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Other Investments => Global Markets => Topic started by: king on September 09, 2017, 03:11:13 PM

Post by: king on September 09, 2017, 03:11:13 PM

Saturday, 22 July 2017
From black swans to grey rhinos

Grey rhino shock: File picture of the headquarters of the Lehman Brothers investment bank on Sixth Avenue in New York. In the 2007 market crash, the grey rhino shock led to Lehman’s failure. — AFP
Grey rhino shock: File picture of the headquarters of the Lehman Brothers investment bank on Sixth Avenue in New York. In the 2007 market crash, the grey rhino shock led to Lehman’s failure. — AFP
EVERY crisis event is best remembered by a concept that explains it in simple terms.

The 2007/9 Global Financial Crisis is well-described as a black swan event, a term coined by contrarian risk manager, Nassim Taleb, as a low probability but high impact event. Most swans are white, but every now and again a black swan appears. Black swans are notoriously difficult to predict, as we don’t see them often, but their impact can be devastating.

Since we are at the 10th anniversary of the Global Financial Crisis, a fashionable term has been coined by best-selling author Michele Wucker, The Gray Rhino: How to Recognise and Act on the Obvious Dangers We Ignore, St Martin Press, 2016. The grey rhino is the highly probable, high impact yet neglected threat, which when it charges, can cause severe damage. She includes in that category issues such as climate change, terrorism, financial stress and social unrest.

The official People’s Daily in China this week, commenting on the National Financial Work Meeting, exhorted regulators to prevent black swans as well as gray rhinos. This caused a flurry of comments within the blogs on what constitutes the grey rhino?

An obvious candidate is the property market.

Since real estate markets are valued at roughly 2½ times to three times GDP, any sharp correction in prices would have considerable stress on the banking system and national wealth. In 2007/8, the subprime crisis caused a fall of roughly 15% in US property prices, but with the US real estate valued at 365.7% of GDP in 2007, that caused a loss of US$10.4 trillion in household wealth or 70.4% of GDP.

With stock market crash of nearly 30%, the grey rhino shock was nearly 100% of GDP, which led to failure of Lehman Brothers, and the US$700bil TARP (Troubled Asset Relief Program) bank capital rescue package.

The second is the exceptionally low interest rate regime, partly caused by slow growth and the unconventional monetary policies, resulting in peak prices in stocks, bonds and real estate. The system is now a Catch-22 problem – damned if you do and damned if you don’t – whereby if the Fed raises interest rates further, asset prices may collapse, but if interest rates are not “normalised”, productivity remains low, as will growth. So far, global markets are touching peaks, as liquidity remains high.

Thirdly, what many financial analysts are concerned about is the rising level of corporate leverage in China and elsewhere. These have implications on the non-performing levels in China. Mixed up in the uncertainty is the quality of assets backing the wealth management products.

Fourthly, increasing income and wealth gaps are threatening social stability. So far, in those countries with relatively low levels of unemployment, the situation is manageable. But the growing level of youth unemployment is of major concern.

Fifthly, technology disruption is accelerating as the speed of new technology adoption in artificial intelligence, robotics, big data, 3D printing and the like are transforming business models and social change. Kodak certainly ignored its grey rhino from digital photography and got ran over. Firms like Takata, Toshiba and Volkswagen all ignored signs of trouble from their product quality and risks to the brand, causing sharp falls in their share prices. None of the troubling signs were completely unknown.

Wucker’s wise advice is not to ignore the rhinos, but to tackle the issues head on. She recommends the practical and completely sensible steps such as:

First, admit the existence of the impending danger and risks.

Second, determine the nature of the beast – the scope and scale of the risks.

Third, you should not freeze and do nothing.

Fourth, take real lessons from what is happening.

Fifth, take the long view and big picture and focus on strategy and execution to get out of the dilemma.

Sixth, the one who recognises the grey rhino is the one who will be able to control the grey rhino risks.

In Sun Tzu Art of War terminology, know yourself, know your enemy, win all battles.

Books like The Gray Rhino are great help for us to deal with the rising level of uncertainty and discomfort with rapid changes in the environment. We are shaken from our complacency because too many changes are going on at the same time. What used to be comforting and stable is changing before our eyes.

To do nothing does not seem to be a safe option. At the same time, with markets that are so correlated with each other, there seems to be no place to hide.

The current state of financial markets reflects exactly that complex mixture of greed and fear. Investors are worried about the possibility of another financial crash, without appreciating where that trigger will come from. At the same time, the liquidity in the market is such that you have to be invested, or you may miss the market boom, in case the bubble goes even higher.

The analogy I like very much is the black elephant, because the unspoken “elephant in the room” or a huge issue that everyone sees, but no one wants to talk about, is often the unseen problem. We do not see the problem because we do not wish to see it. The black elephant is the combination between the black swan and the elephant in the room – namely, the elephant in the room does something no one predicts. The grey rhino is a variation of the black elephant, large enough to do serious damage. Elephants are big and will cause problems one way or the other.

Black swans, grey rhinos or black elephants are nothing compared with the golden monkey. Visiting the famous Monkey Forest in Ubud, Bali, I saw a sign: Do not feed the monkeys and take care of your valuable possessions. We live in an age in which Hanuman, the monkey god from the Indian saga, the Ramayana, greatly disturbs the realm.

Great advice from the Monkey Forest.

Tan Sri Andrew Sheng writes on global issues from an Asian perspective.

sheng , column

Post by: king on September 09, 2017, 03:14:52 PM


2017-08-07 17:15第一白银网A-















Post by: king on September 09, 2017, 03:18:14 PM

2017年07月19日 17:50:16 NAFMII资讯



“ 防范化解金融风险,需要增强忧患意识。……既防“黑天鹅”,也防“灰犀牛”,对各类风险苗头既不能掉以轻心,也不能置若罔闻。




“灰犀牛”这一概念是由美国学者、古根海姆学者奖得主米歇尔•渥克(Michele Wucker)于2013年1月在达沃斯全球论坛上提出的,根据他所著《灰犀牛:如何应对大概率危机》一书,“黑天鹅”比喻小概率而影响巨大的事件,而“灰犀牛”则比喻大概率且影响巨大的潜在危机。
























Post by: king on September 09, 2017, 03:19:28 PM

2017-07-29 21:04阅读:244
今年3月,新华社就关注到了“灰犀牛”的存在。在一篇题为“透视 逆全球化 表象”的文章中,新华社记者提出,“灰犀牛”比“黑天鹅”更可怕,更值得关注。
Post by: king on September 10, 2017, 09:11:53 AM

The Era Of Complacency Is Ending

Tyler Durden's picture
by Tyler Durden
Sep 8, 2017 10:35 PM
Authored by James Rickards via,

Physicists say a “subcritical” system that’s waiting to “go critical” is in a “phase transition.” A system that is subcritical actually appears stable, but it is capable of wild instability based on a small change in initial conditions.

The critical state is when the process spins out of control, like a nuclear reactor melting down or a nuclear bomb exploding. The phase transition is just the passage from one state to another, as a system goes from subcritical to critical.

The signs are everywhere that the stock market is in a subcritical state with the potential to go critical and meltdown at any moment. The signs as elevated price-to-earnings (P/E) ratios, complacency, and seasonality — crashes have a habit of happening around this time of year.

The problem with a market meltdown is that it’s difficult to contain. It can spread rapidly. Likewise, there’s no guarantee that a stock market meltdown will be contained to stocks.

Panic can quickly spread to bonds, emerging markets, and currencies in a general liquidity crisis as happened in 2008.

For almost a year, one of the most profitable trading strategies has been to sell volatility. That’s about to change…

Since the election of Donald Trump stocks have been a one-way bet. They almost always go up, and have hit record highs day after day. The strategy of selling volatility has been so profitable that promoters tout it to investors as a source of “steady, low-risk income.”

Nothing could be further from the truth.

Yes, sellers of volatility have made steady profits the past year. But the strategy is extremely risky and you could lose all of your profits in a single bad day.

Think of this strategy as betting your life’s savings on red at a roulette table. If the wheel comes up red, you double your money. But if you keep playing eventually the wheel will come up black and you’ll lose everything.

That’s what it’s like to sell volatility. It feels good for a while, but eventually a black swan appears like the black number on the roulette wheel, and the sellers get wiped out. I focus on the shocks and unexpected events that others don’t see.

The chart below shows a 20-year history of volatility spikes. You can observe long periods of relatively low volatility such as 2004 to 2007, and 2013 to mid-2015, but these are inevitably followed by volatility super-spikes.

During these super-spikes the sellers of volatility are crushed, sometimes to the point of bankruptcy because they can’t cover their bets.

The period from mid-2015 to late 2016 saw some brief volatility spikes associated with the Chinese devaluation (August and December 2015), Brexit (June 23, 2016) and the election of Donald Trump (Nov. 8, 2016). But, none of these spikes reached the super-spike levels of 2008 – 2012.

In short, we have been on a volatility holiday. Volatility is historically low and has remained so for an unusually long period of time. The sellers of volatility have been collecting “steady income,” yet this is really just a winning streak at the volatility casino.

The wheel of fortune is about to turn and luck is about to run out for the sellers.

The Trap of Complacency

Here are the key volatility drivers we have considered:

The North Korean nuclear crisis is simply not going away. In fact, it seems to be getting worse. It appears North Korea has successfully tested a hydrogen bomb last weekend.

This is a major development.

An atomic weapon has to hit the target to destroy it. A hydrogen bomb just has to come close. This means than North Korea can pose an existential threat to U.S. cities even if its missile guidance systems are not quite perfected. Close is good enough.

A hydrogen bomb also gives North Korea the ability to unleash an electromagnetic pulse (EMP). In this scenario, the hydrogen bomb does not even strike the earth; it is detonated near the edge of space. The resulting electromagnetic wave from the release of energy could knock out the entire U.S. power grid.

Trump will not allow that to happen, and you can expect a U.S. attack, maybe early next year.

Another ticking time bomb for a volatility spike is Washington, DC dysfunction, and the potential double train wreck coming on Sept. 29. That’s the day the U.S. Treasury is estimated to run out of cash. It’s also the last day of the U.S. fiscal year; (technically the last day is Sept. 30, but that’s a Saturday this year so Sept. 29 is the last business day).

If these two legislative fixes are not done by Sept. 29, we’re facing both a government shutdown, and the potential for a default on the U.S. debt. Time is short and my estimate is that one or both of these pieces of legislation will not be completed in time. This will certainly trigger a volatility spike and produce huge profits for investors who make the right moves now.

Even if the budget CR and debt ceiling get fixed under Trump’s new deal with Chuck Schumer and Nancy Pelosi, that simply postpones the day of reckoning until December 15. That’s only three months away and will be here before you know it. Markets tend to discount the future so a train wreck on December 15 will start to show up in market prices today.

Congress has to pass two major pieces of legislation. One is a debt ceiling increase so the Treasury does not run out of money. The other is a continuing resolution so the government does not shut down.

Both bills could be stymied by conservatives who want to tie the legislation to issues such as funding for Trump’s wall, sanctuary cities, funding for Planned Parenthood, funding to bailout Obamacare and other hot button issues.

If the conservatives don’t get what they want, they won’t vote for the legislation. If conservatives do get what they want, moderates will bolt and not support the bills. Democrats are watching Republican infighting with glee and see no reason to help with their votes.

If these two legislative fixes are not done by Sept. 29, we’re facing both a government shutdown, and the potential for a default on the U.S. debt. Time is short and my estimate is that one or both of these pieces of legislation will not be completed in time. This will certainly trigger a volatility spike and produce huge profits for investors who make the right moves now.

Other sources of volatility include a planned “Day of Rage” on Nov. 4 when alt-left and antifa activists plan major demonstrations in U.S. cities from coast-to-coast. Antifa are neo-fascists posing as antifascists; hence the name “antifa.” Based on past antifa actions in UC Berkeley and Middlebury College violence cannot be ruled out. This could be unsettling to markets and be another source of volatility.

Finally, another monster hurricane could be bearing down on U.S. shores, just after Hurricane Harvey devastated Houston and other parts of Texas and Louisiana.

Hurricane Katrina struck at the very end of August in 2005 and Superstorm Sandy hit the Jersey Shore in October 2012. Both did enormous damage and unsettled markets for a time. Now we’re facing two major hurricanes almost at once.

Other wild cards include domestic terror and cyber attacks.

Finally, we are entering an historically volatile time of year. Many of the greatest stock market crashes of all time have occurred in September or October including the Black Thursday (Oct. 24, 1929) and Black Tuesday (Oct. 29, 1929) crashes that started the Great Depression, and the Black Monday (Oct. 19, 1987) crash, in which the stock market fell 22.61% in a single day. From today’s levels, a 22.61% drop would mean a loss of 4,900 Dow points in a single day.

Don’t rule it out.

None of these scenarios are far-fetched or even unlikely. The war with North Korea is coming. Washington, DC dysfunction is a fact of life and we’ve had several government shutdowns in recent years. Social unrest is spreading and in the headlines every day. Hurricanes and terror attacks happen with some frequency.

It has been nine years since the last financial panic so a new one tomorrow should come as no surprise.

In short, the catalysts for a volatility spike are all in place. We could even get a record super-spike in volatility if several of these catalysts converge.

The “risk on / risk off” dynamic that has dominated most markets since 2013 is coming to an end. From now on it may just be “risk off” without much relief. The illusion of low volatility, ample liquidity, and ever rising stock prices is over.

The safe havens will be the euro, cash, gold and low-debt emerging markets such as Russia. The areas to avoid are U.S. stocks, China, South Korea and heavily indebted emerging markets.

It looks like a volatile and bumpy fall ahead.
Post by: king on September 10, 2017, 09:42:11 AM

Business NewsHome > Business > Business News
Saturday, 9 September 2017
Are tech stocks overheating?


Many of the companies have seen their share prices go up at least two-fold year-to-date

IT has been said that a tech stock bubble exists in the United States – a country long associated with dominance in the information technology (IT) sector.

With stock prices reaching new highs everyday, it’s not difficult to see why.

But some argue that US tech companies are now a different breed from the dotCom days of the late 1990s and early 2000s.

While there was a lot of euphoria surrounding that era, many tech companies now have consistent earnings growth to justify interest in their stocks.

Recall the likes of Cisco, Intel and Oracle which were at one time the darlings of investors.



They have largely been replaced by Facebook, Netflix, Apple and Alphabet.

In China, a country which is fast building a reputation for tech companies, Baidu, Alibaba and Tencent have also gained fame among global investors.

The business structure of the established tech companies of today is one that is asset-light, enabling them to scale up very fast, experts believe.

This also allows them to have an edge over their predecessors.

In July, the US S&P 500 technology sector broke the record it created in March 2000 – the peak of the dotCom bubble – lending support to this notion.

Even so the valuations of US tech companies are generally in line with the broader market, unlike in those days when the gap was wider.

Currently, most US tech stocks are trading at 19.4 times their 2017 earnings, while the S&P 500 is trading at 19 times price earnings (PE), according to July Bloomberg data.

It is worth noting that there are exceptions.

Online shopping site is trading at a massive 248 times its current earnings.

Netflix, which provides streaming media and video-on-demand services, is trading at 218 times.

However, there are other top tech stocks which are trading at more realistic valuations which, in turn, keep the sector balanced.

Apple is trading at 18 times its current earnings, Facebook at 39.5 times and Alphabet at 30 times.

Presumably, it is for this reason that investors are not selling just yet.



The domestic scene

Can the same be said of Malaysian tech stocks, which have also been getting a lot of attention from investors?

In a market where the benchmark index has gained just slightly over 8% year-to-date, many of the tech and tech-related stocks have gone up at least two-fold over the same period.

Among the highest valued tech-related stock is GD Express Carrier Bhd (GDex), which is trading at a whopping PE of 100 times.

GDex’s major shareholder and chief executive officer (CEO) Teong Teck Lean often downplays discussions about his courier company’s valuations, preferring to focus on its growth opportunity as a key enabler amid the rise of e-commerce here.

GDex, which embraced technology in the early years of its business, has also managed to secure many big investors.

Singapore Post Ltd and Yamato Holdings Co Ltd had bought stakes in GDex on different occasions, once when the latter’s value was 50 times its earnings and when it was 70 times.

However, not everyone has remained positive about GDex’s prospects.

Kenanga Research says: “We believe foreseeable positives are already well priced-in at current levels with the share currently trading at 104 times forward PE.”

Kenanga has slashed its profit forecast for GDex by 13%-19% for the financial year 2018 (FY18) and FY19, as it expects margin pressure stemming from intense competition in the express delivery business.

“There is increasing competition in the industry with the entry of new players coupled with continued fight for market share among the established players,” it says in a report.

With the lower earnings forecast, the research house has also lowered its target price for the stock to 45 sen from 48 sen previously.

It last traded at 66 sen.

Apart from GDex, there are many other listed tech companies that are trading at high PEs.

Notably, the higher the PE ratio, the higher the expectations of the investors in terms of earnings growth.

This begs the question – are the firms overvalued?

And if so, is it time to sell? As a market observer points out, it is logical to a certain extent, for a stock like Apple to trade at a PE that is lower than many Malaysian semiconductor players which are producing products and services for tech giants including the iPhone manufacturer.



Scarcity premium

Fortress Capital Asset Management director Geoffrey Ng says there is a “scarcity premium” ascribed to the domestic tech stocks.

In Malaysia, some investors are averse to tech stocks, as many are perceived to be small firms with unsustainable profits.

The perception is not surprising, considering that many tech firms have gone bust amid intense competition and the inability to retain workers.

Ironically, many ACE Market companies are in the tech space.

Tech companies should be evaluated on a stock-specific basis, says Ng, who tracks the sector.

“Many of the companies serve domestic or regional markets and therefore are niche players compared with global tech stocks.

“Many of the technology service providers that trade on Bursa Malaysia offer solutions in collaboration with international technology principals.

“Hence, their enterprise value depends less on the intangible value of the technology but more on the sustainability of their earnings model,” Ng adds.

On a global scale, he says that there is no tech bubble.

He believes that the global tech stock sector has become mature since the last bubble in 2000.

“We have seen growth from both the demand side namely users adopting technology on a daily basis using smartphones and the Internet of things (IoT).

“We have also witnessed the evolution of tech business models which emphasise more on sustainable earnings growth and asset-light balance sheets compared with those in the past dotCom bubble.”

Meanwhile, Danny Wong, CEO of Areca Capital, believes that “a bubble is building up” for global tech stocks.

“No one knows when it will become too big to manage. The tech stocks need to show real earnings to justify the upbeat expectations,” he says.

On the local front, Wong, who manages over RM700mil in funds, points out that valuations are not “too much of a concern”, specifically for the semiconductor players.

“Most of them are enjoying actual capacity expansion effects (real earnings growth) and are not selling future growth stories,” Wong says, adding that the semiconductor firms are “genuinely boosted by orders.”

Rakuten Trade research vice-president Vincent Lau opines that the local semiconductor companies, which are part of the larger IT ecosystem, are “not cheap”.

“Although they are not cheap, we believe they still have some legs to run,” he says.

Lau says the upcoming launch of a new iPhone model, as well as the continuous rally of the so-called Fang – Facebook, Amazon, Netflix and Google (now Alphabet) – stocks, will continue to fuel the current tech stock movement around the world.

He points out that changes within the automotive industry, like the development of new technologies where cars are becoming “connected” to the Internet, have been one of the drivers of the increasing demand for microchips.

According to the World Semiconductor Trade Statistics organisation, global economic recovery is set to drive semiconductor sales this year, with the Asia-Pacific region expected to record a 12.4% growth.

It says that the global semiconductor industry is on track for another record-breaking year in 2017, after recording all-time high sales worth US$339bil in 2016.

In a sweet spot

Like many local semiconductor players, JF Technology Bhd is involved in the design and manufacture of test probes and test sockets for the semiconductor industry. The company, however, is trading at a PE of 38 times. Is this justified?

According to the company’s chairman and managing director Datuk Foong Wei Kuong, the demand for microchips is no longer dependent on smartphone and computer sales.

“Previously, the semiconductor business was cyclical but today, there is emerging demand for microchips from the automotive and IoT sectors,” he says.


Foong: Previously, the semiconductor business was cyclical but today, there is emerging demand for microchips from the automotive and IoT sectors.

IoT has been hailed as the next big digital revolution, connecting millions of everyday objects using inexpensive microsensors so that things like thermostats, cars, door locks and even pet trackers have network connectivity.

Foong reckons that the company is in a sweet spot as a testing equipment manufacturer within the semiconductor sector.

“A microchip is like a car which needs to change its tyres every now and then. Test equipment for these microchips, which we design and produce, are generally wear-and-tear products,” he says.

JF Technology generated a 32% profit margin for its fourth quarter ended June 30.

For Systech Bhd, which makes proprietary and franchise IT solutions for multilevel marketing companies, earnings growth is sustainable, as the company is banking on a new segment – cyber security.

Founder and CEO Raymond Tan believes that his company, which stock trades at over 50 times its current earnings, will continue to see a rise in profits, therefore justifying its high PE.

He says cyber security has become increasingly important not only for banks but also the corporate sector domestically and internationally.

“I don’t think we are expensive even though our PE is 50 times, because we will continue to deliver profits,” he says.

Systech, which has been in the business of IT solutions for more than a decade and has a 30% local market share plans to tap new and existing customers for its cyber security business.

The company, which will monitor the traffic on networks of firms which hire it and raise the red flag if it detects anything “suspicious”, is in a net cash position and has been paying dividends to its shareholders on a regular basis.

Systech took over the listing status of beleaguered Viztel Solutions Bhd in 2011 and has been more aggressive in sealing its position within the IT sector since then.

Promising trends

In its report last month, UOB Kay Hian said it was positive on the prospects of the Malaysian technology sector.

“Homegrown companies have been raising their capabilities and diversity in product and service offerings in the past few years, and will ride on the upcoming trends of proliferation of laser light applications, popularisation of industrial automation, evolution of the automobile sector, and other promising trends.”

The house, which has an “overweight” recommendation on the sector, has a “buy” for Globetronics Technology Bhd because of the “strong comeback of its sensor segment that provides revenue visibility.”


Tan: I don’t think we are expensive even though our PE is 50 times, because we will continue to deliver profits.
It is also upbeat on Inari Amertron Bhd and ViTrox Corp Bhd “for their near-term earnings growth and long-term prospects, although the current valuations have largely factored in the foreseeable prospects.”

Nevertheless, investors ought to tread with caution.

The Malaysian stock market is already trading at a higher value of 16.7 times earnings compared with, for example, Singapore’s 11.5 times.

Many local tech stocks are trading at even higher values.

The jury is still out on whether these companies can deliver on their profit projections.

tech stock

Post by: king on September 16, 2017, 09:02:43 PM

老虎基金创始人预言 低利率製造股市泡沫
財经 最后更新 2017年09月16日 19时12分
老虎基金创始人预言 低利率製造股市泡沫

对冲基金传奇、老虎基金创始人罗伯逊(Julian Robertson Jr),在CNBC与《机构投资者》联合主办的实现绝对投资回报大会(Delivering Alpha Conference)上表示,如今股市估值非常高,並担心正在形成市场泡沫。





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24日 • 3星期前
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13日 • 一月前





2000年,运转了20年的老虎基金关闭,但罗伯逊依然为曾在他基金中工作过的年轻基金经理提供种子资本创办新的基金公司,他现在仍活跃於其门徒所创立「Tiger Cubs」基金。
Post by: king on September 16, 2017, 09:22:33 PM

Is another financial crisis just around the corner?
Saturday, 16 Sep 2017

by tee lin say


IT has been 10 years since the start of the Global Financial Crisis.

Psychologically, this is another factor which puts some fear into investors. How can a market sustain its uptrend without a correction once every 10 years?

In end-2007, triggered by a collapse in the US housing market it caused the deepest recession in living memory and the near-collapse of the financial system.

Banks failed, government institutions were bailed out, stock markets crashed and countries had to be propped up financially.

One of the most significant effects of the crisis has been the long and steady fall in bond yields.

Japanese, German and UK bond yields remain below 1%, which reflect investors’ view on the outlook for interest rates in those regions. US bond yields have climbed above 2% as the Federal Reserve has begun to raise interest rates.


However, the knock-on effect of central bank attempts to stimulate economies has sent stock markets charging back. US stocks have risen more than 260% since the crisis’ low point in March 2009. UK, European and Asian stocks are all up more than 150% in the same period.

Also, the VIX index, also known as the “fear gauge” is now at historically low levels, As governments and central banks intervened to stem the flow of the crisis the VIX subsided.

Confidence among investors grew. Schroders says that this indicates that investors see nothing on the horizon that will cause extreme market volatility.

“Low interest rates and the effect of money being pumped into the economy has benefited businesses and therefore the stock markets on which they are listed,” says Schroders.

Schroders fund manager and multi-manager Joe Le Jéhan says the key to navigating the financial crisis was being alive to the warning signals that were evident across markets in the preceding months.

“If we avoid significant losses, we should be in a position to take advantage of cheaper valuations when the opportunity arises, rather than nursing our wounds. We strongly believe that it’s this willingness to actively manage risk that allows investors to compound strong returns over the longer term,” he said.

Jehan said that during the financial crisis, this meant holding very few economically sensitive equities, avoiding areas like financials and using assets like government bonds to provide some upside as most things fell in value.

“While such a concentration on capital protection is vital at the end of all cycles, this cycle has been quite different. So, what we can use to protect portfolios this time may well also differ,”

“Government bonds – historically a more obvious safe haven – may not offer the same opportunity this time around. This is why it is worth looking at the few assets that look relatively under-valued and/or have the potential to protect should markets enter another stormy patch.

He said that these assets might include cash to help dampen volatility and provide that option to invest at cheaper levels when the buying opportunity returns. The other asset to look at is gold, which also has the ability to make money should equity markets fall.

Stocks Analysis , Economy , Teforeign

Post by: king on September 18, 2017, 07:41:30 PM


老虎基金创始人预言 低利率製造股市泡沫
財经 最后更新 2017年09月16日 19时12分
老虎基金创始人预言 低利率製造股市泡沫

对冲基金传奇、老虎基金创始人罗伯逊(Julian Robertson Jr),在CNBC与《机构投资者》联合主办的实现绝对投资回报大会(Delivering Alpha Conference)上表示,如今股市估值非常高,並担心正在形成市场泡沫。





跨国企业 掀囤积现金潮
18日 • 19分钟前
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7日 • 一星期前
28日 • 约3星期前
耶伦不提货幣政策 美元重挫令吉攀升
28日 • 3星期前
全球主要经济体 10年来首次同步增长
24日 • 3星期前





2000年,运转了20年的老虎基金关闭,但罗伯逊依然为曾在他基金中工作过的年轻基金经理提供种子资本创办新的基金公司,他现在仍活跃於其门徒所创立「Tiger Cubs」基金。
Post by: king on September 20, 2017, 10:45:35 AM

跨国企业 掀囤积现金潮
財经 最后更新 2017年09月18日 19时08分
跨国企业 掀囤积现金潮


QUICK  FactSet的数据显示,自2010年以来,中国网络巨头腾讯的流动资產扩增12倍至518亿美元,復星国际与中国石化则分別扩增6倍与4.5倍;韩国韩华集团与三星电子在同期间的现金与流动资產总额,分別扩增11倍与2.5倍。




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同时, 资金过剩的情形反映新投资领域的不足,也显示透过对富人减税来嘉惠中產阶级的「涓滴经济学」(trickle-downeconomics)效果不如宣传所言。各国央行仍持续营造低利率环境以提振经济。
Post by: king on September 27, 2017, 11:59:04 AM

Get ready for the stock market’s October surprise

Published: Sept 26, 2017 11:51 a.m. ET

Investors can expect a bumpier ride down Wall Street
Sony Pictures/Everett Collection

Fasten your seatbelts. October is just around the corner, and historically it’s the most volatile month of all for stocks.

The data are summarized in the chart, below. (For the statisticians among you: The standard deviation of the Dow Jones Industrial Average’s DJIA, -0.05%   daily percentage changes in past Octobers is 1.44%, in contrast to 1.08% across all 12 months taken together.)

You might think that October is an outlier because of the 1987 Crash; on Oct. 19 of that year the Dow fell 22%. But that year accounts for only a small portion of October’s above-average volatility; October tops the monthly volatility rankings even if we exclude 1987.

To be sure, the data that appear in the accompanying chart are based on more than 100 years of history, and there is considerable variation in the historical record. So there is no guarantee that the stock market in October of this year will experience above-average volatility. But you probably should be prepared for it nonetheless, since — compared to price trends — volatility trends in the stock market tend to be relatively predictable.

Read: Warning: ‘Group stink’ is as strong now as it was in 2000 and 2007, says fund manager

How should you prepare for a volatile October? Probably the best way is to resolve not to panic if and when there is a spike in volatility. Despite the month’s dubious honor at the top of the volatility rankings, for example, its average performance is no worse than average — in seventh place, in fact, when ranked according to average Dow performance since that benchmark was created in the late 1800s. Since 2000, furthermore, October is in third place in a ranking of monthly performance, with an average gain of 1.84%.

Another factoid that may help you stay the course in the face of a spike in volatility: far more bull markets have begun in October than have ended. This, by the way, is the source of October’s reputation as a “bear killer.”

Majority of Wall Street CFOs believe this stock market is "bubblicious"
Consider the bull market calendar maintained by Ned Davis Research, according to which there have been 35 bull markets since the beginning of the last century. No fewer than eight of those bull markets began in October. If bull market beginnings had been randomly distributed across all months of the calendar, fewer than three would have begun in October.

To be sure, no one way is saying that we’ll see a new bull market begin this October. But it’s worth noting that a below-average number of bear markets have begun during the month—just one of the 35 in the Ned Davis calendar did so, in fact.

The bottom line: The stock market is due for a wild ride in October, but its volatility is not likely to spell the end of the bull market.
Post by: king on October 06, 2017, 11:42:11 AM


美国人又开始买游艇 景气快触顶预兆?
財经 最后更新 2017年10月5日 20时53分
美国人又开始买游艇 景气快触顶预兆?

(纽约5日讯)想知道美国经济能否一帆风顺?据《彭博》报导,Pictet Wealth Management资深美国经济研究员托马斯凯斯特(Thomas Costerg)指出,每到经济景气扩张期后段,游艇的销售往往就会加快。





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Post by: king on October 09, 2017, 09:03:02 AM

How long can the global rally in financial markets last?
Monday, 9 Oct 2017

by yap leng kuen


“Following the financial crisis, it was balance sheet expansion by major central banks that flooded the world with money and juiced the markets.  “With the US Fed starting to shrink its balance sheet, the countdown to the end of the band’s hour on stage has begun,’’ said Pong Teng Siew(filepic), head of research at Inter-Pacific securities.
“Following the financial crisis, it was balance sheet expansion by major central banks that flooded the world with money and juiced the markets. “With the US Fed starting to shrink its balance sheet, the countdown to the end of the band’s hour on stage has begun,’’ said Pong Teng Siew(filepic), head of research at Inter-Pacific securities.

THE risk-on mode has been turned on amidst the global rally in financial markets; the question is how long can the party last?

Are we in for another wave upwards, or as some say “an early upswing,” or a countdown before the “last waltz”?

“Following the financial crisis, it was balance sheet expansion by major central banks that flooded the world with money and juiced the markets.

“With the US Fed starting to shrink its balance sheet, the countdown to the end of the band’s hour on stage has begun,’’ said Pong Teng Siew, head of research at Inter-Pacific securities. (The Fed has started to reduce its US$4.2 trillion in holdings of US Treasury bonds and mortgage-backed securities that it purchased to stimulate the economy following the financial crisis).

But investors are banking on the prospects of tax cuts in the US and a global economic recovery that may help prolong the profit cycle.

“We are in an early upswing phase with healthy recovery, low rates, low inflation and increased spending.

“Depending on global developments, we will enter the late upswing phase when most people are in the boom mindset with easy money, high inflation, rising rates and restrictive government policies,’’ said Danny Wong, CEO at Areca Capital.

Asian markets are not expensive. “MSCI Asia ex-Japan is trading at 14 times price-to-earnings ratio. If companies can deliver earnings, markets will continue to perform.

“Certain stocks in cyclical industries might face headwinds on rich valuations,’’ said Thomas Yong, CEO at Fortress Capital.

“The animal spirit in financial markets has revived, but they must be cautious of the unexpected. The uptrend in global interest rates is gradual now. Even if the pace accelerates slightly, the knee-jerk reaction can cause huge losses,’’ said Nor Zahidi Alias, chief economist at Malaysian Rating Corp.

“The risk of policy uncertainty remains as we move into 2018. The great unwinding of the Fed balance sheet may lead to periods of volatility as liquidity is drawn from financial markets.

“A faster-than-expected increase in rates could tighten financial conditions and trigger reversals of capital flows to emerging economies.

“Along with US dollar appreciation, this could strain emerging economies with large debts denominated in US dollars or those with mismatches in balance sheets,’’ said Lee Heng Guie, executive director at Socio Economic Research Centre.

Other major central banks have not begun to shrink their balance sheets yet.

“Until they do so, perhaps late next year, capital will still flow into the US, and so, the dance goes on,’’ said Pong, recalling the words of former Citigroup chief executive Chuck Prince that “as long as the music is still playing, you’ve got to get up and dance.”

Some large funds consider US dollar strength to be unsustainable.

“Credit markets have re-rated Malaysia upwards but further inflows were limited. The ringgit is at about its real effective exchange rate, and I do not see more upside potential at this moment,’’ said Pong.

Some view the ringgit may outperform. “The trade weighted index (TWI) remains weak, and we are seeing strong export performance from recovering crude oil, palm oil and manufacturing.

“Expect the ringgit to hit RM4.10 to the US dollar in due course,’’ said Hor Kwok Wai, chief operating officer, global markets, at Hong Leong Bank.

The TWI shows the relative strength of the ringgit against a basket of currencies which is weighted by the size of their trading activities with Malaysia.

“Although the ringgit has strengthened in the past few months, it is still relatively weak compared historically on the TWI,’’ said Hor, adding that the index can improve with the ringgit strengthening against the currencies of its trading partners.

“The ringgit’s rally is supported by a good set of growth numbers in the first half. As long as external trade remains vibrant and the economy is inundated by capital flows into bonds and equities, the prospects for the ringgit will remain positive,’’ said Zahidi.

“The US dollar has performed poorly year to date, due to delays in policy reforms and a less hawkish tone by the Fed. The outlook for US dollar hinges mainly on the path for rate hikes,’’ said Yong.

“Forces that influence the movement of the ringgit include the timing and magnitude of the Fed’s monetary agenda, policy shocks, uncertainties associated with the Trump administration and Brexit talks and geopolitical tensions.

“Domestically, economic growth prospects and future direction of interest rates also play a part,’’ said Lee.

Columnist Yap Leng Kuen is cautious of never ending parties.

Markets , Corporate News , Yap Leng Kuen , Economy

Post by: king on October 14, 2017, 12:20:19 PM

Will higher interest rates bring the next crisis?
Saturday, 14 Oct 2017

by fintan ng


IMAGINE a situation where whenever you needed it, you could always dip into the kitty and come up with a fistful of dollars. This is what it was like for the past decade when central banks around the world, including the United States Federal Reserve (Fed) and the European Central Bank (ECB), created money by buying up bonds in the market, what is known as quantitative easing (QE).

Mopping up these bonds had the effect of making long-term interest rates lower, while at the same time, policymakers in these developed economies such as the US, the European Union and Japan also held down short-term rates by keeping key interest rates low.

At that time, the move to keep interest rates low was done in order to revive the economy. The short-term rates are the rates that commercial banks refer to when they set their rates for property loans, hire-purchase and personal financing loans.

Now that global economic growth is revving up, policymakers are mulling raising benchmark interest rates again, while those central banks that had created money in order to support growth are either starting to shrink their balance sheet or are planning to do so soon.


The problem with shrinking the balance sheet, which the Fed has begun from this month, will mean that long-term interest rates will start to go up. The Fed has also raised short-term interest rates twice this year after raising it last December. The benchmark federal funds rate now stands at a range of between 1% and 1.25%. There is at least one more rate hike this year.

Faced with the prospect of higher interest rates, meaning higher borrowing costs, how will businesses and consumers react? What about those who have borrowed at cheaper rates but are now faced with higher rates? Will this trigger the next economic crisis?

But economists are cautioning against jumping to conclusions. They do not deny that there will be volatility in the financial markets that will have a spillover effect on the real economy. But they argue that any rate hike or “tapering”, that is a reduction in the bond-buying programme used to stimulate economic growth, will be more nuanced.

UOB KayHian Malaysia Research economist Julia Goh tells StarBizWeek that as far as the markets are concerned, the Fed will take the gradual approach for rate hikes. “It’s going to be modest and moderate, not likely to disrupt the markets. After all, it took them many years to get out of the recession (the 2008/2009 global financial crisis). I think they wouldn’t want to hike aggressively and cause a pullback in the economy,” she says.

Goh points out that the reduction of the balance sheet has also not been aggressive. “The Fed is just letting the bonds mature and not reinvesting,” she says, adding that this will be easier for the markets to absorb versus the Fed aggressively selling down.


Goh says what could cause the markets to be more volatile is when all the central banks reduce their stimulus programmes at the same time. “It doesn’t appear that this is the case,” she says. The ECB will be giving more guidance on when it will start tapering at the Oct 26 meeting. There are various estimates of how much the ECB will reduce its bond-buying programme for next year, which stands at €60bil per month this year. Some have estimated a low of €15bil to €20bil to a high of up to €40bil. A revision of the eurozone growth rate to 2.2% from 1.9% does support a reduction in the bond-buying programme, but a steadily strenghening euro has stayed the hand of policymakers.

Goh does not believe that the Bank of Japan (BoJ) will raise its key rate soon, as inflation in Japan continues to be low. “The Japanese economy is doing well but inflation is still nowhere near the target,” she says. The BoJ has a 2% inflation target. At the end of January last year, the BoJ also introduced negative interest rates in the hope it would spur commercial banks to lend more and consumers to spend instead of save.


It cannot be denied that the global economy has become addicted to the cheap money created by the QE and low interest rates. Because growth was slower in the advanced economies, corporate earnings took some time to recover while the QE meant lower bond yields. In search of growth and yields, investors took their money to emerging markets.

This had the result of inflating asset prices – from bonds to properties – in the emerging markets. A measure of how disruptive any tapering can be came in 2013, during the “taper tantrum” when the-then Fed chair Ben Bernanke said the Fed would start to “taper” the bond-buying programme. That had a disruptive effect on markets worldwide and particularly for emerging markets.

Citigroup Inc managing director for global strategy Mark Schofield says in a report from last month that it is not certain that tapering will bring the big increase in volatility that many commentators anticipate. “The reality is that it isn’t really possible to create a one-size-fits-all scenario for tapering. Each country will have its own response and each asset class will likely see a different reaction,” he says.

Schofield says based on a survey, the consensus seems to be somewhere in the middle as to the impact of tapering on the financial markets. “There is a great deal of debate as to how significant the impact of tapering is likely to be. Some see tapering as an integral part of the new phase in the cycle and as such think it will have no real impact on the global economy, while others think that it could be the event that finally bursts the bubble, leading to a downward spiral of asset prices and a brutal tightening of financial conditions that could tip the economy back into recession,” he notes.

How will this impact emerging markets, especially the exports-reliant Asean economies already threatened by disruption of trade flows from protectionism? There is the very real fear that the QE and interest rate hikes will have a negative impact on the financial markets of this region and other emerging markets, and this will eventually have knock-on effects on the real economy. Emerging-market currencies will bear the brunt of the market volatility.

AmBank Group chief economist Anthony Dass expects some capital outflows from the emerging markets of this region with the tapering and the rate hikes. “There could be some pressure, but I expect some of the countries in this region to eventually start pushing up rates. In the case of Malaysia, should inflation stay around 3% next year, then we may see Bank Negara raising the overnight policy rate by 25 basis points,” he says. This will bring it to 3.25%.

Dass says there is some breathing space for monetary policy in the region as it remains low. “The hikes for emerging markets in this region will be marginal, so raising by 25 basis points is not going to be disruptive. This is done so that the interest rate differential (between emerging markets and advanced markets) will not be so wide,” he says. Wide interest rate differentials will cause volatile capital flows, in this case, fund flows increase over time back to the advanced economies.


Based on the real effective exchange rate, the ringgit has been undervalued since November 2014. This means that borrowing costs have been more expensive, but Dass expects a stronger ringgit next year relative to this year. The house view is for the ringgit to average between 4.22 and 4.25 against the US dollar versus this year’s 4.31 to 4.33.

“If the ringgit appreciates a bit more, then borrowing costs will be relatively cheaper than this year,” Dass says, adding that in Malaysia’s case, fundamentals have improved with international reserves above US$100bil, cumulative inflows into local equities at RM9.53bil while foreign shareholding of Malaysian Government Securities is holding steady at 42% (from a low of 38%).

“When you look at this kind of liquidity numbers, there is some appetite. We’re not off the radar screen, we’re back on the radar screen and give some support to the ringgit, which will help in the borrowing cost pressures,” he says.

Related story:

Rate normalcy a concern for stock markets

Economy , Banking , Julia Goh , Rates , Quantitative Easing , Inflation , Growth , Unemployment

Post by: king on October 16, 2017, 06:42:09 AM

Goldman Sachs: There is an 88% chance we’re heading into a bear market

Jim Edwards, Business Insider UK October 15, 2017
Goldman Sachs' Peter Oppenheimer.
Goldman Sachs’ Peter Oppenheimer. CNBC / screengrab
LONDON – Goldman Sachs has circulated a fascinating but scary research note to clients suggesting that the probability of stocks entering a bear market in the next 24 months currently stands at about 88%, based on the history of previous bear markets.

The note is titled “Bear Necessities. Should we worry now?” It is an exhaustive, 87-page dive through macroeconomic data and stock market activity going all the way back to the early 20th Century. It was written in September by London-based Chief Global Equity Strategist Peter Oppenheimer, and European strategists Sharon Bell and Lilia Iehle Peytavin. Most of their data focus on the US S&P 500 index of stocks – the largest and most-followed of the share indices globally.

Here is the historic context. The S&P is currently the second largest and longest bull run in history.

Goldman Sachs bear market 1
Goldman Sachs
The index is also relatively expensive, the Goldman trio says. The aggregate valuation of the S&P 500 is now in its 88th percentile, as measured since 1976, according to Goldman’s calculations. The median stock is in the 99th percentile.

The trio calculated a risk index based on the Shiller price-earnings ratio (the price of S&P 500 stocks divided by the average of 10 years of earnings, adjusted for inflation), the US ISM manufacturing index, unemployment (very low), the bond yield curve, and core inflation.

The resultant “GS Bear Market Indicator” is currently flashing at 67%. The indicator typically hits highs right before a bear market in US stocks appears:

Goldman Sachs bear market 3
Goldman Sachs
Historically, when the indicator is at 67%, there is an 88% chance of stocks falling into a bear market in two years’ time, the Goldman analysts say:

Goldman Sachs bear market 4
Goldman Sachs
However, the chance of a bear growling into view in the near-term remains low – just 35%.

Bear markets are triggered in three different ways, Oppenheimer et al argue:

“Cyclical” bear markets are trigged by rising interest rates and recessions; “Event-driven” bears come from negative economic shocks like war or emerging market crises; “Structural” bears come from financial bubbles.
Depending on your point of view, all three of those triggers are hovering on the horizon: The Fed and the Bank of England are both signalling interest rates will rise; US President Trump is threatening military action in North Korea; and plenty of people think the low-interest rate environment of the last 10 years has inflated asset bubbles in stocks, real estate and property in Europe, and private equity tech startup valuations.

However, Oppenheimer also believes that a bear market is currently being held back by low inflation, which in turn will force central banks to keep interest rates very low. “Rising inflation remains elusive,” he wrote in a recent column for the Financial Times. “Market prices continue to reflect a low risk that interest rates will increase enough to trigger a recession in the near future.”

If a bear market does happen it will be a roller coaster ride. Goldman created this diagram based on an average of historic data. Typical bear markets feature a false “bounce,” in which stocks decline suddenly but then recover, reassuring investors (who then get crushed in the months afterwards) or giving clever investors a second chance to get the heck out of stocks.

Goldman Sachs bear market 2
Goldman Sachs
Buckle up!