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31 st Oct 2012 would be a historic day for Malaysia financial planning industry with the launching of newly formed Association of Financial Advisers (AFA) at Lanai Kijang, Bank Negara Malaysia. From now onwards, AFA will effectively represent all the Licensed Financial Advisers and Corporate Unit Trust Advisers (CUTA) Firms. The association is approved by Registrar of Societies on the 16 th August 2012 with the support from Bank Negara Malaysia. In conjunction with its launching, AFA also held its inaugural financial advisers conference titled “ Charting New Frontier – FA the Future ”. During the conference, audiences were empowered with up to date practices by Bank Negara and Securities Commission. Then, an interesting forum on the Future of Malaysia Financial Advisers Industry was discussed with everyone attentions. How we benchmark ourselves with other countries? We heard some success stories from Singapore and Hong Kong. It was a successful milestone event for financial planners...

Don't believe the argument that natural disasters fuel economic growth.  That argument is only true if what is being destroyed is something that should have been demolished in the first place.  Otherwise, things like "Sandy" should be viewed as a net wealth loss.  So, who steps up to make up for the wealth loss....the government? Governments at all level are broke.  Sandy will only exacerbate the problems of state and local governments and everyone knows the federal deficit is on a path to disaster.  So, there is no silver lining here. The loss is not confined to destruction.  Shutting down New York City and much of the East Coast for two days is not going to be completely made up later.  Some substantial loss is inevitable from the shutdown. Sandy is a reminder that bad things can happen randomly. It is also a reminder of why people and governments should save for a rainy day.  Sometimes it rains.

Still remember one fund called AmDynamic Bond fund? If yes, you definitely knew the superb performance of that bond fund, which had became the flagship fund for AmMutual for past years. However, it was sad that, since few months ago, no more subscription was being allowed for AmDynamic Bond fund because it has reached the maximum limit set by regulators. In other words, too hot the demand for that fund. Then how? Because of that reason, AmMutual is proud to launch another new fund, AmTactical Bond fund, which was managed by using the same strategy, but with a little bit more flexibility. The Fund aims to provide income and to a lesser extent capital appreciation by investing  primarily in bonds. How Flexible is it? The Fund seeks to achieve its objective by investing primarily in sovereign, quasi-sovereign and corporate bonds including convertible bonds. There is NO minimum rating for a security purchased or held by the Fund. To construct the portfolio ...

On October 6, the Director General of Civil Aviation (DGCA) in India asked Kingfisher Airlines Ltd. to stop selling tickets. The airline hasn’t paid its employees since March, leading its pilots, technicians and engineers to go on strike as of October 1st. The strike compromised the safety of the airline’s flights since the engineers are responsible for certifying the aircrafts before flight, warranting the DGCA to suspend the airline’s license. Kingfisher and its employees were able to reach a compromise on October 25 regarding wage payment. Kingfisher agreed to pay four month’s wages by the end of the year, and the remaining three month’s wages by March 2013. The airline also announced that it would be fully operational within a month’s time, and its employees could resume work then. Sanjay Aggarwal, the airline’s CEO has said, “We expect to be in the sky soon and put forth our case to the Directorate General of Civil Aviation. We have addressed all the concerns of the employees...

MEHYAR AFKARI Maneuvers by American cell phone companies to acquire one another are threatening to erupt into all-out war. Not only am I wondering which will survive, but also whether the survivors will be destroyed by the prey they're rushing to eat up. The war began in 2011, when AT&T made a bid to acquire T-Mobile U.S.A., the American subsidiary of Deutsche Telekom, which had been looking to sell it for some time. Considering the well-known antitrust concerns, AT&T’s move was quite brave. It was a terrible move for AT&T. Regulators blocked the deal, and the provider walked away with a $6 billion loss: the $4 billion required to pay over the failed acquisition, combined with the estimated value of the broadband licenses it was required to grant T-Mobile. With recent M&A news in the cell phone space again, we are heading in the direction where three big wireless companies will dominate the US market, and not many more. The big will continue to get bigger as they s...

            Rajat Gupta, former Goldman Sachs Group director, was convicted of insider trading and sentenced to two years in prison. Usually, a case convicting someone of leaking corporate secrets and gaining an illegal, unfair advantage, would be one of triumph. However, in the case of Mr. Gupta, it was an unfortunate reality.             Mr. Gupta’s rise to success from modest beginnings in India had been an example of unrelenting hard-work and fierce determination. When he was a teenager, he lost both his parents- his father, a follower of Gandhi, w as jailed in the fight for independence from the British and died in prison of tuberculosis; his mother, a schoolteacher, died two year after [1] . Despite this tragedy, Gupta continued his schoolwork, was accepted to and excelled in India’s most prestigious school - Indian Institute of Technology. From there, he rej...

The President, in the third and final debate with Governor Romney, said that sequestration was "not going to happen."  Wonder what he knows that we don't?  In any event, it has already happened in some sense.  The expectation of increased tax rates and of sequestration are already playing into the economy. Business folks don't wait until January to make decisions.  They are making them now.  Business has ground to a halt in the US, excepting a spurt in housing and the buoyant energy sector.  The combined impact of Dodd-Frank, of Obamacare, of the expiration of the Bush tax cuts, and of the coming sequestration are enough to scare any self-respecting entrepreneur about America's future. We are already careening down the fiscal cliff.  The question is, if the President loses his re-election bid, can we climb back out of the abyss.  That depends upon what a President Romney would prioritize.   In the short run, the economy needs the governm...

The Return of a Pay TV Giant!!! Astro Malaysia Holdings (AMH) is poised to list on Bursa's Main Market on 19th Oct with a market cap of RM15.6bil . The largest pay-TV operator in Malaysia has a de factor monopoly, commanding a 99% market share. Are you excited, again? Background AMH is the leading media entertainment group in Malaysia with 3,100,000 customers and one of the largest in South East Asia. It is primarily engaged in the creation, aggregation and distribution of content over multiple delivery platforms including TV, radio, publications and digital media within Malaysia. What's the different from the then delisted entity? Recall that Astro All Asia Networks (AAAN) was the one taken private in 2010 by its single largest shareholder Astro Holdisngs SB. Meanwhile, AMH is effectively the domestic media business arm of previously-listed AAAN. How good was Astro Malaysia Holdings? A monopoly in the pay TV segment with 99% market share A capital intensive industry, creates ...

It plays well to say that some hedge fund guru who makes $ 100 million per year should pay higher taxes.  Who can't sympathize with the view? But, of course, that is never what is actually proposed by the Obama folks. Instead the "tax on millionaires and billionaires" is aimed at the very large group of Americans who make far less than a million dollars per year.  The Obama "tax on the rich" aims it's bazooka at Americans who make $ 250,000 or more.  How did that group get labeled "millionaires and billionaires?" There are a lot more families with income between $ 250,000 and $ 1,000,000 than families with income above $ 1,000,000, so Obama's plan is to soak the folks that aren't millionaires and billionaires, but, perhaps, aspire to be.  Worse, anyone aspiring to join the $ 250,000 plus crowd should take note.  This bazooka is aimed at your economic future.  No point in starting that new business or hire that extra employee!  The President...

Just another new fund from TA Investment Management (TAIM)? Think again... In fact, this is the first bond fund launched by TAIM and it will take on the other bond funds in the market with a " Wow"   effect. Why? Believe me, you gonna put this fund into your radar of unit trust investment. And, you will know why after reading this post. The TA Total Return Fixed Income Fund is a feeder fund which invests a minimum of 95% of its NAV into the PIMCO Funds: Global Investors Series plc - Total Return Bond Fund (SGD Hedged) and the balance in liquid assets. What? PIMCO !!! Yup, it's the leading global investment management firm, especially on fixed income investment. 5 Reasons Why you should invest into this Fund? Total Return Strategies, Global Diversification & Flexibility It aims to maximize the total return, consistent with preservation of capital and prudent investment management by investing  2/3  of its assets in a diversified portfolio of fixed income instruments...

The main reason that free markets struggle to achieve political legitimacy is that outcomes can be unpredictable.  There can be booms, busts, cycles, and anxiety.  In a regime like the old Soviet Union, there was no anxiety and no booms and busts.  There was simply perpetual stagnation.  Is there anything in between these two alternatives? Probably not. The idea of a 'mixed economy' is a common staple of university courses in economics and politics, but one wonders if a 'mixed economy' is a stable outcome.  Once a large part of the population derives its income from government, then a 'mixed economy' has a tendency to move more toward a government-dominated economy.  People vote their economic interests.  Public school teachers, once the most conservative voters in America are now among the most liberal voters.  Why?  They vote their economic interests, which they identify with the liberal economic policies that expand government and boost th...

Smirking and rolling his eyes as a substitute for discussing policy, Joe Biden showed why the US economy and foreign policy has been run into a ditch.  Neither Biden nor Obama has any real interest in the issues of the day.  The discussion of the catastrophe in Libya provided an excellent summary of the Obama Administration's approach to life:  "We will get to the bottom of this!"  Really? Biden seemed to think that any real discussion of policy was unnecessary.  His attitude was so condescending that it made one wonder what he and Obama really think of the American people.  The idea that government knows everything and the people are sheep to be lead was so pervasive in Biden's attitude, that it is easy to see why the Obama Administration feels that it doesn't need to produce budgets, programs, plans or anything.  Just smirk your way forward. Biden constantly interrupted Congressman Ryan and talked over Ryan during Ryan's time.  Biden's contempt ...

When news broke out that " Rich Dad, Poor Dad now a Bankrupt Dad ", everyone was so excited to share it out to their circles of friends. Maybe thanks to the interesting news title created to attract the attention of us. In fact, it succeed (because it reaches Finance Malaysia attention now). Well, since we're a financial related blog, we must blog about this hyped news without second thought. Should we learn from Robert Kiyosaki from now on? About the Bankruptcy... According to UK dailymail, "the financial guru behind New York Times bestseller Rich Dad, Poor Dad has filed for bankruptcy on one of his companies after losing a $24 million judgement." Read carefully... It's on one of his companies , not under his own name. Meaning, Robert Kiyosaki didn't bankrupt . Then, what's the difference? The liability of the debt was limited to the extent of the company only. It's doesn't affect the other business or on Robert Kiyosaki personal either. Do...

Recently, the Romney campaign issued a statement pledging to label China as a “currency manipulator”, claiming China is cheating. First off, to understand what he means by that on a broad level, he means that China is intentionally undervaluing its currency – because it is able to as a socialist market economy – and this undervaluing in turn hurts the US economy. This artificially low Chinese currency impacts the American economy by making Chinese goods comparatively cheaper in the US and US goods far too expensive for China. A further implication is that due to this price disparity, Chinese laborers are cheaper to hire and manufacturing factories are cheaper to export to China. So given his plan, what does this mean for both economies? Well mainly, the US will have to set tariffs or other trade barriers in order to allow the dollar to fall relative to the yuan (because right now, its relative price is very high due to this “currency manipulation”). But then what about the long-term re...

While CPO prices have declined 20% over the past one-month to M$2,300/t, share prices of our upstream plantation universe have not reacted materially moving by -8% to +3% (-3% to +3% for our top picks) Key question hence is whether this raises the risk of a further sell-off in plantation stocks or will CPO prices recover? Key reasons for the CPO price fall: 1) High inventory levels amid the current high output season. 2) Some easing in demand (though not materially) mainly from slower bio-diesel production. 3) Softening crude oil prices. 4) Better soybean supply prospects with improved weather. Will CPO prices weaken further? CPO’s price competitiveness to soy-oil and crude oil is now at its best since the previous economic crisis in late-2008. CPO's price discount is currently at US$340/t to soy-oil (spot) versus its historical mean discount of US$160/t. CPO at current spot levels of M$2,300/t is also already discounting crude oil pri...

The global economy is deteriorating.  There are no real bright spots.  The BRICs are slowing, Europe is in chaos, and the US is stuck in the mud.  For all the promises that governments make, real economic progress for the average person comes only when economies are growing.  Economies can only grow when markets are free and individuals are willing to take risks to make money.  Unfortunately, no modern politicians seem committed to free markets.  Romney is probably better than the alternative, but even Romney sees government as an important player in the economy.  His Massachusetts history gives one pause.  The real problem is that Americans and Europeans generally believe that twenty or twenty five years in the work force deserves eighty years of compensation.  The arithmetic doesn't work for that.  Something has to give. Things like social security and medicare are not affordable.  No society can afford them.  What is playing...

RHB research institute (RHBRI) is of the view that it could still be a choppy few months for the equity market in the 4Q given weakening economic fundamentals in the major world economies and fears of an imminent general election on the home front. Whilst more rounds of quantitative easing have been unveiled in the developed world, the big question in investors’ minds is how all these quantitative easing measures will translate to better global economic outlook. Having said that, equity still stands up vis-a-vis the unappealing returns of the alternative asset classes, such as cash and bonds and any good news is still likely to prompt a rally in equities. How was Malaysia fared? And, what's the strategy now? Thus far, Malaysia has fared relatively well in the global financial crisis, and this is partly on account of low reliance on foreign funding of its banking system and more importantly, the progress in the implementation of the Econ...

The United States has achieved some pretty amazing feats in space exploration. When Neil Armstrong first landed on the moon, it not only showed America's technological abilities, but also unified the nation as a whole. Since then, America has continued to expand its knowledge of outer space, completing more and more missions. However, as the costs of space research piled on, the US government pulled back funding for NASA and significantly limited its space travel programs. What does this mean for the future of space travel? Will America no longer shine as the leader in this effort? Have no fear, SpaceX is here. Space Exploration Technologies Corporation (SpaceX), a privately-held space transport company represents privatization at its best. Tonight, it successfully completed another cargo launch sending vital supplies to the Space Station. SpaceX became the first private company to get a commercial space craft to the Space Station last May and has since been gaining momentum. ...