America's in Recession

We watch TV, we read newspapers, we hear people talk - about the America's Recession. Many are not familiar how this has got to do with them. However for me, it impacted my job, my livelihood and my portfolios. In fact, it affected many other people without them realizing it.

What does it mean to your job?

As an engineer in the electronics manufacturing field, I feel the heat as more and more products are moving away to China and Vietnam. This is largely based on the China+1 policy adopted by many big firms to have a place in the world factory and a backup in another country with Vietnam the upcoming favourite. Sometimes, I find it funny to hear some Production Engineers say that it is great that products are moving to China. They thought when products go away, they don't have to work that much, sitting around and wait for the wages. What they don't know is that products go away, so do their jobs.

What does it means to your life?

Our livelihood, undeniably, depends on money. Generally, the less we have, the more miserable we become. When prices soar, called inflation, everything increases, except your salary. That's where the problems come in. With oil prices fetching $105 per barrel and soaring, there is definitely a pressure in driving commodity prices higher. Being an ordinary Malaysian, it is even worse, indifferent to the overall low income per capita, the government increased the oil prices almost 90% in the past ten years, despite being an oil-exporting country. Toll prices as much as 70% although we should have a freeway by now. Food prices increased as much as 50%. Home prices at 100% with cement and steel shortage. Energy, transportation, food, and shelter - the basic necessities in life is already biting away my salary and savings, I don't even dare to think of spending much on entertainment, let alone courting girls.

What does it means to your portfolio?

Well, I decided to put this as the last subtopic as not everyone invest in the stock market and mutual funds/unit trust. But as I said, "everything increase, but your salary", I have to find a way to make my money grow faster than inflation. I learnt to take risks.

I invested in one of the local market funds in 2006. It started very healthily. In first quarter of 2008, I profited almost 50%. But one bad news after another in the America, it dropped to a mere profit of 25% and I decided to sell. Sure glad I did, the surprising 12th general election results sent stocks plummeting across the boards. If I didn't sell, it would have offset all my gains.

On the bright side

Not all hopes are lost, at least now with the weakening dollar, you can order your Ipod from eBay at a lower price. Shall you have the savings to go for a vacation, perhaps now is a good time to pay a visit to the Statue of Liberty.