Wednesday, May 20, 2009

Temesak lose BILLIONS!

The market has been exceptionally bullish for the last few days. And sadly to say, if I had actually shorted as I mentioned for my previous posts...I would had made a really big lost.

Anyway, lots of things has happened for the past week. The biggest one being Temasek selling its stake in Bank of America, with a staggering lost! Singapore news reports it as US$3 billion, while other online sources reported it as US$4.6 billion. Either way, its really a HUGE loss.

However, we cannot deny the fact that the whole world in general took a huge hit. But losing so much of the people's money is still painful to see.

Some reasons behind the sale was that Bank of America's vision is not inline with that of Temasek. Initially Temasek was suppose to be a major shareholder in Merrill Lynch, which is an investment bank. However, after Merrill Lynch was taken over by Bank of America (which is out of their control), Temasek essentially is now a minor share holder in a bank that does simple home loans etc. With such a big change in company philosophy, it wouldn't be surprising that they would eventually sell off their stakes in Bank of America if they initially bought into Merrill Lynch for its business.

In other news, Market rallying seems to be unstoppable recently. I guess that many people who were sidelined are actually now trying to inch their way into the market. Buying into any small drops, hence supporting the market. However I am still skeptical, because I feel that the situation is not really getting any better. People are still focusing on every little bit of good news to give them a reason to let the stock market rally and denying all the bad news. Logically, this should not be happening.

Also, I just read that south Korea has lifted the ban on short selling. With this, I think more countries are going to start lifting the ban. Which would mean.....if the market were to turn bearish, it will be a VERY quick process. So I would suggest to people who are trading the Singapore market to be wary once Singapore lifts the ban on short selling. I personally think Singaporeans love to be 'shortists'. I.e they like to short the market.


Anonymous said...

Chanced upon your blog. Good job. I am impressed by your energy level and embarrassed of my limited financial knowledge. Shall be following your blog to beef up this area. Thanks!

ntuchartist said...

Thk! =)

Anyway, its never too late to learn. I happen to be at the right place and right time to be exposed to such stuff.

Hope you learn many useful stuff!