The losses of about 7% on 29 Sept 2008 is not the largest in DOW's history. The following table will show that there are about 18 times that DOW lose more 7% or more. The last time was in 17 Sept 2001 when DOW lose 7.13%, after the terrorist attack on 11 Sept 2001. Google showed that DOW had done 368 mil which is 150% of the average volume of 240 mil. on 29 Sept 2008.
As for the gains, there are about 19 times that DOW has gained more than 7% as shown in the following table. The last gain of larger size was in 21 Oct 87. That time DOW gained a hefty 10%.
Sunday, September 28, 2008
27 Sept 2008
Documentary Film of The Stock Market Crash in 1929
The full video come in 5 parts, each about 4 minutes. Click the button to view the various parts. To return to this page after viewing, click "Back" button
If you are in a hurry and prefer a condensed version that contains only the documentary, click here to play (8 minutes)
Friday, September 26, 2008
26 Sept 2008 Interesting videos about the WallStreet Bailouts...
Video 1: Bush Sounds the Alarm
Video 2: THEY WANT MAMA
Video 3: Let's Play "WALLSTREET BAILOUT"
Thursday, September 25, 2008
26 Sept 2008
This is an interesting video that attempts to talk about how money was created and manipulated in the history of United States. It is an old documentary made before 1996; but many points raised in the video are quite relevant in today's context.
Note that this video is about 3 hours long and the information contained therein have not been verified but it is entertaining. The video pointed out that it was meant only for educational purpose so that people would be aware of how US money was created and manipulated.
For those who just wanted to know about:
a) the Crash in October 1929 that was described in the video (about 5 minutes); b) the Federal Reserve Board of United State is a quasi government organisation. It was said that Goldman Sac and Lehman Brothers are two of the stockholders. (10 minutes); c) the Market Crash is not the Cause of a Recession (1.5 minutes)
This short clips are part of the film"Money Maker" widely circulated in the Net for public viewing. The audience are advised to check the facts and verify themselves before taking any further action. Video 1: Federal Reserve Board, a quasi government organisation (10 minutes)
It was said that Goldman Sac and Lehman Brothers are two of the stockholders.
Video 2: The Crash in October 1929 (about 5 minutes)
Video 3: Market Crash Not the Cause of a Recession (1.5 minutes)
Saturday, September 20, 2008
20 Sept 2008
Introduction
When investment giant, Lehman Brothers, filed for bankruptcy, some local investors received calls from DBS Bank, warning them that their investment in the DBS High Notes 5 may be at risk and the investors may only get a portion of their investment back or none at all. Some had invested S$50,000 while other had invested much more.
What is DBS High Notes ? DBS High Notes are structured “first-to-default” credit linked notes, linked to a basket of stocks traded in SGX or NYSE or other World markets. The companies of these stocks usually have a minimum credit rating of A+ by Standard and Poor. It is designed for investors who are mostly clients of DBS's priority banking unit. It is an alternative means for these investors to participate in stock market investment. DBS has more than 150 different types of structured investment as indicated in their Website
What is DBS High Notes 5? DBS High Notes 5 is a 5-1/2 year structured product linked to eight underlying stocks that includes:-
a) Goldman Sachs; b) Morgan Stanley; c) Merrill Lynch; d) Macquarie Bank and e) Lehman Brothers.
DBS High Notes 5 was issued in 2007 and the maturity date is 16 Nov 2012. It is based on Singapore Dollars.
How Do They Payout?DBS will invest on behalf of the investors and pay interests to the investors at a rate of 3.5% - 5% per annum depending on the contract. In the case of High Notes 5, 5% per annum. The interest payment will stop when DBS redeems the Notes or when a Credit Event occurs. Normally, investors will receive 100% of their principal amount at final maturity;
but when there is a Credit event, the Notes will terminate automatically and the investors will receive only the Credit Event Redemption Amount(CERA).
What is a Credit Event? The occurrence of any one of the following events to any stock in the basket as determined by DBS Bank Ltd, as a Calculation Agent for the Notes:-
(a) Bankruptcy (b) Failure to Pay (c) Restructuring
According to the contract, the Calculation Agent has the sole and absolute discretion as to when and whether to declare a Credit Event in respect of the Notes
How Do They Work Out the Credit Event Redemption Amount (CERA)? The amount will be calculated based on the following formula:
(Principal Amount x Final Price) - Unwind Costs
What is Final Price ? The Final Price is the price of the stocks in the basket expressed as a percentage determined by the Calculation Agent; most probably, worked out based on the current stock price
What is Unwind Costs? The loss incurred by DBS, as determined by the Calculation Agent, for terminating, liquidating, obtaining or re-establishing any swap agreement, foreign exchange transaction, financing arrangement, investment or other financial transaction entered into by or on behalf of DBS in relation to the issuance of the Notes.
What will be the CERA for High Notes 5 ? To be worked out. According to Straits Times report on 20 September, High Notes 5 investors may get back some money by Credit Event Redemption Date, which is not later than 37 payment Days after the determination of the Final Price (the Valuation Date).
Disclaimer: Information here is for sharing and learning. It is not intended to give any advice on price of any stock or movement or trend of any index. If a price or movment of a stock/index is given, it is only intended for illustration. The reader shall verify the information given here before using them.
Friday, September 19, 2008
19 Sept 2008
Is Today's Gain the Highest in History?
Today's gain of about 6% is not the highest in STI history. The highest gain was recorded to be about 14% in 1998 when we have IMF and Asian Crisis. In 1998, we have about 8 days when market gained more than 5%. Then, STI fell 1,300 points from 2,240 on 17 Jan 96 to 827 on 4 Sept 98, roughly about 60% over a 2 1/2 year period.
(Double click for enlarged table)
As for the losses, we have a record loss of about 10% on a black Monday in 1989. Record losses were also found in the 1997/98 crisis, when we have volatile trade with single day drop of more than 7% in 4 occasions. Note that we have the very first one of about 9% in this bear market. There may be more to come.
(Double click for enlarged table)
Disclaimer: Information here is for sharing and learning. It is not intended to give any advice on price of any stock or movement or trend of any index. If a price or movment of a stock/index is given, it is only intended for illustration. The reader shall verify the information given here before using them.
Thursday, September 11, 2008
5 Sept 2008
Bear Flag in Our Backyard
Did anyone notice that we have a bear flag in our backyard ?
The attached chart shows that the flag pole of the bear flag pattern started to form sometime in 29 Oct 07; it was completed on 21 Nov 07. The length of the flag pole was about 515 points. The bear flag took the STI up 300 points from 3,300 on 21 Nov 07 to 3,600 on 11 Dec 07.
(click to enlarge for viewing)
According to the description of bear flag pattern, the target point shall be the length to the flag pole, measuring from the bottom of the flag. This target point is 2,790 which was exactly where STI had landed on 17 March 08. It rebounded to 3,200 for a total gain of about 400 points before heading south again. Since then, 2 wedges have been formed and both were broken.
By the look of the sharper fall being developed recently, STI may be going to create another bear flag pattern on its way.
Bear flag in Weekly Chart
To filter out the noises, it would be interesting to see how the chart will look like in a weekly chart.
(click to enlarge for viewing)
As shown, the weekly chart also forms interesting bear flag pattern except that the daily chart’s bear flag has now disappeared. What was shown is another bear flag pattern that had the pole top formed since 12 October 2007 @ 3,870. The bottom of the pole was completed on 20 March 2008 @ 2,825. The total length of the flag pole is about 1050. The flag took STI to a high of 3,250 on 9 May 2008.
Again, if the traders had their ways and the bear market shall continue for a few years, the target of STI could be 1,800, which is about 1050 (the length of the flag pole) away from the bottom of the flag pole.
Take note that 1,800 is a very strong support and it is also around 0.618 of the Fibonacci retracement level.
Disclaimer: Information here is for sharing and learning. It is not intended to give any advice on price of any stock or movement or trend of any index. If a price or movment of a stock/index is given, it is only intended for illustration. The reader shall verify the information given here before using them.
Thursday, September 4, 2008
4 Sept 2008
Why STI Was Falling More than HSI, Shanghai and other Indexes?MAS announced various economy data yesterday; some of which are important such as CPI and PPI figures; but, these figures were ignored in the past and why so different today? DOW closed positive at 0.14% during the night, Nikkei closed down 1%, HSI closed down 0.95% and Shanghai closed flat but look at STI, closed down 3%. All these while, STI has been tracking the movement of DOW, HSI and Shanghai indexes from a distance; for example, when HSI dipped 2%, STI dipped only 1%.
There is no obvious reason except for the possibility that the traders are waiting for some bad news to come because they were cautiously optimistic during the past trading days, cumulating some gains. Today is the right moment; poor economy data plus a Head and Shoulder pattern shown in the attached chart.
Notice that STI broke one of the neckline of the Head and Shoulder pattern on 7 August and the market responded with an increased volume of trade and today, it just repeated the same.
If the STI traders had a choice, they would set a new low target for STI. It is often said that whenever a neck line of a head and shoulder pattern is broken, stock price would further dip from the break point by the same price amount measured from the tip of the head to the neckline. This new low target happened to be 1,600. This target might become a reality if this bear market were allowed to be continued for a number of years.
(Doubleclick for enlarged view)
Disclaimer: Information here is for sharing and learning. It is not intended to give any advice on price of any stock or movement or trend of any index. If a price or movment of a stock/index is given, it is only intended for illustration. The reader shall verify the information given here before using them.
Saturday, August 16, 2008
World Major Index Comparison doubleclick image for enlarged view
13 Feb 2009
30 Jan 2009
The US 10-year bond yield stayed high since the 1st day of the new year, 2009. It would appear that investors were not interested in the bonds and directed their investments elsewhere..
23 Jan 2009
17 Jan 2009
10 January 2009 The 2nd week of the new year was not good for US equity. DOW and S&P slipped into the red as compared to the monthly average and Nasdaq was the strongest among the 3 US indexes, still maintaining its gain for the week. KLSE and Jakarta climbed to the 1st and 2nd position. The US 10 year bond yield had appreciable gains, indicating that investors are losing interest in Bonds.
2 Jan 2009 "A good start in the new year will bring good luck to the market", so said many investors. This is exactly what the investors have done. World indexes shot up with the European and US market taking the lead, gaining more than 6% compared to the monthly average. STI and Hang Seng have made reasonable progress except for Shanghai, which lost about 7% compared to its monthly average. The continued rise in the 10 year US bond yield supported the US equity market.
28 December 2008 It has been a terrible Christmas week for World equity markets. Many indexes have lost their gains and left only about 30% of them in the black. Jarkata, Nikkei and KLSE maintained or increased their gains to clinch the top 3 position. STI slipped to 10th position after having lost about 5% of its shines. It is hope that year 2009 will be a better year for World equity markets.
21 December 2008 STI advanced to 6th position from last week's 10th position and Hang Seng Slipped for the week to 4th position. Kospi clinged the 1st position after having gained 10% compared to the 4 weeks' average. On the other hand, the US and the European markets have slipped their position in the week. It is noted that Australia, Japan and Malaysian markets have turned positive in the 4 weeks average. Altogether, 17 out of the 19 indexes tracked have registered gains in the week. 13 December 2008 Hang Seng is still in top position although it had shed more than 5% on Friday when all Asian Market fell because US Senate rejected the US Auto bailout bills. STI dipped more than 3% to 1,740 but it had advanced to the 10th position because it had less volatile sessions in the week. The US and Erupean markets, except for Stockholm and FTSE, had poorer performance and slipped to lower position in the week. Looking ahead, the Asian markets could have better performance in the coming weeks.6 December 2008 Shanghai and Hang Seng has taken over the lead in the week with the US counterpart following closely behind. Shanghai gained an appreciable 6% and Hang Seng, 2% as compared to the 4 week average. The US market performed relatively well since the 3-4% hike on Friday. The rest of the World market appears to be in negative territories. They might do catch up from next week. 30 November 2008 The US and European market staged a surprise triple digit gain after the thanksgiving holiday in a 1/2 day trading session last Friday. This gain lifted the US and European market to the front as far as the index rating is concerned. With the better than expected Black Friday retail sale figure, one would expect the US and European market to perform even better in the coming week. As for the Asian market, the have slipped their position with STI going back to the 16th position, except for Hang Seng, which had capture the 1st position with continuous gain over the past 1 week. Bombai was worst hit because of the terrorist events which killed over hundred and injured more than 300 people when terrorists sieged the Taj Mahal Palace Hotel. The event has just only ended. 21 Nov 2008 Asian Markets soared in the week in the process of replacing US and European markets to take the lead. Many Asian countries have been given out stimulus packages. Shanghai was still in the lead with a wopping gain of 7.5% compared to a month's average. STI and Hang Seng made progressive gains with US markets also improved against the European counterparts.
15 November 2008
It is not a very good week for the World's equities. The indexes dropped with only Shanghai and FTSE stayed position compared to the 4 weeks' average. The US markets are testing their low again. STI shed about 4% and slipped from 6th postion to now the 12th position. All markets are now way below its 52 weeks's average by a margin of more than 25%. Shanghai, Hang Seng, Jakarta, Bombai, Taiwan were hit the hardest with losses of more than 40% compared to the 52 weeks' average.
8 November 2008
The Asian stocks have advanced and caught up with the European and US markets which had huge losses last week. STI gained 0.7% compared to the 4 weeks' average and clinched the 6th position in the chart. On the other hand, DOW slipped to 7th position from 3rd position after losing more than 3% compared to its 4 weeks' average. The Hang Seng made progress also in the week.
1 November 2008
The US and European markets ended the month with a good gain. They were up more than 1% compared to the 4 weeks' average. Their Asian cousins, however, are still struggling to get ends meet for some reasons. They were down 2 to 11% compared to the 4 weeks' average. As usual, the table will turn slowly and soon the Asian markets will be up and the US and European markets will be down again.
24 Oct 2008 The US 10 year Bond yield still remained high, meaning that traders are going for some other type of investment or just keeping the cash in hand. STI performed badly in the week and slided to the second last position with Korea's KOSPI in the last. US and European markets appeared to have done better than the Asian counter parts although KLSE held on to its position for quite some time. 11 October 2008 lor=#333333>It is not that the Hang Seng or STI's performances improved but rather the European and US markets deteriorated last week. STI and Heng Seng climbed several notches for STI to reach the 8th position. It is presently down 17% compared to the average about 1 month ago. Shanghai appeared to have recovered from its "shocks" and is now gaining momentum. The position of the various indexes appears to go in cycles. As soon as one index went down to bottom, it would come up to clinch the top position later and vice versa.
4 Oct 2008 It is US's turn to take the punishment now that their indexes has slipped badly with Nasdaq now in the last position, slipping from 7th position just about 2 weeks ago. STI and Hang Seng inched up a notch in the week with Kospi (Seoul) clearly the winner. Nikkei's performance was not too good in the week, falling from 12th to 16th position. 27 Sept 2008
The Shanghai traders must be happy when the Shanghai index jumped about 4.5% in the week compared to the average for the month. It is now in the 1st spot, pushing other indexes down. The Australian performed rather well and managed to recover some of the gain for the week. As for STI, its performance has deteriorated from 12th position after losing about 6.5% compared to the average for the month.
20 Sept 2008 STI improved its position from the 15th to 12th as it gained 2.1% to reduce its losses from 4.9% to 2.8% in the month. The US and French markets were the top gainers with US 10 year yield in the top position, gaining about 2.45% compared to a month ago. This suggested that traders were selling bonds and buying either equities or commodities as the markets rallied.
13 Sept 2008 Bombai slided to 13th position after losing about 500 points in the week.. KLSE and Swiss Exchange lost quite a lot as well. This allowed Dow, FTSE to climb up. KOSPI of Seoul had impressive gain of about 70 points or about 5%. STI stayed put, although a tad better than Hang Seng. Note that the 10-year bond yield has gone up; may be smart money is going for Commodities stocks. Overall, the equity market is still underwater.
Disclaimer:
If a price or movment of a stock/index is given, it is only intended for illustration. The reader shall verify the information given here before using them.
