Dreamer,

Read my points and make a better conclusion. What I've been saying is this:

1. US economy - caused by subprime => affects everyone there as jobs are axed everywhere, and housing is a need
2. In Malaysia, we get the coupling effect (but in foreign debt, manufacturing, financial not even close to US' level)
3. So in Malaysia, those who get retrenched first will be in these or closely related sectors.
4. For those who get retrenched, what is their equity profile? Some in cash, some in stocks, some in properties.
5. For those in properties (as in own stay), what category of props are affected, ie sudden spike of supply like you mentioned?
6. Are these the target group for property investors? For me, NO. Even for others who are, then wouldn't it be a golden opportunity to buy?
7. The demand and supply usually not come from the same group of ppl. Eg, I would buy a 500k prop to be rented out if the return is good, but I'd never stay in it. Just like I'd buy a 100k apt to be rented out to student.

On the diversification thingy, the same goes for dollar cost averaging, to be is total bunk. Yes I too CHOOSE to not diversify in the way you do. I don't have the numbers that you're holding, but I'd think if one's fall is helped by other's rise (US fall "compensated" by Asia's rise or vice versa), at the end of the day you get more or less the same return, albeit capital has a higher chance of getting preserved. And this is in good times. When times are bad like now, the whole portfolio may trend downwards for a while.

I now compare what's happening to property investment in ONE country, ie our beloved Keris-C4-Malaysia. If I were to compare what I get in stock market, or to look at return in commodities/equities worldwide, I'm still way ahead. They say if the market lose 50% and you lose only 40%, you're actually beating themarket by 10%. Sure, if that makes you feel better. But I want ABSOLUTE return, ie better than FD, better than inflation, better than MOST equity markets. So far, well..what can I say, so the very not shabby at all good! Sure, all the eggs are in one basket, but mind you, even within the basket you can diversify

You are actually also putting all your money in ONE basket, ie equity and spread it across regions/industries etc. I am putting all my money in ONE basket too, ie properties and spread it across diff target market, diff property types etc. If you agree with the last statement, then I'd say you're doing nothing different than I. 

peace out-meejawa

bro dreamer,

1. If hell breaks loose, which investment option is sheltered?

2. My answer is no one is saying it will not get worse before it gets better. Glass half full way of looking at it, it will get better eventually if one has plan to weather the downturn. Like I said, at the situation now, things are still ok, and I'm with you that things will get worse than now. But if and when it does, refer to 1.

Also, if things get worse, do ppl not need a place to stay (I'm not talking abt US level subprime where ppl need to stay in tents in parks). Students will stop their studies? Ppl will move further to get cheaper rent and/or place to stay? Sure (with big chunks of salt), but I don't foresee ppl camping in KLCC park here. Again, diversifying in target market is what I do. And when the hay is made during sunshine, now is the best time to use the buffer to hold and wait out the storm.

Your strategy is different from others who are in the wealth accumulation phase. Is your point here to GROW the wealth, diversification is key? So you not concur this can be achieved in one investment basket in one country? And looking at the global situation now, how is one's wealth preserved?

If you look closer, when you invest in stocks, you're giving your money to the company to invest and hopefully get a decent return. When you invest in mutual funds/unit trust/bond, you give your money to someone who gives the money to the company to invest, hence the money gets "further" away from you. This may be trivial or irrelevant to some, but to me I want to be able to control how and where my money goes, hence the money goes to me who invests it.

meejawa

LOL - you should practice what u preach then.  Di-worse-fication is YOUR SYSTEM.  It is YOUR choice.  It is NOT suitable for me.

LOL - I know what I know about you too.  And, I also know how to verify what I know.

cheers chief.

err..i thought Uncle Sam is already in hell since many months liao?? People camping, Wall street bankers pose for Penthouse..remember? 

nitpicking aside, I don't have much experience in stock investing, maybe you can help to explain something to me. What will happen if the investment house/brokers go bust? I'm always curious, just like here in Malaysia, what will happen if OSK/AmInvest etc go bust, or Vanguard in US (not even sure if they are in the same grouping)? They are the guardian of your money, you pay them loading to help you buy the stocks. Who created the ETFs? What's the worst case scenario?

thanks,meejawa

actually, i asked some loan officers before... the general rule ranges between 33% to 40% some banks allow up to 40%.

however, if you are one of the high earners (e.g. 20-30k a month), the banks will relax the limit for you... but this one got no fixed guidelines... go case by case...

*the above is only what i hear from the bank officers - i cannot confirm true or not*