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In January 2008, in my e-mails to friends all over the world, I forecasted that Dow would go below 11,500 by the 2nd quarter. And the KLCI would go below 900 in the 3rd quarter.
Dow went below 11,500 months ago and just recently Dow even dipped below 8,000 but recovered.
Yesterday, 20th October 2008, the Kuala Lumpur Composite Index (KLCI) in the opening hours dipped below 900 points touching 888 but recovered to close at 906.25. My forecast for KLCI was off by six weeks, but the fact remains that it went below 900 points yesterday.
My analysis is now reproduced in my book, The Shadow Money-lenders and the Global Financial Tsunami.
Obviously markets gyrate all the time, more so in these turbulent times. But to state in January 2008 that the KLCI would retreat in the later part of the year is a result of hard work and in-depth research and analysis.
Not one financial analyst in Malaysia engaged by financial institutions and the mass media even come close in their forecast. They were all trumpeting that the good times will still be rolling. Many investors loss their hard-earned savings because of the over optimistic analysis of these so-called experts and economists.
Today, I read in the newspaper that the Deputy Prime Minister is hopping mad that Malaysiakini has attributed incorrectly to the Deputy Prime Minister an UMNO election manifesto which was put out by a blog. Malaysiakini has since apologised to the Deputy Prime Minister. This is only right.
However, I hope that the NST will also apologise to the Deputy Prime Minister for contradicting him.
The Sun newspaper on the 21st October 2008 at page 2 reported as follows:
Malaysia is not in a financial crisis and should not be talked into one, Deputy Prime Minister and Finance Minister Datuk Seri Najib Abdul Razak said yesterday.
The NST today, 21st October 2008, at page 1, reported as follows:
Extra RM5 billion to manage market crisis.
There will be those who will quibble that there is a difference between “financial crisis” and “market crisis”.
I shall not waste my time arguing on this point, suffice to say that at the present moment, stock markets throughout the world are in a topsy-turvy state and trillions have been wiped out since July 2007.
The stock markets have all dived from record highs, because of the global financial crisis impacting on the local economy. If the financial crisis did not impact on Malaysia, the KLCI would not have sunk below 900 points yesterday before recovering to 906 points.
For those of you who are still in the market, I hope your optimism is not misplaced.
Many have lost their pensions and life savings. |
