Saturday, May 23, 2009

Disgusting Pac Andes

Pac andes just threw a grenade towards my direction. Make it 2 grenades. It got me hot and bothered!

1. First grenade - they are issuing rights on a basis of 1 rights share @ $0.15 for every existing share held. The rights come with detachable warrants, with an exercise price of $0.23 each to convert to 1 ordinary share.

Hey, didn't pac andes do a rights issue in 2007 before? And they are doing it again? C'mon...are you so pressed for money to keep asking shareholders to part with their cash?? It's not enough to dump shareholders with rights issue, and you still want to get more money out of shareholders when they convert their warrants??

2. Second grenade - they are going to restructure their share capital. Initially, their share capital of $400 mil is divided into 2000 mil shares, with par value of $0.20 each. Now, they are going to divide their share capital into 8000 mil shares instead, giving a par value of $0.05 each.

This takes some fees and do you know what's the rationale for this exercise?

It's stated that the main purpose for this reorg of share capital is to enable the company to undertake the proposed rights issue because the average closing price of pac andes is at $0.186 (for the 7 month prior to the date of the announcement today). This happens to be below the par value of $0.20 per share in the current system.

Since the Bermuda Companies Act prevents a company from issuing shares at a price below the par value of the share, they are going to go through a reorg of the share capital just so as to allow the proposed rights issue to go on! They stated that this will allow them greater flexibility in issuing new shares in the future when the opportunities arise.

HELLO! There's a lot of nasty things I wouldn't want to blog in public. What is the management thinking about?!

Tuesday, May 19, 2009

How much to save to retire

I was just doing some simple calculations to see how much I need to earn in my working life (assuming I have to retire at 55) in order to sustain myself only till the end of my life. I've a average monthly expenditure of around 2500, all inclusive.

So assuming I pass on at age 85,

$2500 x 12 x 54 = $1,620,000

I probably need this much money now in order to stop working yet be able to sustain my lifestyle till 85. This 1.6 million of course do not include family, or any other commitments that I incurred while I survive till 85...thus it's quite an underestimate.

Reality sucks, isn't it?

Assuming I maintain my expenses after I retire all the way till 85, I need to spend $900,000 (based on $2,500 per month expenses for 30 yrs). I only have 24 yrs to get this amount before age 55, the age I can retire. This means that I need to save $3,125 per month from now till age 55 in order to save up to that amount. That's hard saving only and it's hard saving that amount for that long period.

If I have an investing capital of $100,000 now, I figured that I need to get a returns of around 9.6% per year on average to multipy that capital to reach $900,000 in 24 yrs. That's assuming I didn't add in more capital to that initial capital outlay. Do you think it's do-able?

How can anyone not invest? It's not impossible to reach financial independence, but it'll be very hard if one has to do it by savings alone.

Thursday, May 14, 2009

The father, the son and the donkey

KK shared with me this story in the cbox. I really thought it's a very important lesson to be learned from it. It is happening to us all the time. Since we learn different things from the same story, I'm not going to interpret but leave it open for readers to form their own thoughts about it.


A Man and his son were once going with their Donkey to market. As they were walking along by its side a countryman passed them and said: "You fools, what is a Donkey for but to ride upon?"

So the Man put the Boy on the Donkey and they went on their way. But soon they passed a group of men, one of whom said: "See that lazy youngster, he lets his father walk while he rides."

So the Man ordered his Boy to get off, and got on himself. But they hadn't gone far when they passed two women, one of whom said to the other: "Shame on that lazy lout to let his poor little son trudge along."

Well, the Man didn't know what to do, but at last he took his Boy up before him on the Donkey. By this time they had come to the town, and the passers-by began to jeer and point at them. The Man stopped and asked what they were scoffing at. The men said: "Aren't you ashamed of yourself for overloading that poor donkey of yours and your hulking son?"

The Man and Boy got off and tried to think what to do. They thought and they thought, till at last they cut down a pole, tied the donkey's feet to it, and raised the pole and the donkey to their shoulders. They went along amid the laughter of all who met them till they came to Market Bridge, when the Donkey, getting one of his feet loose, kicked out and caused the Boy to drop his end of the pole. In the struggle the Donkey fell over the bridge, and his fore-feet being tied together he was drowned.

"That will teach you," said an old man who had followed them:

"Please all, and you will please none."

Friday, May 08, 2009

Wordle here wordle there

This is another wonderful piece of art form I found from PG's website. Indeed very fun - I spent a few hours playing with it just to see the different combination that comes out.

Here's a wordle of the books I've read so far this year. The bigger the fonts are, the more times it occurs in the titles of the books I've read :) Have fun trying, it's found here!

See? I've read a lot of books on millionaires and a lot of them have the words 'Buffet' and 'Richard' in them :)

Thursday, May 07, 2009

Top-down approach in investing

I usually adopt a bottom up approach towards investing, so it's good to do a top down approach too, just to see the broader picture. I read this little book series (yes, finally completed everyone of them!) called Bull Moves in Bear Markets by Peter Schiff and in it, there are a very investment themes to take note of. Basically the author is very bias towards the near term future of US, notably because of the high amount of debts that it is mired in and the unwillingness of FED to raise the interest rate to curb inflation, thus running the risk of hyperinflation.

Here's a few countries that might do very well in the future:

1. Australia - This is a country rich in natural resources, with lots of supplies of natural gas and metals. Being very close to China, who is very likely to consume huge amounts of metals and energy in the future to fuel its economic growth, Australia is thus likely to participate greatly in the commodities bull run mentioned by Jim Rogers and other such 'visionaries'. I think its close proximity to China makes it a good exporter of commodities to China at a cheaper price.

2. Canada - Stupid also mentioned about the loonies. It is the largest foreign supplier of energy, including oil, gas and uranium to US. Canada is resource rich with a lot of metals, agricultural commodities and energy. Again, another commodities play, with likely appreciation on its currency, like Australia.

3. Singapore - Yes, this little tiny dot is mentioned in the book as well, which I'm pleasantly surprised. For those cheapo neh neh, can go to bookstores to browse this book. It's on page 163. Singapore depends a lot on export, particularly in consumer electronics and IT products. Manufacturing is diversified into petroleum refining, chemicals, mech. engineering and biomedical sciences. I guess Singapore's advantage is its good relationships with China and US, so can probably use its status as a financial, hi-teh and medical tourism hub (the book said so, not me) to leverage itself into a nice cushy position. The other advantage I can think of is the stronger stable government.

Hey, you can complain all you like about the government, but we all have to concede defeat to its stability and the effects this can have on investors abroad. No strikes, tri-partite relationships with labour unions (do we have one?), low unemployment rate, highly educated labour force -- all this adds up I suppose.

There's a line which I snigger at: "Singapore is the third most popular place for Chinese companies to list their stocks, after Hong Kong and the United States." Oh true, that's why we get all the third-tier ass shares listed here.

Ok, I'm not going to list say's the list of other countries that the author feels for: Norway, HK, Switzerland, New Zealand and Netherlands. We can analyse the countries and see that he is bullish on Asia (esp those leaning towards China), as well as those countries with lots of commodities.

Okay, enough from the book. Here's a few themes that I think are worthy to consider in the future:

1. Green technologies

There is this strong undercurrent of green movement happening around the world today. Carbon footprint seems to be a key concern too. I've a lot of young people telling me about saving the earth and so on. China might also be setting up their own green cars to compete with US. Might be the next technology to lift the world's stock market to another feverish bubble.

2. Commodities

Energy related commodities will continue to play a big part to power the world's economy. Hmm, unless someone managed to find a very environmentally friendly and abundant supply of fuel...looks like bubble creating material to me. There are reports saying the huge demand of metals that China will need in build its infrastructure, thus turning it from a net exporter to net importer. With the low interest rate environment, inflation could be a problem in the future, so countries with lots of commodities will be able to take in more foreign exchange gains if the commodity bull run is true, thus maintaining their currency from dropping.

Wednesday, May 06, 2009

Microsoft Live Writer review

After listening to what PG had mentioned with regards to my time saving article recently, I decided to adopt and download the free Microsoft Live writer. It's actually a very cool piece of software and I'm testing it right now as I type this article. In the past, I used to type my blog on Microsoft words then cut and paste onto the blogger site, but it seems that this cool piece of software can publish straight to blogger!

I can even see how it looks like in the actual colour settings, which is damn cool! If not, I can always switch to html or the normal 'words' format to edit as I wish. Very convenient indeed! I can even put in pictures from web or from my computer, which previously I can't from microsoft words.

The software is also quite idiot proof and I spend less than a few minutes trying to figure out which buttons is for what functions. It certainly makes my blogging experience more enriched. I think it's even more user-friendly than the blogger interface :)


Definitely a must-use for me! Potential time-saver found!

Monday, May 04, 2009

Ways to save your time

As time gets more and more precious, I wondered how else I can do to squeeze more time. Everyone gets 24 hours a day, but some people wasted a good part of their time doing things that are not aligned to their goals or not pleasurable to themselves – in order words, their time got ‘robbed’ by others.

Here’s a few ways for me to squeeze more time to really do the things I want to do:

1. Blog my articles in Microsoft words first, then cut and paste it straight to blogger.

I’m currently doing that now because my internet connection was down, so I’m using the time now to type it out in the words form so that later I can just copy and paste it to post the article up. This is a great time saver because by blogging the articles when my thoughts are the most lucid and fluid, I can save a lot of time thinking about what and how to write the articles.

2. Give yourself 5 minutes to read through the snail mails and decide what to do with them straight away

I used to keep a pile of snail mails on my desk, waiting for the day when I’m finally free to sort them out. It takes a great deal of time just reading the mails again then following up the actions required. These days, I give myself 5 minutes to read through, decide and follow up the action immediately. These grant me two advantages – firstly, my desk is clutter free and secondly, I do not have to sit through the piles of mails to follow up the actions required. I either throw them straight away or file them up if needed. This ‘no-second-look’ philosophy must have saved me a few hours per month, which is substantial savings in the long run.

I think this rule applies to emails too. If I didn’t follow up my emails immediately, chances are that I would not do it anymore. So I make it a point to apply my ‘no-second-look’ philosophy to that too.

3. I always bring a book whenever I go

It never fails to amaze me how a well-planned schedule for a day can go horribly wrong. I might end up waiting a few hours for events to happen, and I dread having nothing to do while waiting. Thus, I always bring a book whenever I go in case I have to end up waiting for people longer than I should be. I also kicked the habit of sleeping on trains and use the time to read while standing/sitting. I can’t read on buses (it makes me dizzy), so I nap a while or just think about stuff.

4. Use of the SBS-Iris online before I go out

As I take buses most of the time, I detest waiting the long waiting time at bus-stops. Since last month, I’ve been using the SBS Iris website to determine the waiting time I need for my bus to arrive at the bus stop and plan my trip accordingly. This is such a time saver that I make it a point to check whenever I’m going out, if it happens that I’m taking a bus.

Use your time wisely. It’s the only resource that you have!