Wednesday, June 26, 2013

Seeking #futureofmoney interns for help with gonzo finance: Will pay with alternative currency

WANTED: UNDERDOGS WITH ATTITUDE
I've got some alternative currency, and I'm willing to give it to interns who can do part-time work for me to help me with publicity for my new book on global finance. I'm going to be resuming work on the London School of Financial Activism soon too, so there are possibilities to get involved there as well.

Up for grabs: Alternative currency for alternative work
I'd like open-minded people who are keen to learn more about alternative finance. I'll be straight up with you though: Some of it is total drudge work, like trawling through a list of 100 institutions and finding email addresses for them. I have a series of discreet tasks you can volunteer for in exchange for a bounty in certain esoteric currencies I've got from selling my book. Choices include:
  1. Bitcoin: Not only is this an interesting experience to use in itself, but you get to tell people at parties that you're paid in cryptocurrency
  2. Brixton Pounds: I'd like to get at least one South London dweller to do a couple hours for Brixton Pounds
  3. Barter: This option is available for people who'd like a copy of my book in exchange for an hour or two of work

How to apply
My email is in the right-hand column, so ping me message if you're interested. I'm favourable towards slightly outsider, underdog, anarchic types. I'm not so interested in how clever you are, or what extra-curricular activities you did at school. Send me a brief description of yourself, and a (non-finance) Youtube video you particularly like (could be anything), or write a haiku about money. I can then send a list of things I'm looking to get done, and we can start a conversation.

Monday, June 24, 2013

Understanding US Treasury & Yields


Just when the whole world coming for a rout, only US treasury yields shoot up to multi-months high. Investors might wondering why this happen. Some of our readers are posting these kind of question to us. We think this article might helps.


US Treasury = US Government Bond

Actually, we are referring to US Government 10 Years Bond. Generally, a government bond is issued by a national government (in this case US) and is denominated in the country's own currency (USD). Bonds issued by national government in foreign currencies are normally referred to as sovereign bonds. The yield required by investors to loan funds to governments reflects inflation expectations and the likelihood that the debt will be repaid.

Also, government bonds were usually referred to as risk-free bonds, because governments could easily devalue their currencies or raise taxes to redeem the bond at maturity. 



The Story of US Treasury Yields...
Just like Base-Lending-Rate (BLR) for Malaysia, everything from mortgages to corporate loans in US depends on US treasury yields. Higher yields mean higher borrowing costs. To stimulate the US economy, Federal Reserve had came out with various Quantitative Easing (QE) actions to bring down the said yields, allowing borrowers access to cheap funding. How to bring down yields? Federal Reserve will buy back US treasuries, thus, flooding the market with money. The side effect was a weakening USD.



However, all things will change 360 degree, if Federal Reserve start to slow down or totally stop their so called QE3. This is what happening now, creating uncertainties to global markets.

Monday, June 17, 2013

●●●● ●● ●●● ▬ ▬ ▬ ▬ ●▬● ●● ●▬

Som titeln kanske avslöjar så vill jag i denna blog betona historiekunskapens betydelse för att lyckas med sina investeringar. Det finns som bekant en uppsjö av tips och råd att förhålla sig till för den som försöker bli en framgångsrik investerare. Jag tror dock ett av de allra viktigaste skälen till att folk misslyckas i sina val av investeringsobjekt är historielösheten. Jag tror att denna ignorans för det som redan skett är allmänt utbredd, jag själv är tyvärr inget undantag, och det sägs att kunskapsluckorna ökar snarare än minskar bland unga. Det som är mkt trevligt med detta är förstås att ju mindre folk i gemen vet desto mer pengar finns det att tjäna för den som vet!

Titeln för denna blog är ett försök att visa vad som händer när det som en gång var betydelsefullt för ekonomin försvinner i glömska. Ni som fortfarande inte vet vad titeln för bloggen säger är levande exempel inte bara på kunskap som går förlorad med tiden men också levande exempel på att man kan klara sig ganska bra utan att behärska den gamla tidens teknologi. Morse var en gång hett, precis som html-kod är hett idag. Och som representant för den (kanske) en procentimille som kan sända och ta emot morsemeddelanden kan jag bara stillatigande se hur den kanske sista potentiella arbetsgivaren försvunnit. Bharat Sanchar Nigam Ltd (BSNL), det Indiska telegrafkontoret, stänger denna vecka ner efter 150 år av telegraferande av stort och smått över subkontinenten! Det enda jag kan hoppas på nu är en kärnvapenladdning stor nog för att sända ut en elektromagnetisk puls (EMP) som slår ut alla datorer världen över (fullt möjligt). Då jag av erfarenhet vet att det tar flera månader att lära sig telegraferandets konst även om man ägnar 8 timmar om dagen åt det borde jag ha ett fönster om ett halvår eller så att skörda monopolvinster.

Vad har detta med finans att göra? Jo, som jag sa i början av bloggen så är det denna typ av paradigmskift (en del mindre, en del större) som jag tror skapar möjligheter för investerare. Nu är det förstås för sent att profitera på mobiltelefonens utkonkurrerande av telegrafen men frågan är vad nästa steg är? Och för att förstå detta innan alla andra förstår det krävs det historiekunskap. Skulle jag tro…….

The Rise of Financial Planner


As promised, Finance Malaysia blog would like to educate public at large on the importance of personal financial planning, after knowing that most Malaysians falls into debt traps because of this poor financial planning. After finding out, we're surprised that actually not many of us knowing this NEW distribution channel in financial markets --- Financial Planner.



The NEW Alternative...

Traditionally, when we sourced for financial products or services, we normally go to either agent or bank. Example, for life insurance or unit trust, we buy from life insurance agent or unit trust consultant or banker.

This trend continues few years back, when Securities Commission of Malaysia and Bank Negara Malaysia comes out a framework or guidelines introducing financial planning industry. Then, financial planning firms emerge, until only recently some of us would have heard about its existence in the market place. Of course, financial planners came into picture too.

Role of a Financial Planner?
By definition, a financial planner is a practicing professional who covers the whole process of financial planning including cash flow management, education planning, risk management, investment planning, retirement planning, estate planning, tax planning and business succession planning (for business owners). The key defining aspect of what the financial planner does is that he/she considers all questions, information and advice as it impacts the financial situation of client. 

Highly Regulated?
In Malaysia, the term 'financial planner' was regulated and legislation requires a person to be licensed before he/she can hold himself/herself out as a 'financial planner'. Authorities view financial planner as a professional and should be differentiate it from the rest of financial practitioners. Just as the title 'Dr' only for Doctor or doctorate graduates, and 'Ir' for qualified professional engineers to instill the confidence of public based on titles.

It's an offence to call on yourself as financial planner or practicing financial planning for clients, without license in Malaysia. Those who found commits such offence, on conviction, be liable to a fine not exceeding RM5mil or to imprisonment not exceeding 5 years term or to both. Wow... Considered as a serious offence.

Even said so, many insurance agents or unit trust consultants commits the offence without realizing it. So, please tell your insurance agent or unit trust consultants whom you love or care about.

This article was contributed by Alex Yeoh, a licensed financial planner with a reputable financial planning firm. Finance Malaysia blog will work together with Alex in bringing more interesting articles on personal financial planning. For more info, you may reach him via email alexyeoh@vka.com.my

Friday, June 14, 2013

Why so FEAR if US Federal Reserve stop QE ?

Global shares tumbles to multi-months low, especially in Asia whom did well year-to-date thanks to Japan's Abenomics. Commodities and gold also can't spare from the bearish sentiment across investment markets. Reason? US Federal Reserve may stop/scaling down their bond-purchase program. Huh!!!


Is this the real reason?
Like what I always said, analysts always give a reason for whatever bull or bear markets (after it had happen). For me, the main reason was (again) profit-taking activities took place in view of the good performances during first half of this year.


How about Federal Reserve's QE ?
It's funny to blame Federal Reserve for the corrections. First, why Fed want to stop QE at the first place? It's because US economy is recovering well. Wasn't this a good news to global markets? Definitely. Then, why we're so fear if Fed stop QE ? Doesn't make sense, right?


Anyway, like what I said, the real reason was profit-taking activities which is normal after a good run-up. Current stage must took place before the market can move higher. Good for investors. Good for you. Good luck.

Monday, June 3, 2013

New Fund: AmIncome Flexi 3 Bond Fund

Following the success of the 1st and 2nd tranches of AmIncome Flexi, which were launched on Sept 18 and Dec 12 last year, with Rm100mil and Rm250mil in asset under management respectively, AmInvest once again would like to satisfy investors appetite.


"Given ample liquidity from the various central bank easing measures, the bond market is expected to be well supported in 2013". The 3 year closed-ended fund, targeted at investors seeking regular income and potentially higher returns than fixed deposits but with lower risk than equities.


How to do that?
To achieve the investment objective, the fund intends to invest its NAV in a portfolio of domestic and/or foreign sovereign issued bonds and corporate bonds, with minimum 'A' credit rating. The manager will purchase bonds which will generally have shorter or same maturity to the fund's maturity. The fund employs a flexible investment strategy as follows:-


  1. Will not actively adopt a trading strategy unless there are decrease or expected decrease in interest rates resulting in an increase of bond price, for the purpose of maximizing returns of the fund over 3 years;
  2. May at its discretion dispose off a bond to mitigate currency risk for the benefit of the fund;
  3. May also opt to dispose off a bond when it has achieved at least 15% cumulative return before its maturity, and return the proceeds of the bond to investors;
  4. May liquidate the particular bond affected in the event of a credit downgrade if the manager at its discretion feels that there is a likelihood of credit default. The bond's sale proceeds may be reinvested in fixed deposits, money market instruments and/or other bonds;
  5. May use derivatives for currency hedging purpose, for investment in foreign currencies denominated bonds.

For more info: