The big question on everybody’s mind now is, “Will we have a quantitative easing QE3?”
Even the big boys on Wall Street are guessing. In US, the Dow Jones Industrial Average has recently dropped from its high at the start of April from 13,297 to end at 12,921 yesterday. The reason for this drop is that the Fed Chairman Ben Bernanke quashed the possibility of a QE3 in the near term. There has been a small correction in US since his remarks.
However, Professor Chan thinks the likelihood of printing money again is high. He commented, “Currently America has the conditions to print money as their inflation is low but unemployment rate is still high. Differing from the US, China is feeling the after effects of printing too much money and suffering from high inflation now.”
As US election will happen at the end of November, Professor Chan thinks that the main objective of US this year would be to bring down unemployment rate. This can only be achieved if Americans start to spend and enterprises start to expand their businesses.
Professor Chan is of the view that the objective of printing money needs to serve two purposes which are to distribute money to Americans to spend and to distribute to enterprises so that they create jobs. The last round of QE2 did not serve this purpose as the bulk of the money for QE2 went only to the rich instead of everyone. As Americans did not spend, businesses did not improve, enterprises in turn, did not borrow money to expand their businesses. QE2 only benefited the stock market but not in the creation of jobs.
Professor Chan said, “When the Fed think of a way to distribute the money, then QE3 will come!” He urged all of us to pay attention to what Bernanke has to say. He added that, “If Bernanke gives indications like how enterprises can borrow money, then it is time to buy stocks!”
Professor Chan shows optimism in the US stock market this year. “The US stock market is probably going to hit new high by year end. In fact after hitting new high, which is a psychological figure, it might have a parabolic run.”
To know more about what Professor Chan taught in the seminar, please come for our Free Revision session on Professor Chan’s teachings.
"Prof Chan Yan Chong revision" workshop
& Secrets of Singapore Stocks
& Secrets of Singapore Stocks
Topic: 1) Will there be a QE3? What conditions are needed to have it?
2) Why is the the market so concerned on Europe Bond Auctions?
3) How will Oil affect America Economy?
4) When will China Stock Market Slump End? How will it affect Singapore?
Date: Thu, 19 Apr 2012 (English) and Fri, 20 Apr 2012 (Chinese)
Time: 7pm - 10pm
Session: English & Chinese
Speaker: Mr Daniel Loh (Student of Prof Chan), not Prof Chan Yan Chong himself
Venue: 141 cecil street, Tung Ann Association Building
Tanjong Pagar MRT exit G, walk straight 80m, opp traffic light
To register pls click here
or SMS <Name><Email><HP><Date><Number of seats> to 93676623