Dollar Still Firm

The US dollar gained against most of the major foreign currencies last week, but the overall tone, leaving aside the yen, was largely consolidative in nature. The greenback was soft in the first half of the week but recovered in the second half.

The Australian and Canadian dollars were the only major currencies that managed to hold onto some of their gains (0.55% and 0.40% respectively). The yen was the weakest of the majors, losing 1.2%, as the panic from the week before died down. Equity markets were mostly higher, with the Nikkei's 5.2% rise, leading the major markets. US 10-year Treasury yields rose 8 bp. Core bonds generally traded heavier, but European peripheral bonds were firmer, in line with the calmer conditions.

We were never persuaded that last week's turmoil would prevent the Fed from completing its tapering operation, and see that in the market, cooler heads are prevailing. Talk of "tapering the tapering" has diminished, and no one is taking too seriously the prospects of QE4. Nevertheless, we note that both the December 2015 Fed funds and eurodollar futures contracts were unchanged on the week at 46 bp and 77 bp respectively.

Perhaps offsetting the diminished interest rate support for the dollar has been speculation that more action from the European Central Bank and the Bank of Japan could be imminent. Reports suggested that the ECB may consider adding corporate bonds to its asset purchase program. There were also report suggesting that the BOJ sees risk that inflation may fall, and this could prompt an extension of the already aggressive Qualitative and Quantitative Easing. We are skeptical that either will materialize in the coming weeks. The BOJ meets next week and the ECB the following week.

Technically, the euro looks poised to continue to consolidate. Most of last week's price action took place within the $1.2625-$1.2886 range set on October 15. In recent session, the euro flirted with the lower end and slipped to about $1.2615. The euro spent the second half of the week below the 20-day moving average, which comes in near $1.2690. This is the nearby cap. Of note, the nearly four-cent bounce in the euro has not been accompanied by a sharp change in euro positioning The confidence of the euro bears is palpable and quite widespread.

The bearishness toward the yen was more evident in the price action than in the euro. We had identified the yen's gains as among the most exaggerated in last week's technical note. The dollar's recovery last week recouped 61.8% of its slide from the push marginally above JPY110 on October 1. It closed above its 20-day moving average in the two sessions before the weekend for the first time since early this month. The RSI has been recovering, and the MACDs have now crossed higher. The risk is that the speculation of more action by the BOJ is getting ahead of itself. This may help cap the dollar, where a trendline drawn off the early October highs comes in around JPY108.70-80 next week.

From a technical perspective, sterling continues to look constructive.Bullish divergence continues to be evident in the daily RSI and MACD. It could be important that the $1.60 area largely held in the second half of last week. It appears that sterling may be carving out a head and shoulder near $0.8650. Before the weekend, the aussie tested both sides of the pattern. It closed firm, in an outside day, though off its high and just below the previous day's high. This is still impressive because of increased speculation that the central bank is considering cutting interest rates. This chart pattern is notorious for false breaks, and the technical indicators do not appear to be generating strong signals.

The US dollar pulled back against the Canadian dollar to challenge the past month's uptrend. It is found near the 20-day moving average, just above CAD1.1210. The US dollar could not get back above CAD1.13 in the first half of the week and came down to test CAD1.1180-CAD1.1200 in the second half of the week. It has been unable to close below the 20-day average for a month. The MACDs are turning lower, though the RSI is in neutral.

The US dollar has also been riding the 20-day moving average higher against the Mexican peso. It comes in now near MXN13.48. The greenback has lost some momentum in recent day but has not pulled back from the highs very much. There is no compelling technical evidence to conclude a dollar top is in place.

- Marc Chandler

Cooking With Dali - Very Spicy Sweet & Sour Lamb

I think I had versions of this dish in many older Hakka establishments or those who cooked for colonial masters during their time.I have not had a decent one for a long time, so I tried to dissect the dish on my own. 

Its my own recipe, so you can tweak it as you like ... but let me tell you, its very very goooood!!!

I use lamb shoulder as it is more flavorful when you fry them or stew them. Ask your butcher or supermart guy to cut it into small pieces for you.

This is the list for making the sauce: vinegar, Lingam's chilli sauce, tomato sauce and chicken broth.

Pick and choose your veggies, I used large onions, red onions, capsicums, cherry tomatoes and bird eye chillies.

Use Lea Perrins to fry the lamb on a non stock pan for 3 minutes each side, adding Lea Peerins before they dry out.

I use Pomegranate juice for the sauce base, or you can use pineapple juice, but I always have pomegranate juice in my fridge... so ...

Fry 3 minutes each side and sprinkle a touch of sea salt, set aside.

The soft ones, cherry tomatoes quartered and chillies diced.

The hardier veggies, brown the onions first in a bit of oil, mid-low fire for 3 minutes. Then add the capsicum and stir for another 3 minutes. Put in half a cup of chicken broth and stir fry till almost completely dry.

The sauce is up to you. I poured in half a box of chicken broth. Half a cup of vinegar, Half a small bottle of ketchup. Three big spoonfuls of Lingam chilli sauce (or as much as you want for fire in your mouth... 3 spoons are a lot already). Add one cup of pomegranate juice or pineapple juice. Add two big spoonfuls of sugar... stir and taste and boil for a couple of minutes. You can add any of the above to tweak to your taste.

Add  a couple of tea spoons of corn starch with water to thicken sauce. Then put in all the veggies, plus tomatoes and chillies.

Add in the lamb, let it stew on medium flame for 10 minutes ...

You are good to go ...




(p/s kids will love this dish with rice, just substitute chicken pieces for lamb, remove all chillies and the Lingam sauce)













Previous manly cooking recipes:

CURRY PORK RIBS
http://malaysiafinance.blogspot.com/2013/08/cooking-with-dali-curry-pork-ribs.html

DRUNKEN CHICKEN
http://malaysiafinance.blogspot.com/2012/09/cooking-with-dali-drunken-chicken.html

BRAISED SPICY GARLIC FISH HEAD
http://malaysiafinance.blogspot.com/2013/09/cooking-with-dali-braised-spicy-garlic.html

PIG TROTTERS VINEGAR GINGER BROTH
http://malaysiafinance.blogspot.com/2012/09/cooking-with-dali-pig-trotters-vinegar.html

Dr Tareq Suwaidan's View

Ridiculous to stop non-Muslims from using ‘Allah’, says Muslim Brotherhood leader

BY MOHD FARHAN DARWIS

Published: 19 October 2014

Kuwait's Muslim Brotherhood leader Dr Tareq Suwaidan says there are many examples in Islamic history which shows that non-Muslims are not prohibited from using the word 'Allah'. – The Malaysian Insider pic by Nazir Sufari, October 19, 2014.Prohibiting non-Muslims from using the word "Allah" is ridiculous, says Kuwait's Muslim Brotherhood leader Dr Tareq Suwaidan.

He said this was because there was no law or ruling within the Islamic realm which prevented the use of the word by non-Muslims.

"I have been following this development in Malaysia, this use of the word 'Allah'... there is no law in Islam that says so," he told a forum organised by PAS international committee last night.

He noted that there were many instances in Islamic history where non-Muslims had been encouraged to use the Arabic word "Allah".

"Do not be confused, this is just wrong, I have hundreds. No, thousands of proof on this," he said, in front of a crowd of 100.

His comment came after an Indonesian scholar Dr Ulil Abshar Abdalla waded into the “Allah” controversy, saying Muslims who believed the word was exclusive to Islam were “confused”.

Ulil, who was denied entry into Malaysia this month for allegedly opposing its Islamic stand, said Muslims did not have a monopoly of the word “Allah” as it was a general term to refer to God.

“The term ‘Allah’ comes from two words which are ‘Al’ ‘and ‘Ilah’ which means God.

“If we mention the word ‘Allah’, it is translated as God. The people of Mecca also used the word ‘Allah’ before Islam came,” he had said.

Tareq and Ulil's view of the “Allah” controversy echoes that of Muslim scholars and clerics, both locally and worldwide, who have criticised the ban of the use of the word among non-Muslims here.

Even the United Nations Special Rapporteur on freedom of religion and belief, Heiner Bielefeldt, had said that many Muslims were of the view that the court ruling undermined the credibility of Islam, in a reference to the Federal Court decision that the word “Allah” could not be used in the Catholic publication, Herald, on grounds it was not an integral part of Christianity.

Earlier this month, evangelical denomination Sidang Injil Borneo (SIB) obtained leave from the Court of Appeal to seek a declaration that the word “Allah” could be used in Christian publications.

A three-man Court of Appeal bench, chaired by Datuk Rohana Yusof, said the Federal Court held that the September 14 finding that “Allah was not an integral part of Christianity” was a mere passing remark.

Among the groups which have defended “Allah” as exclusive to Muslims are Malay rights group Perkasa and Ikatan Muslimin Malaysia (Isma).

The “Allah” row started in 2008 when the Home Ministry threatened to revoke the Herald’s newspaper permit, prompting the Catholic Church to sue the government for violating its constitutional rights. – October 19, 2014.

- See more at: http://www.themalaysianinsider.com/malaysia/article/ridiculous-to-stop-non-muslims-from-using-allah-says-muslim-brotherhood-lea#sthash.Y7apqsfb.2ML4r9nZ.dpuf

Democracy would see poor people dominate vote, CY Leung saysas he initiates his own seppuku

Wow... I thought Malaysia had a stranglehold on politicians making the silliest comments. Now we have some competition. Hong Kong's Beijing-backed leader Leung Chun Ying told media that if the government met pro-democracy protesters' demands it would result in the city's poorer people dominating elections.Hence, you cannot run a HK democracy and that free elections were impossible.



Conclusion and side-admissions:
a) the poor people know nothing in HK/China
b) the other 50% deserve less than a vote per person as citizens
c) the poor do not know what's best for the country
d) HK only serves the rich and powerful, otherwise how did we get here
e) you, the other 50% are basically screwed and I am telling you in your face
f) poor people, you are Fucked and Fuck You

This is almost like the political crisis in Thailand, in that the poorer rural folks side with the ousted Thaksin and his cronies, while the city folks think that Thaksin is the devil incarnate and that the rural folks are stopping genuine demands for liberation and freedom from cronyism and excessive corruption.

Anyway, back to CY Leung:

"If it's entirely a numbers game and numeric representation, then obviously you'd be talking to the half of the people in Hong Kong who earn less than US$1,800 (S$2,250) a month," Mr Leung said in comments published by the WSJ and INYT.

Mr Leung's latest comments are likely to further fuel the anger of protesters who see him as hapless, out of touch and pandering to the whims of a small number of tycoons who dominate the financial hub.

("Gee... I am royally fucked by what I said" ... "must go to Chinese medicinal shop and ask for cure for foot-in-my-fucking-mouth disease")

His quotes also echo that of Mr Wang Zhenmin, a well-connected scholar and regular advisor to Beijing. Mr Wang said recently that greater democratic freedom in the semi-autonomous city must be balanced against the city's powerful business elite who would have to share their "slice of the pie" with voters.

"The business community is in reality a very small group of elites in Hong Kong who control the destiny of the economy in Hong Kong. If we ignore their interests, Hong Kong capitalism will stop (working)," he said in August.

If it’s entirely a numbers game – numeric representation – then obviously you’d be talking to half the people in Hong Kong [that] earn less than US$1,800 a month,” he said in reference to the median per capita wage. “You would end up with that kind of politics and policies.”

Equity Strategy

 A decent piece of research overview from KAF.

Following lacklustre trading for most of the year, the FBM KLCI has broken down in the past month. The sell-off was sparked by concerns over weaker global growth and collapsing oil prices. Although the oil price decline is a concern, we think the risk on the current account, in particular, is manageable. We expect GDP to be buoyed by resilient domestic demand, which should get a boost from the large scale infrastructure projects expected to begin next year. We view the correction as an excellent buying opportunity and introduce an end-2015 index target of 2,070, offering 17% potential upside.
 

Why bother?
Issues To Consider 

 ·         Another global sell-off - Although global growth expectations may have been too high a few months ago, we do not think the situation is as bad as during the European sovereign debt crisis in 2011. In fact, it is probably more comparable to the QE tapering jitters seen in July/August 2013. The FBM KLCI fell by as much as 16% during the 2011 sell-off while the correction last summer was under 7%. More importantly, the index recouped its losses in four months following the 2011 sell-off and in about a month last year, trending even higher over time. 

·         A big picture perspective - We believe the US is on a strong footing while China should deliver healthy growth albeit slower than in the past few years. The main external concern is Europe. Locally, private consumption has slowed along with fiscal consolidation, but we believe GDP growth of 5.8% this year and 5.4% next year is achievable. The 2015 Budget, while providing good follow through of last year’s reforms, also shows greater flexibility on the part of the Government now that desired results from reforms are coming through. Along with public-private initiatives, infrastructure projects worth as much as RM75bn should take off in 2015. We believe that investment activity should pick up further next year while the budgetary measures coupled with the significant infrastructure multiplier should shore up sentiment. 

·         Two key risks to key an eye on - We discuss the exuberance in property prices over the past 2-3 years and the present collapse in commodity prices, mainly Brent crude. Interestingly, we find that the country’s large surplus from energy is mainly from LNG exports, as Malaysia became a net importer of petroleum early last year. Property prices have slowed in the past three quarters but there needs to be further easing in order to prevent an unwanted accident. 

·         Good value emerges despite index target being pushed back - Despite earnings disappointments, we believe expectations built into share prices are quite modest. The market’s 1-year forward PER has fallen from 16.6x last December to 14.4x currently while ex-defensives, it is trading at only 12.9x 2015F. Following the latest sell-off amidst rising risk premiums, we are lowering our YE index target to 1,905 from 2,000. Under the assumption that Malaysian risk premia should still ease over time, we introduce an end-2015 index target of 2,070, offering 17% potential upside. 

·         Compelling entry points - Besides compelling opportunities in Banks, Oil & Gas and Technology, we highlight the resilience and growth upside of sectors linked to domestic themes such as Construction and Property. We also cover several companies trading at attractive valuations and offering strong cash generation and healthy yields that are largely insulated from external issues.

Actionable Ideas
·         We maintain a bullish stance on Banks along with Oil & Gas, Construction, Technology and Property.
·          Big-cap stocks we like are: TNB, CIMB, HLFG/HLBK, BAB, RHBC, MISC, and IJM.
·         Key mid-caps are: MSGB, UNI, PETR, MPR, WCT and SWB.
·         Five key stocks to sell are Public Bank, PPB, Petronas Gas, Top Glove and Astro.

Key Catalysts
·         Implementation of key budgetary proposals, we believe, should act as a re-rating catalyst for the market especially if there is good follow through in rolling out the slew of large projects. Also, better earnings delivery, good investment growth, some recovery in commodity prices, and resilient consumption.

Key Risks
·         The main risks are poor earnings delivery, sustained weakness in CPO/Brent prices and sharp slowdown in domestic demand. A key component of earnings delivery is the timely implementation of ETP projects and fiscal policy, in general. Sharp US dollar appreciation is also a potential risk.

The Paper Sculptor

Anna-Wili's sculptures are stitched together from archival cotton rag. Her works explore the organic qualities and resistance of paper, generating a tension between the complex realism of form and the limitations and economy of the materials used. They represent animal life in an immediate way that conveys the energy, movement and physical character of different creatures. Her aim is to engineer a moment of contact with nature in a way that emphasises both the startling differences and similarities of human and animal forms and consciousness.


Born in Sydney 1980, the daughter of a Puppeteer, Anna-Wili studied Fine Art at the National Art School, Sydney. In 2008, after working as a Scenic Artist for Opera Australia, she began making sculptures independently by commission. Her works are held in private collections around the world and have featured in numerous publications.

Why Oil Price Is Sagging

The respected site oilprice.com did a summary of why oil prices are sagging, but MISSED out one big factor. 

The strengthening USD over the past few weeks. Three or four months back, the turmoil in Iraq was causing some disruption anticipation to oil supply, which have been eased following the "drones strategy with partners". 

The USD has rallied over the past few weeks in anticipation of a uptrend in interest rates there, coupled with better recovery in the US compared to other developed counterparts. However, to me the strength in USD is not that permanent but rather a rebalancing and will not rise by much from hereon.

-----------------------------------------------

By Chris Pedersen for Oilprice.com

1. The U.S. Oil Boom
America’s oil boom is well documented. Shale oil production has grown by roughly 4 million barrels per day (mbpd) since 2008. Imports from OPEC have been cut in half and for the first time in 30 years, the U.S. has stopped importing crude from Nigeria.  

2. Libya is Back
Because of internal strife, analysts have until recently assumed that Libya’s output would hover around 150,000-250,000 thousand barrels per day. It turns out that Libya has sorted out their disruptions much quicker than anticipated, producing 810,000 barrels per day in September. Libyan officials told the Wall Street Journal last week that they expect to produce a million barrels per day by the end of the month and 1.2 million barrels a day by early next year.

3. OPEC Infighting 
There have been numerous reports about the discord between OPEC members, leading many to believe that OPEC will not be able to reign in production like it has done so in the past. The Saudis and Kuwaitis have reportedly been in an oil price war, repeatedly lowering their prices in order to maintain their market share in Asia. John Kingston, the news director at Platts, believes that the Saudis will not be willing to give up market share like they have done during previous price drops.

4. Negative European Economic Outlook
European Central Bank president Mario Draghi has left investors concerned about the continent’s slow growth. Germany’s exports were down 5.8 percent in August, stoking the fears of anxious investors that the EU’s largest economy had double dipped into recession last quarter. Across the Eurozone, the IMF again lowered its growth forecast to 0.8 percent in 2014 and 1.3 percent in 2015.

5. Tepid Asian Demand 
Beyond slow economic growth and currency depreciation, a number of Asian countries have begun cutting energy subsidies, resulting in higher fuel costs despite a drop in global oil prices. In 2012, Asia’s top spenders on energy subsidies, as a percentage of GDP included: Indonesia 3 percent; Thailand 2.6 percent; Vietnam 2.5 percent, Malaysia 2.3 percent, and India 2.3 percent. India is a primary example. Between 2008-2012, India’s diesel demand grew between 6 percent and 11 percent annually. In January 2013, the country started cutting the subsidies of diesel. Since then, diesel consumption has plateaued.