Sunday, May 8, 2016

Cold water on the interest rate rising scenario



8 May 2016

 

Dear Fellow Investor,

 

Friday night’s headline US employment numbers  poured cold water on the  interest rate rising   scenario contrary to the Bloomberg blue chip consensus of investment houses led by the vampire squids Goldman Sachs and JP Morgan.

 

In the Last 3  weeks all Asian markets have  been under pressure due to fears of US interest rate rises as the last time in December 2015 when the Federal Reserve raised interest rates  ¼ point world stock markets went into free fall losing over 2.7 trillion USD in capital value.

 

Shock Headline on CNBC

The U.S. economy added the fewest number of jobs in seven months in April and Americans dropped out of the labour force in droves, signs of weakness that cast doubts on whether the Federal Reserve will raise interest rates before the end of the year.

Before the release of the numbers the Dow overnight futures were down more than 150 points as the continued gloom and negative sentiment caused fear selling.  After the release gold jumped USD 23, the Dow/ NASDAQ went into positive territory and the 10 year US treasury made new highs.

Based on the CME Fed funds futures contract there is now less than a 6 % chance there will be a rate rise on 23 June, the next FOMC meeting.

Our positions should do well in the next few weeks. We stood our ground and did not get caught up in the panic and fear mongering by the Vampire Squids, US Federal reserve propaganda and media hype.

After all we buy only high quality value shares with growing earnings, growing dividends and honest managements.  No need to worry. Using common sense as an example, why would potential rising rates in the US effect our investment in PBA, the Penang water authority whose only product is water, a recession proof commodity?

On Wednesday 11 May, Dolly and I will be off to Taiwan for a 1 week holiday with Reliance Travel and I hope to give you a positive report next Saturday or Sunday.   

Should you have any account queries please call Linda/ Nora or Idza @ 03 2783 0300.  For dealing you may call Steve/ Ashley/ Jeffrey or Richard who are Phillip fund managers @ 03 2166 8099.  You may email them @ pcm-dealing@poems.com.my I will also check my emails in the evening after we return to the hotel if you need assistance.  You may email me @wermineb@gmail.com

I was told Taiwan has very advanced internet, hand phone, Whatsapp coverage?

Below is something I intuitively knew but never had the scientific facts to prove the point. It has to do with stress and why observing trees will lower stress. 

 
 
Being around trees makes you less stressed – study
 
 
 




People relax behind a Japanese blooming cherry tree at the horticultural exhibition '

 

Trees helps people become less stressed - and the effect increases the more trees are visible.
new study by researchers at University of Illinois has confirmed the long-held understanding that natural scenery can be a useful tool in helping reduce psychological stress.
 
 



Invest well and grow your wealth,

 

Bill
 

For previous letters which are in a much better format you may visit my Eagle Investors blog asianequity.blogspot.com Linda will post this letter on Sunday
 
 


 

No comments:

Post a Comment