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Home arrow News and Articles arrow Dennis Predicted Stock Market Crash 1 year in advance, how did he do it?
Dennis Predicted Stock Market Crash 1 year in advance, how did he do it? Print E-mail

Someone asked me a question on How I can predict the "future". Below is his question and my reply for your easy reference.


Regards.


Dennis Ng, http://www.HousingLoanSG.com  


Dennis, you predicted the stock market crash and Global Financial Crisis, are you a Prophet, can you tell the future? How do you predict the future?


My reply below:


I don't really predict. I can appear to you to be predicting the future, but actually what I do is learning from past Crisis, including Asian Crisis, to "foretell" by learning from history, learning from past mistakes, those made by others and myself.

It is why I could "foretell" stock market Crash in year 2008 in year 2007. It is also why I could "foretell" property market turning in late year 2008 1 year earlier in late year 2007 as well.

Thus, a few months ago, I also could "foretell" that the local banks' share prices are likely to fall, again, from my experience working in the Bank back in Asian Crisis.

And I can tell you that I'm not the only one who could "fortell" all these things, several of my mentors have similar views and we have positioned ourselves accordingly before the onslaught of the Global Financial Crisis...my mentors have been through even more market cycles than myself....which again "sharpened" their "sense" of observing the "possible turn of markets".

You can treat whatever I say as nonsense or boasting or whatever. I don't really bother what you think becos I'm basically telling you words straight from my heart. And what you think of me, whether you believe me or not, will not change the truth of the words I said.

 

Human Beings tend to repeat the same mistakes. Pains and lessons learned in one Crisis is soon forgotten....and when the next Crisis strikes again, it is no wonder most are struck by surprise...which is actually quite hilarious....since it is an observable FACT that Booms are followed by Busts.

In year 2007, when I warned that stock markets might Crash, many disbelieved. Some seem to think that it is possible for a Bull market that goes on and on (just like Celine Dion's song "my heart will go on...").

While anyone who bother to check out the history of Singapore stock market would realise that there has NEVER been a time when Bull market in Singapore lasts more than 4 years.....the recent Bull Market started in Mar 2003.....and in Jun 2007 have already passed the 4 years' mark....

Anyone bothered to read government's release of economic forecast would also know that in Nov 2007, Singapore government said that Year 2007's economic growth is likely to exceed 7%, but year 2008's economic growth is likely to be lower at between 4% to 6%.....the lower end of 4% forecast by Government shows a very drastic fall in economic growth....

Again, stock markets trade ahead of economic data...thus, it is also very clear that Year 2007 is probably "as good as it can be" for the stock markets....and going ahead things are turning....

Thus, it is not difficult to "foresee" the Stock Market Crash that followed. Booms are followed by Busts as surely as Sunrise are followed by Sunset. Think about it, there is nothing extraordinary if at about 6 pm someone "predicted" to you that it will soon get dark. Similarly, for those who have sufficient experience in the markets, it is also nothing extraordinary if after 4 years of Bull Market, someone "predicted" that bull market is ending....and will be followed by a Bear market...

Most bear markets lasts 1 year to 3 years. Again as the Bear market drags on....we are closer to the end of Bear market and "nearer to dawn".........the darkest hour is just before dawn.....However, I look around, it does not seem to be the darkest hour yet....retrenchments are just starting to accelerate in Singapore; HDB Resale Flats' prices have yet to Crash (they would, anything over 20% down is a Crash); many people are still Cash Rich....which again, does not coincide with the "darkest hour"...if we look at the "time", well, this Bear Market started in Nov 2007, or about 1.5 years so far....as compared to average bear markets of 1 year to 3 years...

Nobody can predict the "exact time" of things happening.
However, Booms and Busts are cycles that repeat themselves with sufficient "regularity" that it is not IMPOSSIBLE to ESTIMATE roughly at what stage of the Cycle we are currently in. As Warren Buffett said:"it's better to be roughly correct than precisely wrong".....

There are many who warned of the possible coming of the Current Global Crisis. Internationally, we have people such as Peter Schiff; Ron Paul; Jim Rogers; Dr Roubini; Gerald Celente.....

Thus, if one is Open Minded enough to read and learn about different views and opinions, there is no lack of the diversity of the views around...

 

As I mentioned in many of the articles before the Crisis, the Important question to ask is NOT whether a Crisis is coming or not, the important question to ask is IF a Crisis comes, how are we prepared and positioned for the Crisis, to not only survive the Crisis, but to take advantage of the Opportunities that arise in the Crisis...

 
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