EVeRYThInG HaPPENs FOR tHE rEAsON :)

In one of little kingdoms of long ago there lived a King who (like most of them) was fond of hunting in wild places. His Chief Advisor was a very intelligent man, and also a very optimistic one. He was famous for seeing the rosy side of things. In fact, so strong was his habit of finding good in everything that at times this annoyed his ruler.

One day the King went hunting and had a little accident. He shot an arrow at his own foot and was injured. He asked the advisor what he thought about the accident, to which the advisor replied, “Everything happens for the good”. This time the King was really upset and ordered for his advisor to be put in prison. The King asked his advisor, “Now, what do you think?” The advisor again replied, “Everything happens for the good”. So the advisor remained in prison.

The King later went on a hunting trip, this time without the advisor. The King was then captured by some cannibals. He was taken to the cannibals' camp where he was to be the evening meal for the cannibals. Before putting him into the cooking pot he was thoroughly inspected. The cannibals saw the wound on the King’s foot and decided to throw him back into the jungle. According to the cannibals' tradition, they would not eat anything that was imperfect. As a result the King was spared. The King suddenly realized what his advisor said was true. The advisor also escaped death because had he not been in prison, he would have followed the King on the hunting trip, and would have ended up in the cooking pot.

Mr. Ben cut rates finally, so WHAT IS NEXT?

Wow... finally Mr. Ben slashed both rates by 75 basis point. Federal funds rate was lowered from 4.2% to 3.5%. Discount rate for the banks was lowered to 4% (was 4.75%).

Remember what happened when FED cut discount rates on 17th Aug 2007??? Before rate cut, DOW Jones index fell down from 14,000 marks (19th July 2007) to 12,500 (intraday low on 16th Aug 2007). Once FED announced discount rate cut by .50%, DOW started to turn the direction upwards which hit 14,160 on 9th Oct 2007.

Are we expecting the same things again happen after FED cut both rates by .75%? Of course, FED hope to see some stability in the market. Nobody can control the markets which are mostly being driven by emotion at the moment. Hangseng Index dropped 2,000 points today, isn't it crazy? However, I believe Mr. Ben moved to cut both rates was the best option that will bring some relief to the market. Another good thing coming up is the $140 billion to $ 150 billion economic stimulus package. Hopefully, it will kick the bear out and let the bull lead the train.

Do you think US will not try their best to avoid a recession? I don't think so especially now they are preparing for the coming election on 4th November 2008. To avoid a recession, we need something more than keep cutting interest rate. Mr. Paulse seems very confident that US can avoid a recession. Let see how he gonna do it. :)

ASIA MARKET (STI, HSI, NIKKEI)

Looking at the history, I am confident technical REBOUND for all ASIA market will start tomorrow onwards.

WELCOME TO MY NEW BLOG!!!!!!!! HUAT 2008

I hope you will find this blog a useful companion on your journey towards a deeper understanding of FINANCIAL MARKET and also understanding yourself better in achieving your goals, dreams and aspiration in life.