Seek you shall find, ask you shall be given

I have been publishing my thoughts over last two weeks exposing the subconscious minds by punching my notebook keyboard. I can see clearly selective perception will influence we want see and we want to hear. If I am bearish, I will ask bearish questions and I will find enough data for a bearish case. If I am bullish, I will ask bullish questions, I can find enough data to support a bullish case. If you ask bullish and bearish questions at the same time, the result is uncertainty. Be careful what you wish, bull, bear or uncertainty?

That's what the market is today. There are tugs of war between bulls and bears on the global front. On the local front, we are facing uncertainty of coming election results. For me, it is uncertainty of Malaysian future itself.

I have been feeling very uneasy about my country for sometime, we always take the path of least resistance. I have seen my colleagues’ children are not coming back to Malaysia - brain drain? I am delighted with government generosity to subsidize our petrol prices, holding off electricity hike when coal prices are skyrocket, cooking oil remains cheap, etc, suppressing the true inflation rate. This will push us into complacency zone, industry will not innovate to cope with true cost and ordinary folks will never understand true hardship.

My readers probably thought I was crazy or producing half-baked analysis in my last week entry saying stock market will go down because they were disappointed with no interest hike last week. The inflation below estimate mean we are not living in the real world, inflation suppression by government means they keep it artificially low, thus there is no need to fight inflation either by rate hike or currency appreciation. Path of least resistance?

Corporate earnings have been so so. Brokerage houses do a bit of cheer leading but it will not last long. Translation: market will be flat unless serious efforts to reform.

Gamuda sell down pushing the construction sector into red zone today is interesting. This show how fragile is the confidence of local and foreign investors. Some may interpret downturn is coming, which I do not think so. We went through hell when Pak Lah tightened the belt when he took over the office. Many have diversified earnings from overseas. That lead to usual suspect, the industry is politically linked. For this very reason, I never touch Malaysian construction stocks, even though some have reached world-class standard.