http://chaitanya.blogsome.com/2008/10/28/economy-downturn-is-recession-approaching/ To those who wants good sleep...yawn..pls read.. Fri, 25 Dec 2009 07:18:28 +0000 http://wordpress.org/?v=1.5.1-alpha http://chaitanya.blogsome.com/2008/10/28/economy-downturn-is-recession-approaching/#comment-190 Fri, 07 Nov 2008 02:11:57 +0000 http://chaitanya.blogsome.com/2008/10/28/economy-downturn-is-recession-approaching/#comment-190 Globally..the economic situation does look bleak. Although with all the rescue plans initiated by many countries around the world...sentiments is still negative and many countries are already in recession. Malaysia for that matter is surely not shielded from all this and it is just a matter of time before we will feel the effects. Research analysis says that the effects may be felt in the 1st and 2nd quarter of 2009 when companies announces lower then expected profit due to decline in consumer demand. International broker house, UBS forecasted a 0% economic growth for next year. Already several semiconductor companies in Malaysia are cutting the production hours thus reducing employee salaries as most of their exports are to US, local banks are more stringent in loan applications, inflation is high even with the lower oil prices. Many are afraid to invest because of the volatility and are staying on the sidelines. However, there is a silver lining to all this…as this is a time to invest in battered down blue chips. Investors should look at the long term as the market will eventually rebound but this may take some time. This has been proven during the 87 & 97 financial crisis, dot-com crisis, 9/11, SARS etc. However carefully analysis must be done by investors. Investors should go for defensive stocks or non-cyclic and focus on the long term returns. Companies which have track records for giving high or consistent dividend yields even at difficult times should be looked at. Investor should continue to maintain the golden rule of “Buy when the market is Low and Sell when the market is High” and as Warren Buffett says “Be greedy when everyone is fearful and fearful when everyone is greedy”. Globally..the economic situation does look bleak. Although with all the rescue plans initiated by many countries around the world...sentiments is still negative and many countries are already in recession. Malaysia for that matter is surely not shielded from all this and it is just a matter of time before we will feel the effects. Research analysis says that the effects may be felt in the 1st and 2nd quarter of 2009 when companies announces lower then expected profit due to decline in consumer demand. International broker house, UBS forecasted a 0% economic growth for next year. Already several semiconductor companies in Malaysia are cutting the production hours thus reducing employee salaries as most of their exports are to US, local banks are more stringent in loan applications, inflation is high even with the lower oil prices. Many are afraid to invest because of the volatility and are staying on the sidelines. However, there is a silver lining to all this…as this is a time to invest in battered down blue chips. Investors should look at the long term as the market will eventually rebound but this may take some time. This has been proven during the 87 & 97 financial crisis, dot-com crisis, 9/11, SARS etc. However carefully analysis must be done by investors. Investors should go for defensive stocks or non-cyclic and focus on the long term returns. Companies which have track records for giving high or consistent dividend yields even at difficult times should be looked at. Investor should continue to maintain the golden rule of “Buy when the market is Low and Sell when the market is High” and as Warren Buffett says “Be greedy when everyone is fearful and fearful when everyone is greedy”.

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