Subprime crisis. Recession next?

Remember the dotcom crash happened a few years back. During that time, everyone were so bullish on dotcom companies that they invested in company that reach few hundreds in PE ratio. PE ratio stand for price earning ratio.

Lately, a few major financial group around the world are reporting write off on subprime mortgages. Who to be blame on this? Will it hurt the world economy?

Remember during our 1997 crisis when our currency was attacked by speculators. It lead to downfall of the stock market and economy as a whole. However, our government at the time was smart to use Danaharta and Danamodal to revive the banking industry and clean up the non performing loan.

I guess the world economy power should learn something from us on this. With billions written off by the financial giants, the liquidity in the market will be reduced and it will definately bring down the economy.

Fortunately something big is happening. China and India are the emerging economy power. We shall wait and see when the financial impact hit US, it will benefit the emerging economy power as more and more funds will flow into the new economy power. So for those who are worried if recession is just around the corner, my point of view is, it will happen in US but not the world. Cause mighty China and India are there to lend hand.

I found this photo in my computer

The photo was removed. Writer are not responsible for all the legal suits and damaged incurred by contents and photo in the blog.

500 figure

Finally, the blog hit 500 marks. Would like to thanks everyone for visiting the blog. There will be more to come.

5 points

http://www.giatmara.edu.my 80 students


http://bpkk.politeknik.edu.my 800 students


Island & Peninsular 700 acres



Gamuda 400 acres


Inch Kenneth Kajang 700 acres

PE ratio

picking of Low Pe stock. :-

GEARING = Asset vs Debt

Gearing below 0.5 ( U hv cash $1.00 vs debt of 0.50 )is considered healthy

0.5 to 0.8 ( Cash 1.00 vs debt of 0.50 to 0.80 ) considered normal n acceptable

U should avoid Low PE stock which gearing exceeded 1 !

gearing exceeded 1 means u hv $1.00 but u hv debt more than $1.00

One classical example := Megan

Megan was once stood at PE 2+ (50% return per annum ), in d same time its gearing almost touching 2, in short :- they hv one dollar in hand n also 2 dollars in debt .

If u r not from accounting back ground to find out what is its gearing stand from balance sheet, u can either find it from osk data base or the edge .

FYI, Plenitude is one of d million that having gearing of ZERO ! Low PE(7) plus high NTA >5.00 ( its current NTA 3.20 was calculated in year 2000, by now it should worth >5.00 at least ) ^V^

Hehe

Customer : Waiter, do you serve pigs?
Waiter : Please sit down sir, we serve everyone.

Lady : Is this my train?
Station Master : No, it belongs to the Railway Company.
Lady : Don't try to be funny. I mean to ask if I can take this train to New Delhi .
Station Master : No Madam, I'm afraid it's too heavy.

A joke a day

Ah Beng's Night Course


Ah Beng went to take night courses with the reasoning in future can get promotion or better job.
During work, Ah Beng likes to show off to Ah Seng about his knowledge.

Ah Beng: Ah Seng ah... I've been taking night courses for 3 months already, next week is the exam.
Ah Seng: Oh... Good luck ah.

Then Ah Beng started show off...

Ah Beng: Ok, I test you, who is Graham Bell?
Ah Seng: Don't know
Ah Beng: He is the inventor of phone la... in 1876, see... if you take night courses, you would know this.
Ah Seng: *speechless*

The next day, Ah Beng shows off again...

Ah Beng: Ah Seng ah... let me ask you, who is Jean Jacques Rousseau?
Ah Seng: Wash your toilet one ah?
Ah Beng: No! He's the author of "Confessions", nah nah nah... told you already, if you take night courses, you would know this.
Ah Seng:.........................*speechless + frustrated*

The next day, once again...

Ah Beng: Do you know who is Alexander Dumas?
Ah Seng: Your gay partner?
Ah Beng: Choiii!!! If you don't know don't simply answer la. He's the author of "The 3 Musketeers", if you take night courses, you would know this.
Ah Seng: .......................*speechless + frustrated + irritated*

This time.... Ah Seng cannot tahan (stand) anymore and ask Ah Beng...

Ah Seng: Eh... Do you know who is Ah Kaw?
Ah Beng: Errrr... No!
Ah Seng: He's the guy sleeping with your wife!! If you stop night courses, you would know this!!

Ah Beng: ........................*fainted*