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Good gracious me, what a coincidence! I'm also by the Beach with beautiful lagoon and palm trees, clear blue sky and babes in colorful bikinis.......and of course, a long tall cocktail to finish the picture......sound familiar............ Yes, I'm talking about cyber-beach lah
The fact I bother to come in here show that I'm already bothered! No?
Jiejie, not "systematic" lah, i say "systemic". They have different meanings.
ps: hehe... how nice here on the beach and not bother again...
My bad, I tot you meant to say that Mahathir challenged the world to impose ........ . . Maybe by changing the word 'to' to 'and' would've prevented any misinterpretation ; " how Dr M bravely defied the world and imposed capital control......" To say that Dr M challenged the world is over exaggerating. I'm he was challenging IMF then!
The Efficient Market Theory always has arguements on both sides -between the Fundamentalists and the Technical Analysts. Both sides have their points and both are not wrong. Whether you're a Technical or Fundamental Analysts, you would surely agree with me that The Markets have in fact become more and more efficient thru the years!
BTW, the Chinese RMB was not freely 'exchangable' and was a very controlled currency during that time. Anyone stupid enough to bet on the RMB then would be digging his/her own grave!!!!!! Cheers!
Yikes... your use of the term "systematic failure" is SCARY!
178investors ( Date: 30-Jul-2008 23:12) Posted:
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Luo, naked shorting is actually disallowed in many countries including singapore and usa based on my understanding. But the rule is seldom enforced and loosely used once a while. Reason i guess it is seldom enforced is because when everyone (traders, investors, SGX, broking houses, etc etc) is making money and market is working properly, nobody cares about the naked shorts.
But in a time when market panic could lead to systemic failure of dire proportion, it takes fortitude and courage by the Authorities to do what it has got to do to fix the problem. (Sounds like in the army, a man got to do what he has got to do! to get things done.)
Again it reminds me of the Asian Financial Crisis and how Dr. Mahathir bravely defy the world to impose capital control on the ringgit. Many people said, at that time, Mahathir was wrong to do that but on hindsight, that old doctor was damn correct to do what he has got to do! (Of course, many singaporeans who owned Clob shares got their money frozen for a few years and cannot liquidate. Well, i can only say that a country interest has always come first before anything else.)
Frankly, the Asian Financial Crisis has taught me many lessons. And i think the current subprime crisis is no where as bad. Korean children with parents were seen queuing up with family treasures in hands to donate to the country, hoping that their small contributions can help their country overcome that crisis. Saw how indonesia economy and businesses fall like ten pins, reformaksi protests and overthrow of suharto. Country almost breakup with unrests in Aceh, and Timor Leste. Ethnic chinese indonesians (suspected to have benefit under suharto regime) were threatened, hurt and women raped. I can go on and on but there will be others who find this boring and would rather shut their ears and think the market is perfect. Honestly, the greatest thing that happened during the Asian Financial Crisis was that China did not panic. China held steady and did not join the rest of Asia in devaluating its currency, the yuan. If China devalue like the rest, it would lead to a death spiral for many smaller asian countries that are less well capitalized.
I like this chinese saying: "using history as a mirror". People who forget history are bound to repeat it.
Luostock ( Date: 30-Jul-2008 20:25) Posted:
| Yes, I agree that SGX should ban naked shorting before Spore becomes another USA. |
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ten4one,
i'm not sure if you read all my postings carefully as a lot of your comments puzzled me. Generally, market is not perfect. I think we are in agreement there. Of course, there are people who cling to the efficient market theory which many smart investors, among them buffett, pooh-pooh.
on your point of having more disclosure: true, more disclosures are always better than little to none. But disclosures, as you know must be sincere, timely and truthful. It is doubtful many of the disclosures in reply to SGX queries, like i think elf mentioned earlier, fully embody the 3 things i mentioned: sincere, timely, truthful. Usually, the disclosures given by the big blue chip company i can place more faith in relative to all the smaller companies' disclosures.
On your the other point that Regulators not interested in the upside is not exactly so. Catastrophe can come from both downside (fear/panic) and upside (euphoria/exuberance). Many catastrophe started with mind-boggling upsides leading to "bubbles" which eventually popped causing serious problem, like the subprime crisis in US.
On capital control, i did not claim the IMF imposed capital control in malaysia. If you have read carefully the full paragraph of my comments, you would understand i agreed Mahathir was correct to impose capital control at that time when the financial contagion swept thru' Asia.
Lastly, timor leste is a longtime problem for indonesia. You're right, it is political problem. Timor has always tried to break free, to have self autonomy or independent. It happens that in a time when a country faces severe crisis that can fatally threaten it, it is also the best time for independent-minded forces to try to take their best chance for a breakaway.
I hope i have explained myself. Thank you for your time.
I remember there was a previous post about how shorts in S'pore markets used to be managed. Back then the delivery requirement was 7 days; this was refined to the present covering of shorts within the same day. Can anyone elaborate?
The Markets are never perfect as the future values could be +ve or -ve as values can be created or destroyed. Therefore, investing in the Stock Market is ( in hope) for future returns and is never a certainty!!!!
It is important to remember that Free Market is not the same as Fair Market. The Market cannot be fair and if you imposed an obligation, it will create a bureaucratic resilance because of this asymmetry between the interests of Regulators and the interests of The Market. Perhaps more disclosure is more apt and necessary!
Regulators are interested on the downside and are not interested in the upside as they want to prevent a catastrophe!
BTW, the IMF (not the world) has never imposed Capital Control in M'sia. It was then the PM who did it to prevent Capitals withdrawal from the ailing Financial System and fixed the Ringgit against the Dollar to prevent further damages in redemptions. And the situation in Timor L was a political problem. Cheers!
Luo, naked shorting is actually disallowed in many countries including singapore and usa based on my understanding. But the rule is seldom enforced and loosely used once a while. Reason i guess it is seldom enforced is because when everyone (traders, investors, SGX, broking houses, etc etc) is making money and market is working properly, nobody cares about the naked shorts.
But in a time when market panic could lead to systemic failure of dire proportion, it takes fortitude and courage by the Authorities to do what it has got to do to fix the problem. (Sounds like in the army, a man got to do what he has got to do! to get things done.)
Again it reminds me of the Asian Financial Crisis and how Dr. Mahathir bravely defy the world to impose capital control on the ringgit. Many people said, at that time, Mahathir was wrong to do that but on hindsight, that old doctor was damn correct to do what he has got to do! (Of course, many singaporeans who owned Clob shares got their money frozen for a few years and cannot liquidate. Well, i can only say that a country interest has always come first before anything else.)
Frankly, the Asian Financial Crisis has taught me many lessons. And i think the current subprime crisis is no where as bad. Korean children with parents were seen queuing up with family treasures in hands to donate to the country, hoping that their small contributions can help their country overcome that crisis. Saw how indonesia economy and businesses fall like ten pins, reformaksi protests and overthrow of suharto. Country almost breakup with unrests in Aceh, and Timor Leste. Ethnic chinese indonesians (suspected to have benefit under suharto regime) were threatened, hurt and women raped. I can go on and on but there will be others who find this boring and would rather shut their ears and think the market is perfect. Honestly, the greatest thing that happened during the Asian Financial Crisis was that China did not panic. China held steady and did not join the rest of Asia in devaluating its currency, the yuan. If China devalue like the rest, it would lead to a death spiral for many smaller asian countries that are less well capitalized.
I like this chinese saying: "using history as a mirror". People who forget history are bound to repeat it.
Luostock ( Date: 30-Jul-2008 20:25) Posted:
| Yes, I agree that SGX should ban naked shorting before Spore becomes another USA. |
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least that can be done is to provide transparency by publishing short numbers.
so that shareholders need not be freighten off by shorts. becuase ventually shorts will have to cover back.
unless the company fundamentals also gone case.
elf, that's was a very perceptive piece from you. well wrote.
Yes, I agree that SGX should ban naked shorting before Spore becomes another USA.
i think SGX should ban naked shorting. traders may say all they like about it being a valid way of making money, but the fact is that most shorting is done by the BBs, especially the foreigners.
And since the US is banned, they shift elsewhere. You think the tanking of the local market was really due to loss of value, hence distribution? Hell, no. It was shorted to death.
Already for longs, the odds are skewed, now to have shorts in as well. It isn't quite fair to retailers. Besides, investing is about growth: strictly speaking, shorting runs counter to the principle of investing.
But then, ours has always been a country that protects the rich and powerful, rather than the common man.
MS. ML. UBS. Citigroup. GS. These are the common foreign BBs in. Add to that the local BBs. And authorities do nothing except send SGX queries of "Can you explain the anomaly in your trading session?", to which the company replies "We know of no material reason for the change in price."
When out and blatantly, you know it is BB moving. C'mon, just time the analyst reports.
It's a hung jury. Paper tigers. bwah.
Means Jim Rogers and his followers must liquidate?
SEC Extends Order Limiting Naked Short Selling Through August 12
http://www.sec.gov/news/press/2008/2008-155.htm
walao... morganites are back again in the 21st century...
"God save America"
Oh yes, 'phantom' shares with real Trade Deals!
All Free Markets have rules & regulations (R&R) too. All Participants, including Regulators, must must adhere to the R&R. From time to time, if new R&R is created, (to be fair) all parties must be informed and agreed upon before implementation.
The Stock Market is just like the jungle where only the fittiest survived. It is often very easy to blame the Market for your own failure and never realising it is your very own 'Greed & Fear' behaviour that caused it. There is no free lunch in the Market - everyone is on their own! That's why to survive in the Stock Market, you've to be the fittiest!!! Cheers!
not counterfeit la, more like phantom shares
CWQuah ( Date: 28-Jul-2008 13:47) Posted:
| Heh - having a public float > 100% means that the total no. of shares in circulation in the stock market exceeded the initial no. of shares issued during IPO for trading. I.e. there are some 'counterfeit' shares as a result of excessive/naked shortselling. |
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It's partly a consequence of different securities regulation regimes - I'm a bit surprised that US can allow such share overhangs, whereas in S'pore, the penalty for shorting can hurt real bad on T + 4 buying in (which solves the issue of excess float from naked short since the shortist is forced to buy back the stock), or when the account gets suspended. Or just let the BBs do a short squeeze haha.
So much for financial innovation.
like that also can.....
