Happy Fathers Day

My friend, Roger Wang, who also happens to be one of the country's finest guitarist ... has composed a lovely song for his daughter. Plus he sings, OMG ... that is so rare. The video sets with the lego pieces, must have been such a labour of love ... Wonderful Roger...

This is the most important song I have ever written. 

It's also my first vocals outing and first music video that I created myself.

The song was inspired by my daughter's obsession with fairy tales and being a princess. It sums up a lot of my feelings about being a father as well as the hopes and lessons I have for her. 

It's often hard for a father to relate to dolls and the way young girls play. Playing Lego together was one of the few activities that we shared. All those hours helped bond us. This video was made with those Lego sets and mini-figures. They became the best way for me to express this song visually.

This song and video come from a very personal place, but it goes out to all fathers and daughters out there, regardless of age.

HAPPY FATHER'S DAY

Asset Class Returns As At 31 May 2013

This is highly interesting. As a test, if you were looking at the table what could you say or what kind of observations could you make. Not trying to be an asshole or "guru" here, but if you are honest about your knowledge of markets, the ability to synthesize data and tell a story, you should do well in financial markets. If you can't, then you shouldn't be, or are just plodding along. To be in the markets you can study, but you have to have passion for it. Make your own observations before scrolling down.


- The one month data does not tell us much.

- YTD, the equity markets have been well led by the US, in fact emerging markets have been trailing ... suffice to say that most of the Asian markets which have been surging so far this year have been an anomaly, which further depresses the real performance of other emerging markets.

- We know the financial markets have been awashed in liquidity with QEs from various central banks, but where have they been headed. The YTD figures are again revealing, some have exited gold in a big way. Them taking money off gold may be just profit taking or likely to mean they are more comfortable that currencies won't be debased anymore, or that bailouts have finally went past a peak. The reduction of fear or volatility could be another reason.

- So where is the liquidity? They went largely into US stocks, US REITs and even foreign REITs. The REITs interest is but a reflection in a strong bottoming in property price correction and a resurrection of demand, and also a hint that people are more employable even now to take up new mortgages, and/or that a lot more PE/VC/vulture funds are taking advantage and making deals on distressed commercial properties.

- Look at crude oil, one month, YTD or 1 year even, that is a good reflection about the robustness (or lack of) of the global economic recovery. The recovery is benign and in patches still.

- Look at commodities, again the same conclusion as for crude oil, still working of excess inventory in the global system.

- Look at the emerging equity markets from 1 year ago, there has been a dramatic shift away from emerging markets back to US and possibly Japanese stocks. Again the robust performance of other Asian equity markets is very telling as it is viewed as largely unscathed and the equity markets there do attract sufficient interest compared to other emerging markets.

- The most important point one has to conclude is a drastic shift away from bonds of all kind. Bonds have been great on a 3 year basis but more funds are moving out. They move out because they either think there is a bubble there (too safe, and too many people willing to pay too high a price for low yields) and/or equity provides a better return even after accounting for risk.

From the above, I am quite confident that the current sell down in equities will be brief.

The Fears Of The End Of Quant Easing

Markets everywhere have been shaken over the last two weeks. First was the correction in the Japanese equity markets. It has lost substantial ground over just the last couple of weeks. Next came the Bernanke's testimony which led all to conclude that QE would be ending soon. 

If an article in Monday's Wall Street Journal is anything to go by, the U.S. Federal Reserve is getting ready to unwind its massive monetary stimulus program. So, is that prospect as alarming for financial markets as feared?

Fed officials have mapped out a strategy to wind down its $85 billion-a-month bond-buying program in careful steps, although the timing of when that will start is still being debated, noted Fed watcher Jon Hilsenrath wrote in the WSJ. 

Any unwinding of the Fed's quantitative easing (QE) program, which has fueled a rally in equity markets and other risk assets, is generally viewed as negative and any indication of this happening has been highly anticipated in the U.S. since late last week. 

"Having spent two New York sessions pricing in a sharp change in Fed stance, it is not obvious that the article was worth the wait," analysts at Westpac said in a note. "The timing of the unwinding of QE remains data-dependent, not a serious prospect until perhaps late U.S. summer at the earliest."

Analysts say that in essence, the Fed appears to be managing market expectations that its quantitative easing program will not last forever. The Fed has said that it would maintain its key interest rate between zero and 0.25 percent until the unemployment rate fell to 6.5 percent. It has also committed to monthly purchases of bonds until labor market conditions improve substantially. 

And it is the recent signs of improvement in the jobs market that has renewed talk about a possible end to the quantitative easing. The latest non-farm payrolls report showed the U.S. economy created 165,000 new jobs last month, much more than expected, helping push the unemployment rate down to 7.5 percent. Data last week meanwhile showed jobless claims at their lowest level in almost 5-1/2 years. 

It looks like the markets are just grabbing at excuses to do a bit of sell down after a spectacular run in most equity markets since the beginning of the years. The timing is still a bit uncertain, but seriously folks, the end game only looks to peter out by December this year. It is very good that markets are readying itself for the end of QE.

The Fed officials are not going to raise interest rates until unemployment comes down to 6.5 percent, and could only come earliest by 1st quarter of next year. What is likely to happen is when unemployment dips below 7%, we may see a scaling back from the $85 billion buyback figure to maybe halve that. 

The knee jerkers would be better off looking at the positives:
- That [an easing of QE] would be good for U.S. stocks because it would mean the U.S. economy is doing a lot better.
- That at least markets are already trying to price in the end of QE, instead of a surprising one off massive sell down.

The last part is very important as we can easily reference to the 1994 massive sell down, just because Alan Greenspan never gave any indication as to the imminent rise of interest rates in the US. That experience probably forms the backdrop for Bernanke's communication strategy. He is managing expectations very well. By putting it out there with the 6.5% unemployment target, it allows all to see the looming horizon.

I still think halving the buyback when unemployment dips below 7% would be an excellent strategy to manage expectations further. Everyone knows QE cannot be there forever.

I like the equity markets now more than in the beginning of the year. Japan has corrected substantially even though Abenomics will still be in the works. This will drive Japan to retests its high this year soon enough. I believe the sell down was a good profit taking exercise and actually allowing a lot of stale bulls (i.e. those holding onto Japanese shares for over 20 years) to exit - all that will come back to the market place for sure.

The local Malaysian equity market has held up better than the rest, and confidence breeds confidence. Having said that, Malaysia is only up 4.6% so far this, thanks to the uncertainty over the elections period. Other Asian markets have risen a lot more, and hence had more room for downside: Indonesia 15.2%, the Philippines 16.4% and Thailand 10.6%.

My Life's Aphorisms

Readers of my blog will notice that I haven't been updating my blog lately ... usually I am pretty not that busy ... now I have to go to Singapore every week for a couple of days ... and then there are the many meetings that suddenly crop up and classes that I have to give for Murasaki ... blah blah ... I miss writing my blog, I love it because its like a diary of sorts, I cannot ignore my blog cause its now 6 years of my life. If anyone reads it carefully, they would know me very well cause I never write to create a false persona, if you think I am an asshole, you are probably right. I don't like to be busy, it makes time flies, and I don't get to sit and relax and enjoy. My Monday nights drinks sessions are sacred, those of you who are part of it knows too well. We all have to slow things down and take stock of what we are doing, whether they correlate to fulfillment of your goals in life, so I think its time to re-look my own aphorisms in life, making sure I stay centered amidst the noise.

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Don't aim just to be rich, aim to create wealth, create better lives, create better livelihoods for people, create jobs where others can contribute to society and be a useful participant.

Use your wealth to fund your passions and causes, and don't forget to enjoy yourself in the process.

Stand up for injustice, for the downtrodden, for those who cannot help themselves. Aim for equality for all, in all.

Have a zest for good things, finer things in life, its OK to to enjoy.

Surround yourself with positive people. Make sure your life partner is enthusiastic, have energy for life, and empathy for people, friends and family.

Don't wait for fate or destiny to affect your life, its your life, make it happen.

Finding something or someone that/who means more to you than yourself.

Make a conscious effort not to hold onto people who don't love us or people who hate us or people who make us mad or people who take us for granted ... we also care too little for the people who love us unconditionally, the people who adore us, the ones who still stick around in spite of all your shortcomings.

Make an effort to to live healthy for yourself and the people who care for you. Live long but more importantly live well.

Make a conscious effort to better the lives of the people around you, your family and circle of close friends.

Bloom where you are planted, not whine about why you are where you are.

Thought For The Day

Why So Few Female Traders

When you speak off the cuff, silly sounding things can pop out. Thats why I am so reluctantly to speak quickly over the radio, and I need pauses so that i don't say things such as those said by Paul Tudor Jones.




For a billionaire hedge fund manager who carefully manages his public image, Paul Tudor Jones had a minor crisis on his hands. Mr. Jones, a billionaire and philanthropist of legendary stature in the minds of many Wall Street traders, was forced on Thursday to explain what he meant in remarks that surfaced in a video published by The Washington Post. The video, depicting a University of Virginia symposium in April, shows Mr. Jones trying to explain why there is a scarcity of female traders.

“As soon as that baby’s lips touch that girl’s bosom, forget it,” Mr. Jones, who has three daughters, says in the video. “Every single investment idea, every desire to understand what’s going to make this go up or go down, is going to be overwhelmed by the most beautiful experience, which a man will never share, about a mode of connection between that mother and that baby.”

“I’ve just seen it happen over and over,” he added. “I’m talking about trading, not managing.” The video was obtained through a Freedom of Information Act request.

His comments went viral online and were widely criticized. In an e-mail sent to news outlets, Mr. Jones said he was speaking “off the cuff” and referring in particular to “global macro traders,” who work across multiple markets.

“Macro trading requires a high degree of skill, focus and repetition,” Mr. Jones said by way of clarification. “Life events, such as birth, divorce, death of a loved one and other emotional highs and lows are obstacles to success in this specific field of finance.” He added that success was possible “as long as a woman or man has the skill, passion, and repetitions to work through the inevitable life events that arise along the way.”

The episode was an uncomfortable turn for Mr. Jones, who earlier this month was called a “modern-day Robin Hood” by CBS News’s “60 Minutes” in a report on the financier’s charitable foundation.

Watching the video, there was a “pit in my stomach of how 1950s that is,” Alexandra Lebenthal, chief executive of the financial firm Lebenthal & Company, said on MSNBC’s “Morning Joe” on Friday.

“I’m not sure that bonding experience of breastfeeding is all that wonderful,” Ms. Lebenthal added.

Joanna Coles, editor in chief of Cosmopolitan, said on MSNBC: “What you see in this is actually what a lot of men on Wall Street still actually think.”

Mr. Jones’s theory is “scientifically unsound,” Simone Foxman said in Quartz. “Women don’t produce as much cortisol when in risky situations and therefore — theoretically at least — aren’t as likely to be as overwhelmed by negative emotions.”

My View is that there is some truth in it, but very little in effect. Let's be honest, Paul is not the person who created the financial trading system, he merely commented on the reality. Truth be told, most good traders who happen to be men, are also mostly dead inside. Nuff said. The ability to focus and block out other thoughts and considerations are paramount to be a great trader. Let's be frank, how many of us can do that without our minds wondering and wandering. Great traders usually have very empty lives, have to keep drowning their hollow soul with liquor and checking their bank balance gives them the kind of temporary adrenaline high to remind themselves falsely that what they are doing is worthwhile.

The reason why most great traders are men lies in the society structure and biases - men still have certain advantages in terms of "old boys network", and preferential treatment when hiring traders. The whole system is geared towards a brutal Darwinian elimination process. Only the good survive the industry. When you have 980 men and 20 women in trading positions to start with ... isn't it normal to see the top ten traders being largely men, maybe 9/10 or even 10/10.

The Silent Movie Man - Speaks For All

Everyone has seen some Charlie Chaplin movies, they were great and still are. That alone would have suffice in leaving a wonderful legacy of a life well lived. Not many has even heard of him speak, but if you watch his only snippet from The Great Dictator, where he spoke in his movie for the first and only time, ever ... you know he has an even greater soul. While disguised as part of a movie script, its blatantly obvious that he chose that one instance, that one platform to voice his important empathetic view - funny how much of that speech is still so relevant for so many people in so many places, ours included.

Good day to you, Sir Charlie Chaplin ....



Another example of his great talent, he composed the music to Smile ... Michael Jackson's favourite song of all time. Charlie Chaplin, a man so devoted to make us all laugh, must have known what hurt is to come up with these two important contributions during his life on earth.

Gotta Watch This - Miyoko Shida Rigolo

This is an exceptional piece of performance art. In fact, it is so much more than just exhibiting the powers of concentration. It is art definitely, loaded with meanings and inflections. The inter-connectedness of everything in life, its delicate balance ... seemingly unimportant (feather) yet it holds everything together. Its beautiful, moving and thought provoking.

Finally, .... 101 Proposals

Finally, somebody has decided to remake my all time favourite TV series, the Japanese romantic comedy 101 Proposal. You will cry buckets and laugh like a lunatic if you have watched it before. The remake is a China production with Lin Chiling, whom I have never thought to be much of a talent, but did well. The always funny and self deprecating Bo Huang. To consolidate a TV series into a movie is never an easy task, but its pretty good. 

If you have a few hours to spend, go watch the entire 12 episodes on You Tube. I have linked the first episode at the bottom (yes, got English subtitles).

The original 101st Marriage Proposal is a "Beauty and the Beast" story starring Takeda Tetsuya (Virgin Road, 3 nen B gumi Kinpachi Sensei) as a down-on-his-luck man who has gone through 99 omiai (arranged dates with the intention of marriage if the date goes well). Not particularly smart, nor handsome, nor rich, he is a man who cannot lie and of course, has a heart of pure gold. On the 100th omiai, he meets Kaoru (Asano Atsuko), an extremely beautiful and talented cellist who can't forget her dead fiancee.



So, Takeda has had 100 arranged dates with marriage in mind setting but its the 100th date that caused him to abandon the "arranged marriage" mentality and pursue true love and devotion. The entire series has him trying to pursue the girl and failing and failing, with comical results. Besides the many things that were seemingly incompatible, she cannot love again as she fears anyone she loves will die on her again like her fiancee. Why is the thing called 101 Proposals ... well ... the 101th proposal is by the girl asking Takeda to marry her, thats why.

Its such an iconic series helped by the ever brilliant Chage & Aska theme song Say Yes which can be heard throughout the series and also in the new Mandarin remake. A side note, am I the only one to notice that Takeda Tetsuya, the original lead, made a cameo appearance as the husband of the girl's teacher from Japan - what a gem of cinematic kismet.

The series was made back in 1991 ... but you can certainly see and count how many more recent movies have stolen ideas left right and center from the series ... HK, China, Korea, America...

If you do not have the time to watch the movie or the series, well at least watch the final 14 minutes of the original series ending as they provide the entire flashback of the courtship and ending. The series is infinitely better as its like 12 movies, and there are many great relationships .... the most touching is between Takeda and his good looking brother.




Watch the whole original series, start with Episode 1, there are 12. If English subtitles are not showing, look for the Caption button and turn to English.

Give Yourself Away

 ... are you a registered donor  ... if not, why not.

Alex Ferguson, Thank You Sir

Ferguson first few years were dicey, much like the first few years experienced by the last 5 Liverpool managers. In actual fact, he was almost booted but turned a corner and has not looked back since then. Continuity is so important and valued in being a football manager, something the modern game can no longer afford, or rather the owners cannot afford. Show me the results within 2-3 seasons or you are out. Molding a team requires time and in Ferguson's case his strategy was most prominent in the way he used the youth system, making it a celebrated channel for bringing up local talents.



In the present days of money buying talent strategy, Manchester United is Manchester United because we can proudly claim a large contingent of home grown talents and still a significant portion of players from the UK, something A LOT of teams cannot claim. At one stage, I though Liverpool was going to change name to Liverpool-Herzagovina.

The New Guy

The bookmakers is giving it to David Moyes, who, I must say has done wonderfully well with a limited budget and slightly above average team. He has shown that he can stick to it for some time. We should want someone who will stay around for at least 10 years. For Manchester United, its not just a manager we hire but a critical new family member.

But my preferred choice from day one has always been Martin O Neil, I think he is a bit more colourful and quite brilliant a manager.

IDEAS' View Of Elections - "Partially free and not fair"

WAS GE13 FREE AND FAIR?

May 8th, 2013 by adminCategories: Democracy, Democracy, Opinion, PublicationsNo Responses

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IDEAS was accredited by the Election Commission of Malaysia (EC) to observe the recently concluded 13th General Elections. Our mandate was to observe, record, analyse and report events leading up to GE13, and subsequently recommend ways to improve any weaknesses found. We benchmarked our observation against the Inter-Parliamentary Union’s Declaration on Criteria for Free and Fair Elections. We deployed 325 observers to 99 parliamentary constituencies in Peninsula Malaysia and 6 overseas polling centres.

Generally, we found that EC successfully ensured the overall process between nomination day and election day proceeded smoothly without any major glitches. Complaints have been filed about the possibility of phantom voters and the failure of the indelible ink to work as it should. Both are important issues that must be addressed. However, we position these two issues in the context of the wider lack of trust in the integrity of the electoral roll, instead of simply a weakness of the EC. In order to address the root cause of the problem, serious attention must be given to improving the integrity of the electoral roll. This involves improving the integrity of the National Registration Department’s database, which may not be within the EC’s purview.

It is important to examine the events building up to GE13 in order to get a better perspective. Taking a long-term view, we saw that (1) The media was heavily biased in favour of Barisan Nasional. State-funded media platforms have been abused to project partisan views to the public; (2) There were doubts about the EC’s impartiality and competency despite their many efforts to improve the electoral system. They were seen as being part of an already biased civil service. The fact that EC members repeatedly issued statements that could be construed as partisan did not help. Their defensiveness when criticised further angered the public; (3) Trust in the integrity of the electoral roll is low. This resulted in the public being very cautious when there were reports of foreigners being flown in, when they saw foreign-looking individuals, or when the indelible ink was seen as ineffective; (4) The Registrar of Societies did not treat all political parties equally, delaying the registration process of non-BN partie; (5) Constituency sizes are too unequal, allowing parties that win many smaller seats to win parliament, despite not commanding popular support; (6) Financing of political parties is not transparent, resulting in a big lack of clarity about the financial standing of the competing parties; (7) During the campaigning period, government and armed forces facilities were repeatedly used for campaigning purposes during the official campaign period; (8) Racial issues were dangerously exploited for political gains. There were many instances of BN fishing for votes by sowing mistrust between the Chinese and Malay communities.

Therefore, although the official campaign period and electoral processes may have proceeded smoothly and with minimal major issues, wider issues that are not within the EC’s purview have built up over the last few years. These issues conspired against non-BN parties, therefore creating a very uneven field. Due to these reasons, we conclude that GE13 was only partially free and not fair.

S&M Show Podcasts

This week's topics: equity strategy after election, first tier, second tier and even third tier stocks

http://www.bfm.my/snm-show.html