Brief Outlook of 2009 Economy - Where do we go from now?

As of today, 4th December 2008, i am drafting my view in 2009 but will further fine tune when more data is going to be out in this month. SO that i can check-point the following review as closest possible of the outlook of World and Malaysia Economy. Again, i leave the statistic to others but always view from a overall perspective that helpful in aligning your strategies.

For US, which all eyes are on them to when recovery will start before EU, China, Japan, India and the globe will follow together. The concern is whether will it be another dampening story like Lehman to come and further dragging down the entire world equities market for 10 - 20%.

After the Lehman story, US regulators will not allow any major financial institution to fall anymore. Be it artificial or be it necessity to do so, at least, this problem may be solved for now temp. I still think it is unlucky we are at this stage but it is also good that before we all moving into major depression. If regulation and mindset will and can be changed after all learn a lesson, the next 5-10 years may be very good for all to come because most of the bad bloods will be wiped out while more time for new problems to be emerged.

I personally reinforce that the bottoming process is soon to be over however Q4 2008 and Q1 2009 will still look bad. As long as market does not reflect to bad news and there is no more suprise like Lehman, i am optimistic 2009 will be a starting point of recovery from 2nd half and make full swing at 2010. Dow Jones tactically strong suport at 7,500 and KLCI is around 750.

For Malaysia, say our this year GDP is around 5% that dragged down by last two quarters slow down. Also, we will also suffer Q1 2009 and Q2 & Q3 2009 with bottoming process to be ended. The estimation is my observation and believe that we are always one quarter slower to response then others. The current impacted will only be felt in Q1 2009 but we will also slow to feel the recovery only happen in 4th Q of 2009.

For Malaysia property market, put more emphasis in AXREIT and BSDREIT are there are performing well in 2008 and current valuation and yields look cheap. Buying a property may need to be extra cautious but overall over local property market is still healthy. It is always, location, developer and selling points. Overal in New York, prices of real estate is holindg much better compare to other states is a great example.

Many estimated that the current fundamental strong hold of KLSE and country's economy are due to the government intervention. Be it is truth or otherwise, i always believe that it is not too possible these days because of the global hegde fund become much stronger then the government as a trend.

If there is a time that opporutnity emerge to hedge fund on shorting the market, stock options, commodities, there will be always a "Soros" there and we still have a long way down for the local market.

Thus, i am optimistic that a more turned agressive buying mode is a good choice. Beside of short term 3 months "long" as explained previously, mid to long term in 2009/2010 turn positive further. Overall, buy with cash but not with borrowings and relax, go holiday. When you come back, things should be alright.

PS: Merry X'Mas and a Happy New Year. Good and Bad times always come, only "we" and God forever to be around. No worry, be happy.