Financial Shock

And I thought the partially nationalisation of Fortis by 3 central banks in Europe, nationalisation of Bradford & Bingley Plc and selling of Wachovia Corp to Citigroup Inc are shocking news..

Guess what.. There is something even greater..

Republicans IS the cause main behind the rejection of USD$700 billion bailout plan in the house of representatives.. The inablilty of the house of represenatives to take decisive action against the financial crisis is the primary cause behind the crashing of US stock markets, with them dropping 7% to 10%.. Politics comes to the way of things again.. Sometimes making a right decision does not mean that you have to vote with what you believe in, it is about making the decision that will benefit the society as a whole..

I don’t understand why it is so difficult for the US house of representatives to work together to make a collective decision but it is so easy for central banks in the world to make collective reactions to the financial crisis.. Perhaps the central banks understand the economics and psychology of the market.. They know what are the things that will instill market confidence..

Rejection of the plan will only make the crisis even more crunching..

The only thing the world leaders CAN say now is they are disappointed at the rejection.. All of them are caught offguard..

What can they do now?

What will convince the 228 votes against the bailout plan?

What will convince the 228 votes that believe that there should not be a golden parachute for the wall street players?

What will convince the 228 votes that interventation although not the right way practiced by a capitalist economy works, is the only way out of the problem?

Though I agree that those corporations that are not performing, we should let them fail. That was what US government advise Asia during the Asian Financial Crisis..

Now, facing with the same problem.. Are they still going to stand by their principles?

The principles and ideology of a capitalist market?

Are they going to stick the the very ideology that will only hasten their way to the graves?

They need to drop all the crap talks about they should let the corporations to fail if they are unable to make it as THEY ARE TOO BIG TO FAIL..

It is often not about WHAT IS RIGHT, it is about WHAT WORKS..

They need to drop all the big talks..

McCain: STOP finding excuses for why republicans didn’t agree with the bailout plan.. All the talks about wanting to solve the financial crisis.. All the talks about putting aside their political goals.. YOU NEED TO PUT ASIDE YOUR OWN POLITICAL GOALS.. You need to get the republicans together.. Like what Obama is doing with the Democrats.. Work for the people, not work for own personal agenda..

US need to come with something that can work.. Something that will improve the outlook of the economy.. Something that will convince investors that the outlook will be better.. They need to come up with something FAST.. Before everything arounds fail (or what they call it.. Capitalist).. For all I know it, the republicans can die for their capitalist cause..

But not at the expense of everyone else..

Fernando Alonso!!

Dark Horse wins the race~~~~

Damn exciting F1 race.. With safety cars coming out twice.. Crashes to some vehicles, faulty system, mistakes by drivers.. This is not just about racing.. It is about everything coming together to provide a good package..

Hamilton got 3rd.. But he still held on to his position at the driver’s standing.. He didn’t do badly today.. Just got held up behind a lot of cars.. I still think he will win this season..

McLaren-Mercedes took over the leader position at the constructor’s standing.. This really has become a two horse race between McLaren-Mercedes and Ferrari.. It’s anyone’s race..

F1 Fiesta

Exciting exciting exciting….

Big big mistake by Ferrari…. Massa jerked off the fuel hose, not his fault…. Blame it on the semi automatic system that tells the driver to move off.. This will have a big impact on Kimi as well..

Poor Kimi.. He was doing quite well, catching up behind Hamilton..

The ranking has changed..

Massa should be out of the top 3 positions.. So will Kimi..

Will Hamilton take the 1st position?

Or Alonso will pull a fast one?

It is anybody’s race now..

Website Building

This is hopeless..

Office 2007 has NO frontpage in it and the only program that I know how to use to build website is through frontpage.. I have been trying to explore a lot of templates for ideas for the website but the problem is I have no idea on how to replicate it in frontpage.. This is going to be an interesting and time consuming project..

Grrr~~

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Hog’s Breath

A trip to Vivo City for Dinner..

Change of Venue, from 黑色会 to Hog’s Breath..

It just didn’t seem appealing enough at 黑色会 as there was no one in the restaurant..

Hog’s Breath..

A place that we always walk pass but never wanted to enter..

Maybe it is the location or maybe there are so many other things that appeal to us more.. It is a place that is easily forgotten as it is situated at such a secluded location in Vivo City.. Away from the food belt.. Away from all the shopping.. Tucked in a corner..

But once we were inside.. Things was not as bad as it seems..

Wooden furniture really goes well with the country feel of the place.. There is a small corner that has an in-house singer.. Singing to oldies.. What nostalgic feel the place gave me.. Perhaps the things that goes against everything was the 2 large plasma TV showing channelnewsasia and the exceptionally noisy crowd..

We had soup and salad combo, blacken prime steak and Tex & Mex combo..

The serving is HUGE.. It may not seem as such but the meal was quite filling.. Especially the Tex & Mex combo where there is this fried mexican wrap (looks like a gigantic spring roll) that is filled with potato and chicken.. Splendid stuff..

If only they had serve the food HOT.. Our steaks were cold when served but nonetheless it still taste quite good..

Team SDE Floorball

Appreciate for all those who participated for this year IFG..

We did quite well today..

Although we didn’t qualify, there is lots of potential in the team..

With a good distribution in the representation from yr 1 to 3, the team should be able to progress well..

THANKS ALL

Eventful Night

What an eventful night for the US Financial Market..

Federal Reserve took a 80% stake in AIG with US$85 billion to prevent a highly possible global financial meltdown. This prevented an established insurance company with estimated US$1.1 trillion of assets from going bankrupt like Lehman Brothers. It may seems all good on the surface but we have to consider that shareholders’ stakes are severely diluted with Federal Reserve taking up substantial stake in AIG.

It really makes me wonder how deep are the pockets of Federal Reserve. Injecting liquidity into Freddie Mac, Fannie Mae, AIG and other financial institutions definitely have an repercussion on other aspects of the economy. All these are at the expense of all the tax payers and at the risk of all the US bond holders. Though the bonds have staggered maturity dates, we cannot eliminate the possibility of bond holders ending their bond prematurally if there are signs of a financial crisis. It is like taking brick from one wall to build another wall. There will always be a hole in the wall, unless we take bricks from another source.

Federal Reserve cannot hold on to them indefinitely. At a certain point, they will have to sell their stake off to private financial institutions. Of cos they have to be sold off at a profit, if not there would not be any confidence left in the market on the Federal Reserve.

There is going to be a major restructuring of the major investment banks, namely Goldman Sach, JP Morgan, Merrill Lynch and Lehman Brothers. All depends who have the deepest pocket to swallow up the others.

REUTERS is quite a good source of updates on the subprime crisis. The crisis will have an impact on our career prospects when we graduate in 2010. Will the crisis recover by then?

Subprime Blackhole

Writedown: The reduction of book value of an asset because it is overvalued compared to the market value.

It is the lack of belief in the market that is fueling the writedowns rather than value adjusting down to reflect market value. There is a multiplier effect by the market believing that future is bleak and their best option is to cut their losses. This is simple demand and supply case, where supply increase and demand decrease, that result to further writedowns. Raising funds through the issuing of more Mortgage Backed Securities with higher yields due to lower ratings will create more problems for the financial institutions if their rating are being adjusted lower as more problems reveal. They should raise fund by issuing stocks or selling off their assets.

There are speculations that Fed will cut rate again to spur the market and there is already US$70 billion of liquidity injected into the market to bail out the financial insitutions. Will Fed bailout package or rate cut help?

Bear Stearns – Sold to JP Morgan

Fannie Mae – US Government Takeover

Freddie Mac – US Government Takeover

Lehman Brothers – Bankrupt, fire-sale of assets imminent

Merrill Lynch – Sold to Bank of America

AIG – What future awaits for them?

Will there be new victims added to the casuality list?

Bleak future awaits..

Mooncake Festival

PPs First Mooncake Celebration

WIth some mooncake, pomelo and tea (minus the lantern and moon)..

Though not everyone is present, it was still quite an experience..