In Physics, there are certain laws which stays true regardless of time, such as the Law of Gravity. When it comes to personal finance, there are also certain Laws of money.
In fact, there are 5 Laws of Money which I like to share with you:
1. Money comes gladly and in increasing quantity to any person who saves at least 10% of his/her earnings (first step to Financial Freedom).
There are only 3 Cashflow Scenarios:
a. You spend more than you earn: This person has negative cashflows and is likely to end up owing other people money (eg. credit cards, friends, relatives, loan sharks).
b. You spend all that you earn: whether this person is earning S$2,00 a month or S$200,000 a month, he/she is still "Just over broke".
c. You spend less than you earn (eg. save 10% of your eanings).
as time goes by, this person will automatically get richer and richer.
Which cashflow scenario do you want to CHOOSE for yourself?
2. Money can work for you, if you become the “wise owner” of money and make money work for you. (note: you’re the Master, money is the slave, while many people are guilty of being slaves to money).
Money is just a tool. We should Love people, use money. The sad thing is there are people who Love money and use people instead.
3. Money will be safe and grow if you invest it wisely or if you invest under the advice of people who are wise in money. ie. investment knowledge is key to making money grow. You can either acquire Investment Knowledge yourself or you can invest money under the advice of people who have investment knowledge.
4. Money will slip away from the man who invests it in businesses or investments with which he is not familiar or not “approved” by people who are wise in money. ie. Ask the opinion of those who are wise in money, they might be able to offer you information or advice that can prevent you from losing money.
5. Money flees the man who falls into scams created by tricksters and conmen, who promise “impossible earnings”. One common weakness of human beings is "greed". Greed can make a person who is usually alert and smart "stupid". Greed can blind a man and is the main reason why financial scams continue to exist whether in ancient times or in the modern day.
By Dennis Ng
Thursday, October 04, 2007
Tuesday, October 02, 2007
Is the US Credit Crises really over?
The Dows/DJIA hits a record high today amidst the drop in the dollar value causing the Euro$ to hit a record high against the USD$. The Singapore STI index have also hit a record high of 3800+pts as stock markets across all region rose significantly signalling that the US subprime mortgage credit crisis has eased.
But is it really over? Or just a death trap awaiting to sprawl on the world largest economy. Its like a major conspiracy. News of Dubai and middle east furiously buying up undervalue stocks during the subprime mortgage turmoil and the recent announcement of China launching its Investment Corp with trillion of funds to play with. Can you imagine what will happen to the US economy if China Investment Corp owns significant percentage of the S&P 500 companies? Obviously, the chinese government's refusal to revalue its RMB has a certain reason behind it causing a big hoo haa to the US feds.
The sleeping dragon has awaken.
China has overtaken Japan as the economy with the largest trade surplus with a forex reserve of $1.33 trillion(as of 11 JUL 07). As crazy as it seem, China seems to be the next super power that could shake the world's economy. China stocks has been soaring in recent years as Jim Rogers pointed out, China is the future. Truth is, No matter which part of the world u travel to, you'll find products or souvenirs having a stamp saying "Made in China". Nearly all countries, there'll be a chinatown. With Macau and HongKong boosting China's economy, i would be surprise if China remains in its conservative state. But with the devalue of US$ and the slowdown on US economy, China's manufacturing sector might be affected.
On a personal note, China is still majorly undeveloped and many people are still living in poverty. Healthcare, water, energy and transportation are still widely scarce in poorer rural areas. I do believe in the near future the wealth gap in china will be extremely wide and it risk falling back into the medieval days of lords and slaves. Looking at the amount of extremely wealthy businessman from the mainland moving out, with leading examples from Russia, maybe communism has evolve agressively?
China is finally seeking its vengeance since the day of the invasion of foreign powers after retrieving HongKong and Macau. The next big thing will be what Japan did, invading the world by using its economic powers.
China resisted devaluation of its currency during the Asian financial crisis of 1997-98, and this provided a key element of stability that contained the crisis after most other Asian developing countries were forced off fixed rates.
China has unpeg its currency from the USD$ after 10years but a floating currency this could make China more vulnerable to future financial crises.
However, China is protected by having huge currency reserves of $750bn (SGD$1300bn), built up by its years of trade surpluses. But many of these are in US Treasury bonds, which will become less valuable to China after its revaluation.
So China may start to switch from holding dollars to holding other types of currency, for example the Euros, which could lead to a sharp fall in the value of the dollar. It could also make it more difficult (or expensive) for the US government to finance its massive budget deficit.
So is the US credit crises over? Think again.
Its off the worse but its not over...
But is it really over? Or just a death trap awaiting to sprawl on the world largest economy. Its like a major conspiracy. News of Dubai and middle east furiously buying up undervalue stocks during the subprime mortgage turmoil and the recent announcement of China launching its Investment Corp with trillion of funds to play with. Can you imagine what will happen to the US economy if China Investment Corp owns significant percentage of the S&P 500 companies? Obviously, the chinese government's refusal to revalue its RMB has a certain reason behind it causing a big hoo haa to the US feds.
The sleeping dragon has awaken.
China has overtaken Japan as the economy with the largest trade surplus with a forex reserve of $1.33 trillion(as of 11 JUL 07). As crazy as it seem, China seems to be the next super power that could shake the world's economy. China stocks has been soaring in recent years as Jim Rogers pointed out, China is the future. Truth is, No matter which part of the world u travel to, you'll find products or souvenirs having a stamp saying "Made in China". Nearly all countries, there'll be a chinatown. With Macau and HongKong boosting China's economy, i would be surprise if China remains in its conservative state. But with the devalue of US$ and the slowdown on US economy, China's manufacturing sector might be affected.
On a personal note, China is still majorly undeveloped and many people are still living in poverty. Healthcare, water, energy and transportation are still widely scarce in poorer rural areas. I do believe in the near future the wealth gap in china will be extremely wide and it risk falling back into the medieval days of lords and slaves. Looking at the amount of extremely wealthy businessman from the mainland moving out, with leading examples from Russia, maybe communism has evolve agressively?
China is finally seeking its vengeance since the day of the invasion of foreign powers after retrieving HongKong and Macau. The next big thing will be what Japan did, invading the world by using its economic powers.
China resisted devaluation of its currency during the Asian financial crisis of 1997-98, and this provided a key element of stability that contained the crisis after most other Asian developing countries were forced off fixed rates.
China has unpeg its currency from the USD$ after 10years but a floating currency this could make China more vulnerable to future financial crises.
However, China is protected by having huge currency reserves of $750bn (SGD$1300bn), built up by its years of trade surpluses. But many of these are in US Treasury bonds, which will become less valuable to China after its revaluation.
So China may start to switch from holding dollars to holding other types of currency, for example the Euros, which could lead to a sharp fall in the value of the dollar. It could also make it more difficult (or expensive) for the US government to finance its massive budget deficit.
So is the US credit crises over? Think again.
Its off the worse but its not over...
Subscribe to:
Posts (Atom)