My portfolio:

US equities: 50%
Forex (shorting USD/YEN, AUD/USD) 20%
Short FKLI 20%
Cash 10%

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Added on October 12, 2008, 10:38 amUS market opens at 9:30 pm Malaysian Time and ends at 4 am.

Bond market is close for Columbus holiday but stock market is open.

It's going to be a sustained rally, unless the last hour we see a huge sell off again.

TED and LIBOR are declining, which is good news. Market is stabilizing.

Congratz to those who listened to me and brave it out.

Just to add few point, it is a suicide act to use foreign reserves of a country to do bailout.

Foreign reserves is not 'the reserves' as normal people think of.

One needs to know how those reserves is come from foreigner money from several ways

1. There is plenty of foreign company want to invest in your country eg. Malaysia, so when they want to come here to invest, they take USD come to here. But USD can't be used to do investment or business in Malaysia. So the foreigners need to go to BNM to exchange for RM. So BNM will give them RM in exchange for the USD, then those USD kept by BNM is the foreign reserves currency.

2. Company in Malaysia doing export, so money received is in USD, so company will take those USD to BNM to exchange back to RM. So BNM got USD in foreign reserves currency.

So if one days, foreign investors in Malaysia want to divest their investment in Malaysia (be it stocks, business or whatever asset), then they will sell those assets, get RM, then take RM exchange to USD, then BNM will need to take USD out to give back to them. As BNM can't print USD, so they must have considerably foreign reserves currency to withstand those outflow or demand.

You know what, 1997 is the classic example of the foreign reserves importance and why this crisis unfolded, simply Asian countries hit by this crisis simply has too low foreign reserves because of red hot economy was growing rapid, there was a current account deficit throughout years, i.e import > export because economy was growing rapidly, there was a lot of demand for import goods range from consumers, machinery etc. Meanwhile short term foreign debt on various countries were high. So in order to pay off those foreign, you need considerably foreign reserves to pay off.

Hedge funds knew the situation, and took the advantage of it, to exploit the currency attack. Becuase if you have 100 of USD in foreign reserves, what if suddenly people take RM 500 to exchange for 200 USD (back then RM2.5/USD), then how BNM is going to face it or take out USD 200 to pay for it? The only choice was lower your currency, as if it becomes Rm5: USD, then BNM can afford already. So there is where and why currency attack by hedge fund is rampant back then.

Foreign reserves can be reduced if there is significant outflow of money just like recently in Malaysia, there is about 10 billion of outflow just in recent month due to massive outflow of foreign fund exiting equities market in Malaysia.

So foreign reserves currency is something that fluctuate that depends on economy situation and investment environment. It is not like ordinary people saving.

Yes, two successive quarters of negative growth.

Raylo, you can join my FKLI trading corner, i did post some charts for couple of KLCI components.

We'll see KLCI hit 870 this week.