You've heard me sing that song a million times
The tune, the melody, the lyrics that rhymes
Have you seen the question in my eyes?
I've spoken words and exchanged a sentence or two
expressing and hoping you'll understand me too
Have you seen the heart that sighs?
Pictures you show can speak a thousand words
You want the world to know that you're powered
with Riches and Wealth, all is but an empty shell.
Just felt like penning something really complicated. I think its nice to imagine a good life as one of comfort. A leather seat posh convertible car. Ur shades and credit cards. The coolest funkiest music played in your car. Giving your friends for a ride. In a pub sharing a few laughs. Great grades and sitting in a leather massage chair in the privacy of your own office and space. People knocking at your door for your signature of approval. Name cards that spell out Very Important Person. Priviledge cards, special treatment. Coming home with a garage to park your car. A maid to serve you with dishes hot and yummy. Lighting made of spotlights or maybe crystle chandelier's.
It all sounds really grand, marvellous and splendid.
I once thought it was great too. But its all a fake! It's not great at all. I know deep down inside there's MUCH MUCH more things that are more precious than these 'worldly desires'.Some times its the simple things of life that makes me happy. Forget about all of it. I just want to head down to the market and sip my tea and eat my roti prata. Spend time with my family and God. You don't have to wait for years or for your bank account to increase 10 folds to have a beautiful life. You can start having one... now.
Saturday, August 18, 2007
Wednesday, August 15, 2007
Educating the Educated
What's happening in the market today? Isn't the Singapore economy booming? Is it not bullish? What has the US sub prime mortgage got to do with us?
Well... here's alittle of my 2cents worth of understanding.
Basically the capital crisis in Wall Street is causing a stir in the markets as everybody is faced with a liquidity crunch.
Q. What is a liquidity squeeze and why should I care if the Wall Street banks are having troubles?
In periods of liquidity, there is plenty of trading, and big institutional buyers and sellers easily move into and out of stocks, bonds and other instruments. But during a 'liquidity crisis' the big banks get nervous about risk and become more cautious about doing deals and making trades. They're less likely to extend the easy credit that has fuelled the economy in the past few years, and that makes it more difficult to match buyers with sellers. That is what happened to markets around the world on Thursday.
The fallout from a liquidity crunch causes a ripple effect. The most immediate impact is that loans could become harder to get. But troubles can spread to the wider economy, hurting people's investments and endangering their long-term financial plans. If banks are not lending and no one will extend credit to anyone else, markets seize up and economic growth disappears.
Q. Why are these big firms so easily affected?
Major financial institutions can absorb hefty losses without toppling. However, liquidity concerns cause institutions to become reluctant to lend money to other banks. Loans between banks on an overnight basis, one of the primary ways they fund their operations, have become more expensive as concerns arise about their ability to repay the loans - and that forces costs up.
Banks also bring debt offerings to the market on behalf of their clients. But if investors are reluctant to buy them, many times the banks will be left holding the debt.
Q: How do central banks inject money into the economy?
As an example, the Federal Reserve carried out a US$12 billion one-day repurchase agreement and a US$12 billion 14-day repurchase agreement. In a repurchase agreement, or 'repo', the Fed arranges to buy securities from dealers, who then deposit the money the Fed has paid them into commercial banks.
The cash infusion adds stability to the market, and fosters more buying and increased cash reserves. When the banks get this unexpected windfall of deposits, it increases their confidence that there is enough money to fund operations and make trades.
Q. I thought this was an American problem. What's the deal with Europe, and should we be worried about China and Asia too?
The sub-prime mortgage mess might be a problem in the US as risky borrowers default on their loans and banks become increasingly shy about offering credit. But it impacts European and Asian players who invest heavily in bonds and other products made up of pools of mortgages.
European investors were said to be heavily involved in two hedge funds operated by Bear Stearns that are now bankrupt after bad sub-prime bets. The announcement by BNP Paribas that it was blocking investors from taking their money out of some mortgage-exposed funds raised the spectre of a widening impact of US credit market problems.
These high-yield investments have been attractive because they offered big returns, and that caught the interest of investors globally.
Q. Aren't the bad sub-prime loans contained, and what kind of impact would this have for regular Americans if they're not?
Defaults in the US$2.6 trillion sub-prime mortgage market have caused many homeowners to lose their homes, while scores of others have reined in spending to keep on top of their payments. There has been some indication that fears about the housing industry have caused borrowers to watch their wallets. And that's evident in the US economy, with retailers reporting sluggish sales figures in July.
reference from BusinessTimes.Aug 11
Well... here's alittle of my 2cents worth of understanding.
Basically the capital crisis in Wall Street is causing a stir in the markets as everybody is faced with a liquidity crunch.
Q. What is a liquidity squeeze and why should I care if the Wall Street banks are having troubles?
In periods of liquidity, there is plenty of trading, and big institutional buyers and sellers easily move into and out of stocks, bonds and other instruments. But during a 'liquidity crisis' the big banks get nervous about risk and become more cautious about doing deals and making trades. They're less likely to extend the easy credit that has fuelled the economy in the past few years, and that makes it more difficult to match buyers with sellers. That is what happened to markets around the world on Thursday.
The fallout from a liquidity crunch causes a ripple effect. The most immediate impact is that loans could become harder to get. But troubles can spread to the wider economy, hurting people's investments and endangering their long-term financial plans. If banks are not lending and no one will extend credit to anyone else, markets seize up and economic growth disappears.
Q. Why are these big firms so easily affected?
Major financial institutions can absorb hefty losses without toppling. However, liquidity concerns cause institutions to become reluctant to lend money to other banks. Loans between banks on an overnight basis, one of the primary ways they fund their operations, have become more expensive as concerns arise about their ability to repay the loans - and that forces costs up.
Banks also bring debt offerings to the market on behalf of their clients. But if investors are reluctant to buy them, many times the banks will be left holding the debt.
Q: How do central banks inject money into the economy?
As an example, the Federal Reserve carried out a US$12 billion one-day repurchase agreement and a US$12 billion 14-day repurchase agreement. In a repurchase agreement, or 'repo', the Fed arranges to buy securities from dealers, who then deposit the money the Fed has paid them into commercial banks.
The cash infusion adds stability to the market, and fosters more buying and increased cash reserves. When the banks get this unexpected windfall of deposits, it increases their confidence that there is enough money to fund operations and make trades.
Q. I thought this was an American problem. What's the deal with Europe, and should we be worried about China and Asia too?
The sub-prime mortgage mess might be a problem in the US as risky borrowers default on their loans and banks become increasingly shy about offering credit. But it impacts European and Asian players who invest heavily in bonds and other products made up of pools of mortgages.
European investors were said to be heavily involved in two hedge funds operated by Bear Stearns that are now bankrupt after bad sub-prime bets. The announcement by BNP Paribas that it was blocking investors from taking their money out of some mortgage-exposed funds raised the spectre of a widening impact of US credit market problems.
These high-yield investments have been attractive because they offered big returns, and that caught the interest of investors globally.
Q. Aren't the bad sub-prime loans contained, and what kind of impact would this have for regular Americans if they're not?
Defaults in the US$2.6 trillion sub-prime mortgage market have caused many homeowners to lose their homes, while scores of others have reined in spending to keep on top of their payments. There has been some indication that fears about the housing industry have caused borrowers to watch their wallets. And that's evident in the US economy, with retailers reporting sluggish sales figures in July.
reference from BusinessTimes.Aug 11
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