Last Day to Enter!!!

Just a reminder that today is last day to enter the bag giveaway. I will announce the winner tomorrow morning. Good luck to you all:o)

Why do Credit Cards charge your future usage ?

From time to time, we may heard news that more and more people are unable to pay their credit card debts. As a result, credit card companies must be earning a lot of money in return. On the contrary, credit card companies have been facing quite some challenges.

More and more people are settling their due payment in full monthly. This results the card company unable to earn money from this group of people. Some users even maximize the interest free period to 2 months and pay nothing to enjoy such great facility.

Due to the stiff competition among the card issuers, every time an annual fee is charged, the card users will simply stop the account.

When late fee and interests are charged, more and more users know how to get them waived.

Generally people are getting better in managing their credit card usages. More and more people are more personal finance savvy now.

Credit card used to be able to get their profit back from the people who owe them money. But now they can keep charging interest to their debtors but eventually the debtors went bankrupt and don't pay at all. Credit card companies ended up didn't earn much from this group of people neither.

This posts a problem. If the credit card companies can't earn as much as it used to be from the people who don't have money to pay. What can they do ?

Well, the other group of people never owe money. That means they must have money. So credit card companies think of a smart way to earn money from them. If you didn't pay your last month balance in FULL, we will charge you interest NOT only on your remaining balance BUT also on all your subsequent future transactions.

How can they get people to buy off with this new innovative but abusive concept ? Well, that has already been show cased in last article.

There you go, as and when people are getting better in their personal finance. Some giant finance institutions may get into troubles, especially those who earn when you spend. As a result, they will always beef up more advertisements and more 'creative' messages to make sure general public are confused what 21st century personal finance is really about.

Shouldn't we let credit card companies earn some ? Since they provide us great facilities ? Well, sure ! They have been earning 1-3% from the merchant every time you use the card. That alone is a multi-millions income every month.

Credit Card forward calculate interest

How did it happen ?

Why do they need to do this ? ( this article )

What can we do ?

Malaysia Personal Finance - Part 2 Amanah Saham

It was mentioned before that EPF in Malaysia is one of the best things that happens to ones personal finance, because it saves automatically even before you can lay a hand on your money - the main principal of Automated Saving System - ASS.

But not everyone works for someone. Or if your employer does not contribute his part, it makes EPF so much less interesting. So a government's mutual fund is born - Amanah Saham Nasional. If you are not eligible for EPF, you can still save in Amanah Saham.

Despite many disputes and diverse understanding on what Amanah Saham is or should be, one cannot deny that our poverty rate has indeed improved. The gap between rich and poor did narrow down since 50 years ago. That's the power of mutual fund, despite how wrong or how right the reason is when one save in mutual fund, all will be sharing the same return.

A government supported fund is even better for those who don't know what it is. As long as the 'government' is there, your money is protected.

So as far as value growing is concerned, that is pretty much what Malaysia government has done for your personal finance. There is an EPF and there is an Amanah Saham. If you are not adopting any of these tools, you are pretty much all on your own.

Part 1 - EPF

Part 2 - Amanah Saham

My last post till late Feb

Ok folks - you have heard me state several times that a rebound in prices past the highs of late 2007/early 2008 would put our 'bubble bursting' graph into doubt. We are there, however...


....it seems like we may have a little reprieve. My technical analysis friends, tell me that there is such a thing as a divergent high.


First you get a 'momentum high' as prices get driven up-wards by panic buying, then you get a scary drop, followed by another zoom up- but this time it is a 'divergent high'. Which means that while prices move up again, things don't smell as fresh.


The divergent high usually happens as the powers-that-be try to sustain the bubble by what-ever means necessary. It is driven by late-comers, bears throwing in the towel and the last few buyers left behind.


In stock terms that would mean the second high comes with lower volume, and just a few star stocks participate in the final climb up, while the majority were flat.


In real estate terms, we could argue that we have just had the divergent high.


1) Much lower list/sales than the previous high. check.

http://agentwill.com/weekly-stats/

2) Limited participation. Check. We have the West-side making new highs (how's median prices of $1.78 Million sound?)- but the Valley, Okanagan and even East and North Van are stagnant or dropping:

http://www.yattermatters.com/real-estate/friday-counsel/

So the rebound has been much more narrow. The OK is nowhere near it's all time highs. But Down-town Vancouver is pretty close, even though there is more inventory and lower list/sales that the previous high. A clear divergence.

Daisy chains

Vancouver, in fact Canada as a whole, is one of the few areas in the world, along with China were RE prices have been on a continued up-swing despite the recent credit events.

You have read me state several times, that many assets seem to be linked at present.

Gold, oil, stocks, commodities, non-US RE have all moved up in lock-step. The driving force has not been increased use, or a sudden jump in population but zero interest rates and a return to speculation.

http://themortgageblog.ca/_wp/wp-content/uploads/2009/05/boc-lending-graph-1024x717.jpg

The zero interest rates are not for borrowers BTW, who still pay 4-7%, but for savers who get next to nothing. The goal is very simple, to allow banks to mint money and repair their balance sheets (6% - 0% = 6% which is a very large spread historically), and to force savers out of money market funds and back into more speculative investments or better still- to just spend the money and keep the consumption orgy going strong. It has worked.

Though commodities such as copper have seen a drop in use and large increase in storage, they have been bid up close to recent highs. Even Chinese pig farmers have been buying up stocks-piles of commodities as investments:

http://www.bloomberg.com/apps/news?pid=20601109&sid=a1B_ZBQfii8Q

Ok, so what does this have to do with Vancouver RE. Well we are linked in a daisy chain of assets to these speculators, since we have one of the most speculative RE markets in the world. Nothing compared to China which has seen 40-60% annual rises in some of it's major cities. Some say that bubble is about to burst too:

http://www.theglobeandmail.com/globe-investor/investment-ideas/where-is-the-next-bubble-going-to-burst-i-bet-on-china/article1450367/

We have started to see risk-fear returning to the stockmarket, and when it happens, things drop quickly. Look at oil or gold or our own TSE -a 9% drop in just two weeks:

http://stockcharts.com/h-sc/ui?s=$TSE&p=D&b=5&g=0&id=p60710887103

So what does this all mean. Not a lot :)

It means that we should look outside Vancouver to see how our RE will fare. We need to watch the Chinese stock market, the S and P, the TSE , gold and oil. They are all moving together and a slide in one is likely to auger a drop in the others.

More than that is impossible to forecast. Why? Because we do not have free markets anymore. If a fat-figered trader at a major bank losses money on an illegal trade the market will drop hard, but if the government decides the tax-payer will pick up the tab, then speculation returns very quickly.

It happened in France, when one trader lost an astounding $7 Billion and brought bank stocks down 6% world-wide - the US FED quickly cut rates and the French Government arranged emergency loans and back-stops.

http://en.wikipedia.org/wiki/January_2008_Société_Générale_trading_loss_incident

In the US, the government bailed out AIG to the tune $200 Billion for foolish, negligent and perhaps criminal (an insurance company should not sell more policies than it can cover) trading.

The bubble has to be inflated at all costs, even mortgaging the future to do so.

The Owe-limp-pix

You all know I was 100% against this wasteful, unnecessary, corporate, nationalistic shin-dig. Why did the proponents want the games again?:

1) To pump RE even more and enrich developers

2) To inconvenience locals, many of whom are fleeing the town.

3) To leave us a legacy of debt.

4) To allow our City councillors to try and negotiate with Wall Street sharks for money and get fleeced.

5) To attract more low and semi-skilled jobs at a time of boom from RE construction, digging more holes and filling them with concrete so that we can have a complete collapse after the Olympics and have to retrain all these people for more sustainable careers.

Ok now that we have that out of the way, I have to say I want the games to be a success.

Unlike some permanently-negative bears, I want to see the games go as well as possible, with as little added costs for bringing in snow by helicopters. Oh and I do want us to win Hockey gold (coz it is our game) and hope we don't have riots if we do or don't.

Why? Because the more it costs, the more we are all - buyers and sellers, Vancouverites and Canadians, going to be on the hook for it and have less money for daycares, and schools and affordable housing which are things worth going into debt over.

And we have to keep those nickles handy for the CHMC, if RE turns sour, or maybe one of our banks gets carried away with gambling, sorry I mean trading and needs help in the future.

http://www.bloomberg.com/apps/news?pid=20601082&sid=a1FRg17zgqGw&refer=canada

Have a safe and healthy Olympics and I will see you at the other end.

My First Giveaway!

I am so excited about this being my very first giveaway. At first, I wasn't sure if I wanted to get into it, but it's just too much fun not to. I made this bag yesterday. It's called the "I'll Have One of Everything" Bag. The pattern is from the Seams to Me book by Anna Maria Horner. My b.f.f. from high school is making(and selling) these, and I fell in love.(Her website is modernmommysewing.blogspot.com) This was the "trial" bag to see if I wanted to start making these as diapers bags for gifts. And the answer is...YEE-AH! Love them! Of course it isn't a full size diaper bag, but it will do the trick. The dimensions are from tip to tip 19 1/2", and from strap to bottom 20". The straps are braided...it's hard to tell from the picture.
Now for the details...leave a comment. You don't have to be a "follower," but I would love it if you would:o) Leave a funny quote that you have heard recently or one that you always use...and keep it clean;o) I need a laugh. The winner will be announced on Monday February 1st...my 7th wedding anniversary:o)(yay for us!!) Now get to thinking, and post those quotes!!:o)...(open to U.S. residents only) This Giveaway is now Closed.

Comments on Jupiter 2010 stock picks

Faber Group was one of the worst run businesses of all time. They wanted to do 'everything' and ended up achieved almost 'nothing'. Its one of those stories who involved in property development and didn't quite make it. The whole restructuring exercise took more than 5 years before they finally turned it around. What is interesting however is its consistent up trend in their EPS earning, despite that it started from a negative (84.2) in 1998. Looking forward, if the person who is managing finance in Faber continues to stay in power, this is worth looking into more. It could become one of the best long term keeper. Key to success is if they can repeat 2005-2006 growth now. This can be determined by reading their latest annual report. Challenges are varies of their continuous law suits.

SAPCRES, Oil and Gas, looks pretty good now. It seems like anything under RM 2.49 is a good buy ( and keep for the next 10 years). The problem is technically it is at its all time high now and corrections are bound to occur. Another problem is it has been relying too much on the oil market and fluctuated too much in the past. Internally they should really improve their hedging strategies to smoothen out their track records.

Paramount is properly most well known when they bought Kota Kemuning with cash 7 years ago. Perhaps they should buy another big piece of land now to stimulate next 3 years of growth !? Basically this is also a very good keeper, it wouldn't go too low anyhow so it has a strong safety net but technical correction pressure is quite high at the moment. Its employee share option scheme also make it a less attractive stocks. Potentially a keeper but lack of stimulants now.

While some think Zhulian is a great MLM company, I personally think they should adopt newer concepts etc. They are still employing 20th century MLM aka. repeat Amway's story but landed on a wrong product to start with. But even with the wrong product, they are in the right market and hence still manage to make it a success in their own scales. My target buy price for Zhulian is only RM 0.66

The rest of the Kurnia, KurAsia, Atrium, TSM and WellCall do not meet volume requirment. So whatever reasons Jupiter recommends them are not based on proven strength analysis - which in turn I consider as speculations. Among all, TSM may be the one what is most speculatable.

My actions ?

I have chosen KNM over SAPCRES in the past before. There is no urgency to change yet although its tempting. Faber and Paramount on the other hands were NOT in my radar before. Can Paramount regains its debut ? Is Faber really undervalued and have their internal issues really addressed ? I may check out Faber's management team first ...

Travel Sippy Cup Holders

I don't normally post more than one blog a day, but I had to put this on as soon as I finished because I was so excited about it. I had to take the kids to the doc yet again today, and on the way home they simultaneously dropped their sippy cups in the floor of the van. Well of course I couldn't reach them, so I got to listen to the poor pitiful cries of two thirsty babies...Then it hit me. I MUST do something about this. When I got home, I got online to see how much sippy cup holders were..the ones that the kids can reel in after they drop them, and they were around $10-$15 each. I have 2 kids...not happenin'. So I pulled out a notepad and started sketching and came up with a design that I thought would work and got to cutting. Here is a tutorial for all of you frustrated mothers whose lil' ones have the dropsy's at the wrong time too:o)
What you will need:
-Fabulous fabric(around a 1/2 yd?)
Cut:
*(1)12 1/2" x 11" square..I guess it really isn't a square if it isn't...square?
(this is the holder fabric section)
*(2)Circles 4 1/2" in diameter(bottom)I used my circle cutter to make a pattern
*(1)22" x 4" strip(strap)
-1/2" Elastic strips(2), 8" & 7 1/2"


Fold the holder fabric in half(the 11" length) and press.


Using your iron, fold the strap in half and press. Then fold each edge towards the center line and press again. This prevents any flipping of which I absolutely detest:o)


Stitch as close to the edge of the strap as possible. Make sure that there aren't any places that slipped and did not get stitched. Fold under one end of the strap and stitch making sure raw edges aren't showing.


Fold finished edge over 3 3/4" over and stitch.


Take the holder fabric and stitch 5/8" to the left of the folded edge. Then stitch another line 2 inches to the left of that. Then another line 5/8" from the second stitched line. These are the slots for your elastic strips.


Grab your 2 elastic strips along with a safety pin to help you run them thru your slots.


Take your 2 elastic strips and run them thru your slots. The 8" strip goes on top and the 7 1/2" strip goes on the bottom. Make sure to have something at each end so that the strips don't slide back thru. Place right sides together. Make sure to add the strap on the inside matching all raw edges. Stitch. Back stitch over the strap for extra strength.


Take the 2 circles that you cut out and put wrong sides together. Baste around the edges so that there isn't any slippage. Now put one of the right sides of the circle and the right side of the holder together matching bottom edges and stitch. Turn right side out.(Sorry that there isn't a pic, forgot to take one)

Slide a cup in to make sure that all stitches are secure and that there aren't any gaping holes;o)



How to attach the holder to your car seat:

Slide strap around bottom of car seat strap as shown here.


Slide the holder thru the loop


Now just pull all the way thru.


Insert cup, and there ya have it! A sippy cup that will never be lost again...unless they try to physically remove it from the holder:o)

Hanging Letters

I have been waiting a while to post this one because I was searching for the perfect wall hanging to put S.R.'s letters on that I made her. E.'s letters came from Pottery Barn, and that was when we could afford to spend $10 per letter. Ain't happenin' now. Sister will just have to deal with moma-made letters:o) I found these letters at Hobby Lobby for 99 cents each. I found scrapbook paper that would coordinate with her room and busted out the Modge Podge(I used several different pages, but only posted the S). I am really starting to like this stuff! It took some time, and it was very tedious, but I am fairly pleased with the results. The edges were a little rough so I hot glued white ribbon all the way around, and then glued a strip on the back to make a bow to hang the letters from. The "Princess" sign came from Hobby Lobby as well and I got that beauty for $4.99. It was perfect in so many ways, but the main reason was it had 5 hooks...enough for all the letters of her name..YAY! My next project for her room is to make a large canvas mural with a butterfly theme. It's in my head, just gotta get it on the canvas:o)

Our Kitchen Table and Chairs (with new matching curtains)

This is our "new to us" table and chairs. I bought this set off of Craig's List for $50 right before we moved into our new house. I loved the lines of the table and chairs, and could see the potential in it. The hubs was not happy about having yet another project ahead of him, but now that it is FINALLY complete, we are both extremely happy with it. He sanded the top down, but only slightly and we painted the whole set this mint'ish green. Once that was done, the top just wasn't cutting it, so he re-sanded only the top, and stained it. I distressed the chairs, hubs polyed it and I covered the seats with the same fabric that I used for the valances. We are very pleased with it. Now all it needs is a little accessorization and someday a small church pew on the back side and it will be able to seat 6 on a regular basis. I think we make a pretty good team:o)

Before...see that stank nasty fabric on the seats?? I removed one covering and then passed it on to the hubs. I get a little freaked out with other people's filth:o)


After...yes you are having flash backs of your granny's house if you caught the plastic coverings on the seats. If you have small children whose food ends up on the seat instead of their mouths, you understand. They are super easy to maintain now, and when I have guests they don't have to look at my seats in disgust thinking, "do I really want to chance sitting on those seats and ruining my nice pants??":o)If they spill something, I just wipe them down and they are as good as new..looooove it!!

Living Standard @ Personal Finance Level

Like inflation, Living Standard can be a big number where GDP, poverty rate, income growth inequality, life expectancy are involved. But as far as personal finance is concern, what you should really care is your very own personal living standard.

Simply put, living standard is your ability to sustain how you live your life. At one hand this can be calculated very much similar to Living Cost and the increase of living cost over time is inflation. So is living standard the same as inflation ?

But it should be the opposite instead. One would want lower inflation but higher living standard. So what has gone wrong in the formula ?

The keyword is "ability". If you are NO longer ABLE to sustain how you live your life when inflation kicks in, you are facing the risk of lower living standard. Inflation is an external factor. Your ability to fight the inflation will determine your living standard. When your ability increases faster than inflation, your living standard is raised.

Most of the time, this ability is associated to income. The more money you get the less you need to worry about how expensive the stuff has become. Although vastly applicable but earning income is NOT the only ability one can have.

Says the food and rent have been increasing rapidly. You have to rent a smaller place and eat at cheaper places. You change your lifestyle, you are having a lower living standard now.

On the other hand, another guy is facing the same inflation challenge. Instead of moving to a smaller place, now he rent a bigger place and sublet it to collect higher rent. He starts to grow his own food at his spare time. He changes his lifestyle, but he is having a higher living standard now - staying in bigger place while paying the lower rent and eating healthier food.

Which of the above is living cheaply and which one is living frugally ?

Sometimes creativity and innovation plays a vital role in achieving higher living standard, both in generating higher income and also how one can live his life.

Jupiter Online Stock Pick for 2010

Just came back from Jupuiter Online seminar, some of their stock picks for the year of 2010 are:

Zhulian

Faber

WellCall Holdings

Sapura Crest

Atrium REIT

TSM Global

Paramount Corp

Kurnia

Talk given by: Pong Teng Siew.

Actually he mentioned these are short to medium terms recommendation only ie. next month to next quarter or so. Overall there are many uncertainties ahead that the bullish trend is really questionable. Hence generally there will be a correction in the market soon, followed by a mainly side trends for the next 2 years.

A few points that I manage to digest are:

Governments backup funds are ending in mid or end of the year, banks are not likely to recover fully and able to stand on their own yet.

USA employment rate is actually higher than reported figures because the number of people claiming un-employment insurance are still rocket high. A lot of part time workers are actually un-willingly working part time but forced to.

China rising inflation may result them pulling back their outflow funds, implying we can't really rely on China neither.

I don't fully agree with all his views but nevertheless shared the similar future trend predictions. I may comment on his stock picks after I eat something ... hungry like a horse now ...

Mutual Fund of the year 2010 ? By the numbers ...

In 2009, about 10 mutual funds thats worth looked into were selected out of 530 choices in Malaysia.

Today lets take a look at how they performed in the past 6 months. Below chart shows their respective return in percentage. From past 1 day, past 1 week, past 1 month etc.

The actual percentage return is NOT important here. We are comparing fund performances across different fund managers. What we are looking for is a graph that consistently stay above the others. That would give an indication of "consistently outperform the others".

The most apparent winner is OSK Equity Fund and the worst is Public Ittikal. However, this does not imply anyone of them is better than another. The market has been trending up generally. OSK is well verse in stock market and therefore able to catch most of the up trend. Public Ittikal on the other hand only deals with halal and safe instruments. You can be assured that both of these funds are very strong in their fundamentals.

However, one clear message from this chart is that we can take TA away from this list. As you may see, their chart patterns show as if they have no clue how the market will move and don't even have any good strategies in their fund management. They are supposed to be as good as OSK.

So if you think the market is continue to be bullish, exercise DCA on OSK-UOB Equity Trust. Else if you prefer safer haven, try AMB Ethical Trust and Public Saving.

Ottoman Re-do(No Before Pic:o(..oops)

I found these two little beauties at the Goodwill as well. I just keep comin' at ya with these Goodwill finds, and YES, I got them all in one day!! These cutey pies were $7.99 each. They are Target brand and still had the original price tag on them of $59.99 each(yes, I scored majorly!!) The fabric was a little on the dingy side, but everything was in good working order, the piping was still in good shape, so off to deconstructing I went. It was sooooooooooo much easier than when I pulled apart the chair to recover(see pic of living room curtains, and it's the yellow one with stripes). It took less than an hour to pull the 24,000 staples out of them. I used some more of the green and purple toile from dear Ms. Stephanie to recover them, and now I'm all coordinated and stuff;o) I painted the legs black b/c I still have 3/4 of a gallon left, so anything else that comes in the house to be painted will eventually be painted black:o) I put them upstairs in the bonus room in front of the couch. See that big empty space on the wall??? That's where the top of the coffee table will eventually be...It's gonna be great!

My Coffee Table Makeover

I keep writing about my trip to the Goodwill store up north, and wish that I could go back every week! That place was awesome! While I was there, I kept passing by this coffee table, and thinking, "do I really need this?" Well of course I do! My first thought was to make it over as a table for the kids to put their blocks, train tracks, and lincoln logs on, but then a selfish thought hit me...I want it for my living room! I took it to the register thinking that I was paying $14.99 for it, which I thought was a pretty good deal, especially since it didn't have the glass panes in it(btw, I HATE glass top coffee tables). The lady said, "That will be $7.49", WHAT???? Holy Cow, I was soooo excited! Got it home and the hubs was pumped about it too. He made a special trip to Lowes for a nice birch top(expensive, I know), and put it on all in the same night. I painted it the next day, and now it resides in my living room.

Before...(the top will be used in another project).


After...I love the size of this thing! I bought the tray at a yard sale back last summer, and had absolutely no idea what I was going to do with it. I think that this is the perfect spot. It has a little brother that is still waiting for a home...

Thanks to vancouvercondoinfo for the above graph.

As regular readers know, I have posted the typical 'bubble graph' several times in the blog and until the end of 2009, there was still a strong possibility that Vancouver was following the path of Dutch Tulips and the Dot-com-laden NASDAQ of the late 90's.

However as you can see from the graph detached has made a new high in average price, which puts this model under some stress. All is not lost...yet. But it is getting close to the wire.

Just because we think something SHOULD correct and clearly is over-priced, doesn't mean it will oblige. There is often a confounding factor that we did not account for that could prolong the bubble or push it to higher heights. Remember Japan had a RE bubble that went on for 15 years without a pause and has been on an equally long down-ward path.

Lets look at the graph above once more.

The Boom-bust sequence often follows a predictable course:

First there is a trend change which is subtle at first and then picks up momentum and feeds on itself.

You can see in this graph that 2001 marked that departure. Prices rise at an even steeper trajectory and bears talk of 'bubbles' and 'unsustainability'. Each minor correction is hailed by bears as the beginning of the major drop, each bounce back is a vindication for bulls that the move up will keep going. People move from the bears to the bulls campand are quickly rewarded by an increase in equity and feel smart for making the jump.

Those who don't change camps, become ever more dejected and bitter towards all the factors that they believe are keeping the bubble inflated...government policies, rich immigrants, tax breaks, realtors, pumpers, lax bank lending etc They feel and are made to feel like losers.

The peak is marked by absolute recklessness as people throw money at the asset. That would be late 2007/2008. It is the last gasp of the main run-up.

Then we have a drop, which was quite rapid and frightening. Bears are jubilant.

There is usually a retest up to the highs. The late-comers see their opportunity, the vested interests try their best to keep the bubble inflated and up goes the asset again.

Bears who didn't buy are ready to leave town or are getting divorced by their spouces :)

However the mood is different than the first peak. It is not as reckless. The recent memory of the drop is still in people's minds and their is anxiety in both camps. I would say this is the part of the graph where there is the most anxiety and worry.

Both sides worry about which route the asset will take. Despite all the bravado from both sides, no one knows, or can say with conviction which way the graph will go.

Buyers, especially recent ones, will turn on any bears who may suggest that their buy was at the top, where-as bears are looking for some indication that they didn't miss the last chance to gas up for 200 miles.

We are at this point now.

I note that the UK was in a similar position and thanks to herculean efforts from the government to pump up the asset and bail out the speculators, the price of housing has rebounded but even they didn't get to new highs as we have in Canada:

http://newsimg.bbc.co.uk/media/images/46503000/gif/_46503012_house_prices_10_09_466gr.gif

Ironically we felt proud in Canada that we had more sound lending and did not end up with the same problems as the US. Then we increased the CHMC limits at the all-time lows of rates and at the all-time highs of prices. To paraphrase Einstein...to repeat the same actions that failed before and expect them to succeed is true stupidity.

The next few months will make things a lot clearer.

Well.....

I thought that I was going to finish all those curtains in one day. HA! Fat chance. I did get the curtains done in the living room and I love 'em! They make the room look complete. Thank goodness. There was almost a catastrophe though. As I started sewing this beautiful fabric, I realized that when you have two windows, you generally want to have 2 panels per window...duh! I only cut 2 panels. Then it hit me, do I have enough fabric???? Just barely(sigh), and I had to do some piecing to make it work, but you won't be able to see it because I am that good...well, not really. That panel ended up behind the chair:o) I started the kitchen curtains, but was getting tired and started to make a mess of things, so I called it quits. I am really pleased with how the living room turned out!
The clock in this pic was a Goodwill find. All the old ladies were eyeing it with jealousy. One said, "My what a pretty clock you've grabbed." And I thought to myself,"Oh yeah lady, and it's all mine!!!!" (was that a little too over the top???)


The curtains hung in all their glory:o) The hubs is gonna be a little irritable when he sees that I moved that huge pic above the fireplace from the dining room to the living room...a bone of contention in this household. I had him take the top part of the hutch to the attic so that I could have the massive pic hung above the bottom of the hutch. (I am a woman and have every right to change my mind if I want to...)After almost loosing appendages, and having to take the stairs off to get it thru the hole in the attic, it found a resting place, and the hubs thought that it was staying put;o) Little did he know...But the pic looks soooooooo much better above the fireplace, don't you agree?

I'll get busy on more projects tomorrow, hopefully. Taking a day off. Yesterday wore me out!! I'll post the new coffee table tomorrow. Very proud of this find!

KLSE Technical 2010-01-21

I have stopped stock market talks for a while based on comments received in the past. But about 20% of the old readers unsubscribed following that. So I am guessing there may still be some silence readers who love stock market talks. And I feel very itchy not to share my view seeing that no one else publishes my opinions. So pardon my incidental randoms.

As some may have known by now that KLSE is damn HOT now! Axiata, PBBank, KYM, RCECAP, LIONDIV, LIONIND, MBSB, AFG etc. all shoot up 8-12% in a day. This has happened since 2 days ago KLSE finally broke its 1300 ceiling after 10 months of 'recovery'.

Things are indeed great. But you may want to know a few things;

Despite higher closing price, MORE number of stocks are dropping THAN rising, 2 days in a roll. This may imply that only a few stocks are being speculated. Investors may even withdraw from other stocks in order to join the hot stocks growth. This also shows that there is NOT ENOUGH investment money flowing within the market now. So whatever the reasons are for the up swing, its NOT going to be able to keep it for long.

There has been a "closing up swing pattern" for the last few months. This shows that certain parties are manipulating the open and closing price so that certain trends are shown in technical analysis (so that other fund managers will join in the game). This is not totally a bad thing but if you are not following what these big boys are doing, its very likely that you don't catch their next moves.

According to Bollinger Band (20d, 2), KLCI is hitting its top band soon ie. 1315 by 25 Jan. So correction is coming very soon. Tomorrow is going to be a red day, if it goes on the day after, then the correction will be confirmed and it will be a good news where you can start accumulating again.

All the other indicators also show that there may only be another 10-20% room for growth in the next month or so.

So what should you do ?

Well, the heat is not going to fade away that fast neither. Tomorrow will be a red day. If you pick some stocks up, you may still be able to get 10-20% gain by February.

If you have already kept some, you may want to plan to profit take when it goes up another 5-10% in the next 2 weeks.

If you don't plan to profit take within the next couple of months anyway, the next obvious chance would be in Q4.

What are the jewels now if you haven't bought any yet ? Well, I have only concluded KNM and BAT for now. Keep KNM for these 2 months and BAT until year end.

Avoid warrants and all derivatives at all cost now!

How do I know tomorrow is going to be a red day ? Well, I just keep my eye on how the whole world market is going before ours are opened ... http://stock.malpf.com/

Mortgage vs Loan

Very often the terms mortgage and home loan are used interchangeably. Although it might not cause big harms but understanding the difference may bring positive impact to your personal finance ie. in Property Investment.

In fact, mortgage is the opposite of loan.

When you need extra money, someone can lend you some and in return they gain profit when you repay them. The lender may ask for collateral like your house so that if you don't repay them, they can take possession of your house, sell it and still earn a profit by doing so. They give you a loan.

If you have something valuable and you want to exchange it temporary for some money, you can prove to people how valuable your possession is and why should they give you money for it. You get your money if the lenders are satisfied their interests will be taken care of. You have just mortgaged your belongings.

Loan is a lender's contract,

mortgage is a borrower's contract.

At one instance, it may seems the same. Its just a story told from different angles. But if you think for a moment as a borrower, do you want to follow your lender's contract or should you come up with your own's ?

If you start thinking the whole money borrowing thing from your own angle and for your own interest, you may just come up with some unique and interesting arrangements.

Items that can be mortgaged are not limited to your own properties. If you are holding some collaterals from other people, you can mortgage them to higher bidders.

You don't have to mortgage 100% of your property. Since it is really up to you, you can even split a single property to 4 different mortgages and borrow money from different sources. However, you would need some very good reasons why people still want to lend you the money. But if it is a 4 sections building, it wouldn't look that ridiculous anymore, would it ?

Item that can be mortgaged does not even need to be mortar. An idea or a method can be mortgaged too. As long as someone believe in your value judgement and their interests taken care of, they can lend you money. So you can literary mortgage your property for money without giving it out as a collateral at all. Especially applicable when you are earning revenue from such properties.

Loan or Mortgage ?

Borrower or Mortgagor ?

Lender or Mortgagee ?

As mentioned earlier, this is just a matter of how the story is told. Do you want others to control your story or do you want to tell your owns ?

http://homebuying.about.com/cs/mortgagearticles/a/deedoftrust.htm

Busy Beaver

After searching for all the perfect fabrics, I have finally gotten everything I need, and I must sit down at my machine and GET BIZZAY! I have around 60 yards of fabric just sitting around in the guest bedroom waiting to be turned into something beautiful. My windows have begged and pleaded with me to clothe them. They are tired of being nekked, and frankly I'm tired of them being nekked too:o) So today is the big day. My poor children don't know what's in store for them today. Mommy is going to be neglectful in the hopes of finishing 8 window treatments in one day...can it be done??? Probably not, but it's worth a shot. I also have to paint a coffee table I bought at Goodwill in Fayetteville yesterday for $7.50. I am beyond pumped about this table!! It is 3 ft. by 3 ft. HUGE! Love. love, love it! It's going in the living room, and now we will have a proper place to prop our feet up. We also got the table and chairs refinished, and I will post that as soon as I replace the seat cushions. It turned out GREAT! Hope everyone has a fab day!!

HLA Guarantee 12.5% saving plan

Hong Leong Assurance offers a plan that guarantees 12.5% return. Basically you only need to save $3,932 for 6 years and you are guaranteed to receive $500 every year starting from the 1st year for 35 years.

So 500 out of 3,932 is more than 12.5%

$500 x 35 years would give a guarantee amount of $17,500. If you do not withdraw this money, it will accumulate more interest. On the 35th year, you will get $50,126 instead of just the $17,500.

In addition, there is a dividend payout where the minimum is expected to be $200. Not guarantee but pretty guaranteed as in insurance layman terms. With the most conservative assumptions etc. you will get more than $105,000+ at the end of 35 years.

Most of the older readers should know this trick by now. There is no such thing as insurance saving that gives guarantee and higher than Fix Deposit return in normal circumstances.

If you save the same $3,932 in a bank account that gives you 1.72%, it will give you a total $41,082 on the 35th year; equivalent to the guarantee yearly $500 plus capital preservation. So the guaranteed return you are really getting is less than 1.72%. Because your capital is NOT guaranteed in this plan.

If you keep the $500 and go for the guarantee $50,126 return at the end, that is equivalent to 2.35% return. Currently bank is offering 2.5% FD rate for annual renewal.

Lastly if you are really getting back $105,862 at the end, that is equivalent to 4.72% annual return.

Consumers need to know what the effective rate is when comparing plans. For crying out loud, insurance field agents please upgrade yourself and calculate what the real effective rate is. May be you don't need to tell everyone about it but when some personal finance savvy consumers asked about it, it is more reputable if you can give some valid figures.

4.72% is NOT a bad return at all. But 35 years is too long.

Somehow I missed this....

VREA's prediction of how RE could could unfold in the near future:

http://tinyurl.com/y97ex74

This is more or less how I see it unfolding too. However I also thought that the bounce in 2009 (caused by lower prices and lower interest rates and the CMHC) would not cause a rebound to new highs, which now seems to be the case.

It seems our RE market is more highly correlated with that of China and HK than with the US, who would have thought it.

The ironic thing though is, while the average price has hit new highs, we are at a higher MOI than we were when we were last at these lofty levels. The market also feels a lot less tight, with more listings coming every day, and less frenzy in the market (except at the end of December).

But as I said before, until we get the Olympics out of the way, we wont know what to make of the numbers.

Curtains for the Bonus Room

Before:


After:

I got some fabulous fabric from my fabu-lo-so friend Stephanie, and had to make curtains with it. Love, love, love toile fabric. It could be in the nastiest color and I would still try to make something great out of it...well, maybe not. Anyway, I thought it would go perfectly in the bonus room b/c there is a lot of black and white, but I couldn't figure out what color I wanted to coordinate with it, and then Stephanie offered her left over fabric. Aaaaawesome! Did I mention how much I love this fabric? Anyway, I made a simple pattern out of some freezer paper(my new found love) and got to sewing away. These curtains would have taken around 2 hours if there hadn't been numerous interruptions:o) I love how they turned out, but they do seem a little naked. Waiting for the perfect trim to show it's lovely self, and I will probably just hot glue it on...the lazy man's way of sewing. There was a ton of fabric left over, so I will definitely be making pillows and a seat cushion for my cedar chest that I will be refinishing and possibly distressing??? Should be fun!

Charge your future usage : how did it happen ?

The way credit card companies forward calculate interest has sicken many users. Together with the 5 cents round up mechanism, there are cases where its not even the users fault not to totally pay off their last month balance.

Some are still in shock how consumers can be abused in such a way. Well, this is how ...

Credit card companies used to charge 18% interest on the amount you underpay and owe to them. Seeing that this high interest has caused many people in debt and even bankruptcy, banks are urged to reduce that rate. So the project of multi-tier interest rate was born.

If the amount you owe is not that much, banks may reduce that rate to 13.5% for example. Like wise, if you continue not to pay, banks will have the rights to charge 18% interest again. So lower interest rate is imposed on lower loan amount.

So far so good isn't it ?

Well, banks are going to give you more. In addition ...

We will give you 22 days interest free on all transactions, if last month outstanding balance, as per monthly statement, are settled within due date. In cases where this interest free is not applicable, we will charge interest on all transactions from the posting date.

Don't doubt my grammar, its a carefully formulated sentences very similar to the actual terms and clauses. All the commas and periods are there for a good reason.

It is still fair isn't it ? What it says is if I paid last month balance in full, I will not be charged interest for another 22 days. Else of course I should pay interest.

There are 2 sentences up there.

The first one evolves around monthly statement. If the bank generates your statement on the 1st of the month, you don't need to pay interest of the amount on that statement up to 22th. Which is also usually the payment due date. Ok still ...

The 'all' in blue color means all the transactions on that monthly statement. Not 'all' the other transactions you used before and after the statement. Guess what, the transactions you used before is a brought forward balance, so its NOT a transaction and therefore will continue be charged interest and excluded from this interest free offer. You are also NOT getting interest free for all future transactions because they are NOT on that statement yet.

The second part starts with "if interest free is not applicable". It doesn't say if you don't pay then we charge you. There are many other reasons interest free is not applicable and no matter what they are, you will be charged. So there is ONE specific scenario you may get interest free period and ALL THE OTHER scenarios would allow us to charge you. Thats basically what it sums up to.

Now there is also a word 'all' in the 2nd part. This time, there is no statement mentioned. This 'all' would mean ALL transactions including the future ones you are going to make. And the interest is calculated based on the posting date which is totally ok even if it is a future date.

I am not quite sure if I have presented this clearly. There is the trick of saying something seems genuine and simple but yet a small word in it turn the whole thing around. A seems-to-be very thoughtful offer has been given, most of us were ok with it and now its too late to turn the game plan.

Banks came to us on day light, offered us lower interest tiers and a new way to calculate interest ( with interest free period !! ) and we bought it. So now its too late for us to pursue normal channels to change this. Whatever left is to propagate this knowledge to more and avoid to be taken advantage off.

If still want to do more, please get more people to read this series of articles ...

Credit Card forward calculate interest

How did it happen ? ( this article )

Why do they need to do this ?

What can we do ?

Apartment rents drop 9.4% from a year ago!!

A huge number!

Ok this is New York, we are talking about. Manhattan to be precise, which as we know, is not as world class as Vancouver and has lots of land.

Actually the drop is probably much higher, as landlords are giving big incentives for leases, such as two months free rent for a 14 month lease. That is equivilent to another 10%+ drop!:

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a2UfZHjKxKrk

Of course this could never happen in Vancouver. BTW I tried looking up the Vancouver Vacancy rate, but had a hard time. Vacancy rates have increased across Canada with increased home ownership, by 1% according to the CMHC, but I couldn't find precise numbers for Olympicville.

Clean Up, Clean Up, Everybody Everywhere!

When we decided to build our house, we knew that the bonus room would be the kids "domain." We made sure that everything in there was going to be kid friendly. I wanted to have a space for them to color and do crafts, and this corner was the perfect space to set up shop. My parents gave us my grandmother's table and chairs(Thank you Papa & Gia), and also tons of colored paper. My children, bless their little souls, are little tornadoes at times, and thus the BEFORE picture. I had to come up with some quick ideas or I was going to go nutso with the disorganization.




The pencils and markers are always strown, and even though they had a basket to put everything in, it wasn't pretty and it had holes in it. I made these from veggie cans. Just glued scrapbook paper to them, and voila. Instant pencil and marker containers.


I had this basket which was formerly a home to all my hair stylist products, but it seems that it served a better purpose by housing all the kids coloring books and craft paper.


And the After. Now doesn't that look much more pleasant:o) They actually like putting the pencils and markers back in the containers. Now I can be a little more sane:o)

5 cents Round Up mechanism

Most of the Malaysians are already used to the 5 cents round up despite how silly some of the transactions could become.

BNM has already clearly stated that this only apply to cash transactions where we are trying to get rid of 1 cent coins. But it is obvious that even if you are paying with credit card, check and online transfer, most of the retailers will still round the 5 cents up.

When you go to bank and make a payment of $9.98 over the counter. You may write down $9.98 in the bank in slip. Upon making payment, the cashier will have to get $10.00 from you. Which is fine since now the rule is to round it up. When the transaction is done and you get back your proof of payment, what do you think your paper work will say you paid ? Correct, $9.98 !

So be smart, round it up and write down $10.00 because that is the actual amount you pay.

What if the amount is $9.96, you would definitely have to pay $9.95 but should you write on the slip $9.95 or $9.96 ?

If you did write down $9.95 as in honestly you have just paid that exact amount and not 1 cent extra, you may face the risk of another funny finance scenario ... credit card forward interest calculation where your 1 cent ignorance could have cost you $15 !! Well, not that funny but its happening everyday ...

Guess what, with this GST coming soon ... we consumers may not see it how it comes at all, we may NOT even realize after many years ... but all these little things combined together are THE ONES that kill your personal finance, especially if you don't know.

Government and the big boys can do all kind of tricks to keep the national inflation number down but what really matter is your own REAL personal inflation rate!