Economy getting worse. Consumer-related companies are having more sales than ever to promote consumer spendings. People become attracted to the cheap stuff and start to buy. Some buy without considering whether they need it, or if they can afford it. In the end, the amount they need to pay for their credit cards becomes shockingly large. Some will fail to pay. Banks end up in big trouble since many people cannot pay their bills and loans.

At the end of the day, the consumer-related companies earn the most. Those people who cannot pay will have to return their homes/cars to the banks, and some even forced to declare bankrupt. And when people cannot pay, the banks will not gain any benefits. They will start losing money if this continues. True, they can take back those cars and real estates, and resell them but they can only resell them at a much lower price. And reselling does not mean there will surely be a buyer. Those cars and real estates might stay with the banks for quite a while due to the poor economy.

In my opinion, I think all these started from the point when consumers (us) start to spend money like water and buy things which they cannot afford, and even borrow loans which they cannot pay (and the banks approve loans without thinking twice. Few months ago, the banks were competing fiercely with each other to get more people to apply for house and car loans. When competition is that fierce, the banks will become more linear when it comes to approving those loans).

So how serious is this?

Frankly speaking, I have a feeling that our country is actually undergoing such a situation, albeit in an early phase. True, encouraging people to spend more will certainly boost the economy since it improves consumer spending. But it does not take away the fact that people ARE getting poorer with the high inflation rate (and companies ARE doing badly due to the bad economy. Do bear in mind that not all companies are involved in consumer business..that’s why there is a possibility of job cuts).

I think perhaps it’s time for people to start being frugal and be prepared. And I do hope that Malaysia will not end up like US, though my gut feel is telling me our country is indeed heading towards that direction (maybe not as bad).

Last but not least, good luck to us all.

I’ve said this before and I will say it again – the recession is already here. Things are already becoming more difficult each passing day even though the fuel price is seeing a slight decrease and things are supposed to be cheaper now. Companies are dying, one by one, and some without warning. People are being retrenched, and they have no choice but to go out and find job – thus making the current job market more competitive than ever before.

Furthermore, some people’s financial situation might be hit pretty hard (like yours truly) and might run out of money including those already in retirement. Try reading the news or listening to the radio and you will realize one thing – many singers/celebrities are making a come back to their respective industries. You can see there are more and more concerts being organized by stars of the past.

So, we have those retired people coming out of their retirement since they’re running out of money and we have the unfortunate people who got retrenched. What’s next? We also have those who think they are underpaid, and feel like changing their current job for another job with better pay. Or some are just the typical job-hoppers who want a better pay every few months.

Seriously, from the looks of it, the job market is indeed going to be rather competitive.

So, for now, stop spending too much money on unnecessary stuff. Start saving up and put all the money into your war chest. It’s never too late to do so. And never stop to improve yourselves so that you can be a good candidate to the interviewers. Good luck!

I talked about Few ways to survive the incoming recession just 2 days ago. But I realized I’ve actually missed out few important things. I’ll talk about those missing points here.

Avoid using credit card

It’s pretty hard for you to keep track of your credit card debt when you’re outside. That’s why always try to avoid shopping with your credit card unless it’s really necessary. The next thing you want is to sign too much and unable to pay, which will bring us to the following point.

Pay your debts on time

Always remember to pay your debts. Always ensure you have enough money to pay all of them including your loans and credit card bill. Failure to do so will cause you to pay extra $$$ in terms of penalty, which is totally unnecessary.

Don’t make unnecessary mistakes

Drive slowly and don’t exceed speed limit, don’t overtake at double-lined road, don’t park illegally, etc. All these can be avoided if you are careful enough. There’s no point to pay few hundred bucks for these silly mistakes. Avoid them at all cost.

Sell off your unneeded stuff

Similarly, you can set up your very own yard sales. Sell all those things that you no longer have use of on eBay or garage sales, etc. They will help you to earn some money.

Know your rights as a tax payer and employee

Certain companies provide the employees with benefits such as optical and dental. Always remember to check those out and fully utilize them. Also, know your rights as a tax payer. What can you claim and what you cannot claim. For example, buying books is a good investment and you can also get tax relief from that.

Plan your trip

Getting up earlier before the morning rush hour, and going back home after evening rush hour will definitely help you save up some fuel cost. Also, plan where you are going before you start your journey because if you end up lost, your car will surely burn up more petrol than necessary.

For now, I cannot think of anything else. Hahhaa. Do let me know if you can think of something which I have not listed here.

Enjoy!

The bailout by the US government has been approved. I expect the share to go up a little this week. Elsewhere, governments across the world have been spending a lot to help failing companies in order to avoid the economy from crashing down. But I don’t see this as a long-term solution.

Firstly, the governments only have THAT much money to save the failing companies. Unless their treasuries have bottomless $$$, I don’t see that this behavior can last long enough to be able to lift the worldwide economy.

Secondly, they’re only saving the failing big companies. It’s very unfair for other big companies which did not do THAT bad. And it’s even worse for those small companies. Who are helping them? And I can foresee that more people will lose their jobs because the “help” cannot reach that many companies.

Back to Malaysia. Our share market has not been doing well since the March 8, 2008 election. It’s partly due to our slumping worldwide economy, food shortages…and also due to our political issues. Our inflation rate is already record high (i think highest in 27 years? I forgot what I’ve read this). The government was pretty oblivious when they first announced that our inflation rate was under control. Well, at least now, they’re being honest to themselves. Furthermore, do bear in mind that our Bank Negara has not increase the interest rates.

That’s why things do look a little gloomy in 2008 and 2009….and maybe the situation will continue till 2010. So if you’re looking to buy shares now…wait for the next big drop which will possibly cause some panic selling. Go in, buy some good dividend-based blue chips….and wait for at least 12 months. If you’re not willing to wait that long, then hold on to your money. Put in FD for short term investment…maybe 3 – 6 months but not more than that. Why? Because I think sooner or later, our Bank Negara would have to increase the interest rates…….which will definitely increase the interest rate for Fixed Deposit. And at that time, you will want to have your money ready.

And if you’re already in the stock market for now….you can either sell or let go when the shares go up again after the US bailout….. or keep it for 1 year. Short term profit taking is simply too risky now. So please be cautious and don’t get burn like I did.

If you’re looking to change job, do it now. The job market in Malaysia is still OK since most of the multinationals are slashing jobs in their home countries…….and adding jobs here due to the cheaper labor fees. Smaller companies tend to be a bit risky.

And if you’re like me, who are planning to start own business soon, then make sure you have enough financial support to last till 2010 or later. And make sure you have ideas which will capitalise on the current situation. A lot of great companies were started in the last recession…in the 1997-1999 period. So, if you want to do it, do it now…else you’ll have to wait for another 10 years.

Just my opinion.

p/s…….. latest update. The bailout suggested by the US government was rejected. The US market dropped 777 points….7%. Worse things will follow soon.

p/s…….. banks in Europe are undergoing tough times as well.

Ok, sounds like a promotion or something.

Here’s what happened. Our famous GOOGLE is having a competition called Project 10 to the 100th. The objective of this competition is not to gain a job in Google…nor to get monetary rewards. It’s to help other people by contributing ideas which will benefit a lot of Earthlings. Here’s how it works.

1. Submit your ideas by October 20th, 2008.
2. Voting.
3. Google will help bring the ideas to life.

You can check out at the link above. Do bear in mind though, you don’t gain anything in return except for maybe…sense of satisfaction?

But I do hope that you guys can contribute some ideas to them so that Google can help to make this world a better place. At least, we’re playing our roles.