A few months ago, in the post “The worst may be over”, I have mentioned this:
Perhaps now is the time, for those who have cashed out earlier, to look at investment opportunities and invest cautiously.
In February , when Aussie dollar went below RM2.40, I did advise some of my friends to look at the opportunity, predicting that it would go up once commodities prices go up since you need Australian dollars to buy those commodities.
If you have invested 10,000 Aussie dollar then in a foreign curency account , you would have made a very handsome profit. Yesterday, It touched RM 2.80. You would have made a profit of Rm4000 in just 3 months on a less than Rm 24000 capital. (with some crumbs as interest, too).
There are many other investment opportunities. But be cautious. Use only spare money and make sure you have enough cash to cover any emergency use
For those who look at the money market, they would have noticed that AUstralia currency has gone up since and has hit Rm 3.10 to one Aussie dollars now.
If you have bought 10,000 Aussie dollar at 2.40 rate ( an investment of 24,000RM), you would have earned Rm7,000 now in a few months.That will give you an earning of 29.1%, in about 7- 8 months. That is excluding the interest rate that you earn. For those who invest big time, 240,000 will bring in 70,000 and 2.4 million will bring in 700,000.
Australia is also the the first country to start raising its rate. Last month, the Reserve Bank of Australia raised its cash rate to 3.25 percent from a 49-year low of 3 percent.
This is from Yahoo finance:
Australia, a G-20 member, has weathered the worst global downturn in decades better than other developed countries. It avoided slipping into recession — helped by stable banks, demand from China for iron ore and other minerals, and the government’s 42 billion Australian dollars ($37 billion) of stimulus spending.
Asia, a crucial market for Australia’s mineral exports, is rebounding from the downturn faster than the West and could face asset bubbles and a spike in inflation if governments wait too long to withdraw stimulus measures. Rising food prices are already becoming a problem in India. HBSC economists said in a report Tuesday that South Korea, Indonesia and the Philippines are also on the radar as countries particularly vulnerable to an inflation blowout.
Australia’s gross domestic product grew 0.6 percent in the second quarter, accelerating from 0.4 percent growth in the previous quarter. In September, consumer confidence surged to its highest level since July 2007. Since March, Australian shares are up 50 percent.
Australia has a lot of natural resources such as minerals, which has cushioned the economy well this time. But so has Malaysia.
Australia has gold, the price of which has gone up and up.. SO has Malaysia in the form of black gold, which has also gone up quite a bit in price.. Why they have not gone into recession while we have gone into a fairly deep recession with minus growh?
Why is their stimulus program working and ours not really felt by most of us? Our stimulus program is smaller no doubt , but so is our economy. So the question is whether our stimulus program is targeted at the right groups and have we adopted the right strategy?
Now that the worse is over, we should seriously review whether we have adopted the right strategy and right stimulus.. It will give us invalubale lessons for future management of economy..
(For those who have not bought Aussie dollars, this may not be a good time now, as the up side of AUssie dollars is quite limited as compared to earlier this year. But do not discount Aussie dollar toovertake US dollar in par value, just as once in the 70s).