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Excerpt from
26 Jan 2006
Writen
by: Vasu Menon
Vice-president and Chief Editor of finatiQ - Bank of Singapore
www.finatiq.com
Geomancy Master Positive on Year of the Dog
Fengshui expert, Master Ong Thiam Peng, of I-Ching Geomancy
Centre, is positive about the economic and investment
outlook in the Year of the Dog.
Good track record
Master Ong is no ordinary Fengshui expert. Many of his past
predictions have materialised.
Three years ago, he predicted that a war would break out
between Iraq and the US, but added that it would be a short
war and that it would create opportunities for traders to
make money.
This was borne out as equity markets corrected sharply that
year, weighed down by the conflict in the Middle East and
concerns about SARS.
His predictions for the US dollar last year was also borne
out. While many forecasters made
dire predictions about US dollar at the start of last year,
Master Ong had a different view.
He said that the US dollar is unlikely to collapse as its
direction is propelled more by the policy actions of major
world governments and less so by pure economic fundamentals
like trade and current account balances and interest rates.
True enough, the greenback surprised most forecasters by
rallying last year - due to the widening interest rate
differential in the US, which was in turn influenced by the
policy actions of the Federal Reserve and its counterparts
in other developed economies.
Master Ong had also said last year that a collapse of the US
dollar will result in a radical change in the global
currency system ¨C something which global leaders are not
prepared for and which is inconsistent with a period of
relative stability expected during the Year of the Rooster.
As he predicted, there was no major fireworks at the
meetings held by the Group of Seven (G7) industrialised
nations, as it adopted a relatively neutral stance last
year.
Master Ong, who has intimate knowledge of the economic and
political system in China, also said last year that the
country will eventually yield to international pressure and
revalue its currency. This happened last July when China
undertook a modest revaluation of the yuan.
Looking
ahead
Looking at the year ahead, Master Ong reckons that the Year
of the Dog should translate to continued economic and stock
market
prosperity, especially for the Asia Pacific region. Many of
the region¡¯s stock markets did well last year, especially
bourses like Korea, India and Japan.
In fact, Master Ong even reckons that the buoyancy in Asia
Pacific markets could continue unabated for the next two to
three years.
 According to him, the new lunar year will herald in what he
calls a ¡°sleeping dog¡±, which is unlikely to disturb the
good times which investors have enjoyed in the past few
years. In the same respect, Master Ong is also
sanguine about the global political
landscape, which he says
is likely to be stable, as there are no major elections
slated to take place in the coming year. This is
complimentary with his positive prognosis for the economic
and investment outlook.
Nevertheless, Master Ong remains cautions, for according to
the
I-Ching
¡ª China¡¯s ancient book of wisdom, the embodiment of Taoist
philosophy ¡ª the new lunar year will be symbolized by unity
and congregations which may either translate to good or bad
news for markets in the short haul. As such, he says that
investors should brace themselves for volatility.
He cited happenings in the Middle East as an example of how
unity among the world¡¯s major nations, in trying to stop
Iran from become a nuclear power, may cause uncertainties
for investors and result in volatility for financial
markets. This is compounded by political uncertainties
in Israel, making the Middle East region a political hotspot
in the world. Nevertheless, Master Ong predicts that the
global support which the U.S. has gathered in trying to
resolve the political stand off in Iran, is likely to end
with a positive outcome which will be cheered by financial
markets. But the process of resolving the dispute with Iran
will cause confusion and result in markets being volatile.
Happenings in Thailand are another example of how
congregations can have an impact on financial markets.
According to Master Ong, Thai Prime Minister Thaksin
Shinawatra, is facing growing opposition to his rule as his
opponents have progressively gathered supported from the
Thai people as evident from growing street rallies and
protests in the country and escalating problems in Southern
Thailand. If Mr. Thaksin¡¯s opponents succeed in removing him
from power, it could throw the Thai bourse into a period of
uncertainty. This could also impact other financial markets
in Asia where politics and economics are often intertwined.
Another uncertainty investors have to deal with is the risk
of a sharp slowdown in the US economy, which has enjoyed
several years of strong growth. Master Ong who was right
about his prognosis for the US economy last year reckons
that the world¡¯s largest economy is unlikely to see a sharp
slowdown. He says that his assessment is corroborated by
feedback he receives from his clients in the U.S..
Risk of more corporate scandals and failures
According to Master Ong, Fengshui qi
or energy cycles change once every 20 years. The past two 20
year-cycles ended in 1983 and 2003 respectively. The current
20-year cycle (which is the 8th cycle) began in 2004 and
will end in the year 2023.
The onset of a new cycle is usually characterised by
significant changes where the strong will start to decline
and the weak will begin to strengthen. This transitional
period is also one of uncertainty - as investors would have
seen in the past two years.
According to Master Ong, looking back at the 6th
and 7th cycles, significant changes took place in
the corporate world at the onset of these cycles, which saw
prominent companies either collapse or where their
controlling shareholders ran into difficulties or
relinquished control.
An example he mentioned was
George Tan¡¯s Carrian Group in Hong Kong. Singapore also had
its fair share as seen with the Chua family of Cycle &
Carriage, Mr. Francis Seow of Lumipax, Hoo Thye of Chop Hoo
Thye and Ho Kok Cheong of Peoples Park. Elsewhere in the
region, Malaysia¡¯s Tan Koon Swan of Multi-Purpose Holdings
and the Pan Electric Group, and Indonesia¡¯s Edward
Soeyadjaya of the Summa Group also ran into difficulties.
Master Ong noted: ¡°With the strong in a state of decline,
the weak began to strengthen gradually and inconspicuously,
propped up the new and favourable wave of energy. Looking at
the number of successful entrepreneurs that have climbed the
ladder of success, and judging by the way they had garnered
various awards recently, obviously, many of them were
commercially successful after 1984
or during the 7th cycle.¡±
Presently, we are still in the early stages of the 8th
cycle. Master Ong noted that some major developments have
already taken place ¨C examples include the demise of
goldsmith Poh Kong Chye, which had a history of more than
100 years, the National Kidney Foundation saga,
the
acquisition of Maxtor by Seagate
and Livedoor Scandal in Japan.
More mergers and acquisitions and corporate failures cannot
be discounted and this is a risk which investors have to
bear in mind, although these happenings can also present
investment opportunities for those who are nimble.
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