if it is so predictable, everyone will be rich.


but what is impt is not to ignore some compelling facts.

e.g. china is slowing and will not pick up fast so soon; commodities prices will stay low for some years.

and... rm will likely stay low since there is really nothing major to help it strengthen significantly.

this is what some critics said. there will never be a day when everything is green to go!

still, who is to argue with one of the most powerful forces on the planet?



likely markets are now pricing in 100% of a rate hike late 2015 or early 2016.

can see the $ strengthening against other currencies again today.

This post has been edited by AVFAN: Sep 18 2015, 11:41 AM

china is surely the wild card. all is still not so well there, unsettling.

now that usa did not raise rate, watch out for potentially further rmb devaluation.

japan was about to welcome a us rate hike to improve yen competitiveness but it did not happen.

hence nikkei dived 2% today.

This post has been edited by AVFAN: Sep 18 2015, 02:46 PM

emerging markets currencies had some relief today after fed's no hike.

rm +1.1%
rupiah +1.1%
south africa +1.3%
mexico +0.6%

rm at 4.20.... ok or not?!

this is the scary part.

i hv noticed some fast food chains and new eateries have gone with higher new prices, about +10%, a lot of others still at old price.

by end yr, everything will hv worked through the chain.

the only good news for consumers is oil/crude/petrol prices should remain low.

This post has been edited by AVFAN: Sep 19 2015, 03:57 PM

let's recap...!

the usd strengthening or rm weakening started about a year ago, sometime in oct 2014 when rate was about 3.30.

on 6 jan 2015, a thread emerged on the subject:
https://forum.lowyat.net/topic/3461956

that day, rate had already moved to 3.56.

today, it is 4.20. peak day closing was 4.339 on 8 sep 2015.

so, from a year ago, -27%.
from jan, i.e. 9 months, -18%.

let's not worry about how right or wrong anyone has been or how clever or silly some comments were since jan but spend more time on what has been useful in protecting one's blood sweat and tears rm savings.

i recall some methods thrown out. how useful or useless have they been?

let's not bother with rm denominated methods as there is no fx involved.

my take over the last 1 year:

1. us stocks/etf's - on average, there is zero cap gain, maybe a small loss. plain fx gains, excl transaction costs.

2. sg stocks/reits - stocks probably lower but with fx gains; sg reits not much cap gain but dividends and fx gains.

3. gold - flat in usd, no dividends, fx gain less buy-sell spread.

4. dual currency/foreign currency accounts; usd or sgd cash - pure fx gains less buy-sell spread.

5. european, asian, emerging markets stocks, unit trusts, other funds - pls comment as i hv no idea.

6. what else?

the clear and present danger: all this is not going away anytime soon. it may be only the beginning of a long period of volatility and uncertainty. there is still the fed rate hike issue, china's slowing economy, commodities supercycle at bottom, oil price may fall further, continued currency wars, etc. plus our infamous local politics, of course.

i personally have done a bit of 1 and 2, quite glad i did that. wish i had done more.

for the young with zero savings or debt but plenty of energy, the world is there for you.

for the about to retire, pensioners or wheelchaired, what you have is all you got; lose it, get robbed or get devalued, no one will help you.

even bnm governor has advised us to "adjust".

it is a major and serious issue that impact all of us.

lastly, saying "other countries also affected" does not help, we all already know, no need to dwell on that.


so, pls comment and share yr experience, plans and what not!

This post has been edited by AVFAN: Sep 19 2015, 07:00 PM

Err... No. I had said no point disucssing RM denominated methods as they have no fx exposure and none of the usual methods would have yielded more than the depr of 18% or 27% in 9 or 12 months.

This post has been edited by AVFAN: Sep 20 2015, 01:00 AM

Which is why never say never put in sgd or usd savings account!!

For usa and sg stocks, it is possible to still have some net cap gain if trading was done well. E.g. I did trade a couple of sg reits a couple of times in the last 2 years, worked out ok. But equities trading is not what we want to discuss here.

i share this view. it is the best gift any parent can give to a child.
our parents gave us something, we give to ours. they give to theirs.
no expectation for any return, just hope it will benefit the child the way it should.

aud will remain weak as long as commodities like iron ore have low demand, primarily from china.
that quite clearly will be the case for some years.
so, imo, no rush to get into aud. more so if u need it only in 5 yrs time.
i may need some aud in 2-3 yrs time, i am relaxed.

sg - it's more dependent on overall global health, primarily usa and china as these are its most major trading partners.
i also think sg's central bank and its monetary policy ranks among the strongest in the world, so i have the confidence.

usd is obviously the big brother, leading all the way.
there is a remote possibility that they do a u-turn and resume qe, very low chance, though.
in the event of a global recession, the usd will stay relatively stronger than all the rest.

bottomline: big question at any time is ALWAYS - will the rm get weaker or stronger from this point?
there is obviously no directly or clear answer.
there are only options - bias towards rm, bias against rm or neutral.
if one cares about the subject, one has to take one of those 3 positions.
then the actions follow accordingly.
not taking any action is also taking a position, nothing wrong with it.

yes, i agree.

a rebound will mainly come from a shift in the political situation leading to a change in investor confidence level.

some fundamental damage done, not easily recoverable.

more so if time allowed for it to be entrenched deep.

the brazilian real case is living proof.

it is best to keep discussion to last one year:

.. the currency rout began a year ago when fed touted tapering and then rate hike.
.. oil and other commodities prices started to fall like stones.
.. 1mdb/bijan chronicles started a yr ago.
.. most meaningful period when it became clear it is happening and not speculation alto there were denials.
.. going back 2-3 years means you have the foresight and vision no one has!

This post has been edited by AVFAN: Sep 20 2015, 01:06 PM

10 years, i am not so sure.

3 years ago was probably best - rm at 3.0, dow started to run up, sg reits lowest prices.

enough la...

pls do not hijack and derail this rm thread.

pls start a new doomsday fiat thread if u wish.

while many "know" it, i think only a minority understand all the reasons and its coming impact.
most simply brush it off a temp, will return to 3.30 or has no impact on them.
partly becos they our ministers tell them that, and they believe.
can't help if that is the ingrained thought process.

in the absence of new major development, it will most likely hang around 4.20-4.30.

gdp or gdp per capita looks fine but once u look at debt/gdp or debt/capita, it doesn't look good - been using enormous debt to buy gdp.
we are not in recession and hope it doesn't.
if it falls into recession, it will be harder this time to bounce back - rising consumer prices, huge debt overhang, little room to move.
it will take massive cuts in big ticket items of the budget and we know bijan & co. will not do that.
i am of the view the economy and rm will get worse before they get better. not all doom and gloom but quick recovery will be elusive.

i just did.

sg and msia were once the same.

now they are opposite twins.

where one will fail, the other will succeed.

what one will not do, the other will.

so, pick yr choice.

diversify, spread yr risk u must!

do more... 20/80, 50/50 or 80/20?

here we go... first prediction of coming inflation - 40%!


seriously, i expect official inflation figure to be still <5% in a yr's time but...

i expect 25-30% overall price incr for urban consumer spending, be it kopi-o, pizza, car battery or ipad.

after price goes up, they never come down.

now, if oil/petrol price rise 10%, 40% actual price incr in a yr's time is very possible.

such shockers coupled with imprudent budgets already seen in several other countries of late.

i think it will be better if 20:50:30, the 30 in something else outside asia.

u never know when some regional disaster can strike - SARS, bombs, conflicts...

property being hard illiquid assets cannot be lumped with consumer goods.

cost of construction will surely rise but if few buyers, developers stop building and wait.

subsale market - will depend on many things - location, loan availability, int rates...

actually, for props, it is interesting to watch from now on - prices have been high but now inflation should push it even higher.

i believe prop market now is weak... i will buy a home to live in or do biz but not to speculate.

This post has been edited by AVFAN: Sep 21 2015, 04:07 PM