I do agree with what you are saying, but these events are short term events.
Political instability does play a huge role in the outcome of stock markets, but if you take a long term view (ie 20-30 years), these problems might not be much of a worry. Take Indonesia as an example. Political problems have been in the limelight for quite a few years, but the stock market there have also performed well. As of end of December 2007, the market have gained around 52% in that year. As with our own political uncertainty, it would be forgotten or solved soon and market bull would return hopefully in the next few years.
So by stating just political instability, it should not be an obstacle for people to enter the market.
As for Singapore, loses involving sub prime issue would recover somehow, so it is also a short term volatility. I believe a country would still have room for improvement as none would consider themselves "matured" and stop economical growth. As long as there's growth, it could affect the stock market positively.

Just another of my 2 cents. Please share if you have a different view from me

Yes, China goverment have taken a few steps one at a time carefully not to burst the bubble.
Since China's bubble have grown over the last few years, it would take the government longer time to cool the market down bit by bit. It will have to be done at a much slower pace because if they don't, we would see another round of chaotic sell-off. They would have to weigh the ill-effects of it and make the critical decisions.

One cannot assume the good performance of stock markets, that would translate to better lifestyle of people in general, by right it should but :-

Let take a look at our stock market, our CI touched all time high this year, and yet people are not happy with our government, and BN could not get a 2/3 majority. It means the people in the street generally are not getting the real benefits. The boom is quite artificial in many ways ( unlike the earlier bull runs ) . Unemployment of fresh graduates are in large number. People in general have money only for the basic items , day to day needs. The boom does not translate into better pay and bonus for working class. With real inflation of 8%, their spending power is in fact less.

The booms of share markets in Indonesia and Vietnam do translate into better living for their people in generally. Small business people feel the booms in their retail businesses for example.

On the other hand, retired people wake up and suddenly come to know that they have to pay tax of 26% on their dividends. Whereas , another group of investors are getting 10 years tax free status.

We have mega projects, but people in the street do not feel the impact. Only the rich are getting richer or super rich. In order to jump start the mega projects, the government might need also to increase the fuel prices.

The economy , stock market and politics co exist, cannot be separated.

Talking about Indonesia, the political issue has been there for more than 50 years, so you mean 50 years are still considered short term by your definition ? In term of attracting FDIs, they are losing out to Vietnam, why ?

Big part of funds, payments and receipts are done through Singapore, meaning their business people are keeping their money in Singapore, but doing business in Indonesia. The trust is absence.

I do believe Indonesia could do better in times to come. Indonesia exports workers in millions to other countries for so many years. These workers, many had learned how others live a better lifestyle in other parts of the world, and now back in their own country. These people would able to help the government to transform the economy. They have also the spending power like getting better education for their children etc. This could lead to the stability of their Government.

Overall, business community in Asia think that Indonesia could be the next potential country to invest. Without the NEP, it could be better in the eyes of investors.

Back to our country, since we introduced the currency control way back, the foreign funds and FDI were virtually absent for more than 5 to 8 years. Is it very short period too by your definition ?

In PM, are you asking your clients to stay invested for the next 20 years or so to get the real benefits ?

Remember, clients' money is at stake. Clients' interests always come first.


Just for sharing purpose.

This post has been edited by SKY 1809: Mar 17 2008, 11:21 AM

I had some different view on this. Just to have slightly different opinion, not meant arguing on, just to have discussion.

Political situation does affect economy growth and eventually stock market. Just like recently, BN threaten to cancel all the mega-project after losing the state gov and 2/3 majority as a punishment for not supporting them. The cancellation will affect big time on construction industry eventually spread to the like cement industry, steel, woodworking eventually provide less job opportunites which by then will afffect consumer spending and finally economy growth. That's the reason why construction stock 'free fall' after the election result it known, as investors fear about the 'punishment' might be happening.
It is not forgotten, just most of the time political situation stabilise afterwards generally, but it doesn't mean it is surely will.

By right, political turmoil shouldn't affect the economy, but with the example given on cancelllation project, it does affect the whole economy. This is called immature politically situation. In reality, you need political stability to achieve good economy growth. Long term political instability is a burden for the economy.

I kinda agree on Singapore banks involve in subprime issue one, it will be heel over the long term, as it is just part of investment losses by them, won't threaten to bankrupt them like Bear Sterns. Instead Singapore now is one of the cheapest bourse in the region.

For China, it is facing a huge problem now, inflation. If inflation keep on sky-rocketing at there, then, all hardwork and economy growth few years ago will be down to the drain. Imagine you work hard to achieve more income and salary growth, but due to high inflation, your incremental in income is being eaten by inflation 'beast' without your notice.

Just my 2 cents.

This post has been edited by cherroy: Mar 16 2008, 10:34 AM

No worries Cherroy bro, anyone can join in this discussion
I am just wondering if this GE is a fair one. Of course by implementing the single tier system is eating up a huge chunk of investors' money, but they did gradually decrease the corporate tax. This move might only affect those in the upper class and business people, but it does also improve the bottomline of businesses. If this is the case, then the government shouldn't be blamed in the first place but it's the business owners are to be blamed. Also by implementing those mega projects, it creates an abundance of employment opportunity for the people. All these should translate into higher wages for the employees. That is why I am a little surprised at BN's loss in the GE.

The matter of fuel subsidy is still in the mist, but I also agree that it would increase sometime soon. The rich is getting richer but at the same time it is their responsibility to spread the savings and income they are receiving. The projects and the cut in corporate tax has just been implemented, but they have not really taken off. That is why peole in the street have not felt the impact of it. They might be thinking of the same thing that the rich is getting richer, that is why they made this verdict. The GE this time around is a little disappointing because the people have not waited to see the outcome of it before making their 'real' decision.

I had no comment on the GE.

Just recent implementation of single tier dividend and increase of min borkerage commission will be seen as punishing the poor and benefitted the richer one. Although the min commission rate is not that big deal, people will have negatively view on why it needs to implement in the first place. And for single tier dividend, it only benefitted those tax bracket above 26% one, aka earn more than 100K pa one, others lose out especially it impact worst on the retired people.

Even the fuel subsidy larger chunk money are channelled to the rich one. <-- by right fuel subsidy is meant to reduce people burden by having lower fuel cost which mean lower lorry transport fee, lower goods price. But still those drive Benz one surely 'eats' more petrol than one rides motorcycle one, so direct subsidy goes more to the richer one although lower income group also enjoy lower cost of goods due to fuel subisidy indirectly, but so does the rich one. This is the loop hole of the fuel subsidy which is hard to solve.

Anyway just my 2 cents, don't want to drag to far away from the topic as this thread is meant for discussing PM related issue one.

This post has been edited by cherroy: Mar 16 2008, 04:33 PM

You are right cherroy. These 2 events are really largely beneficial to the rich. One weakness of our government is that they did not strike a real balance in the economy by benefiting both upper and lower classes. I hope that they would learn their lesson with this GE and implement better budget next year. Still the majority of our country is the lower class people, and that makes all the difference. I believe if they strike a balance, then our economy will be more resilient to foreign events.

As you said, lets not take this further and we should get back to PM issues. Nice discussion here and I believe it would benefit everyone reading this thread

Both ASEAN and China has their own advantage and disadvantage.

ASEAN, no doubt, political issue is the main issue and this will affect the economy and share market. In this region, only Spore is stable in politics. Anyway, Vietnam, Philippines, and Thailand are growing rapidly and these countries definitely will continue to grow. In the progress of growing, government policies play an important role. As, unemployment rate, inflation rate must be controlled well.

For China region, there should be no political issue unless for Taiwan. China has a serious problem now, which is inflation. Luckily, China government aware about this problem and trying to cool down the market and reduce the inflation rate. China has huge population, although it has grown for 10 years, it is still potential to grow further, as still many places in China are not developed yet. And don't neglect Hong Kong. Hong Kong is one of the strongest economies in Asia. With Hong Kong's lead and China huge population, the economy should be able to grow further.

So, justify yourself which region you prefer and invest in long term.

Hi,

Izzit mean that China-related mutual fund is performing slower compare to other fund?

Undoubtedly that PCSF and other china fund dropping badly...

Another Q: Since the global market is so volatile.. do u all advice to sell the fund and buy back when the price is lower, or juz keep it?

FYI,
Looking back at 1997-1998 Asia Financial Crisis, HSI had lose over 60% from the high of 16,000 to 6,700 points, and Singapore had lose over 64% from 2,200 to 800 and KLCI had lost over 75% from the high of 1250 to 300 points.

Do u think the US subprime issue will worst than Asia financial crisis?

Thanks...

Determination of Pricing for EPF Investments

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The prices at this period of time are definitely very attractive.

This post has been edited by David83: Mar 18 2008, 07:31 PM

I'm buying like no tomorrow. As long got money keep buying

You are so confident that it will rebound back ?Or even climb higher rather than drop continuously?

This post has been edited by LY123: Mar 19 2008, 09:50 PM

It's merely my observation and personal opinion. Compared to whatever I bought or switched, it's definitely very lower.

Rebounce or not is another matter.

I'm looking at PCIF also. It's kind of worrying for me right now, would I hold my investment right now or wait until next month to see whether the fund perform or not. Any professional opinion?

I think data going beyond 4 decimal points is close to meaningless.

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We are pleased to attach the market wrap and bond market review for the week/fortnight ended 14 March 2008 for your information.

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Would not recommend to buy PCIF.. juz look at the HSI benchmark compared with PCIF benchmark.. it's poor performance..