|
|
Malaysia is now one of the most vulnerable countries subjected to capital outflows. This is mainly due to our large exposure to short term debts. With Short Term Debt/ FX Reserve at 80% and Short Term Debt/ Total Debt at 40% and dwindling foreign reserves. In short, we are running on wafer thin safety margin. With Turkey, Russia and Brazil already admitted to defeat in the Currency war, Malaysia’s effort to prop up the Ringgit by selling the Dollar will end up a loser game. Brazil has since gone to the next level of protectionism by enlisting embargo and tariffs. If our political crisis is not solved within a shortest period of time, our economy, exchange rate and stock market will risk a rapid decline soon.
In tradespeak, this amounts to terminal velocity. Terminal velocity decline in any asset price is due to the animal spirits (ideas and feelings) among us. As a normal investor we are all prone to the loss aversion which is a psychological reaction to the market behavior. This refers to our tendency to avoid losses rather than acquiring gains. In normal conditions investors tend to buy when stock price increases and sell when stock price decreases. This will have the tendency to cause a price change in one direction. This will cause a feedback loop where selling begets selling which is also known as price-to-price feedback. This can cause a drastic drop in the asset price as it will lead to panic selling. Eventually it will cause a crash in the asset price. This can happen to our Ringgit when foreign investors start dumping our Bonds and Stocks as it is happening now.
By CK Sam |
|
本周最热论坛帖子
发表于 11-8-2015 01:29 AM
变色卡
千斤顶
楼主
，今天最好笑的笑话是竟然有些人认为我跟你是同一人，他们是毫无根据全凭感觉就随便认定人，所以相信买房子也一样完全靠感觉，不跌也难。我想来想去都不知道为什么？因为只要经过分析就知道，我跟你的意见其实不大一致，像你认为目前房市在跌价，我则认为房价跌将会在美国升息后才会发生，我行不更名，坐不改姓，看好强势美元全被我说中，为什么还要特地跑去开个户名吃饱没事做？不过相信为了找下台阶，他们一定会妄想说我患了精神分裂症
1682 
216
