Article from 曾渊沧博士

the following article is from Professor Chan (曾渊沧博士) ;

"Just as I predicted in my talk on 15 March, US started printing currency notes in March,
thence stock markets rose and continued to rise into early April. Then, came A H1N1 flu that brought about some deaths in Mexico by the end of April. We still remember vividly the impact of SARS epidemics in 2003, and I have been closely monitoring the impact of A H1N1 on stock markets. Before its certain happening on 24 April, STI closed at 1852.85. After the annoucement of the flu, the stock market was only slighly affected for 2 days, and recovered on the 3rd and 4th day. On 30 April STI broke through 1852.85 points to reach 1920.28 points. 1st May was a public holiday; and on 4th May STI shot up more than 100 points to break 2000 barrier. It looks like A H1N1 flu has little impact on stock markets.

When I searched through past records, Singapore market although affected by SARS in
2003, the flu epidemics did not affected Western countries like USA where stock markets still kept rising to great extent. At the time SARS also spread to US, with only few cases. Now A H1N1 started in Mexico, US is affected, but not severe. Its impact on Asia is minimal. Up to now, Singapore is not affected. Hong Kong had one case, but on 4th May Hong Kong market rose substantially, Hang Seng Index rose 5.54%, comparable to STI. Having had the experience of 2003, investors are confident that A H1N1 flu will not severely affect the economy, and 27 and 28 April were opportunate days to buy in at low prices.

I said on 15 March that the moment US started printing currency notes and banks easing
credit squeeze, bull market will raise its head. Now that US Government has begun printing notes, I believe banks will begin to lend out more freely. In fact it has already happened in China and England, China in particular. Banks in China have increased lending to almost 5 trillion yuen RMB. The President of Chinese Monetary Regulatory Authority Liu Ming Kang even said that lending has no upper limit; in other word lending may increase further. Chinese Government realizes that it is necessary to increase supply of currency notes, and I believe Chinese stock market will outshine other markets. If you have the opportunity to travel or on business trip to Hong Kong, it is no harm to open an internet stock account to buy some Chinese H shares listed in Hong Kong.

Singapore market is also good. Bank and industrial shares that have dropped so much are
worth collecting for the first wave of bull market to come.

Bull market lasts for a long time, it will not keep rising all the time, but subject to intervening reversals. You must have the patience and stamina to hold on to your holdings. Do not sell off for small gains, and do not hope that you are able to ride on top of the market waves, thinking that you could sell at the highest and buy back at the lowest."