If you come for Asian Investment Leading Guru Mr Hu Li Yang's seminar last September, you would have heard about him talking about the Europe situation. 1 year later, his predictions do seem to come through.
Last September, he urged all of us not to worry about the Europe crisis. It is in fact a golden opportunity to go into the market. Yes indeed, this January we reached a new high and we put the Europe crisis behind us.
At that time, he mentioned that the stock market this year will continue to have potholes for us to fall into. "Do not expect a smooth sailing journey all the way to election. There will be bumps along the way." Yes indeed, he got it right again. Just when we expect Dow Jones to continue its 1st quarter's marvelous run, the 2nd quarter put a sudden halt to it.
Europe's problems came back again. China's slowdown became a major concern which caused oil price, commodities, energy and industrial sector stocks related to China to decline sharply. All stocks related to China, no matter is it listed in Singapore or US, went down. Suddenly US also seems to be facing economical uncertainty with 3 months continuous shortfall in employment results. Even the famous fast growing BRIG nations, Brazil, Russia, India and China were forced to cut interest rates to save their economy. China being the latest to join in the crowd this month.
Of course, will all these troubles eventually lead to a recession? Will Italy, Spain and Greece problems bring down the world? Mr Hu Li Yang does not think so. This problem will be solved. In fact Mr Hu Li Yang last year predicted how the Euro Zone will shape up. He even referred to Europe crisis like how the Romans fight the war in the past. When in war, the Romans did for once to tie up 8 horses together to enhance their fighting capability. Gradually they found out that though 8 horses did increase the capability, when one horse got shot down, it affected the rest of the seven. Mobility was compromised. Hence the Romans began to reduce to 4, later to 2.
Mr Hu Li Yang said, "This is identical of the European problems. The way to solve it is to kick out the incapable nations. Those ill horses. One by one. Until the capable are left behind. He predicted Europe will do it within the next 2 years."
Again, it does seem very likely now that Greece may be the first country. With this weekend election, we seem to have accepted the fate of Greece rest in the opposition. And it is no secret that the opposition do not want to accept EU terms and regulations. We are growing accustomed to the fact with each passing day that Greece might be out soon.
Will Greece exit lead to a collapse in the European Union? I think Mr Hu Li Yang is right. The only best solution now is to eliminate the weakest horse. Only then will the Dow Jones reach its glorious all time high of 14198 points. After that strong psychological resistance, we might go on a super bull run just like what Prof Zeng Yuan Chang predicted.
So let us pray and hope Greece exits fast!!!