Would Genting Dominate?

There was a press release recently about how Genting has intentions to takeover MGM Mirage's operations in Macau after acquiring a 3.2% stake in the company.

HMMMMM........

"Genting, Asia’s largest casino operator, is looking to expand at a time highly-leveraged US rivals are barely meeting debt obligations and may turn to asset sales to stay afloat." -excerpt from http://biz.thestar.com.my/news/story.asp?file=/2009/7/29/business/4408519&sec=business.

There was mention that the main reason Genting is a huge deal in Malaysia was because it is a monopoly (there's only one legitimate casino in Malaysia). If they want to break through foreign markets, it might seem like a huge upside bet on their part.

Nonetheless, I can consider this as an excellent opportunity to gain a bang on their buck as parts of influential casino operating companies are valued for way less than they are worth. Well, consumers are not willing to splurge on gambling, are they not ?-in this crazy economy which seems like it is recovering but might head downwards again. Great potential gain and loss simultaneously.

"Genting’s head of strategic investments, Justin Leong told investors in London this month the company wants to be one of the top three gaming players in the world and will be patient in executing its expansion strategy." (ibid.)

Top 3? Fo' real? Well, for the sake of my country, I feel like this would be a really good deal but there are always consumer sentiments to take into consideration. Maybe Genting should scrutinize the markets and CPIs slightly longer before jumping the gun.

Another Day,
Becky Hiu

Hybrid Portfolio Theory - Gets You Thinkin', Ey?

Hello peeps.

It has been awhile, has it not? Well, here's an interesting read about the Hybrid Portfolio Theory, where you place 80-90% of your investments in safe securities (Certificate of Deposits, Money Market Accounts/Funds, Treasuries etc.) and the remaining 10-20% in super risky securities and high-growth opportunity companies.

Here's the link to the nice read of the Hybrid Portfolio Theory: Venture Populist

Some actually had outcries saying that why should they pay financial advisors to place their money into safe securities when they can do it themselves. For the most part of it, I think that this theory works nicely for high net-worth individuals who have no inclination whatsoever with finance and have no time to do so in the first place. But, of course, if you're a conservative investor, this works VERY nicely too! :) It's always great to make more than the rate of inflation + some leftover after!

The remaining 10-20% of the portfolio would be allocated into risky securities, so that's where the financial advisors come into play. Getting a steady stream of income of lets say, 6-8% Return on Investment (ROI) ain't too bad, is it not? -especially if you're a rich dude/ dudette and compound interest has its own wonders, ey?

And, when a crazy economic turmoil hits, like the one we're facing right now, you won't be hit as badly. There's this field force of financial protection surrounding you.

What you earn = What you put in * (1 + ROI per year)^number of years.

***Hmm, that's quite an astounding amount when you power it up. Try hitting in a few numbers into your good ol' calculator. :)

By the way, getting a steady return of 6-8% for a conservative investor (which is actually a vast majority of people), is g-r-e-a-t!

Go figure.

Becky Hiu

Problem 1.8 - My Blunder

Please click on this image to view a clearer picture of my solutions

This post is allotted for my Econ 107 class. I had trouble posting my answers on the Blackboard forum so I posted a JPEG image of my response here for my reviewer and Professor to view.

I hope they don't mind what I just did. This would most definitely not happen again. Wow to the powers of HTML.

Cheers,
Becky Hiu

Financial Adviser in West Des Moines Puts Client First as He Revamps Strategy

When a financial adviser's compensation is tied to products he sells, how can he look out for the best interests of his clients?

If you're asking that very question, this is the very article you should read:

http://www.desmoinesregister.com/article/20090626/BUSINESS/906260365/1029/archive#pluckcomments

"Busick created River Glen Wealth Counselors, a financial advisory firm in West Des Moines. "We are creating an organization that tips the scale in favor of the individual investor," he said.

Many financial advisers seeking this type of independence from product lines and financial services companies become fee-based. They usually get paid a percentage of the client's investments.

Busick decided this wasn't enough - he wanted a fixed-fee pay structure based on particular service, and one that was completely transparent to clients. "The goal is to be different on a cost level," he said.

River Glen works on a fixed-fee system, determined by the complexity of the service required, with the option of asset-based fees or performance-based fees for investment planning. "My first and highest priority has to be to the client, and bringing that fiduciary responsibility to everyone," Busick said."
-excerpt from the Des Moines Register, 6-26-2009 @ http://www.desmoinesregister.com/article/20090626/BUSINESS/906260365/1029/archive#pluckcomments

We do need client-focused companies to ensure that the financial system is sound and would adhere to the goals and best interests of the clients. That is what River Glen Wealth Counselors provides -transparency, competency and reliability.

Reference: http://www.riverglenwealth.com/

Update: 6-17-2009

It has been sometime, ey.

Economic situation? Not too well. The DJIA has been fluctuating once again like a yo-yo. Oil? Hit its year high but still kinda fluctuating. I don't think it'll hit the 4 buck per gallon of gas like last July but who knows, the economy is as unpredictable as Iowa's weather.

"Millions of Americans who have worked hard and behaved responsibly have seen their life dreams eroded by the irresponsibility of others and the failure of their government to provide adequate oversight," Obama said. -excerpt from "Obama touts major rules to stave off econ crises" from Yahoo Finance. http://finance.yahoo.com/news/Obama-calls-for-new-rules-of-apf-15550556.html?sec=topStories&pos=main&asset=&ccode=

Hmm, yes, the government has most definitely contributed to this entire problem. But, I think it's everyone's fault. The government, banks -both commercial and investment, insurance companies, mortgage lenders, rating companies, consumers...i.e. everyone including you and I. I do know there's a heck lot of blaming going on right now but face it, if everyone's poking fingers at one another, where are we heading?

It's our behavior -the want -not need for more, more, more -GREED. Sky's the limit. People close one eye when it comes to certain ethical things -they say it's OK. If everyone's doing the same thing, who cares, right? It builds up and when the bubble expands and finally bursts -we suffer its dire consequences. Shame, shame. shame.

We used to learn about how to use those financial instruments such as MBSs, CDOs, CMOs and other complex instruments in finance classes. Now, we are learning that the crisis origninated from them. It was said that even Alan Greenspan and a room of all his leading economists did not even fully comprehend those instruments, what else others? Wow.

Nevermind. We still have hope -like how we have hope in Christ. Things are to get better in due time, I know it will. :D If people place their hope, faith and trust in Him, nothing is impossible.

"For the Lord your God is living among you. He is a mighty savior. He will take delight in you with gladness. With His love, He will calm all your fears. He will rejoice over you with joyful songs." Zephaniah 3:17

For Him,
Becky Hiu

Avoiding Conflict: What I should know about my Financial Advisor?

//*Click on this picture to enlarge it*//

Check out River Glen Wealth Counselor's website @ http://www.riverglenwealth.com/

Has the Bull Pawned the Bear?

Finally, I'm in the black with regards to my stock portfolio for this fiscal year of 2009. Will the rally sustain? That I'm not too sure -whether this is a "V" shaped rally or...a "W" shaped one.

Will a pull back occur again? There have been tons of positive indicators -an increase in the real estate market, better than expected profits, employers slashing less workers and a rally today as there's news that the investors are slowly gaining confidence in the financial institutions due to a better than expected outcome of the "stress test" by the US government.

Some say that this is a short term occurrence and this rally will soon fizzle out. We shall see in the upcoming weeks.

It takes at least 5 years to become a matured investor. It has been a couple of months for me and so far I'm doing good -beginner's luck? :)

Boomin'
Becky Hiu