Invest
Bull-Bear Royal Rumble: Bear To Assert Presence Soon
By Jeflin  •  May 25, 2009
[caption id="attachment_1319" align="alignright" width="150" caption="Photo by azrainman"]Photo by azrainman[/caption] There is nothing more detrimental to our psychology than seeing our friends get rich. With each day that stock markets continue their impressive surge, lingering skepticism are transformed into belief and rational people are behaving once again like gamblers. It was only months, if not weeks ago, that the same investors and businesses were perched on the percipice of financial ruin. Those who got badly burned were swearing off stocks or any form of investments. Now, the rolling good times have erased all these memories. To be sure, the current stock market rally is surprisingly resilient compared to the typical dead cat bounce which hovers in the 20% range but we have to remember that if something doesn’t go on forever, it has to stop. Indeed, a setback in the stock market is imminent, after such a heady run-up. For the second straight day, US stocks began on a strong note, only to have the momentum died down at the close. Despite repeated attempts, the inability of S&P 500 to break through the psychological resistance of 940 is telling. While much uncertainty in the financial sector has been cleared up after the stress test, the bears are not convinced. In fairness, the bears are correct to believe that there could be more skeletons in the closet which require greater capital infusions. And you don’t get anybody more authoritative than the messiah of free market speaking about banks’ capital requirement. Alan Greenspan, the former Federal Reserve chairman who is heavily castigated for his role in Wall Street’s orgy, says banks still have a ‘large’ capital requirement especially in commercial banking. Wheez, if only Alan Greenspan had been as discerning about this financial crisis during his reign. If only the credit binge was curtailed by raising interest rates and stringent lending standards. If only he had been more forceful on curbing the extensive leverage on Wall Street. If only… Read more...
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By Jeflin
In Jeflin's blog, you will read about his thoughts about the stock and property market. I am not a financial analyst but I have been a retail investor in the local stock market for years. Currently, I am invested in several blue-chips, like SIA, SembMarine and UOB. These stocks have performed well for me and provided attractive yields over the years. I believe in long term investments, especially amid the uncertain economic climate.
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