Misc	2.00
Personal care products and services	1.00
Education	7.00
Savings	9.00
TOTAL	100.00

Claiming for the Deserving Compensation With the Help from Personal Injury Attorney

2010-03-12T06:38:00.000-08:00

It is always worrying that whenever a person has accident is paying the high price of the treatment and medication expenses. In actual fact, he or she can actually claim for the deserving compensation with the help from the trusted Honolulu Personal Injury Attorney, especially if the accident takes place in Hawaii and if it was induced by another people. The Accident Attorney Hawaii will offer free consultation and Personal Injury Attorney Hawaii will not charge any attorney fees unless the firm manages to claim it on the victim’s behalf.

Malaysia Bank Swift Code

2010-03-10T05:30:00.000-08:00

What is Swift code? Swift code is known as ISO 9362 and is a standard format of Bank Identifier Codes approved by the International Organization for Standardization (ISO). It is the unique identification code of a particular bank. These codes are used when transferring money between banks, particularly for international wire transfers, and also for the exchange of other messages between banks. The codes can sometimes be found on account statements. The Swift code needs to be filled in a form whenever a person want to do International transfer, like wiring money from the United States to Malaysia. Other activities that requires the Swift code is withdrawing money from Paypal to Malaysia in local currency.

Below are the Swift code for most banks in Malaysia.

Malaysian Bank Swift Code

Affin Bank Berhad = PHBMMYKL
Alliance Bank Malaysia Berhad = MFBBMYKL
Ambank Berhad = ARBKMYKL
Bank Islam Malaysia Berhad = BIMBMYKL
Bank Kerjasama Rakyat Berhad = BKRMMYK1
Bank Muamalat Berhad = BMMBMYKL
Bank of America = BOFAMY2X
Bank Simpanan Nasional = BSNAMYKL
CIMB Bank Berhad = CIBBMYKL
Citibank Berhad Malaysia = CITIMYKL
Deustche Bank = DEUTMYKL
EON Bank Berhad = EOBBMYKL
HSBC Bank Malaysia Berhad = HBMBMYKL
Hong Leong Bank Berhad = HLBBMYKL
Malayan Banking Berhad = MBBEMYKL
OCBC Bank Berhad = OCBCMYKL
Public Bank Berhad = PBBEMYKL
RHB Bank Berhad = RHBBMYKL
Standard Chartered Bank Malaysia Berhad = SCBLMYKX
The Royal Bank of Scotland Berhad (RBS) = ABNAMYKL
United Overseas Bank Berhad = UOVBMYKL

Investing With The Help of CLSA Feng Shui Index

2010-02-23T05:48:00.000-08:00

A very interesting article which appeared in The Edge Financial Daily, February 4th which I would like to share out with every one, which is related to Feng Shui. Whether you all trade using the Feng Shui Index or not, it is still up to you because if Feng Shui is really that accurate, we will be seeing all the Feng Shui master as Top 10 richest in the world. However the article is indeed interesting. I do find myself on and off being superstitious (proven to be quite true especially when watch football with people that I consider bringing bad luck, as well as last year when I saw a "so-call" Feng Shui calendar for KLCI which says the market is not going to be good after April, in which I decided to take profit on one of my stocks, in which it continue to rocketing up after that).

The article is as follow ...

HONG KONG: The Dow Jones Index gained significantly in the previous year of the Golden Tiger in 1950, but Tiger years are typically marked by dramatic changes and even upheaval, said CLSA Asia-Pacific Markets in its 16th CLSA Feng Shui Index (CLSA FSI).

In the report with a tongue-in-cheek look at what 2010 held for equities, commodities, property, celebrities, and the zodiac signs in the months ahead, CLSA cautioned investors to view 2010, much like the tiger itself, as an energetic and powerful, but impulsive and risky, year ahead.

“Those trading equities should get set to ride the wild tiger. The markets will be volatile with a surge in the first month followed by a decline that turns upwards in June, dips, and then swings up again in September to see the Golden Tiger roar by January 2011,” it said in a statement.

With this Tiger year’s heavenly stem being metal, CLSA said gold was set to have a great run and it predicted that it could break US$2,000 (RM6,820) per ounce.

“In fact, commodities of all stripes will fare well including silver, copper, zinc and aluminium. Those regarded as ‘wood’ will also do very well: pulp and paper, clothing and pharmaceuticals.

“‘Fire’ and ‘earth’ elements, thus technology, power, telecoms and property will have a good yearbut ‘water’ related sectors will be challenged, translating to a bumpy time for shipping, airlines, logistics, autos and transport,” it said.

The following is CLSA’s month-by-month take on the year.

• February would bring fantastic opportunities for those sharp enough to recognise them and fast enough to grab them.

• March signals the start of three bumpy months, but there’ll be no shortage of good trades for those brave enough.

• In April, the influence of the stars of misfortune is especially disruptive, while the first few weeks of May will be feisty.

• June heralds a great month but maybe not the best for betting, although the June 21 summer solstice is especially auspicious and gold may surge.

• July is more relaxed with time to enact long-cherished plans and projects.

• August sees the return of volatility and precious metals look set to break upwards, especially gold, silver and copper.

• In September, the trend is upwards and a mixture of considered and idle speculations offers the possibility of eye-popping returns.

• October is possibly one of the best months of the year, with life returning to the markets. It marks the return of a sustained drive upwards that continues into November, December and January.

• Each of the last three months features an auspicious date; Nov 17, Dec 8, Jan 16.

• In terms of the Zodiac, a great year lies ahead for those born in the years of the Dragon, Sheep and particularly, the Horse. A relatively good year is in store for Rats, Cows, Rabbits, Roosters, Dogs and Pigs, while it will be a bumpy ride for Tigers, Snakes and Monkeys,” it said.

CLSA said the Golden Tiger year would favour China’s wealthiest woman, Nine Paper’s Zhang Yin, a Rooster in the Chinese zodiac.

“She will take on some of the toughest competition of her career and come out on top. For China’s wealthiest man, BYD CEO Wang Chuanfu, a Horse, the sun will continue to shine as it has since Warren Buffett invested into his company and set the price soaring.

“And for Buffett, also a horse, the future looks just as bright. He is about to enter the most financially lucky period of his life. Expect some significant and unusual developments in Berkshire Hathaway’s already substantial interest in China,” it said.

“As the Chinese saying goes: ‘Once on a tiger’s back, it is hard to get off’. But if you can hang on, it is certainly the safest place to be. Enjoy the ride and Happy New Year.”

Happy Chinese New Year

2010-02-13T05:26:00.001-08:00

Wishing everyone a Happy Chinese New Year :D. Hopefully everyone will be healthy and prosperous in this year of the Tiger.

Central Banks Slowly Starting To Raise The Interest Rates

2010-01-30T07:51:00.001-08:00

The global economy crisis has led the central banks all over the world to reduce the interest rates to close to 0% which is the all time low. With interest rates that low, borrowing has been cheap which can indirectly spurs the economy - low interest rates, company can borrow to for company expansion, people can borrow more to buy properties and people are forced to spend their money or savings. In fact, the global stock market has been rallying non-stop since March 2009 because of low interest rates and this lead to the presumption that global economy has recovered, although the jobless in the United States stays at 10%. Some has the feeling that the stock market and commodities rally was led by low interest rate because people starting to treat stock market as just another legalized casino. Nevertheless, I do believe we are on the way of recovery but this road is expected to have a lot of potholes. With recovery on the way, central banks will be slowly starting to raise the interest rates.

But as the global economy is on the recovery and interest rates at all time low, no doubt interest rates have only one direction, up. In fact, China has already start tightening the lending policy and the US President, Barrack Obama has also voiced out to have stricter ruling and policy for the banks' activities in the United States. Bank Negara governor Tan Sri Dr Zeti Akhtar Aziz also said on the January 29th that the interest rates were reduced to the current 2% to avoid a fundamental recession as the global crisis had led to an emergency condition and the interest rates will need normalization, in other word raising interest rates is inevitable. Central banks will be pressured to slowly starting to raise the interest rates with inflation starting to kick in.

Raising interest rates is definitely inevitable, to cool off the soon-to-be overheat stock market and commodity. Problem is, can the economy sustain its road to recovery if the interest rates raised? The world stock market has been undergoing correction from the first day Obama and China start voicing out on stricter ruling on the financial sectors. Imagine what will happen to KLSE if Bank Negara Malaysia decided to do the same? KLSE will definitely take a beating. People are thinking that a correction indicates that the economy is not on the way to recovery and on the way to another crash, but after a nine months non-stop rally, correction like this is in fact healthy. You cannot expect stock market to go one direction, even though in a very strong bull market. What goes up must comes down and vice versa.

For those who is still thinking whether we should continue to invest, I would definitely say yes, and if we are foreseeing the global economy recovery to be a long but painful one we should continue to invest, invest in undervalue stocks or dividend stocks but not over invest as even the best company in the world will suffer setback during this correction. If we realized one thing, it is during market correction that we can get very stocks at cheap price. Warren Buffett quoted before, "Price is what you pay, value is what you get". So if you think a stock worth more than 1 and the current price is 0.70, why not buy it? The question will remain which stocks are undervalued? How we know whether the stocks are undervalued?

The uncertainty in the market...

2010-01-27T04:08:00.000-08:00

While many people have been talking about 2010 being the year towards economy recovery. However, things does not always look too good despite of all these speculations. However, South East Asia stocks does not seem to feeling the positive push. And it could be that the whole world is feeling it as well. Singapore and most South East Asia countries have been on the fall for the sixth day, while Malaysia bank hits.

Singapore's index fell for a sixth session on Wednesday, weighed down by selling in Genting and other big caps, while Malaysia hit its lowest in almost a month, with banks suffering the most.

Most likely, the fall and impact especially towards the bank was due to worries among the public regarding the recent banking proposals in the United States by the Obama administration. There are tough and strict rules being proposed to limit the size and the scope of activities of the country's biggest banks. There are a lot of fears that this might eventually spread towards Europe and eventually the world.

Not only that, there are major concerns that Sentiment in Asian stock markets weakened amid fears that China's efforts to rein in soaring credit growth could hamper the global economic recovery.

Well, this is definitely a period of uncertainty in the market....

San Antonio SEO

2010-01-12T05:51:00.000-08:00

Blogging allows one to earn passive income from his or her writing. Blogging, unlike freelance writing requires less responsibility and effort, although without effort, the earnings would be a lot lower, compares to bloggers who put in effort in blogging. A good blogger would be able to optimize his or her blog for search engines so that it will generate more traffic. More traffic will be equivalent to more money, as the chances of people clicking at the CPC program like Adsense advertisements on the blog is higher.

To start a blog, one must choose suitable blog engine for the blog. Some of the well known blog engines are WordPress and Blogspot. Blogspot is usually used by the beginners, while those with blogging experience will prefer WordPress mainly because of the flexibility of the WordPress. For beginners who plan to use WordPress and are staying in Austin, Austin WordPress expert can help one to develop functional, beautiful, and high-ranking WordPress sites in conjunction with some of the Austin SEO and San Antonio SEO services available. By using the correct SEO service, blogger can expect the blog to start generating income after sometimes of hosting because a good SEO service will be able to develop blog starting from scratch until the blog or mini website reach its target audience.

Money Articles

2010-01-10T04:59:00.000-08:00

The money articles in a1 articles are quite interesting and help me to get a better understanding on how Adsense work. The articles not only give tips on how to make money through blogging, it also includes ideas on internet business, through ebay and other realistic ways. One of the good points about the money articles are the inclusion of the need to spend wisely and also about setting budgets. Realistic, applicable and provide path to generate more ideas, the articles help us to see more opportunity in the internet world. Not only that, there are also articles regarding ways to make money even though you are lack of information. These articles are also constantly updated by various authors and thus provided information and knowledge from different perspectives.

Setting Financial Goals for Year 2010

2009-12-27T05:27:00.000-08:00

As the year 2009 is coming to an end, we should start setting financial goals for year 2010. Financial goals are needed so that we can control our day-to-day financial affairs which will be executed by creating and following a budget. Good financial goals are usually realistic and achievable and will give satisfaction to one. It doesn't serve a purpose if a person earning 10,000 a year setting a goal which is to save 20,000 a year because it is impossible to achieve. Not only that, it will then demoralize him or her.

There are few steps to set financial goals:-

Identify and write down your goals.
Break goals down into short-term goals and long-term goal - timeline could be differ; eg. some might take few months as short-term where as some will consider it as long-term
Educate yourself and plan - Learn the debts and assets that we have, and to look into the expenses. Then plan a budget. Follow the budget with discipline and diligently.
Evaluate your progress - it doesn't serve a purpose to have goals where we do not strive to achieve it, right?

Just like the rest of the people, I also have certain goals and adjustments that I make every year. Example would be, for the year 2009, I have targeted 20% growth in my stocks portfolio, in which I successfully did and I might figure to have the 20% growth change this year. More generic financial goals for this year would be:-

Continue tithing.
Clearing 10% debt (both car loan and education loan).
Stocks portfolio to grow another 20% (this would be review quarterly).

We still have about 4 days before 2010. Start setting your financial goals for year 2010, and by end of the year, see how many goals that we have achieved. There are no hard ways and fast rules for implementing a realistic financial goal. The important thing is to do it and to start NOW!!

Have you set your financial goals for the year 2010? If so, do share it out :)

Spend Wisely This Christmas

2009-12-07T05:42:00.000-08:00

As Christmas is just two weeks away I would like to blog a bit on Christmas shopping and spending. I believe by now, many of us are either busy preparing for Christmas, like me, decorating the Christmas tree at home just not long ago or busy planning the shopping details for this year's Christmas and with financial turmoil is just on the way for recovery, many might cut Christmas spending. It is always a virtue to spend wisely this Christmas, as we still have our financial goal to achieve, coupled with more festive celebrations over the next two months, namely the New Year and The Chinese New Year.

Christmas is a celebration of giving as what our God has done by giving his Son, Jesus to redeem us. We can demonstrate the spirit of giving by giving gifts or celebrate this Christmas with others. Anyway, back to the point of spending wisely, there are indeed few points that one can consider in order to reduce the budget for this Christmas while at the same time enjoying this meaningful occasion:-

Gifts.......As the celebration is about giving, gifts are like indispensable items on the Christmas day. Gifts usually contributes to big chunks of the Christmas budget. One can consider making gifts on your own and it will be meaningful and unique to the receivers. There are a lot of things that you can do at home and it will be an attractive gifts to others. Some ot the examples are like drawing Christmas cards, knitting a sweater to your love ones, or making a unique photo frame.
Food......Food is next item that will cost a lot on this day. Well, one can cook simple meals like spaghetti for the enjoyment of the whole family. Christmas is not all about turkey and meat. It is about the celebration together with the family members and friends. One can organize BBQ or pot bless where the guests can contribute to the food as well.

By cutting on gifts and food, one can still continue to enjoy Christmas day with his or her love ones, and not feel "stingy".

Congratulations to Steve Jobs, FORTUNE's CEO of the Decade

2009-11-20T22:20:00.000-08:00

Whether you like him or not, the Apple CEO Steve Jobs has had a helluva decade. After all, it was under his helm that Apple defined the portable music player market with the iPod, has shaken up the mobile industry with the iPhone, rocked the retail music business with iTunes and re-invented the computing business with OS X in a way that the PC business - with less than 10 percent of market share - is no longer the bread-and-butter of the company.

Of course, the marketing plan by Apple was brilliant and create a loyal and if I could use that word, a cult-like followers of the Apple brand. In fact, FORTUNE magazine describe it as the DECADE OF STEVE - How Apple's imperious, brilliant CEO transformed American business. It also mentioned about the dedication and commitment that Steve Jobs had towards every small details in the company.

We cannot deny that the manner in which Apple conducts business has been highly effective at not only increasing sales and broadening the company’s portfolio but also setting trends, creating buzz and putting out top-notch (dare I say near perfect?) products again and again and again.

During each of Apple’s news announcements, we know about the giddiness in those auditoriums - even from the press. And the fact that Apple almost always has the items in-store and online by the time Jobs takes the stage surely helps spark some spontaneous sales. There’s rarely a months-long wait for products the way there is for some competitors.

"A key Job business tool is his mastery of the message. He rehearses over and over every line he and others utter in public about Apple."

Even under his own serious health problems, Steve Jobs has been committed towards the Apple products and it is indeed great to hear about the success of his liver transplant surgery.
And there is definitely probably one thing that define Steve Jobs better than others...he make it a point to know everything about APPLE. That is right...he was passionate about his business. No wonder he deserves to be the CEO of the Decade....

Investment Allocation Rule

2009-11-04T06:50:00.000-08:00

Have you heard of the rule of 120 minus age? It is actually an investment allocation rule or a guideline for novice investors like most of us. The rule is pretty simple, just take 120 minus your age, and you will have the allocation in percentage for investment. Example, Ricky is currently 23 years old, which means that he should invest up to 97%.

The idea behind this rule is the younger we are, we need to allocate more for investment, as we can afford to lose. Besides having nothing to lose, the income we are getting when we just started to work is not that high.

Imagine the scenario below:-
Ricky, currently 23 years old and start to work earning 20K annually. After deducting all his expenses other deductions like loan installment, he will still have about 4K (assuming 80% is the expenses in percentage). From this 4K, he should invest 3880 (120-23 = 97% of 4K).

17 years down the road.....
Ricky now age 40, and earning 40K annually. Assuming 80% is his expenses, he will still have 8K left. Using the 120 minus age rule, he should invest 80% of the amount, which amounted to 6400.

From the above scenario, we can see that although Ricky's earning is doubled, but now his investment is just 64% extra, instead of 100% extra. The 120 minus age rule is meant to make the most of the investment capital based on the age, risk and annual income.

Malaysia Budget 2010: 1Malaysia, Together We Prosper

2009-10-23T07:36:00.000-07:00

Below are the summary in the Budget 2010 which was tabled by the Malaysia Prime Minister, Datuk Seri Mohd Najib Tun Razak:-

* Government to make it easier for skilled/qualified people to get permanent residence status. Visa to be granted for family within 14 days.

* CSR Fund of RM100mil to be set to carry out social programmes.

* Tax breaks for registration of patents and copyrights.

* Big scale factory outlets to be set up to boost tourism besides having major events like KL Grand Prix Fest, National Water Festival, Malaysia International Golf Exhibition and Rain Forest Eco-Challenges

* Taxpayers will get tax relief on broadband subscription fee of up to RM500 from 2010 to 2012. Civil servants can apply for computer loans up to a maximum of RM5,000 from the govt once in every 5 years.

* RM6bil for agriculture sector for paddy fields irrigation, fish production, fruit farming, livestock farming infrastructure, training

* RM2bil subsidy for farmers and fishermen including subsidies for fertilisers, incentives for padi yields and allowances for fishermen

* RM9bil to finance infrastructure projects including road and bridges projects and rail, sea ports and airports facilities

* RM1.5bil fund to promote green technology by providing soft loans to companies that supply and use green technology

* RM200mil Creative Industry Fund to finance film, drama, music productions, animation, advertisements through Bank Simpanan Nasional

* In a bid to develop high quality human quality, RM30bil will be allocated to enhance primary and secondary education nationwide

* Rewards for students who excel in studies:

- 30 National Scholarships to the creme de la creme of students stictly based on merit

- Convert PTPTN loans to scholarships for students who graduate with 1st class honours degree, beginning from 2010,

- Offer a netbook package, including free broadband service, to university students for RM50 per month for 2 years.

* The Permata programme that emphasises early childcare and education, including the gifted child programme, will get RM100mil

* Insurance industry to be improved to meet market demand.

* Govt to clamp down on the abuses committed by Ah Longs by enforcing Anti-Money Laundering and Anti Terrorism Financing Act 2001. Moneylenders Act 1951 to be also reviewed.

* Allow 100% foreign equity participation in corporate finance and financial planning companies compared with the present requirement of at least 30% local shareholding.

* To ensure rapid development of financial services, the existing tax incentives to be extended to 2015.

* Among steps to combat corruption is to set up 14 Special Corruption Sessions Courts and 4 Special Corruption Appeal High Courts.

* Tax of 5% to be imposed on gains from the disposal of real property from Jan 1, 2010. Existing tax exemption will be retained for gifts between parent-child, husband-wife, grandparent-grandchild.

* To promote prudent spending, a service charge of RM50 a year to be imposed on each principal credit card and charge card; and RM25 a year on each supplementary card, effective from Jan 1, 2010.

* To ensure that fuel subsidies only benefit targeted groups, Govt will implement a fuel subsidy management system in early 2010, which will utilise the MyKad.

* All Ministries and govt departments are required to provide day care and education centres for children of civil servants.

* The maximum income tax rate for individuals to be reduced to 26% from assessment year 2010. Personal relief increased to RM9,000.

* Police force to get RM1bil to improve its services in govt's efforts to reduce crime. Major measures include to increase police presence, including mobile police stations in 50 crime hotspots.

* To promote house ownership, Govt will launch a scheme that enables EPF contributors to utilise current and future savings in Account 2.

* Employees' EPF contribution to be increased to 11% again, on a voluntary basis, effective immediately. However, from Jan 1, 2011 employees' EPF contribution will revert to 11%.

* Personal relief for EPF and life insurance schemes to be increased to RM7,000.

What about RECESSION?

2009-09-17T05:00:00.000-07:00

I believe that nobody ever suspects what happened to Lehman Brothers about a year ago would actually took place. And if that is not enough, let us take a look at one of the struggles that the Wall Street wizard, J. Christopher Flowers had to endure lately. Of late, Flowers is struggling to salvage a series of ill-timed investments that he made just before the financial crisis got really ugly and dragged already distressed institutions down further than he thought possible. His billion-dollar stakes in Japan's Shinsei Bank and in Hypo Real Estate and HSN Nordbank, both in Germany have crumbled.

Such is the impact of what many claimed to be the worst economic crisis ever since the Great Depression. Probably some of us want to know how the economic crisis all started?

Not long ago, a US homeowner did something that he hadn't done for quite a while. He sold his house for less than the listed price. When enough other sellers did the same, the house prices that on average had more than doubled since 2000 began to fall. That first fateful sale burst a real estate bubble, a runaway increase in prices not justified by any rational economic calculation and triggered a downward slide that by the end of 2008 had knocked almost 25 percent off the value of the average American home and sent the world economy reeling.
"Housing is the business cycle." UCLA economist Edward Leamer has written, noting that housing slumps have preceded eight of ten postwar US recessions. Housing is crucial because for most people, their major asset would be their home.

When your home lose value, homeowners cut spending. And when consumer stop spending, firms can't sell their goods and services, leading to business owners lay off workers and in a vicious cycle, spending is cut further.

Housing downturns have always been bad for the banks. If the borrowers ran into trouble, the bank might have to take possession of a home or two, which might not be a serious problems when house prices were high. But selling houses in a down turn market means losing money. Make a habit of it and the bank is doom to fail.

But this time, the securitisation of mortgages have spread the trouble more widely. Beginning in the 1990s, financial institutions started bundling mortgages together and selling off the rights to the income streams that they generated. Investors liked the higher rates of return they offered. And note that many rating agencies gave them high marks for safety. But when the US housing market fell further and faster than anyone could anticipate, many of these securities plummeted in value. Banks that owed them were forced to call in or not renew loans they had made, so as to raise liquidity, cash or financial assets that can be sold quickly to build their reserves and pay back any of their own borrowing that might not be renewed. This rush to liquidity created

CREDIT CRUNCH.

Some didn't survived...as the introduction of this post mentioned earlier: Lehman Brothers Holding Inc. And it also hit the world's largest insurance company, AIG.

Now that this might sound depressing, but it serves only as a warning to us of what could be worse if we are not being an ethical consumer. This might just bring about the responsibility revolution in our economy world. There have been stimulus plans, packages and others being done by the government with the help of economists but no one can truly say they know what is next.

I will talk more about the RESPONSIBILITY REVOLUTION towards CONSUMERISM as well as some of the stimulus packages.
Of course I'm not a professional economist or an investor but doing detailed research as well as studies on Actuarial Science professional paper has exposed me into some of these realities. It helps me to see that financial matters in the real world.

Profit From Patience

2009-09-04T10:46:00.000-07:00

The recent so-call bull rally has last for almost six months, and while people are predicting that the market will be having a bad day in the month of September as September has always been a bad month for stocks, market continue their wild run after few days of fear. This mini bull rally reminds me of something call profit from patience. For most traders, selling after some percentage of profit and cutting loss is a norm.

The illustration below is to show the comparison both investors A and B, where A will sell his stock once reach 10% while B is holding stocks for some time. Assuming both of them buying stock Z which is yielding 4% a year.

6 months continuous bull run resulting the price go from 1.00 to 3.00

For investor A,
From 1.00 to 1.10 (10%), A realized gain is 10cents
Then stock continue to move up 1.30, and A buy it back and because sentiment is extremely bullish, he will sell at 30% profit. So, once hit 1.70, he sell it again.
A buy again when price drop to 1.60 and sell at RM2.10.
Continue buying when the price hit 1.90 and sell it at 2.80 (40%) because market is bullish, but the price continue to soar to 3.00

i)1.00 -> 1.10, A earns 10cents.
ii)1.30 -> 1.70, A earns 40cents, but top up additional 20 cents from initial capital of 1.00
iii)1.60 -> 2.10, A earns 50cents, extra 10cents cash in hand
iv)1.90 -> 2.80, A earns 90cents, extra 20cents cash in hand

Total net profit A = 10 cents + 20 cents + 90 cents = 1.20 (in actual fact 1.00 for the investment of 1.00)

While investor B have net profit of 2.00, should he realize the gain after 6 months.

People might have been questioning where has the profit of A gone, but let us understand the scenario of both investors using the same initial capital of 1.00. The (i), A earns 10cents, but then again in (ii) A needs to top up additional 20 cents to buy the stocks, but still earn 40 cents. And in case (iii) market pull back a little, and A manage to buy below his sell price, so he earns extra 10 cents. The same goes to case (iv). In this scenario, he really make money in (iii) and (iv) where he has additional cash in hand after buying stock Z. Why this happen is because he is actually chasing stock.....so the profit earned from previous transaction is to be either topped up or buying lower than his previous transaction selling price (if it happens like case (iii) and (iv)). So in the end the real profit is profit from the final transaction + all his cash in hand when he manage to buy lower. While for B, he just put and realized his gain (if market is bullish) in 6 months time and his earnings are a lot more than investor A.

Again, we will have another argument....if market is bearish, A will be at least cutting his loss while B will continue to hold stocks that will be losing its value from time to time. Actually, if we realized, stocks go up and down together. So if A cutting loss at stock Z, and buy Y, Y potentially still bearish and A could still be suffering the same loss as B, in the end, unless A stop playing stocks after the first loss.

What is the point of jumping here and there when market is bearish? You will end up with realized loss, while for those holding the fundamentally strong stocks, only paper loss. However, stock quality is also another consideration, but we will discuss that in the future.

Do you agree??

Link Only Nevada

2009-08-15T05:19:00.001-07:00

You probably heard a lot about health insurance from insurance companies. According to the report by Families USA, it says that from 2000 to 2007, the median earnings in Nevada rose 21.4 percent, from $25,411 to $30,859. During this same period of time, health care premiums for families rose by 54.6 percent, from $6,688 to $10,341. However, this same report also says that while Nevadans are paying more for health insurance, the amount of coverage is decreasing.

The reason given for this increase was that the skyrocketing health insurance costs were a problem in Nevada even before the current economic downturn. He says slow wage growth and additional job losses will only make matters worse.

There are a lot of Nevada Health Insurance companies being set up. Therefore, it will be wise to have some health agents that can help you at no cost and the agent can offer free advice on what underwriters look for and how the underwriting process works. Moreover, a licensed health insurance agent can speak with underwriting directly, something you cannot do. This gives the agent the ability to help obtain medical records or information about prescriptions or the applicants medical history.

Without an agent, you will find that all communication is done through the United States Postal Service, which can take weeks longer to request and provide the additional information. Remember from Vegas to Reno, the agent gets paid directly through the carrier, so it is no costs to you. Therefore it is always wiser to buy the insurance through QuoteFinder as it is important since the health insurance has become more costly and expensive.

Nevada Health Insurance. We offer health quotes on many health insurance carriers in Nevada, such as United Health One, Anthem Blue Cross, Humana, and Aetna

Finance MATTERS!!

2009-06-29T20:17:00.000-07:00

At moment of crisis, you will wonder why some survives, some fall while some others triumphs. During this economy downfall, we see how AIG nearly fall into bankruptcy due to the lack of financial planning and too much of unnecessary bonuses given.
However, it doesn't mean during economy crisis, all is lost and gone.

If one manages the money they have effectively, be it the financial situation of their company or their personal finance, there will definitely be enough for rainy season. So often we see an individual or a company suffers during economy crisis due to the lack of financial planning. Most often these people spent more than they have even during the good times.

Finance matters to all of us. And if you lack financial planning or any personal finance advisor, then I believe it is time you learn about it. Probably the first crucial step is for you to define your financial goals.

When you have a certain goals or direction, it will help you to plan everything in accordance to that direction. However, there are a lot of people who fail to define their financial goals as they fail to set their priority right.

If you indeed intend to learn more about financial planning and financial management, please leave us your comment here. We will follow up from there. It might not be long before you earn wealth that you never imagine of.

Debt to Income Ratio shows your true borrowing capability

2009-05-26T02:42:00.000-07:00

Up to what extent you can drown into debt in a month, and come out of debt smoothly by repaying, is best shown by your debt to income ratio. This ratio of debt and income is the key method to determine the availability of cash from you monthly income for repayment of your loans….or, in other words, it expresses your true borrowing capability. That’s why creditors consider debt to income ratio a very effective tool to figure out your monthly payment, and your true financial situation. This ratio clearly calculates the total amount of loan an individual can take.

There are 3 categories of debt to income ratio:
Front End and Back End Ratio
Your creditors tend to analyse your debt to income ratio with two numbers 33/38. 38 is the back end ratio. It is the long term debt ratio. And front end ratio is 33, which is the ratio of housing expenses.

Housing Expense Ratio
The payments of an individual’s housing normally means each and every payment you need to make in your day to day life. That includes all of your monthly payment. It includes costs like- principal, interest, taxes, and insurance. The ratio of housing expense is meant for measurement of an indivudual,s income’s percentage which would cover all his housing payments. A limit would be normally set by your creditors on where your debt to income ratio is wanted by them.
For example, sometimes the creditors set a rule that they want your housing expenses should not exceed 28% of your gross monthly income, and like that.

Long Term Debt Ratio
Long Term Debt ratio is used to calculate the specific percentage of an individual’s monthly earning that is available for making repayment of total debt. The calculation of Long Term Debt ratio includes your housing expenses (PITI), auto loans, credit card loans and some other debts.
Here also, the limit seting trend exists like that of your Housing Expense Ratio. The creditors sets a limit to your long term debt ratio. It is also referred as Back End ratio.

Budgeting Mother's Day Spending

2009-05-12T07:37:00.000-07:00

It was Mother's Day last week, and I am sure that many of us bought our beloved mum special gifts and maybe treat her a meal. Before I began writing on Budgeting Mother's Day Spending, I wish all the mothers in the world, a Happy Mother's Day, though it is kind of a little too late. Anyway, for those who has yet to celebrate Mother's Day with their beloved mum, I do hope that they will not be too stingy or cost savvy about the spending. I'm sure that the every mum would be very happy if her children even decided to cook for her or just do something special on this occasion - nothing fancy, but maybe spend some extra time with her or buy her favorites recipe book, etc. Mother's Day official date might be the 2nd Sunday of May, but if one cannot make it last week, then he or she can celebrate Mother's Day on some other day, but at least we do something to show our love for our mum and honor for her.

My family (total seven of us including my brother's girl friend) celebrated Mother's Day on Sunday, well, we actually just dine at Sushi King on Sunday evening. Before that, we bought her a perfume set from Lancome. I will not be revealing the total that we spend that day for the dinner and present, but I can assure you, it is not expensive.

Many has thought dine out and presents are not necessary to show our love and honor to our mum. They are right also, but for me, I believe buying presents or gifts to show that we remember that the day is special, and not just ordinary weekends dine out with family members.

To budget on the Mother's Day spending, first, I take into account the financial strength of all my siblings plus my brother's girl friend. As my brother is still studying in University, the budget for the gift/present cannot be too high, so that it is fair to everyone - everyone would be paying fair and square and it will not be burden to others.

Next, we need to budget the dinner spending as well. Dinner for seven definitely will not be cheap, and even if it is shared among the four of us - which is why Sushi King come into play. During the November to January time frame where HSBC is having Padini and Sushi King promotion, where credit card user will be delivered Padini or Sushi King RM30 voucher, if certain terms and conditions fulfilled. Since I have a lot of the Sushi King vouchers, we decided to dine at Sushi King, since it is like "free" meal. So, dining out will not necessary cost much.

Basically our mother's day spending is just the gift/present which would be about 50% of the overall cost as well.

Mother's Day spending does not necessary means burning hole to your wallet. One just has to budget his or her spending properly and spend within his/her mean. A meal does not necessary have to be at luxury restaurants, it can be at the fast food restaurants or even better - home cook food. We dine outside because it is simple and also to use the vouchers that I have and also because my mum is a KKC teacher in church as well, so dining out on Sunday evening is like a norm to the family. The gift does not necessary cost a bomb, it could be as simple as just a cookbook. I'm sure that every mum will treasured her those gifts/presents they got during this special day.

As consumer and credit card user, one must know when to spend and when to hold on to horses. I spend on what I need during the time when credit cards and shopping malls are having promotions. So, in one way or another, I still need to buy stuff, just that I'm using the correct credit card and do my shopping at malls that are giving better discounts and loyalty points. It is always my opinion that it is best to use credit cards for purchasing stuff, because we get credits and also loyalty rewards. The most important thing is to control - discipline in spending.

Money

2009-04-08T05:35:00.000-07:00

It's kind of ironic in our life that when we are young, we will wish that we are grown up but when we are grown up, we will be wishing that we are still the young and innocent guys or gals that we used to be. A lot of this was actually caused by one thing.....money. Money is the root of all evil and problems. We must not forget, we are living in the materialistic world no matter how much we would like to deny. Money, can be a great servant if we use it properly while a the same time, it can be an evil master.

So, what is money to us? Do we treat it as our master or our slave? How do we know whether we are the money master or the slave? If we are the master, surely it is the money who work for us while if we were the to be a slave to somebody, we would be sweating to please the master. There is no two way about it.

For the money case, it is very obvious that if we are the money master, we would be investing the money, so that in one way, the money will earn more money for us, while we just sitting around doing nothing. We work and earn money, and invest wisely on equities or properties or whatever investment vehicles that can generate enough ROI to hedge the inflation at least. This is call money make money. So, if the money is working for us, we are the money master.

For most people, it is the other way round. They are working day and night to earn money. Some take it to the next level where they will be cutting their expenses by skipping meals, ignoring health care etc and ended up living in depression or in bad health condition when they are old. If we are sweating all out, it means we are slaving ourselves for money.

I'm not here encourage people to invest or to spend or not to save money, but we should adopt a more neutral financial goals. There is no point earning a lot of money or having a lot of money in savings account, when we cannot really enjoy it. Be neutral....spend on what is necessary - spend smart and at the same time, invest.

Friday the 13th

2009-03-16T06:34:00.001-07:00

Do you all believe that on Friday the 13th, something bad will happen? I mean, there are so many Friday the 13th, and something bad might eventually happens on one of those days, right? Well, on the last Friday the 13th, something bad really happened. If you all have notice, I have not been serving the Google Ads since Friday the 13th this month. Well, I received an email saying that my adsense account was disabled because I pose risk to the Adwords advertiser. I'm not sure what went wrong as I was still able to see the Google Ads few hours before that and after that when I woke up, I thought Google was down or whatever until I checked my email. I am now appealing and not sure how it will turns out, but hopefully I will be accepted back to the program. At the same time, I will also search for something like adsense. Not that I'm greedy or what, but I just want to earn something out of my writings.

I do hope Google forgive me, if I really posed risk to Adwords advertisers - not sure what does this mean. I have been following the Google Adsense TOC/S but suddenly, I got this. In fact, when I read the agreement again, I realize that I almost break it, as I do copy some of the articles, but I do state the source and put in the links as well. Next, regarding whether I do any changes to the ads code given by Google, I'm sure I did not violate this. I mean, when I compare to my blog with others, I have only 1 banner on top, the other 2 in between the post, which I'm sure will not create accidental clicks or whatsever. Then, it is the invalid clicks. How was I suppose to know when this invalid clicks occur? Even if it does, if Google manage to detect it, why Google did not deduct the amount, but totally disabled the account? This was the questions hanging over my head over the weekends.

Anyway, back to reality, I'm waiting for the appeal and curently have nothing much to blog except to rant out my dissatisfaction. I do hope that Google will consider my appeal, else there is nothing much I can do. If Google really do reinstate my adsense account, the first thing I will do is to see whether there is anything I can do to avoid the invalid clicks incident. If there is, I'm hoping to share it out as well, so that small-timers or part time bloggers like me can have some protection.

Google Adsense is the best, though their rules are kinda strict. I understand it, as they have to protect the advertisers as well. But I do hope, in the future, Google can do something to protect the publishers as well. Wish me luck...ok :)

Spend Smart and Invest Wise

2009-03-11T06:09:00.000-07:00

Over the weekends, I discussed with my brother on the money topic again. As always, I prefer healthy brainstorm session so that I can learn more. As we all know, learning is a continuous process. Anyway back to the money topic, we were discussing on what to do with some cash in hand. I am the kind of people with the philosophy - "Savers are always the losers". Now why did I hold on to this principle. A lot of reason. One of it being inflation will eat up our savings.

I always encourage to continue invest, and not trade in times of uncertainty. When we invest, we are actually buying a business or at least pass on the inflation to the consumer. Imagine a scenario. If the cost of a product increase due to material cost, are you going to priced it lower than the manufactured price? Of course we will pass on the inflation to the consumer, no? Unless business is very very bad, else we definitely will pass on the inflation to the consumer. So in other words, buying business will at least guarantee something that will be able to counter inflation, provided we are buying the correct management, as when we buy stocks, we are only have business in-directly. So, a transparent and trustworthy management is crucial.

Anyway, I do have to agree with my brother that while we invest wise, we need to spend smart at the same time. He told me that he will invest, but only if his cashflow is not clogged. Seems like he is growing up as well. Invest wise is actually investing something with lower risk. This includes invest within your mean and invest in good companies.

What about spend smart? What do spend smart mean to me? Well, spend smart meaning spend on necessity and buying what is worth to buy. One of the criteria is to get bargain. Like shop when you see there is sales, though I know most retails will jack up the price before giving discounts....so shopping depends on skills and some basic information on the price.

Another good example on spend smart is when we decided on insurance premium. Why I am using insurance is because I was sort of forced to decide on the insurance premium recently. I see that a lot of people either over insured or the other way round. I do not have the best advice on buying insurance, but I do believe that we should neither over insured nor under insured. I see that a lot of people that I know tend to have a common idea on insurance....which is insurance is part of investment. I do not agree that insurance is part of investment, because insurance is ....well, just insurance. Thus, over insured is a very bad idea. It will lead to less capital for investment and savings for rainy days. And when we are out of job, then we will definitely stop one or some of the insurance payment and end up getting nothing.

Seems like I write a lot on insurance.....in this post. I think I should post the insurance related stuff on the next or future post. Signing off as for now :)

Plan to weather the storm

2009-03-02T05:39:00.000-08:00

Malaysia entering recession......it is one of the headline from Business Times.

Below are the details of the news:-

MALAYSIA is entering a recession, if it is not in one already, head of RHB Research Lim Chee Sing said.

He predicts the economy to shrink 1.5 per cent this year, or possibly worse, depending on the state of development in the US and other bigger economies in the world.

At this rate, the recession seems set to be sharper than that in 1985 when gross domestic product (GDP) shrank by 1.2 per cent, but milder than the 7.4 per cent contraction in 1998.

"Depending on the definition you use, Malaysia is already in recession, or perhaps, is entering a recession," Lim told reporters during a discussion on the stock market in Kuala Lumpur yesterday.
A recession is commonly defined as a decline in the GDP for two or more consecutive quarters. But this definition is unpopular with many economists since it does not take into consideration changes in other variables such as jobless rate or consumer confidence.

"Malaysia's export has contracted for the third month, each time getting sharper. The industry production index has also fallen for three months, and at 15 per cent, it's even worse than the fall in October 1998," Lim said.

He is the latest in a growing group of private sector economists and research houses forecasting a domestic recession this year.

US bank Citigroup this week slashed Malaysia's economic forecast to a 1.5 per cent contraction, while Nomura Holdings Inc had predicted a 4 per cent fall this year.

Source

We all know how severe this recession going to be. But any of us really prepare for the worse? I still remember there was a time our Deputy Prime Minister still denying the fact that Malaysia will eventually go to recession within this year. As for me, I do believe I'm well prepared to weather the storm as I have prepare a realistic financial goal since the start of the year as I foresee that we might go through a long recession.

Some of my plan includes:-

tighter budget for own expenses which includes food, entertainment and some misc spending
continue to reduce debt (car loan, education loan)
invest in dividend counters as I foresee the Bank Negara will reduce the FD rate (which prove to be correct)
earning extra income - planning to look for some freelance programming

So, what is your plan to weather the storm? Note that I do have cut spending on others but my plan include continuous investment as I believe in the long run, equity will outperform cash.

Are you buying in equities??

2009-02-16T06:03:00.000-08:00

Today top story in yahoo finance.....source

World market falls as Japan's recession deepens

LONDON (AP) -- World markets fell Monday, after new figures showed Japan's economy contracted at its quickest pace in 35 years and a weekend summit of Group of Seven finance ministers provided few concrete proposals to counter the economic crisis.

In European afternoon trading, Britain's FTSE 100 fell 0.6 percent to 4,165.31, Germany's DAX sank 0.3 percent to 4,400.23, and France's CAC 40 dropped 0.5 percent to 2,982.16. Trading was subdued as U.S. markets will remain closed for Presidents Day.

Japan's worse-than-expected fourth quarter GDP numbers were a sobering reminder of the toll the worst economic downturn in decades is having on Asia's export-driven economies. The world's second-biggest economy shrank 3.3 percent from the previous quarter, or at an annual pace of 12.7 percent.

In Europe, financial stocks dragged down markets. In London, shares in Lloyds Banking Group dived after the market open, following its revelation Friday of larger-than-expected losses at recently acquired Halifax-Bank of Scotland and on market fears the combined company may be headed for nationalization. Shares dropped 20 percent in early trading, but regained ground to trade down only 0.3 percent. Shares had dropped 30 percent on Friday.

Insurance companies also dragged the FTSE 100 down. Legal & General Group Plc fell 6.1 percent, Prudential lost 5 percent and Aviva slipped 4 percent.

"Whereas before people were just selling banks, now they are looking at the risk involved with other financials," said Jane Coffey, head of equities at Royal London Asset Management.

Investors also seemed disappointed after finance chiefs from the Group of Seven developed countries finished their meeting in Rome with pledges to work together to boost growth and unemployment, but stopped short of concrete measures.

Increasingly, investors are unconvinced world governments are acting quickly enough to counter the economic crisis, analysts said.

"The global recession is deeper than anticipated. At the same time policy makers are failing to deliver measures to address the problems," said Dariusz Kowalczyk, chief investment strategist for SJS Markets in Hong Kong. "It seems that what they're doing is too little too late."

Japan's Nikkei 225 stock average edged down 0.4 percent to 7,750.17, and Hong Kong's Hang Seng Index dropped 0.7 percent to 13,455.88. South Korea's Kospi lost 1.4 percent.

India's benchmark tumbled 3.6 percent after the government, proposing its interim budget, offered no new stimulus measures. Markets in Australia and Singapore also retreated.

In Japan, several exporters were hurt by the data showing the economy sank deeper into recession.

The result represents the steepest drop for Japan since the oil shock of 1974 and outpaced GDP drops in the U.S. and the euro zone. A survey of economists by Kyodo news agency had projected an 11.6 percent annualized contraction.

"It's clearly very shocking data," said Clive McDonnell, head of Asia strategy at BNP Paribas Securities in Hong Kong. "The drop is certainly beyond our own quite negative expectations. (Japan's) policy response has not been as effective."

Shares in Toyota Motor Corp. lost 0.7 percent, while electronics heavyweight Canon Inc. slid 1.2 percent and Sony Corp. fell 1.3 percent.

Bucking the wider trend, Shanghai's benchmark climbed 3 percent to 5 1/2-month high to extend China's recent really.

Since the start of the year, Shanghai's index has risen more than 31 percent. But analysts say the rise has been driven not by economic fundamentals, but by a surge in bank lending that has sent money flowing into the market.

"The economic fundamentals are not strong enough to support the market's rise," said Zhang Xiang, an analyst for Guodu Securities in Beijing. "The market is in an irrational state, which is not going to last long."

U.S. equity markets are closed Monday for Presidents Day. On Friday, the Dow fell 1 percent to 7,850.41, its lowest close since Nov. 20. The S&P also fell 1 percent, ending its week off 4.8 percent.

In the coming days, investors will be watching President Barack Obama, expected to sign the country's $787 billion economic stimulus measure on Tuesday. He plans to outline steps to stem home foreclosures on Wednesday, though analysts say investor enthusiasm surrounding the pending announcement is fairly low.

Oil prices were steady after jumping 10 percent last week, trading 10 cents higher at $37.61 for a barrel of light, sweet crude for March delivery. The contract rose $3.53 to settle at $37.51 a barrel on the New York Mercantile Exchange on Friday.

AP writers Jeremiah Marquez in Hong Kong, Tomoko A. Hosaka in Tokyo and researcher Bonnie Cao in Beijing contributed to this report.

So, the question again, are we seeing bottom or will there be another round of big big drop?? Another question people will ask is "Is it the suitable time to buy equities??" In fact, some people have been asking me over and over......"Are you buying in equities now?" Again, my answer would be, there is no right time to buy market and we will never know when is the bottom. Greed is the only answer to those questions.

We need to have different investment strategy at different economy environment. So, during recession, most people will stick with defensive stocks like high dividend yield stocks or REITS. It is actually the safest bet, and in fact most high dividend yield stocks will give you higher return compares to FD.

Another reason we need to buy during the uncertainties is because we can get bargain. Some blue chips counters in KLSE listing already drop about 40%-50%, some drop even more than that, while dividend counters' price are a lot cheaper now. People may argue that it may drop more......or we are still not seeing the bottom. But if we think this way, when are we going to buy equities? When the coast is clear??? Usually, by then the stock price already appreciate 20%-30%. Anothing point to ponder is in the meantime, where do you want to park your money?? FD again?

FD in the long run will give the lowest return compares to equities. And using FD to beat inflation, it can only means your money losing its value as time goes. Example is RM100k value will lose about 50% in 10 years given the inflation rate of 7% per year. But buying equities is different in a sense you are buying business and we all know the business run with inflation. Meaning to say, if inflation is 7%, a business is very likely to increase 7% at least.

Investing in the correct stocks requires one to do some basic research on the company and management. But it will be worth it because you are actually beating inflation by doing so. So, think about it, do you want to beat the inflation or let your money keep on losing value from time to time??? Are you buying in equities now?

Automobile Insurance & Auto Maintenance Cost Planning

2009-02-03T05:48:00.000-08:00

I plan to write out a bit on the automobile or usually called car maintenance cost planning. This has come into my mind as recently I need to renew my car's road tax, which means that I need to purchase insurance for automobile as well. Well, I believe this is not something new, especially to car owners. But how many of us really know how much to insure our car or how to get the insurance for automobile quote? Most of us will take the easy way out to let our sales agent or friends to settle everything for us. I am one of the as well. Although my sister sort of like settle everything for me, but I, myself also go through the process as well. First, I need to get the auto insurance quote from her colleague based on my car's value in the market. One thing I realize is that the bankers have different valuation system, thus the auto insurance quote that I have is beyond my expectation. I did calculate the auto insurance using auto insurance calculator on some websites but based on my expected car value. But anyway, we finally settle the auto insurance based on the value that I want, which I'm quite glad to hear that so that the whole auto insurance thing will not affect my budget planning.

Back to the automobile maintenance cost, my cost planning includes fuel, service, wear and tear maintenance like tyres, loan installment as well as the auto insurance. My maintenance cost for each km based on the current fuel price is about RM1/km. Kind of high, but what to do. In Malaysia, without own transportation, I also wonder how we are going to work or go from one place to another. Some might say that maybe because I buy slightly expensive car, but for outstation traveling we actually need a more reliable car so that it will not break down so often. I won't be revealing my "Dark Knight".

Back to the topic again, most people forgot to take into account auto insurance, car's wear and tear and etc. Most of them only includes service cost and fuel, which will in turn make them to rake some unexpected expenses during some of the time. Accident occurs some time, which is why I do jack up the price for wear and tear, so that if it happens, at least the car expenses for each km that I drive will not differ much from my budget.

Do feedback me if I missed out something on the maintenance cost. I'm still in the process of learning.

EPF vs KLCI - Part 2

2009-01-28T18:48:00.000-08:00

I'm continuing from where I left last year regarding this topic .....links. No doubt, EPF is the safest bet for our retirement besides FD, which is why it is necessary for us to save some money in EPF. So this means that EPF is necessary.....only as retirement fund in which I would assume it will not be sufficient as well.

The debate on EPF and KLCI is actually started when our DPM announced that EPF contribution by employee can be reduced to 8% where the extra 3% can be use to spur the economy ....as if the 3% would make a different. Unless your annual income is more than RM75k, reducing to 8% only benefits the government. You only pay more income tax by reducing it to 8%. Take the following scenario:-

Annual income = RM55 000
a) EPF contribution (11%) = RM6 050 (max income tax deductable capped at 6k)
b) EPF contribution (8%) = RM4 400 (RM1 600 extra is taxable)

From the above scenario, by just changing the EPF contribution 3% less, you will have RM1600 extra, which is taxable, though you can invest the balance of the money on stock market.

Back to the topic, EPF vs KLCI. If I'm not mistaken, EPF gave high dividend before, which is about 6%-7%. And that is only for a year. After that, the dividend rate has been going down. So, we can have the assurance that given the best scenario, the EPF payout will be about 5%-7%, which will be almost the same as dividend counters at KLCI (this, provided you choose the correct counter). But with dividend counters, you can earn from two things....the dividend yield annually and the capital appreciation. So, in this case, which one is better? EPF or KLCI?

One might say that stocks will fluctuate according to the market environment. When the market is bearish, it will go down. The same actually applies to EPF. Where do you really think EPF make money from? The stock market actually. Think of EPF as a very very big capital unit trust or funds, then you'll get the picture. Which one would you prefer? Funds or stocks? For most, funds will yield better return due to lack of knowledge in the stock market, but for some, it will be like...."Why pay others when you can do it on your own?".

The conclusion is there is no right or wrong in this debate. EPF can yield more for those who do not really understand stock market, while for some, it will be KLCI getting better yield. It all boils down to own personal risk management. But given the current situation where we can reduce our EPF contribution to 8%, my advice is unless you are earning more than RM75k per annum, it will be wiser for you to stick with the current 11% plan as most of your additional 3% 'disposable income' will be taxed.

Boycott American goods to save Palestine? Think again

2009-01-12T05:03:00.000-08:00

Malaysia former PM, Tun Dr. M urge the Malaysian to boycott US goods (source) in order to save Palestine. So what is your take for this? Well, it is always very easy to such call.....and with his influence as the PM in Malaysia for the past 20 years before the current PM, Abdullah Badawi, I'm sure some will follow suit.

There are those two face bloggers or internet users who might have call for the same action via blogging, Facebook. Little do they know that Google, Facebook also from the States. And we will actually see some of them at Starbucks, McD etc. If Dr. M call for the boycott action, is he going to lead by example first? Will he stop using Google? Is he going to stop blogging? Because if he voice it out, he should lead by example. Don't use laptop or PC. Those CPUs are American products. Google also from the States. Next, if he has a Facebook account, he should stop using it totally.

For those who are wondering whether to follow or not.....think again. First of all, go ahead and check, whether Dr. M or those who answer the call to boycott the American goods really boycott the American goods. This includes not using google, PC (they should not have use it in the first place), Facebook etc. If those promoting this boycott via Facebook or msn, we can totally ignore them. Cause they don't walk the talk.

Then, we have to know....most franchise chain like KFC actually owned by Malaysian, and most of their staff are also Malaysian. Since KFC Holdings is a listed company, the bumiputras definitely have 30% stake in it. If we actually boycott the like of KFC or McD, who will actually suffer? Do you think the Americans? No....it is us, Malaysian who will suffer the most. Less staff are required because of low business output, KFC Holdings share will drop like no tomorrow because they cannot produce decent earnings to attract investors....more and more KFC or McD restaurants will have to close down due to no business and this translates to more jobless Malaysian and more bankruptcies.

We can continue to say that we want to boycott US goods such as CPUs, chipsets, search engines. But who will suffer in the end. Malaysian. Intel CPUs or chipsets were manufactured in VFs in many countries including Malaysia. Granted, we boycott it, so Intel and AMD need to layoff their employees. Who do you think will suffer? Those working in VF, of course. And where do this lead us? More jobless Malaysians.

To those who think boycott American goods will be able to save Palestine....think again. It is us, Malaysian who will suffer the most. Jobless, bankruptcies etc. In fact, with jobless and bankrupcies rising, it also means that Malaysian who wanna donate to Palestine, are unable to do so. What does this lead us to? Less donation and contributions from Malaysia. So, is this going to help Palestine? Think again.

I, for one will not answer the call to boycott the American goods. I also urge others especially those belongs to the working class like me to think over it carefully. Recession is at the doorstep and if we are still so childish to boycott this and boycott that, suddenly the Americans pull out their investment from Malaysia, who is the biggest loser? So, think again. There are many ways to help Palestine. Boycott American goods definitely not the way.

Year 2009 - To Spend Or To Save

2009-01-02T08:41:00.000-08:00

It's been about a month since I last update this blog as I was busy with my work, my other blogs as well as planning ahead for Year 2009. Year 2008 ended with stock markets all over the globe almost collapse (I'm using the word almost since we never really know whether we have reached the bottom or there's still downside risk). Then the word RECESSION, STAGFLATION, INFLATION, VSS, etc started to creep out and people have FEAR in them. Why FEAR?

We do not know how long this financial turmoil will last and how long it takes for the business to see the bottom or recover. We can never know. No one in the world will know about it except, well, GOD, of course.

Domino effects will be seen as one business will cost another business to collapse or successful. Once a business is affected, it will affects others as retrenchment and major cost cutting will take place in other business. And this will continue to go in a loop until an equilibrium is achieved, that is when the global economy will recover. However, we do not know when this will happen.

People will start to worry about tomorrow, whether they are still hired, or whether they are not with the company or even worse, the company goes out of business. So, this will triggered people to save.

When people started to save almost all of their money, this is equals to close to zero spending, which is bad bad news for economy. We have to understand this.....economy is made up of money.....and money means spending. So, without spending, more and more company will go out of business.

The question now is whether we are to save or to spend? I'll post more on this in the future, but let us look at the situation and think......Is it best to save or to spend.

EPF vs KLCI - Part 1

2008-12-03T06:49:00.000-08:00

Quoted directly from today's The Star Business..... links over here

IN general, most people have the impression that the money placed in the Employees Provident Fund (EPF) always generates lower returns compared with the returns from their own investments.

In this article, we will look into the returns from EPF versus returns from the KL Composite Index (KLCI). We assume that investors are able to generate their own returns equivalent to the returns from the KLCI.

Based on our 23 years of data compilation, it is generally true that the average returns generated from EPF are lower than KLCI returns. From 1986 to 2008, the average return of EPF was 6.7%, 2.3 percentage points lower than the average return of 9% from the KLCI (see table).

However, most people do not understand the risks they need to undertake when they invest by themselves. The standard deviation of EPF is only 1.5%, 22.2 percentage points lower than the standard deviation of 23.7% from the KLCI.

We use standard deviation to measure risks. Most investors only look at how to generate the extra 2.3 percentage point returns, forgetting that they need to undertake a much higher risk to generate the extra returns. The extra return is unable to compensate for the extra risks that investors need to take.

Let’s assume one investor invested RM10,000 in the EPF and the KLCI respectively at the beginning of 1986. Logically with the average KLCI return higher than the average EPF return, the fund in KLCI should be higher than the fund in EPF in most periods.

However, as the table shows, by the end of 2008 (we assume that EPF will only be able to generate a return of 4.25%), the fund placed in KLCI would have reached RM40,000 versus RM43,946 generated by EPF, a shortfall of RM3,946.

The main reason behind this shortfall is that the EPF never gives negative returns whereas the KLCI generated negative returns eight times over the past 23 years.

There is a market saying that out of 10 people who invest in the stock market, only one can make money, the others will lose money. Warren Buffett says if you want to win, you don’t lose. Hence, we disagree with some people who advise others not to place money in EPF because it generates lower returns.

In most periods, the money in EPF gets lower return than the money placed in KLCI. However, the main reason for the lower fund value in KLCI by the end of 2008 was the market crash during 1998.

The money in KLCI dropped by 47.1% to RM18,105 in 1998 from RM34,246 in 1997 whereas the money placed in EPF increased further to RM26,594 in 1998 from RM24,924 in 1997. After 1998, it took nine years for KLCI to catch up with the fund value in EPF.

Last year the fund value in KLCI (RM46,000) finally surpassed the fund value in EPF (RM42,154). However, as a result of the recent market crashes, we are anticipating the fund value in EPF to overtake KLCI again this year.

It will take a few years from now for the KLCI to catch up with the EPF again. Unless investors are constantly monitoring their own investments and are able to avoid most of the negative returns, we think it is safer to put money in the EPF rather than withdraw it for their own investments.

And then another news that kinda contradicting with the earlier news out........

EPF Q3 investment income down 60.4% to RM2.06b

Links over here

See how contradicting? Not totally contradicting, since EPF not really losing any money but the fact remains that EPF's earning will suffer as well during the financial turmoil or recession. We can argue forever and say that the Government promises us at least 2.5% return (Wikipedia is the man) without risk. But how sure are we that the EPF will give a return of > 3.5% (comparing to the FD rates). If during recession (worst case) EPF only give return of 2.5%, then it is lower than the current FD rates in Malaysia. Worse still, it is way below the current inflation rate of 7.x% (provided by Bank Negara, but we all know it is a lot more). What about equities, in our case KLCI? Will it always return lower or negative return? I will continue to discuss on Part 2 when I have time. In the meantime....think about it yourself. "Is EPF really better than KLCI?"

The internet is the market of tomorrow

2008-11-27T09:09:00.000-08:00

I was blogging about Adsense and all in this blog...
Idle Page
It was at this point that I realize the internet is the market of tomorrow. At the moment, most people look at internet business in the form of freelance writing and other etc. But in the near future, I believe with almost everyone having the access to internet themselves, the market will be big enough to attract people into channelling their business strategies into the cyber world.
At the moment, only big company like Amazon and E-bay that is gaining popularity. However even in Malaysia we have Mudah and some other lelong online market. Although we must take into consideration the fact that some of these companies are not reliable but with strengthening markets in the internet, big companies will start to consider the internet as their main play ground.
Some of the rough ideas that I could give you is this:

The tuition place has been crowded with students and hence more and more parents are concern about the reliability of the tuition centres. There are a few tuition centres operating through the internet even at this point although I believe that it is not quite reliable at the moment. However, further improvement will make these companies a big force in the years to come. In recent days, more parents will opt for private tuition, but with the high demand of livelihood, private tutor that could be very costly might not be the best option and hence, internet could be the solution.
Talking about mobile phones, laptops, and other accessories, you will soon find that the internet are flooded with such items on sale. And in fact, at times you could be getting it at a cheaper rate. Let us not forget that the internet alone generate more than billions of traffics. Assuming only 1% of those as your customers, you will be soon be on the way to join the millionaire society.
Boutique? Can it be done? I understand that most teenage girls are already turning into the net as their shopping mall. One of a friend of mine has open a boutique in Kuala Lumpur is quick to realize that through the internet, the business in fact has a better turn out of profit. Especially with the fact that rental are now super expensive and really, business needs to be extremely good to rake in profit and hence, the internet plays a major role in such business options.
Comic books, manga, movies?/ what about starting a Cinema online? Almost impossible?
Think again....of course, the concept of cinema has the advantage as it has big screen and wonderful sound system. But take a bigger picture. Look at the changes that globalisation has brought to this world. Now, some couples will have to live miles apart just because of their work responsibilities. For examples, business run in China need to be look after by someone who has a wife in Malaysia. Here is when all these come in. People need that concept to keep them connected to one another in a wonderful way. Something like Sykpe but better than that because you get to be watching a movie together in a Cinema...but the difference is that it's in the internet.
Think bigger and you will soon find out that virtual life has been one of the HITS lately and trust me, it is only a matter of time that more business opportunities will occur even in this game itself.

If you can't even imagine how much impact the internet will bring to the next generation, then you have better start to observe and learn more about the cyber world.
This is the FUTURE.

If you can see this, then you're half ahead of the rest and that's when Money easily follow after you.

Petrol Tax for Net Oil Exporter

2008-11-18T05:16:00.000-08:00

When I was reading the news on theStar online (www.thestar.com.my), I got a bit shocked. The Malaysian government not only not giving petrol subsidy for Malaysian, but now starting to earn revenue from the current petrol price at RM2.00 (source). While shocked, I was not surprised. Well, it does not take a rocket scientist to figure out that we are actually paying the government when the crude oil price was below USD60 per barrel. As mention by my previous post that we did actually pay the petrol tax .....source, it seems that now it's OFFICIAL that we, Malaysian, born in a nation producing oil will have to pay petrol tax. Well, previously they do not want to admit it, but at least this time they admit they are actually getting return by reducing the petrol price 15 cents to RM2.00 and they can still earn some money out of it. I will need to search for more details to confirm that we will be the 1st net oil producer to impose tax on petrol. Until now, I can see that majority net oil producer cum exporter will give subsidy to the petrol. Not sure we have again becoming the 1st - you know la....our government wants us to become no 1 in a lot of thing, be it good or bad.

The reason I'm blogging about this here is because I want to stress out how short sighted the Malaysian government is. Again in one of my previous post regarding the petrol price hike, I already stressed out the hike in the world crude oil and wanted to see the face of those who increase the petrol price over Malaysia when the world crude oil price down. And as predicted, the government is blushing and is not keeping the promise to let the price float with additional RM0.30 subsidy. I would assume that if the next GE when BN falls, it is not because PR is better choice. It is because BN flip-flop policies and short-sightedness when drafting the Budget. Actually with the removal of subsidy, the current government only caused the people from my era suffers. And we must not forget, GE happens every 4-5 years and the upcoming GE will have a lot of voters from my era onwards and not everyone support a party. We will vote those we think that can help us, and not vote blindly like people from the previous generation. Not that I want to say that I'm good in predicting things, but at least at the moment 2 out of 2 things that I posted happened. Well, we will see in 4-5 years time.

Recession.....now Japan into recession as well

2008-11-17T05:44:00.000-08:00

It seems that more and more countries are slipping into recession. Euro zone, Singapore and now Japan. Here's what I have from theStar online:-

Japan's economy slid into a recession for the first time since 2001, the government said Monday, as companies sharply cut back on spending in the third quarter amid the unfolding global financial crisis.

The world's second-largest economy contracted at an annual pace of 0.4 percent in the July-September period after a declining an annualized 3.7 percent in the second quarter.

That means Japan, along with the 15-nation euro-zone, is now technically in a recession, defined as two straight quarters of contraction.

The result was worse than expected. Economists surveyed by Kyodo News agency had predicted an annualized 0.1 percent rise in the third quarter.

Japan's Economy Minister Kaoru Yosano said following the data's release that "the economy is in a recessionary phase,'' according to Kyodo.

But the worst may be yet to come in the wake of the global financial crisis, especially with dramatic declines in demand from consumers overseas for Japan's autos and electronics gadgets.

Hurt also by a strengthening yen, a growing number of exporters big and small are slashing their profit, sales and spending projections for the full fiscal year through March.

Toyota Motor Corp., for example, has cut net profit full-year profit forecast to 550 billion yen ($5.5 billion) - about a third of last year's earnings.

Compared to the previous quarter, gross domestic product shrank 0.1 percent, the Cabinet Office said. Business investment - a main driver of Japan's six-year economic recovery since 2002 - dropped 1.7 percent from the previous quarter.

"As the global economy is expected to slow down for the time being, downward movements (in Japan) are expected to continue,'' Yosano said, according to Kyodo.

Since taking office in late September, Japanese Prime Minister Taro Aso has unveiled two economic stimulus packages in an effort to cushion the blow.

His latest 27 trillion-yen ($275.7 billion) proposal includes expanded credits for small businesses and a total 2 trillion yen ($20.4 billion) in cash disbursements to households.

At its last meeting, the Bank of Japan cut its key interest rate for the first time in more than seven years, lowering it to 0.3 percent, joining central banks around the world in trimming borrowing costs.

In its semiannual outlook report, the central bank slashed its projection for economic growth to just 0.1 percent for the year through March, compared with a 1.2 percent gain it projected in July.

It said both exports and domestic private demand have weakened.

The deteriorating conditions also recently led Masamichi Adachi, senior economist at JPMorgan Securities in Tokyo, to downgrade his outlook on the Japanese economy.

"We are now looking for a severe recession, similar to that during Japan's own financial market crisis in 1997 to 1998, and to the current US recession, in terms of depth of real GDP contraction,'' he said in a report.

Monday's data showed that net exports sapped 0.2 percentage point from growth, as the high cost of importing fuel eclipsed a slight increase in outbound shipments.

Imports rose 1.9 percent, while exports grew 0.7 percent.

Private consumption, which accounts for more than half of inflation-adjusted GDP, increased 0.3 percent from the previous quarter.

However, the rebound in consumer demand is unlikely to last, economists say. - AP