Local Banks Produced Results. Obviously.

As indicated in my previous post here back in April, the 3 local banks produced quite healthy results in this kind of climate.

I have no idea why the market previously is giving such a valuation to the local banks. They do not have a lot of exposure to the toxic assets, and they are definitely not going to lose 10+ billion dollars per quarter. So why such a valuation? At most the banks will make lesser profit, but profits they will certainly have. People forget that Singapore is a highly regulated country. There's a reason why we are often labeled kiasu and kiasi.

Not only the banks will do okay, this will extend to most of our non-property blue chips. They will not make billions of dollars losses like the news that we keep reading about. Going forward, I see lesser profits for those companies, but I don't see any losses. In fact, I think the 1Q is the crucial test for them. Once they past this test, the 2Q results should be better. In fact, go out to the streets and you'll know what I mean. Judge by what you can see, and not by what you're reading.

This only goes to prove what I've known ages ago. There is no such thing as an efficient market. I won't try to persuade anyone with any analysis, charts, or some crystal ball.

Just ask yourself this. The market is governed by buyers and sellers who can enter/exit anytime they want. Buying and selling are all directly/indirectly controlled by humans. Humans are imperfect. Therefore, how can the market be efficient?