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It's football season again. This round we have EURO 2012 Championship which will kick off on 8th June 2012. Are you ready? Before that, let us look at the championship from financial perspective. Don't care who will win the championship, Poland already emerged as the winner financially. Why? The UEFA European Football Championship has taken place every 4 years since 1960. For the first time in history, Poland and Ukraine have scored the chance to co-host the Euro 2012 Football Championship. Despite high set-up costs for the two emerging economies, both countries are likely to experience long-term economic benefits. The Statistic and Requirements: Estimated 670,000 football fans will pack into the new stadiums Around 1.5million spectators at fan zones  only Minimum requirement capacity of 30,000 to 50,000 spectators for infrastructure and modern stadiums Sufficient parking possibilities, hospitality facilities, luxury hotels and training facilities was needed Required transpor...

When market sentiment was bearish, equities market would slump, just like what we seen for past few days. Global markets suffered yet another blow due to the uncertainties surrounding EU, where Greece may potentially exit European Union. Would Greece finally exit EU? This is an interesting yet important questions for investors. The headlines have been on the EU crisis recently, overshadowing the highly speculated Malaysia general election's date. Well, now would be a tough time for our Prime Minister to call on an election amid the gloomy global outlook. Maybe, the best time to hold an election already gone!!! Anyway, another interesting issue was the slump in Gold prices. Curiously, many investors questioning the different trend for gold prices. Normally, it will spike up along with the risk level of global equities market, together with USD. Theoretically, gold and USD would over-perform other asset classes during bad times. Yes, USD had already appreciated against a basket of c...

It's the time again for Greece to convince its counterparts that they are serious in cutting budget deficits. By doing so, Greece was to put on the lifeline (bailout) by European Union (EU) once again. The discussion of whether to save or not to save Greece had been dragging for one week time now. Why? In Chinese, we say "we cannot see people die by not lending our hand". That's why China said they will help when the time arrives. The question is when is the right time? Until Greece go bankrupt? Or,  until Greece left EU? Who can save Greece? The answer to this very important question is very obvious. In Christian, they always emphasize on " we should take responsibilities on what we did ", right? So, the solution lies in Greece hands. Not the country, but, the citizen, the people of Greece. It's time for them to come back to reality. Let's take Malaysia as a benchmark, they are working fewer hours than us, yet they are earning much better than us. G...

Well, many people already bored with the on-going Europe debt crisis, and subsequently liquidity crisis. This is like what we have seen in 2008 when Lehman Brothers collapses, which drags down the whole financial systems globally through liquidity crisis. The different is between company and country. Maybe some of us doesn't know how this chain effects rattles the global markets. So, let us start here. The European Organisation chart of Debts The root of the problem plaguing the market right now is Europe debt crisis , where Greece and few other European countries were highly in debts. They just simply cannot generate enough revenue (taxes) to support the economy itself. So, they resorted to seek for funding via borrowing by issuing sovereign bonds to finance their day to day operations. However, the debt is piling up intensively after 2008 global financial crisis until recently. Because the government does not have money, their bonds may go into default. So, they were forced ...

Today, gold is becoming an ever important asset class in the world. Banks nationwide is offering investors the opportunity to invest in gold, whether it is for capital preservation or capital gain. How well you diversify without investing in gold? This is the question being asked by those already investing in gold, and most of them already making profit out of it. But, is it really so different? Is it really a must have asset class? History of Gold Gold has been used for numerous monetary functions long long time ago, especially in China. Ancient people used gold as a form of currency and storage of wealth. By using gold as a medium to which paper currency was pegged, most modern international monetary systems were created since then. What drives up Gold price? The modern gold rush scenario happened since 2008 global financial crisis, driven by extremely low deposits rate on cash, very volatile equity markets and surging inflation . Negative real value of money is the key factor why m...

During market uncertainties, there are two popular safe assets which is Gold and USD . This explain why the demand for these two assets is great, resulting them to become more valuable while equity market fell. We experienced the said scenario recently and let's see the chart below to gauge the Gold price movements. "Gold prices collapsed from their August highs in September amid a broad commodity sell-off and despite intensifying concerns over sovereign debt issues in Europe. After exhibiting a remarkable correlation to real rates this year, particularly during the swift August rally, the sharp pullback in gold prices occurred with real rates mostly unchanged." "Gold prices have now fallen back in line with our 3-month price target. As we expect gold prices will continue to be driven in large measure by the evolution of US real interest rates and with our US economic outlook pointing for continued low levels of US real rates in 2012, we continue to recommend long t...

Titled " Perilous Crossroads; Challenging Times Ahead " RHB Research painted a not so rosy 4Q2011 outlook for KLCI. Undeniably, our market are in for a turbulent times and we do not know how the year will be ended. Bear or Bull market? Below is the excerpt from the said report: ~ The US economic recovery has slowed to a crawl, while Europe is not just lurching from one crisis to another, it is lurching into a new one before the previous one is solved. There is growing risk that sustained weak confidence could exert downward pressure on demand and business activity worldwide. ~ Nevertheless, " double-dip " recession can still be avoided if political leaders get their acts together fast enough to contain the debt crises and avert a contagion given that global trade has not fallen off the cliff. ~ On the home front, we expect the Government to speed up the implementation of the Economic Transformation Programme, which coupled with resilient consumer spending, will prov...

We cannot deny that we are in for another round of hard times since 2008 global financial crisis. Some experts are saying that we are facing the Great Depression wave coming in the next few months, if no concrete efforts put in by global leaders. Meanwhile, some experts think that opportunities arises again and put off the double-dip recession speculation. The downgrading of US's AAA rating re-ignite the fears over the sustainability of its sovereign debt. However, please be mindful that US rating remains extremely sound and reflecting a very low risk of default in the long term, still. USD remain the preferred and most widely traded currency in the foreseeable future, and there is no reason to worry about. Sovereign Risk scaring investors away? Meanwhile, in Eurozone, the situation remains very complex and greater political will is needed to maintain Euro as regional currency. Between Eurozone breaking up and resolving the situation, which one is easier? Of course, the economic ...

On Sept 7, J.P.Morgan came out a report titled "Global Markets Outlook and Strategy". Here, we would like to share the equity strategy written, which we think is the most sought after reference for investors to strategize during this uncertain times. Below is the excerpt from the said report: "We believe perceptions of a US recession will continue to weigh on equity markets and we thus keep a low amount of risk in our equity portfolio and reduce beta to negative." "The most likely positive catalyst for equity markets in the near term lies with US economic data. This is not happening yet. Our US Economic Activity Surprises Index remains in negative territory, where it has been for 5 straight months (Chart 1). We need to see this index moving to positive territory, and US economic data surprising on the upside, for equity markets to sustain a recovery." 2 reasons why Under-performance The August market slump saw emerging market (EM) equities and small caps u...

$1 trillion rescue package by European Union. Global share markets reacting positively towards EU latest move. Euro gains 2.7% in one day boosted by EU and IMF. European markets posted best one day gain this year. Sounds GOOD? This is the power of UNITY showed by EU countries during this round of financial meltdown. After a frantic talk on Monday, European officials agreed the 16 euro nations would put up $572 billion in new loans and $78 billion under an existing lending program. Meanwhile, IMF will pump in another $325 billion, adding up to a rescue package of nearly $1 trillion. However, many economists and analysts are still concern as to how the money would be dispensed and on what terms. A lot of them citing the euro rescue won’t solve the main problems plaguing the economies of Greece, Spain, Portugal, Ireland and Italy, which is low growth and weak balance sheets . Let’s enlarge the chart below ( you must ) to have a clear picture of the debt-ridden countries, taken from www....

With Greece having trouble, it is now pulling other assets too: US Dow Jones plunged as much as 9% on Thursday before recovering to end 3% down. MSCI’s emerging markets index lost 11% since mid-April. Crude oil price has fallen 14% over the past week, with Greek crisis putting the brakes on speculators as well as fears for Chinese growth. Commodities indexes have lost 5% in a week. The question in all investors mind this week would be: When would this stopped?   To contain the infections, Euro zone leaders decided on Friday they have special measures ready before financial markets open on Monday to prevent financial turmoil in Greece spreading to other countries such as Spain and Portugal.   However, European Commission President Jose Manuel Barroso declined to give any details of the proposals, which will be presented to all 27 EU finance ministers for approval on Sunday.     The EU summit, called to discuss longer-term efforts to coordinate economic policies, t...

After months of speculations and rounds of discussions, all the European Stars reunite at last, as shown in EU flag. On 12th April 2010, the euro zone nations have agreed on a Euro30 billion rescue package for their heavily-indebted partner - Greece. The finance ministers of the 16 European Union nations, who have euro as their common currency, finalized the details of their bail out plan for Greece. The annoucement comes amid mounting concern in the financial markets about the cash strapped Greek government's ability to service its staggering debts of more than Euro400 billion, thus, pulling down euro to very low level recently. How was the package like? Under the package, it will cover a 3-year fixed 5% interest loan and the amount of the loan could be increased over the next 12 months. The European loan is likely to be shared proportionally based on the breakdown of the ECB's capital. The IMF will complete the plan with a Euro15 billion loan at an adjustable rate based on th...