Is it nice? Is it gonna be a success & sell like hot hot cakes? Dare to try? :-)

Bush Fires in Australia Engulfed 171 Lives & The Numbers Continue To Rise

http://news.bbc.co.uk/1/hi/world/asia-pacific/7877243.stm

Mr. Sony Financial Woes & Its Misleading Advertisement

Should Sony Shred Its Too Many Layers Of Management?

A long list of big icons worldwide risk being toppled by the global financial crisis! Reputable companies which once could be relied upon to make steady profits are now losing money and shedding jobs.

One of the big name which had succumbed to the current ferocious global recession is Sony and its on course now for its first annual loss in 14 years. Sony says for the financial year ending in March, it expects to make a net loss of 150bn yen ($1.7bn; £1.2bn).
Of course, it's by no means the only major firm to suffer because of the global credit crunch. So, what's the big headached for Mr. Sony?

Playstation losses
Take for example the Playstation 3 computer game console. Sells are not as brisk as its cheaper rivals - Nintendo's Wii & Microsoft's XBox

How about it's latest Vaio P computer? Will it really suit consumers' pockets?
Sony's been criticised for not cutting its price and loses money on each PS3 it sells, hoping to turn a profit when customers buy their games. The company plans to shut unprofitable parts of its consumer electronics operations but its Playstation division will have to remain in order to save face. It is cutting 16,000 full and part-time jobs from the electronics side of the company.
Although that may save money in the long term, the redundancies will cost the firm dear this year in terms of compensations paid to employees who opted for voluntary separation scheme (VSS). Some blame Sony's woes on its complex business structure. They say the management is too slow in responding to problems and the firm often misses its profits targets.
Sony's debts are estimated at about $10bn. Analysts from Credit Suisse, who've poured through the accounts say a major management rethink is needed urgently.

Not that Sony has given up trying to innovate. It is currently in the throes of marketing a miniature computer known at the Vaio P. The advertisements on the Tokyo subway system show the gadget poking out of the back pocket of a model in a tight pair of jeans. In reality, the computer's rather too big for most people's pockets. One of the design team revealed that the jeans in the publicity photographs were specially made for the shots. Mr.Sony, please don't exaggerate when marketing your miniature computer Vaio P. Common sense will tells you that it surely won't fit into an ordinary normal pockets... hehe.. This might falls under fraudulent misrepresentations as the description of the goods on advertisement does not fit for the purpose ! :-)

Too many product lines, too many sections, too many layers of management contributes to Mr. Sony's losses. Hence, it should be noted that BIG in size does not necessarily means efficiency and profitability ! Also, it must be borne in mind that the bigger the investment of one's company in times of this dreadful recessions, the more losses and cash flow problems will crop up due to the weak demands from consumer & dwindling investors sentiments across the globe! This is clearly evident in the case of General Motors which need a huge & urgent massive bailouts from U.S. government to avoid it from collapse and eventually leads to millions of unemployments! Same case scenarios happens on AIG, Freddie Mae & Freddie Mac. Recently, even Microsoft, Caterpillar, Toyota, Honda, Philips, Intel, and many other big names are announcing massive job-cuts to save their respective company from plunging into horrible losses!

The current financial crisis has forced Sony to make cutbacks which its critics say were long overdue. The focus now must now be on rebuilding the brand and restoring the devotion of its admirers!

Coffee or Tea for a Healthier You ?

Good Morning Ladies & Gentleman! Are you drinking tea or coffee right now? Popular belief labels tea as a health drinks and coffee as bad :-) How much credibility can we give to this general statement and popular belief? :-)

In an attempt to survive the rigors of our stressful lives, many people turn to fuel their bodies by consuming coffee. Caffeine is the principal element in coffee that is responsible for improving concentration and extending the time before the onset of fatigue. After as little as one cup, caffeine absorbs to almost every cell in the body, where it stimulates the central nervous system by elevating blood glucose levels giving an allusion of an energy surge. There, caffeine blocks a chemical called adenosine that signals to the brain it is tired; turning it into that invigorating buzz coffee drinkers crave. Caffeine is a psychoactive drug that can lead to dependency. Researchers suggest that caffeine is helpful in combating fatigue, increasing alertness and efficiency, but should be limited to two cups a day for optimal results. When using coffee as an antioxidant source, experts recommend that it is best to spread your coffee intake throughout the day stressing that fruits and veggies are still the ideal choice.


The impact of coffee on the overall health of mankind has been an extensive subject of survey over decades altogether. The resulting research has always reported a series of varied results, ranging from ill effects to moderate effects and even instances of a beneficial role of the drink. Let's analyze the pros and cons of coffee and tea in this article from various aspects with indications from different research reports.


Some research suggests that coffee effectively reduces the risk of being effected by colon cancer, though that is only likely to happen if the consumption is more than four cups a day. May I ask you, are u going to drink more than four cups a day of coffee? If the answer is no, then you won't be able to benefit from it.

There is no doubt that coffee also has an amazing effect on mental alertness.

A set of Chinese studies also report that coffee can reduce the effects of Parkinson’s disease.

In addition, various American and Scandinavian studies show that the decaf as well as regular coffee can help in the reduction of the risk of being effected by type-2 diabetes.

There is also a possibility of coffee being effective in reducing the constriction of airways in asthma sufferers, when consumed in moderation.

Well, that's all the benefits of coffee according to some studies and research conducted. Now, let's analyze the detrimental effects of coffee to our health.

Coffee Increase the Risk of America’s Main Cause for Death

Coffee consumption significantly increase risk of developing heart disease and succumbing to a heart attack. Heart disease is not only the foremost killer of adult Americans; associated cardiovascular problems can create substantial debility in older adults. Some of the factors that contribute to developing cardiovascular disease include: high cholesterol, diabetes, high levels of homocysteine, elevated blood pressure, abdominal obesity, stress, arrhythmias, low daily fruit and vegetable consumption. Coffee consumption negatively impact many of these risk factors. Coffee raises serum cholesterol. Coffee drinking causes increases in serum homocysteine levels. Coffee raises blood pressure and increases the incidence of arrhythmias. Coffee drinking significantly increases levels of stress hormones. Chronic stress and constant release of excess cortisol (which is affected by coffee) produces a more frequent incidence of abdominal obesity, further increasing heart disease risk!


Coffee Increase Chronic Stress

Coffee consumption increase our experience of stress by stimulating the release of the stress hormones cortisol, epinephrine, norepinephrine and the glucocorticoids. The continuous presence of these hormones not only has a damaging effect on a number of different physiological systems, but can also accelerate the aging process. Although short-term stress can be psychologically motivating and can mobilize physiological processes, the extended presence of stress-related hormones is detrimental and damaging. When stress hormones are chronically elevated, which occur as a result of our intense lifestyle as well as a consequence of ingesting coffee, mental concentration is short-lived as anxiety and feelings of tension increase, while fine motor coordination is impaired; the immune system is suppressed, digestion and elimination are impaired and the body’s normal repair mechanisms are inhibited, thereby accelerating the aging process!

Coffee Lowers Production of DHEA

Coffee decrease levels of the steroid hormone, dehydroepiandrosterone, commonly known as DHEA. DHEA seems to have a protective effect on the body and appears to be involved in defending against the negative effects of aging. Some of the physical and physiological changes of aging are related to the decline of many hormones including DHEA that assist in repair of cells and tissues, enhance cognition and memory, and help maintain the body’s physiological processes. Coffee negatively impact these complex hormonal systems!

Coffee aggravates Dementia and Alzheimer's disease

Alzheimer’s disease and associated dementia are not a normal part of aging; BUT current statistics reveal that approximately 7% of the population age 65 and over suffers from Alzheimer’s disease. Although coffee consumption are not directly related to Alzheimer’s disease risk, hypertension and other vascular abnormalities appear to be linked to a predisposition to developing the disease. Coffee and caffeine adversely affect blood pressure and the vascular system.

Coffee Reduce Minerals Absorption and Bone Density

Although caloric requirements often decrease with age, nutritional requirements increase and thus, it can be difficult to maintain adequate vitamin and mineral status. For instance, deficiency of vitamin B-12 occurs as frequently as in 20% of the elderly, but can be difficult to detect. Coffee interfere with absorption and increase excretion of several vital minerals necessary for maintaining cardiovascular health, preserving bone density and preventing chronic diseases, including calcium, potassium, magnesium and iron.

Today, 10 million of U.S citizens are diagnosed with osteoporosis and 33 million more suffer from low bone mass, which subsequently increases their risk of developing osteoporosis or associated fractures. One out of every two women and one in four men over 50 will have an osteoporosis-related fracture in their lifetime. Osteoporosis is responsible for more than 1.5 million fractures annually. Usually thought of as a disease of post-menopausal women, osteoporosis is increasingly a problem in elderly men: more than 2 million American men have osteoporosis and each year, 70,000 men fracture a hip.

With increasing age, the probability of developing osteoporosis also increases. Osteoporosis has no single cause. It is related to a complex series of hormonal interactions that regulate bone formation and reabsorption. Hormone levels, including estrogen and testosterone, are both important in mineral deposition and activity of osteoblasts, the cells which create new bone.
Bone density is not only influenced by mineral intake, absorption and excretion but also by maintenance of the bone’s mineral composition. Adequate calcium and vitamin D is critical for mineralization of bone, and coffee intake not only interferes with calcium absorption but also increases urinary calcium excretion. Consumption of acidic foods including coffee increases the leaching of minerals from the bone due to overall increased metabolic acidity. Minerals appear to have a buffering effect on the bloodstream and are subsequently leached from bone to realkinalize the blood when pH levels have shifted too far into acidity. Excess acidity has been associated with negative calcium balance and increased excretion of calcium.

Caffeine’s Interaction with Pharmaceutical Drugs

The body perceives caffeine as a drug that needs to be detoxified by the liver through the cytochrome P450 (CYP) 1A2 pathway. A number of other substances are also metabolized via this pathway, including a number of pharmaceutical medications. These include anti-arrhythmic drugs, the selective serotonin reuptake inhibitor antidepressants, brochodilators and the quinolones, a group of broad-spectrum antibiotics that includes Ciproflaxacin, among others. The interference among these chemicals may cause toxic effects from the increased levels of either caffeine or medications, or both, in the bloodstream. As people tend to take increasing numbers of pharmaceutical drugs with age, these interactions can become significant. The presence of caffeine increases the workload for the detoxification processes of the liver.
Women who take estrogen replacement therapy should be concerned about caffeine intake. Estrogen inhibits caffeine metabolism, therefore simultaneous use of caffeine and estrogen can increase serum concentration of both chemicals, increasing the risk of toxicity or adverse effects.
We are constantly being subjected to chemicals, environmental toxins and free radicals that directly damage both cellular DNA and their biochemical structure as well as interfere with the ability to repair the effects of constant injurious onslaughts. Caffeine and coffee impede the processes of constant repair, which are necessary to keep functioning in optimal condition. Eliminating caffeine and coffee from the diet can support the process of aging with grace and improved health.


Aside from that, the following characteristics of coffee have an adverse effect on the aging process:

Coffee Affects the Endocrine System

Coffee Elevates Stress Hormones. Caffeine in coffee elevates the stress hormones cortisol, epinephrine (also known as adrenaline) and norepinephrine. This elevation is present even hours after consumption. Chronic metabolic acidity associated with coffee consumption stimulates cortisol secretion, further activating the stress response, leading to a more rapid aging process. Decaffeinated coffee also stimulates the autonomic nervous system. The purpose of this “fight or flight” response is to provide the body with a temporary energy boost for intense physical activity by increasing heart rate and blood pressure to create a sense of “emergency alert.” Circulation of oxygen to the brain and extremities is decreased, the immune system is suppressed, and normal circadian rhythms are disrupted. With today’s sedentary lifestyle, the continual state of increased stress resulting from coffee and caffeine consumption dramatically accelerates the aging process and compromises the nervous system.

Detrimental Effects of Coffee and Caffeine on Aging

• Coffee Increases Gastroesophogeal pressure exacerbating heartburn and acid reflux. Consumption of both decaffeinated and regular coffee increase gastroesophogeal pressure increasing incidence of heartburn, acid reflux and chronic gastrointestinal reflux disease.

Coffee Increases Intraocular Pressure

People over the age of 60 have a greater risk of developing damage to the optic nerve caused by glaucoma, which is most often due to increased intraocular pressure. In healthy adults, consumption of caffeine in regular coffee increases intraocular pressure as well as systolic and diastolic blood pressure, and increases intraocular pressure to a greater extent than drinking herbal tea. Consumption of both caffeinated and decaffeinated coffee demonstrably increases intraocular pressure. Magnesium deficiency is also linked to glaucoma, and coffee interferes with magnesium absorption.


Coffee Increases Risk of Developing Rheumatoid Arthritis

Rheumatoid arthritis has a common onset of middle-age, between 30 and 50, but it is a chronic degenerative disease that often worsens with age. Preliminary studies indicate that regular coffee consumption can increase the risk of rheumatoid arthritis through the higher levels of rheumatoid factor. Decaffeinated coffee consumption is linked to increased incidence rheumatoid arthritis onset. Other studies found inconclusive results. Significantly, low levels of the hormone DHEA are observed in women who subsequently develop rheumatoid arthritis.

Coffee Affects Erectile Dysfunction

Caffeine consumption is associated with increased incidence of erectile dysfunction in adult men.

Coffee Interferes With Ability to Fall Asleep in Older Adults

A study examining the ability of older adults (age 67 or older) found the use of caffeine interfered with their ability to fall asleep. Reduced quality sleep has been found to increase insulin resistance which can lead to type 2 diabetes and heart disease.


Ooops... it seems that based on the scientific evidence & general common sense, the detrimental effects of drinking coffee far outweighs it's benefits :-) As people age, their ability to break down caffeine decreases and interactions between caffeine and prescription medications can become more problematic. Caffeine and coffee also increase susceptibility to many of the chronic diseases associated with the aging process. As people get older, they would do well to avoid coffee.

And now, let's find out the effects of drinking tea and it's effects on our health

Tea helps prevent diseases such as Alzheimer's. Tea may also help keep bones strong to help fight against Osteoporosis. Osteoporosis affects peoples posture which affects the way they walk. Drinking tea may help you ward off Osteoporosis which is very important. Unlike coffee, tea helps your teeth. Coffee makes your teeth discolored and brittle. However tea has antioxidants that prevent cavities and unlike coffee, tea doesn't stain your teeth. Coffee drinkers are advised to visit the dentist a minimum of 2 times per year unlike non-coffee drinkers who may got once a year. That impliedly means non-coffee drinkers would be able to save more money from flowing to dentist..ha ha.. Tea may be more vital to your health than you think. Coffee just suppresses your appetite making you not want to eat. However, tea helps speed up your metabolism which causes you to burn fat faster and helps you to lose weight alot quicker. To those who wants to keep fit & slim, you know what to do :-)

Well, well, well, so if you guys and gals would like to avoid accelarating your aging process, to lead a less stressful life, to fall asleep easily and indulge in your world of fantasy, to avoid those chronic disease, to have a longer life, and not forgetting to keep fit and slim, you know what is best for your health :-) The choice is yours!

Things that have really been said in American courtrooms, allegedly ...

ATTORNEY: Are you sexually active?
WITNESS: No, I just lie there.


ATTORNEY: This myasthenia gravis, does it affect your memory at all?
WITNESS: Yes.
ATTORNEY: And in what ways does it affect your memory?
WITNESS: I forget.
ATTORNEY: You forget? Can you give us an example of something you forgot?


ATTORNEY: What was the first thing your husband said to you that morning?
WITNESS: He said, 'Where am I, Cathy?'
ATTORNEY: And why did that upset you?
WITNESS: My name is Susan!


ATTORNEY: So the date of conception (of the baby) was August 8th?
WITNESS: Yes.
ATTORNEY: And what were you doing at that time?
WITNESS: Uh ... I was gett'in laid!


ATTORNEY: She had three children, right?
WITNESS: Yes.
ATTORNEY: How many were boys?
WITNESS: None.
ATTORNEY: Were there any girls?
WITNESS: Are you kidding? Your Honor, I think I need a different attorney. Can I get a new attorney?


ATTORNEY: Can you describe the individual?
WITNESS: He was about medium height and had a beard.
ATTORNEY: Was this a male or a female?
WITNESS: Guess.


ATTORNEY: ALL your responses MUST be oral, OK? What school did you go to?
WITNESS: Oral.


ATTORNEY: Do you recall the time that you examined the body?
WITNESS: The autopsy started around 8:30 p.m.
ATTORNEY: And Mr. Denton was dead at the time?
WITNESS: No, he was sitting on the table, wondering why I was doing an autopsy on him!

Climate Change : London's Largest Snow Storm in 18 years!

After Crazy Snow Storm!
Before Crazy Snow Storm

Snow cripples London Underground, London's Heathrow & Gatwick Airport, London's rail network and London Bus services due to treacherous road conditons. It was the largest widespread snowfall in 18 years. The storm, which began Sunday night, left much of London and southeast England paralyzed, while ferociously dumping as much as 6 inches of snow on other parts of England.

So, what's the impact of this ferocious storm on Britain's economy? Workers unable or unwilling to get to work contributes to lost productivity as a result of this major storm. Since few businesses were already operating at full capacity due to the recession and if the bad weather phenomenal persists, it will surely aggravates loss of productivity.

It should be noted that the recession has also hurt business cash flow and lost of productivity is largely a cost to business. So if storm-related disruptions lead to delayed payments, the double jeopardy hit on cash flow and profit could send many businesses who might be close down to the brink of premature bankruptcy! Generally, many of the businesses on the verge of failure are in the construction and retail sectors, which are likely to be affected by the devastating impact of storm-related disruptions. 2,000 to 3,000 businesses could fail in the first quarter as a result of bad weather conditons.

So, what's the moral of the story from this bizarre phenomenal? :-)

- A concentrated & serious efforts is urgently needed to curb Global Warming before it freezes the whole Europe!!!!!!!!!!!!!!

- Climate Change affect and interconnect with the Economy & our Social Life. It's a wake-up call for those who are ignorant of this Global Warming which lead to dramatic Climate Change!!!

- To some politicians, please stop fighting for powers to control the country. This Climate Change / Global Warming issue if of utmost important and should be on top agenda (priority) to be addressed in Parliament with urgency! To some economist and CEO of company, please minimize & reduce the emission of carbon dioxide from power plants & factory. To those air plane & vehicle users, please reduce the usage. Also, stop destroying tropical forests (deforestation). Together, we can make a different for the betterment of this ailing Planet :-)

SINGAPORE FLYER : World's Largest Giant Observation Wheel~

London Eye, You Loser :P

It Happened on Last Day of Bush In Offices

Osama Bin Laden decided to send George W. Bush a letter in his own handwriting to let him know he was still very much in the game. Bush opened the letter and it contained a single line of coded message

370H-SSV-0773H

Bush was baffled, so he e-mailed it to Condoleezza Rice. Condi and her aides hadn't a clue either, so they sent it to the FBI. No one could solve it at the FBI so it went to the CIA, then to MI6 and Mossad. Eventually they asked Australian Intelligence (ASIO) for help. Within a minute, ASIO emailed the White House with this reply:"Tell the President he's holding the message upside down."

We Hope the newly elected Mr. President Barack Obama would not encounter the same case scenarios :-)

Breathtaking, Scenic & Picturesque Skyline of The Lion City~

Uniquely & Dazzling Singapore's Building & Skyline~

Uniquely & Dazzling Singapore's Building & Skyline~

The World is now facing 3F Major Problems ie Fuel, Food & Financial & not forgetting Climate Change!

BIG ISSUE : PREPARE TO BRACE FOR THE BAD TIMES

As the global credit crunch bites deeper into Britain, even the rich are beating a path to the pawnbroker's door like Suttons and Robertsons, hawking their pocket watches, diamond rings and other valuables for quick cash.

Sadly, the fact remains that every household is being badly hurt by surging fuel and food prices as well as higher mortgage repayment and utility bills.

As a consequence, whether you're an upcoming professional, pensioner on a fixed income or a struggling wage-earner, apparently everyone is bracing for what they see as a long & harsh winter ahead.

Amid reports that inflation had doubled in the past six months, some analysts believe it will hit 5% soon, delivering a hammer blow to millions of middle-class families.

Well, if locals are suffering the tightest squeeze on living standards since the 1970's, foreign students living in Britain, including some 12,000 Malaysian students, are not being spared either.

The US Wall Street's financial crisis add more salt to the wounds as millions of people around the world are hard hit by the US banking meltdown which will eventually send the whole world economy into recession very soon. Indeed, US has already enter into recession zone.

Singapore's economy is shaken up when world banking is in turmoil. Lehman Brother's operations came to a halt, a day after it went into bankruptcy. The jobs of its 260 staff members may disappear. Also the bailout of AIG, Fannie Mae & Freddie Mac are sending shock waves throughout the financial industry. Be it foreigners or Singaporeans are deeply concerned about their jobs. The US credit crunch is hitting this financial centre like a foot of big Gorilla stepping on this tiny island at a time when it is already in the midst of an economic slowdown and super-high inflation. For Mr and Mrs Singapore, worrying times for them as the economic downturn begins to bite. The stock market appears to be the worst hit where many Singaporeans had invested their money. The index shares have fallen by 35% in the past year and many other shares are down by as much as 50% to 60%. Some life savings have been wiped out and thousands are groaning over their large losses. The pulse of the Singaporean consumer spending is weakening and hurt due to stock market fall and the super high inflation.

If Singapore, Hong Kong & Japan which is such a dynamic Asia's roaring dragon country are bracing for the worst, what do u expect from others? :) Even with the US 700 billion financial rescue package, it seems like the money had been thrown down to drain & it ain't doing much benefits to heal the turmoil & investors sentiment. Investors around the world are dumping shares and property as it depreciated greatly in value like never before since the Great Depression.

The moral of the story from the ongoing saga :

-Don't live beyond our means & try to live without those credit cards

-Always save for the rainny day before it's too late

-One should reconsider investment banking as an alternative to build up wealth, as evident from the current crisis, the higher the profits rate promised, the riskier the investment would be

-Human beings ( judges, lawyers, Prime Minister, Mr. President, CEO, COO, doctors, accountants, legislators & even God of Wealth (Choi San Yeh-in cantonese) do make wrong judgements, stupid policy, so called "law & order" based on their false findings, wrong decisions, not so wise reasonings based on their very own opinions, flaws arguments & inferences

-Nobody & Nothing is perfect except God

-This world would be a better place to live in if everybody had the powers & wills of speaking the truth, practising honesty, set aside greeds & selfishness for the peace of the world

-Perhaps, this is the price we need to pay for Globalization & it's discontents :-)

-Cash is King at this point of critical time

-May The Force Be With You!!!

Causes & Effects of the Greatest Financial Disastrous on Earth!!!

Friday, October 24, 2008 at 12:00am

How is the financial tsunami started & who's to blame for this contagion global credit crunch which has now drag US itself, Singapore into recession & many more real soon. The roots of the problem had its beginning in the aftermath of Sept 11, 2001. After the incident, there was loss of confidence and consumers were in a state of gloom & doom. The Federal Reserve (Fed), in order to spur the economy, adopt a policy of a low-interest rate regime. Prior Sept 11, the Fed discount rate (interest that banks pay to borrow directly from the Fed) was 3.7%, with cost of fund for prime rate ( a reference interest rate used by banks) at 6.5%. At the end of 2002, the federal discount rate was 1% with the prime rate for loans at 4%. This low interest rate agenda continue up to mid-2005 and, because of these low cost funds, banks were aggressively on lending spree, primarily for housing. Mortgages were given to those without good track record ie no employment, no credit rating and no stable income. The banks were doing that because there was a steady appreciation in house prices by 2005 and they believe and treating houses as a very good collateral whereby in case of foreclosure, the prices of houses were more than the mortgages. Unfortunately, inflation went up and by 2006, the Fed had to increase the rates. In June 2006, the federal discount rate was 4.95% and the cost of funds for prime rate was 8%. As a results of this heavier mortgage payments for many house owners, they could not pay and default. They have to let go their properties. Consequently, the banks took over the houses and this created a slump in the market. By 2007, banks like Citibank and UBS were facing difficulties and sought injection of funds. The property market kept on slumping & dwindling till even a good paymasters could not afford to pay. The troubles heightened & escalated as Lehman Brothers, Fannie Mae and Freddie Mac, the top organisation for housing loans were in deep trouble. It should be noted that Fannie Mae and Freddie Mac had packaged their loans and resold them to buyers like Japan, Hong Kong, Singapore, China & many more. Those foreign countries thought that buying these financial products were akin to buying US treasury bills because they were implicitly guaranteed by the US government. As for AIG, it went into trouble because it provided insurance for many mortgaged properties. Hence, even the final protector (insurer) also collapsed.

One must be wondering how can big companies like American International Group Inc (AIG) go bankrupt and need US$85billion bailout & how did the world's fourth largest investment bank Lehman Brothers end up with a massive US$660billion of debts. A logical sense will tell us that this is only possible when financial institutions are using other people's money to invest and need prices to go up in order to make a profit and pay themselves 20% bonus on top of the 2% management fees. Most financial institutions have employed best graduates by paying them lucrative & hefty salaries to configure financial derivatives and mechanism that pushes the price of things so that they can make a killing as speculators. On 7th Julay 2008, oil speculators pushed up the price of crude oil to a record of US$147 per barrel based on demand for construction, cars, weather forecast and 2 billion consumers in the emerging markets like China and India entering the new market. Another illustration is that a piece of land that was worth $20 million was sold at double the price. The second buyer sold it to the third guy for $80million. The fourth buyer got a loan from the bank for $120million based on his proposed plans. When the plans did not materialise, the last guy declared himself bankrupt and the bank has classified that as a non-performing loan (NPL). The four smart guys then shared the $120million ;-) Such is the craft of the new financial wizard and the current banking system. That's how you get a credit crunch & financial meltdown. Who are the perpetrators of this financial tsunami? Clear cut answer- just take a look at the way and number of credit card offers one receive from the banks, either marked pre-approved for $10,000 or $15,000 or have a fake cheque that can actually be used just with a call to the customer service. Well, well, well.. all these cunning ways & efforts by the bankers is to hook those gullible consumers into the world of "high & painful interest rate loans". I reiterated "high & painful interest rate loans" !!! Some hold 7 credit cards while the average US citizen hold 13 cards. Wilbur Ross, a bankruptcy expert and investor feels that in some ways, the US financial onslaught could be blamed on the American consumer for wanting to improve their standard of living without having the wages and means to do so. Mortgage delinquencies, foreclosures, late payments, repossessions are increasing dramatically because loans were issued to people who clearly could not afford them.

Each day, there are people buying properties at higher prices based on their own reasonings that the asset value will appreciate and they can make a handsome profit within a year or two. When there is a property glut, all becomes NPL. Only those who had the staying power will see any benefits in their property investments. Speculators & borrowers will be caught by surprise when they can't pay the loans or during property slump. When there is a property slump and fewer buyers, the people who took out credit and re-mortgaged their properties to financial institutions and top insurers like AIG are in fact using funds two or three times the value of the property. And when they cannot pay, all the financial institutions go bankrupt. Creditor institutions should always adopt the golden rule : When you lend money, do not lose it. When you loan money professionally, you are at a big advantage because you have systems in place to make sure every borrower has the desire and ability to repay you, and the collateral in case they default. The problem surface when they do not even bother to conduct a stringent financial status check on the borrowers before making a loan. When the problems becomes insurmountable, is it fair for the government to bails them out with tax payers' money? It should be noted that, just like the borrowers, the lenders or seller too are responsible for their own reckless actions at the end of the day.

In the final analysis, it all boils down to this- Irresponsibility & greed to make profits on the part of financial institutions AND the public at large who lacks financial management skills had contributed to this financial meltdown and now need to pay for this terrible economic price. What to do? Nobody & nothing is perfect !!!

Crash! Boom! Bang! Crumbling! Tumbling! Plunging! Crippling!

Saturday, October 18, 2008 at 12:42am

10th October 2008 will always be remembered as horrible day for investors around the globe. Asian stocks were hammered with Tokyo diving 9.6 per cent as investors grew more concerned that the contagion global credit crisis is getting out of control. Markets across the region plummetted into the sea of red as dealers ignored a wave of interest rate cuts and billions of dollars of cash injections to sell their shares amid the worst global financial tsunami since the Great Depression.

Hong Kong saw 7.2 per cent wiped off its value. The market here has fallen 19 per cent in the past week and 50 per cent since the start of the year. Sydney also battered, losing 8.3 per cent, its biggest fall since the 1987 crash. Singapore lost 7.34 per cent to its lowest level in more than four years. Bangkok lost 9.6 per cent. Jakarta chicken out by suspend its bourse for a third straight day after a massive loss of 10 per cent on Wednesday. Basically, the markets were following the trend in Wall Street, where the Dow Jones plunged 7.33 per cent overnight, closing below 9,000 points for the first time since 2003.

The Nightmare on Wall Street gets scarier each day. Consumers spending powers are dwindling, car sales dropped most in 15 years and the US economy lost 159,000 jobs last month. Companies are downsizing & shed staff (retrenching) to stay competitive. Home foreclosures, stories about people losing their retirement funds and layoffs are common topics nowadays not only in US but worldwide. At least US$2trillion has been wiped out of retirement savings in the US following the credit crunch. USA Today reported that this came about as millions of Americans stopped contributing to their 401(k) accounts due to the economic difficulties. The property market goes bust and it's not likely to recover within the next three years. There won't be a property boom anymore. A financial consultant relates how a McDonald's shift manager who earned US$8.50 an hour inflated his salary by reportiing a US$80,000 annual income during a loan application to buy a US$750,000 house.