Would you believe me if I say the KLCI is headed for a fall below 800 anytime before Christmas? I am sure many of you wouldn't. Just like the price of crude oil my guts feeling is telling me it would in spite of the huge three-day rally on Wall Street.Most Asian markets rose in tandem with Wall Street.They will, likewise, fall together with it.Wall Street is the doyen and barometer of the world of equity trading.
There is absolutely no reason even for Wall Street to rear its bullish head other than on false sentiments of make-believe.There is not a drop of good news to usher a steady pattern of positive long term improvement of the markets.The only good news is the forthcoming departure of that mad man in the White House by January 2009 before he could screw up the US economy any further.The euphoria on Wall Street is a flash in the pan.More bad news will come.
No news is good news, bad news is now no news. Nothing new had come out of the US economy except troubling economic figures.The US gross domestic products contracted by 0.5% annual rate for the 3rd quarter (July-Sept).Twenty-two banks have failed so far this year and more are expected.Citibank, one of the largest in the US is in the doghouse and needed huge dose of heart worm injection to stop its demise.It was given $300 billion bail-out, giving respite to the decline on Wall Street.The three giants in Detroit, GM,Ford and Chrysler are still stuck in the muck awaiting lifelines.
American views of the economy remain the gloomiest for decades as they grapple with massive layoffs, dwindling retirement funds and slumping house prices.American consumers, the lifeblood of the economy --- spending continues to slide down.The unemployment rate is 6.5% and expected to rise.The $700 billion financial bail-outs have not been able to restore stability to the financial markets and help the sinking economy.
With a massive $7 trillion in bail-out money and a huge budget and trade deficit where the hell are the Yanks going to get the money from? Issue more Treasury Bonds, print more dollars or starts World War III?.
It can start by bombing Iran first, than North Korea, than all Muslims nations and than last China and Russia will join the war to stop the Ugly Americans.Isn't that a good recipe for a world war and an excuse not to pay your debts.
In Malaysia the government has not released any economic figures to show how much the economy had shrunk.Even if they do, I suspect it would be slightly sugar-coated to make those gullible enough to believe that our economy is fine.
Looking at all the bad news the probability of the global economy shrinking further for the rest of this year and into early next year isn't pure fantasy.
HONG KONG, Nov 26 - Most Asian stock markets rose today after Wall Street extended its gains, but Japanese shares lagged the region as leading automaker Toyota Motor Corp. saw...Read More