dr m did not do that in 1998 due to the conditions imposed by IMF.
the same conditions will apply now - and will be rejected.
becos the conditions will be about nep, civil service, mega projects.

going back to 1998, certain things happened to help the turnaround besides the peg. will current gomen do something like that or stick to "it will rebound (by itself)"?

This post has been edited by AVFAN: Dec 19 2016, 05:14 PM

the indisciplined ones will become more miserable.

some made it good with IMF - thailand got out of the mess with IMF borrowings quite quickly.

so did ireland more recently.



like any borrowing, it is only good if used properly for financially sound purpose(s).

hence the IMF conditions.

for greece or any country.

no handicaps, no privileges, no special rights.

we watch for this...



what and how decreased output and price change will impact revenues, dividends, debt... and budget 2017... and the RM.

i'm afraid there is no good answer to yr question.

common public = ?

this topic started 2 years ago:
https://forum.lowyat.net/topic/4140626

if u read enough, u will find diff people did diff things.

if new, do check the various threads in this section - fd, fsm, gold, reits, unit trusts, dci, foreign equities.

gold only dropped just recently due to trump-$ rally.
if one bought gold 2 years ago or so just when the rm started to slide, there is still good gain in rm today... >20% over 2 years, i think.

fd... this one is just near zero risk, good for "boring times", not useful when the currency dives.

bnm was poised to CUT rates to boost gdp growth when the trump win derailed it.
if they hike rates now, that will be a further slash on gdp growth, so i doubt it.
in the last decade or more, bnm/gomen has been pushing gdp growth primarily, a lot with debt/consumption.
every bnm report comes with something like, "growth is robust due to strong consumer consumption" - as debt levels grow.

there appears to be no major concern for the rm yet; we are still hearing the big fellas saying,"not too bad, don't panic, will bounce back".
so, i think current situation will continue - bnm intervention, letting it slide if need be.

given current variables, the impact of oil on the rm is very much diminished as a marginal net crude oil exporter.

on the contrary, higher petrol prices will fuel inflation even faster, adding more pressure to the rm.

good list of events.

and that is the thing - not just individual but gomens as well - can get caught up with twist of events.

more so for those who are already in weak condition. more so for those who do not recognize the underlying root problem(s).

it illustrates the point that one must not assume hunky dory environment to continue, but be prepared in some ways.

here, we knew about 1mdb; we knew >40% debt held by foreigners; we knew oil price went ultra low, can shoot up anytime.

what was unexpected was the trump win-trump $ rally.

good point.

still, it is just a self imposed ceiling.

can easily incr, no parliament needed.

can also move some of the debt out of the ceiling.

so, more debt to grow gdp it is!

even SGD is under pressure.




meanwhile, RM sticks to just <4.48.

will be interesting to see if this "peg" will hold.

Just "pegged" at 4.479x.

The way euro, yen and sgd gyrating with usd, dont u find whats happening obvious?

Ya, think not a bad time to get more usd at this time.

Did the RM explain why the strengthening in tandem with usd?

whether stocks or currencies or a country's econmy, they don't strengthen by themselves.

(but they will decay if u do nothing and continue to bleed it systematically.)

so, we look for leading indicators - bursa (local and foreign funds), mgs yields; local industries/banks-developers- retailers well being.



not sure if u r there - in the early 90's, man... u see money everywhere - local, foreign.

everything was booming incl RM at 2.50.

simply pick a counter, it rises 20% in a week.

plenty of smiles, all were happy, some thought they became gods of money.

until 1998.

i think AUD is softening due to softening of commodity prices.

for AUD, i will rather watch RMB rather than USD as china buys a lot of aussie commodities like iron ore.

This post has been edited by AVFAN: Dec 22 2016, 07:40 PM

always look at usd.

the exchange rate is adjusted quarterly.

next report will show a much bigger no. in RM.

$ dozing off, traders bedded for the holidays.

should pick up strength after the new year.


will $ reach parity with the euro in 2017?

in hongkong, u may get only HKD1 with RMB1!


This post has been edited by AVFAN: Dec 23 2016, 10:28 AM

in this new bloomberg article, morgan stanley is recommending indian rupee, brazilian real and russian ruble.

against SGD, taiwan $ and korean won.

no mention of RM.

https://www.bloomberg.com/news/articles/201...onomies-diverge

bigger problems emerging, e.g.

what do u think?

the SGD will most likely weaken due to reasons u mentioned and the fact then MAS will want to ease it to cope with a weakening economy. still, SG has always proven to be capable of holding out better than most other countries and currencies. still a relatively safe bet, imo.

USD... not only USD but Euro, Yen all had massive rounds of QE, albeit diff methods. but the bigger thing happening now is trumponomics. such a change will be far reaching and effects will be long, more so now that yellen has "approved" a few more rate hikes. it will be a mistake to think this will last only a month or 2. but surely nobody knows how high the $ will go and how long will it last. even the biggest banks in the world can't say with confidence. for little ones like us here, i will think it best to adopt a direction u hv confidence in and keep looking for indications if the direction will change, make changes if necessary.

what i read, many are expecting the $ to keep rising in 2017. indications of "topping out" may be (or close to):

.. $ index 1.10
.. parity with Euro
.. china RMB 7.3
.. us 10 yr bond yield at 2.75%
.. us stocks start to tank, correction

** above is just the views i hv read, not a recommendation.


RM... it's basically a case of blame game and management by hope. totally at the mercy of rotten internal politics while outside development moves ahead. no concrete measures to strengthen it. in fact, i suspect "they" won't mind if it goes to 4.8-5.0. outside cyberspace, majority not complaining. so be it.

This post has been edited by AVFAN: Dec 25 2016, 11:45 AM

This post has been edited by AVFAN: Dec 27 2016, 10:37 AM

we know foreign ownership WAS 45-50%; no figure what it is since the sell off.

there is also bursa sell off.



besides returning to USA, the money is also being reallocated to other emerging markets - thailand, vietnam, pakistan stock markets gained well in 2016.

same with czech republic, hungary and poland in europe.

for that to happen, investors must be bullish and confident about that market, that country.

obviously, the reverse is true.

capital in and out happens all the time.

and there is ILLICIT capital flight which we hear nothing about internally and probably compounded the RM's weakness.


"money returning to USA" is more correctly "money converted back to USD".

what i read, a lot has gone into US equities on a net basis, but a lot is still in cash, in transit, working as hot funds around the globe.


next for RM.. everyone has a view.

true that the main fall is due to trump win.

question is how long does one think the resulting events and implications yet to come will be.

an equally impt question is one's view of what actions will come locally, if any, to inspire confidence or do the opposite.