6 Economic Indicators to Manage Your Finances

BY RICHARD HARTUNG PUBLISHED: 12:45 PM, APRIL 17, 2016
INGAPORE — GDP. NODX. CPI. Every month these or a slew of other economic indicators flood the media. The challenge is figuring out which ones are important, what they actually mean, and how they affect your wallet and investments.

A Framework Economic indicators are important for investors because they show trends in the economy, which can affect everything from profitability in specific industries or companies to the interest rates on deposits and bonds. Tracking trends in these indicators can help investors decide where to place their money and whether to shift into different types of investments.
Which Indicators to Follow While there are indeed many indicators, a small number can provide excellent insights about the economic outlook.
GDP: Gross Domestic Product (GDP) is the broadest indicator about the economy, showing the value of all goods and services produced in the country. The GDP growth rate shows how fast the economy is growing or slowing. Investors should look at what factors are driving GDP growth, such as increases or decreases in manufacturing or services, to assess whether economic fundamentals will lead to their investments increasing or decreasing. No growth in GDP from the fourth quarter of 2015 to the first quarter of 2016 means economic growth may be continuing to slow, for example, even though GDP grew 1.8 per cent compared to a year earlier.
CPI: The Consumer Price Index (CPI) measures the average price changes in a basket of consumption goods and services commonly purchased by resident households, according to the Department of Statistics. A “core” index excludes rent and cars, which are more volatile. Government policies may change depending on whether the index indicates that prices are rising or falling.
Employment: Employment shows the number of residents and non-residents working in Singapore, both in total and in various sectors of the economy. “Employment is the one most personally felt,” as investment advisory firm Kiplinger describes it, because “these are people’s jobs we’re talking about. Consumers are the engine of our economy, and when their spending flags, business feels it.” Business costs may increase and inflation may rise if labour is scarce and wages go up, so investors can use employment data to assess corporate profitability and government policies.
NODX: In a country where trade is so important, non-oil domestic exports (NODX) data is essential for assessing the health of Singapore’s overall exports as well individual sectors such as electronics or petrochemicals, and exports to specific countries such as China or South Korea. Rising or declining exports can indicate strengths or weaknesses in industry sectors and specific companies.
Retail Sales Index: The Retail Sales Index and the Food and Beverage Services Index measure short-term performance of the retail and F&B industries. Retail and F&B are a big part of the economy, so trends in these indices indicate whether consumers are optimistic about the economic outlook as well as whether they will increase or decrease their spending.
PMI: The Purchasing Managers’ Index shows whether manufacturing in Singapore is growing or contracting. A reading above 50 means that the manufacturing economy is generally expanding, while a reading below 50 indicates contraction.

Investors looking for a broader assessment of the economic outlook can also use the MAS Policy Statement, which is published twice a year. MAS provides its forecast for the economy and outlines the policy it will take regarding foreign exchange rates.

What’s Important Watching each of these indicators regularly is beneficial, and assessing each one as well as how it fits into the current economic situation can give good insights into growth prospects for investments. What is equally or even more important is watching trends over the course of several months. Whereas a change in a particular indicator may result from specific factors such as Chinese New Year, ongoing increases or decreases would show longer-term shifts in outlook.
Omega Wealth Management President Lisa Kirchenbauer explained that investors should not necessarily react based on just one data point, even if markets immediately react to it. Even though one indicator may sway the market for a day or two, she said, the key to understanding indicators is to spot larger trends that will affect the market over the longer term.
Along with watching data from Singapore, looking at data from other markets can also be helpful. As DBS Bank economist Philip Wee said, “in practice, we spend more time watching the indicators of our major trading partners, namely, the US, Eurozone and China, and how they affect their markets.” Whether the US Fed delays interest rate hikes, which can affect rates in Singapore, may depend on factors such as how strong employment or GDP growth is in the US. Also, Wee noted, “it is no longer simply stronger data implies better markets.”
While the range of indicators may seem a bit overwhelming, watching a select few can help you to decide where to invest. And as the American Association of Independent Investors said, even if you don’t follow the indicators in detail yourself, it is helpful to know where the “experts” are drawing their opinions from. The key is to remember that even though data can change rapidly, following key indicators and watching broad trends are most beneficial for managing your finances well.
Source: Todayonline

Ten lies which we always believe

In life, we encounter a whole range of stale ideas about what’s supposedly right, and what’s wrong. We hear some things so often that automatically start accepting them as truth. Since many of these things are negative, when we latch on to them, they can weigh us down for years on end. Here’s another great article from professional ’lifehacker’ Mark Chernoff, in which he helps us to confront a number of potentially damaging lies head on.



Lie number 1: Alone means lonely ‘Alone’ doesn’t always mean lonely, and ‘relationship’ doesn’t always mean happy. Being alone will never cause as much loneliness as the wrong relationship. If things don’t feel right, take a break and spend some time with number one — you. Find yourself first. Appreciate your own worth. And next time you’re in a relationship that’s sinking, you’ll be prepared to swim to safety.

Lie number 2: Happiness comes when you have everything you want To be happy doesn’t mean you don’t desire more, it means you’re thankful for what you have and patient for what’s yet to come. Sometimes we get so caught up in trying to accomplish something big, that we fail to notice the little things that give life its magic. So appreciate today for all it’s worth. These are the good old days you’re going to miss in the years ahead.

Lie number 3: Pain is something you can see Never underestimate the pain of a person, because in all honesty, everyone is struggling. Some people are just better at hiding it than others. You don’t know what goes on behind closed doors. Passing judgement is an unnecessary waste of time and energy. If you have time to judge other people, you have way too much time on your hands. Get off your behind and do something meaningful.

Lie number 4: Life is supposed to be a certain way It is ultimately only our own thoughts that hurt us. Simply feeling what we are feeling, and dealing with it honestly, can be very healing. We always have the freedom to choose how we wish to respond to whatever life presents to us. Let go of how you thought your life should be, and embrace the real life that is trying to work its way into your consciousness. Change what you can change, change your thoughts about what you can’t change, and move on in peace.

Lie number 5: You are supposed to be a certain way When you stop comparing yourself with other versions of yourself, real or imagined; and when you stop comparing yourself with other people, real or imagined; that is when you taste a peace that is real, not imagined.

Lie number 6: Only a privileged few have the ability to live a great life If every morning you wake up and say, “Yes, today is going to be a great day.“ And every afternoon you find a reason to say, ”Yes, today is a great day.“ And every night you find a reason to say, “Yes, today was a great day.” Then one day, many moons from now, you’ll look back, smile at the memories, and say, ”Yes, I lived a great life.“

Lie number 7: Tough times are unnecessary Sometimes things have to go wrong before they can go right. Sometimes you have to let the wrong people walk out before the right people can walk in. Sometimes you have to feel weak in order to know what it’s like to truly be strong. Sometimes you have to feel a little broken to realize you’ll never truly be shattered. Sometimes you have to meet a lot of people you like before you find the one you love. Sometimes you have to take the good in with the bad, knowing that in the end it’s all a worthwhile learning experience.

Lie number 8: To be strong is to not feel pain In reality, the strongest people are the ones who feel pain, accept it, learn from it, and work through it. It’s all about having the courage to ask for a time out, to shed a tear, to dust yourself off, and then getting back in the ring to fight like you’ve never fought before.

Lie number 9: You can fake it Feel the love before saying, ”I love you." Feel the gratitude before saying, “Thank you.” Feel the humility before saying, “I’m sorry.“ Feel the release before saying, ”I forgive you.” When you feel it before you say it, it needs fewer words and goes straight to the heart of your relationship.

Lie number 10: Dreaming is a waste of time The greatest gifts are those invisible to the eyes but felt deeply by the heart. What we can see is usually just a small fraction of what is possible. Imagination is having the vision to see what is just below the surface — to picture that which is essential, but invisible to the eye. Somewhere, something incredible is waiting to be known, you just have to dream big enough to discover it. Source: Brightme.

Wise words written by a father to his children. Indispensable read for our children too!

Following is a letter to his children from a renowned Hong Kong TV broadcaster and Child Psychologist. The words are actually applicable to all of us, young or old, children or parents! This applies to daughters too. All parents can use this in their teachings to their children. Dear children ,

I am writing this to you because of 3 reasons
1. Life, fortune and mishaps are unpredictable, nobody knows how long he lives. Some words are better said early.
2. I am your father, and if I don't tell you these, no one else will.
3. What is written is my own personal bitter experiences that perhaps could save you a lot of unnecessary heartaches. Remember the following as you go through life...
4. Do not bear grudge towards those who are not good to you. No one has the responsibility of treating you well, except your mother and I. To those who are good to you, you have to treasure it and be thankful, and ALSO you have to be cautious, because, everyone has a motive for every move. When a person is good to you, it does not mean he really likes you. You have to be careful, don't hastily regard him as a real friend.
5. No one is indispensable, nothing is in the world that you must possess. Once you understand this idea, it would be easier for you to go through life when people around you don't want you anymore, or when you lose what/who you love the most.
6. Life is short. When you waste your life today, tomorrow you would find that life is leaving you. The earlier you treasure your life, the better you enjoy life.
7. Love is but a transient feeling, and this feeling would fade with time and with one's mood. If your so called loved one leaves you, be patient, time will wash away your aches and sadness. Don't over exaggerate the beauty and sweetness of love, and don't over exaggerate the sadness of falling out of love.
8. A lot of successful people did not receive a good education, that does not mean that you can be successful by not studying hard! Whatever knowledge you gain is your weapon in life. One can go from rags to riches, but one has to start from some rags!
9. I do not expect you to financially support me when I am old, neither would I financially support your whole life. My responsibility as a supporter ends when you are grown up. After that, you decide whether you want to travel in a public transport or in your limousine, whether rich or poor.
10. You honour your words, but don't expect others to be so. You can be good to people, but don't expect people to be good to you. If you don't understand this, you would end up with unnecessary troubles.
11. I have bought lotteries for umpteen years, but I could never strike any prize. That shows if you want to be rich, you have to work hard! There is no free lunch!
12. No matter how much time I have with you, let's treasure the time we have together. We do not know if we would meet again in our next life.
Your Dad

8 timeless Warren Buffett quotes about life,

by Kenji TayThe Fifth PersonThursday, Feb 04, 2016
With a net worth of $67 Billion, Warren Buffett is one of the (or the) greatest investors of our time.
Just as how we like to evaluate the management of a company through its words and actions, Buffett's quotes also reveal a great deal about his character, beliefs, and investment philosophy.
And I believe we, as investors, can draw huge inspiration from the wisdom and experienced offered by his timeless quotes.
So here are, in my opinion, eight timeless quotes from Warren Buffett that everyone can learn something important from:

1. "Be fearful when others are greedy, and be greedy when others are fearful."
Greed and fear - the two emotions that are the bane of every investor.
Remember Sunshine Empire, Gold Guarantee and Genneva Gold? These Ponzi schemes have conned thousands of people out millions of dollars and you wonder why do people continue to fall for such schemes?
The reason is simple: Greed. People see early investors walking away with large profits and they rush to jump in because they don't want to "miss the boat".
But more often than not, when everyone starts jumping onboard to try making money out of something, the more prudent you should be in investing your money.
Likewise, history has proven that an economic crisis is the best time to invest in the stock market - everyone knows this! Then again, fear triumphs over logic in most people.
When prices fall, investors dump their shares to "cut their losses".
Are you able to override this fear? Because if you do, you will have the greatest opportunity to buy wonderful companies at huge discounts.

2. "Someone is sitting in the shade today because someone planted a tree a long time ago."
The earlier you start, the better off you will be in the future. Warren Buffett planted his tree a long time ago.
He bought his first stock at age 11 and he regrets that he didn't start earlier! Buffett's investment in Wells Fargo in 1990 has returned him 9,417 per cent so far.
His investment in Freddie Mac that same year was worth almost $4 billion by the time he sold it in 2000. I could go on about his investments in Coca-Cola in the late 1980s, American Express in the mid-1960s, etc. But I won't. You get the point.
Imagine if you had saved a large sum of money whenever opportunities come calling? How will your life be different today?
The SARS epidemic in 2003, the financial crisis in 2008, the euro debt crisis in 2010 - all of them presented a chance for you to possibly double or triple your wealth.
Opportunities come and go… and if you missed out, more will come still, but you better be ready then! It is always good to start early… because you can never buy back time.

3. "Time is the friend of a wonderful company."
If you are going to invest, invest in a wonderful company with a great business!
A wonderful company will continue to grow as time passes. As it becomes bigger and more profitable, the more likely it is to garner the attention of investors and the media.
The more attention and coverage it gets, the more demand there is for its stock - driving prices higher.
Think of Apple, Amazon or Visa. Over the years, these companies have grown from strength to strength, becoming more profitable as they gobble up more market share in their respective industries.
A great local example is Raffles Medical Group - Singapore's largest private healthcare provider.
Its stock IPOed in 1997 at a price of 38 cents per share, it is now worth around $4 - a return of 953 per cent. I need to encourage my future sons and daughters to be doctors.

4. "Risk comes from not knowing what you are doing."
Granted, everything has risk. Heck, even going outside means you have 1 in 1.9 million chance of being struck by lightning!
But because we know it's highly unlikely it'll happen, we get out of our houses and head to work every day.
But would you dare ride in your friend's car if he never passed his driver's license? Or would you go scuba diving without proper training and certification?
No you wouldn't because you know it's risky.
But that risk is drastically reduced when you are trained and know what to do. Suddenly, driving and diving don't seem so risky after all.
Likewise, when investing in the stock market, it is crucial that you know what you are investing your money into.
Have you examined the company's business model, its financials and valuation?
What is your time horizon and exit plan for an investment?
Just as you wouldn't hop on a friend's ride if he didn't know how to drive a car, never go into the market blindly just because someone out there says that there's an opportunity you need to jump into now.
It's your money, your responsibility, and your reward - so do your homework.

Image Credit: Business insider.

5. "Price is what you pay, value is what you get."
This is one of the most famous quotes from Warren Buffett… but what does it really mean?
In layman terms, it is simply about getting more than your money's worth - and it can be applied to almost anything in the world.
If an economy class ticket to Europe costs $1,200, would you pay an extra $300 to upgrade to business class so you can have that extra leg room, priority check-in, better choice of food, free flow champagne and that extra touch of exclusivity?
I don't know about you, but I would! The value of that experience worth is so much more than its price - the extra $300.
Likewise, in the world of investing, if a great company that has a business model that generates high cash flow, zero debt, pays dividends consistently and is on course to grow 15 per cent per annum for the next five years is selling at a 25 per cent discount to its value, would you snap it up?
I would and so should you (if you like a good bargain, anyway!).

6. "The most important investment you can make is in yourself."
Try to unlearn the English language… you can't. This is because the skills you learn stay with you forever.
Knowledge, wisdom, personal growth are things that can never be taken from you.
Want to invest better and grow your wealth? Pick up a book or join course and start devouring the knowledge between those covers.
Want a pay raise or to become more relevant in your industry? Upgrade your skills, network, and work hard because your accomplishments stay with you forever.
You are your own biggest asset and you alone determine how you want to lead your life and the brightness of your future.

7. "I don't look to jump over 7-foot bars, I look for 1-foot bars I can step over."
Warren Buffett is a simple man when it comes to his investments. He doesn't go chasing the next hot stock or the next big thing hoping to strike it rich; he simply invests in familiar companies he fully understands.
How does Coca-Cola make its money? It sells soda and beverages to consumers around the world (to the tune of billions!). Nothing fancy schmancy about that. We've all drank a can of Coke in our lives.
Buffett invested in the train company, Burlington Northern Sante Fe, in 2008. What does it do? It gets people and goods from point A to point B. Again, a simple business that anyone can grasp.
The point is Buffett doesn't overcomplicate things when it comes to his money and investments; he sticks to the businesses he knows will give him a high probability of success (the 1-foot bars) and ignores the rest.
So ask yourself: What are the companies you're already familiar with?
And start from there. Who is your internet provider?
Likewise, in life, set short attainable goals towards your bigger vision.
If you want to make reading a habit but finds it hard… Why not allocate just 30 minutes a day to reading instead of trying to read a whole book in one day.
Once you get used to the 30 minute time frame, you can increase it to an hour, and so on.
So… Where are your 1-foot bars?

8. "Predicting rain doesn't count, building the ark does."
Less talk, more action! We can dream about the impossible, make all the plans we want and talk all about the possibilities, but nothing happens until you take the first step.
I'm sure you've heard of the phrase "if only…" A few years ago, one of my friends claimed that Facebook was his idea and he went on to talk about how rich he would be if he had implemented that idea.
Well, if he actually did something… maybe.
We can watch the news and wait with bated breath when the next crisis will happen.
But until we start saving and setting aside a sum of money to capitalise on that opportunity, we'll never benefit even if the crash comes true.
Truth is, we all want a better life, be wealthier and happier.
But if all we ever do is to talk until the "cows come home", nothing will change until you start something going. So get going today (if you already haven't!).

Every morning when you wake up, you’re given $86,400...

'Imagine that you have a bank account which gives you $86,400 every morning when you wake up. Whatever you don’t use up during the day gets taken back. Question: what would you do with the money?

Of course, you would spend every dollar on your own pleasure and that of others whom you love. You would devour every cent from this magical bank, take the opportunity to make everyone around you as happy as you could with it. Maybe you’d even end up giving some of the money away to those who you didn’t know — because you probably couldn’t spend all of it on yourself and those close to you in just one day. So what am I getting at? Each of us has such a bank — it’s name is time. The horn of plenty, which is constantly pouring out the seconds of your life. Every morning, it credits you 86,400 seconds. Every night it writes off at a lost, whatever of this you failed to invest to a good purpose. It carries over no balance. It allows no over draft. Each day it opens a new account for you. Each night it burns the remains of the day. If you fail to use the day’s deposits, the loss is yours. And there’s no getting round the bank’s other key rule: it could close your account at any moment without warning; your life can end at any second. So what are you doing with those 86,400 seconds? You must live in the present, on today’s deposits. Invest it, so as to get from it the utmost in health, happiness, and health. The clock is running. Make the most of today.' Marc Levy, "If Only It Were True" Source: http://brightside.me

How to END financial self-sabotage

How to END financial self-sabotage ---> Break Free

Perservance

Meow!