Archive for June, 2010
Gain the High Account
June 26th, 2010 | 
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Desire a high gain fast and easy way to make people prefer to put their money in deposits than demand deposits and savings for example. Though there are many other investment instruments such tempting stocks, bonds, etc., both conventional and sharia-based.
Data Deposit Insurance Agency (DIA), the number of current accounts in national banks as of May 2010 reached 2307 accounts with a value of Rp 476.30 trillion.
While the number of accounts to savings accounts but many reaches 86 772 smaller amounts of deposits which were Rp 598.26 trillion.
Comparing with the deposit account number even with fewer 2871.77 savings accounts but reached Rp 950.86 trillion.
Assistant Vice President Investment Sales Alfred R Triestanto HSBC Indonesia, in the “Media Workshop Series Investing in Sharia Way, HSBC” in the WTC Towers, recognized currently about 40 percent of public funds is still stored in the form deposits.
Whereas the current deposit interest rate is less tempting average of around 6-7 percent (deposit amount), not to mention the tax cut of about 2.5 percent. “Whereas other investment instruments which can be many alternatives,” he said. Advance exemplified HSBC products that provide many benefits to the customer.
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How to Manage your Personal Finance
It is increasingly difficult to live within one’s income these days and even harder to save anything for the future. Yet, with the economy uncertain, it is even more important than ever to do just that. Maintaining one’s personal finances in a solid and balanced manner is vital toward staying economically and emotionally healthy.
The most important aspect of keeping one’s finances in order is budgeting. It is important to be aware of monthly expenditures, and especially important to find areas where it is possible to cut back if there is a risk or reality of going deeper into debt just trying to live from month to month.
It is a depressing reality that credit cards are crucial to our current existence. It is virtually impossible to rent a car, reserve a hotel room or book an airline ticket without that kind of backing in case of a failure on our part to pay for a service. This is scary, because credit cards also make it far too easy to go into debt beyond anything easy to get out of. So, while credit cards are a virtual necessity, judicious and limited use of the same is essential to effectively manage personal finance.
Making sure spending stays within the limits of our means is important as well for those times when borrowing is necessary. While staying out of debt entirely is laudable, it is the rare person who can purchase a house without incurring some debt, and the way one has managed their finances up to this point will show on their credit report. Personal finance management will also be considered when determining what kind terms and interest rates are applied to the home loan, which in turn will impact how quickly said loan can be repaid– turning debt into asset.
Making sure assets and possessions in general are protected is also crucial to keeping one’s finances in order. While it may be difficult to incorporate the cost of insurance into a monthly budget, the cost of not doing so can be far worse. Fires, floods and other disasters are far costlier financially to the homeowner, or even renter, who does not have insurance than these events are to someone who does. The same goes for smaller catastrophes, such as teenagers with drivers’ licenses.
The right insurance can also save a family in light of death or illness. It is not something people generally like to talk about, but pretending nothing can happen is not a guarantee of safety. Some policies even allow for savings against a future need and so can do double duty toward providing security if it is needed.
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Free Your Debt now
All people in the world must want to avoid from debt, more over generate it to the next generation of their family. It must be worst. Nowadays lifestyle sometimes force people to follow the change and its flexibility, the ease of every aspect is trying to be obtained in order to make people easier to run their life, and to show that there is nothing to be left than the practicality. Credit card is a must, for those who are rising up the practicality of money transaction. But some people do not regard any deeper consideration, such as do we really need it to replace cash in money transaction? Does credit card help us on finance condition? Do we need it as reserve transaction tool?
By that consideration we should know much the benefit of credit card, but still we involved far in debt of credit card when we feel enjoy in it. Many people feel burdened when they know that they owe much money to the credit card company. And they force us to pay the money that we have used through our credit card. The interest also included into the bill that asked to us. We sometimes confused to pay the debt and the interest also.
There is a company that provide the solution on solving debt problem especially debt of credit card. We have to find credit card consolidation companies which is able to give you advise for your debt problem. The company usually offer the solution by checking your problem debt, and background of your debt of credit card. You have to find reliable debt settlement companies and reputable debt relief companies. The companies will do the negotiation to you; they also will understand the condition and how to solve your problem. The company will charge you for a few percent as a fee, but it never burdens you much. So find the company as soon as possible to avoid you from over debt.
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Flowing Out of Foreign Funds
After a massive get out during May 2010, this month re-entry of foreign funds into the financial and capital markets of Indonesia. This condition makes the exchange rate tends to strengthen again.
Director of Economic Research and Monetary Policy Bank Indonesia (BI) Perry Warjiyo, Monday (21/06/2010) in Jakarta, explained that the flow of foreign funds back in because the trust fund to invest in emerging markets, including Indonesia, back up. Moreover, the prospect for the Indonesian economy continues to improve.
Foreign funds in Bank Indonesia Certificates (SBI), for example, increased to Rp 4.2 trillion in the past week. This makes foreign funds in SBI reached Rp 37.7 trillion as of June 18, 2010.
Earlier, during May 2010, foreign funds flowing out of the SBI increased uncertainty following the European settlement of the crisis. At that time, foreign investors pulled their funds from the SBI and transferred to the U.S. dollar denominated instruments, which is considered more secure.
Throughout the month of May, foreign funds out of the SBI Rp 47 trillion, this makes a significant weakening of rupiah exchange rate. As a result of it all, the position of foreign funds in SBI dropped, from Rp 82.99 trillion at the end of April 2010 to Rp 36.36 trillion at the end of May 2010.
According to Perry, in addition to the SBI, the foreign funds are also flowing into the SBN and stocks. As of June 18, 2010, the position of foreign funds in the SBN Rp 151.68 trillion, an increase of USD 7.6 trillion, compared to the end of May 2010 which is only Rp 144.09 trillion. In the same period, total SBN increased 4.82 trillion, from Rp 609.68 trillion to Rp 614.5 trillion. This means that all additional SBN hired in June 2010 on foreigners.
Earlier, such as SBI, foreign positions in the SBN down around Rp 4 trillion during May 2010 due to the crisis in Europe.
In the stock market, boost the flow of foreign funds Composite Stock Price Index in Indonesia Stock Exchange. In trading yesterday, the Jakarta Composite Index rose 12.31 points to 2941.9 levels. Foreign investor transactions recorded a net buy USD 423.3 billion.
Perry explains, the BI policy requires that investors hold a minimum one-month SBI (one-month holding period) in fact, do not reduce foreign interest in buying SBI. Foreign investors precisely assess the prospects for Indonesia’s financial markets become better with the policy.
Economist Dradjad Wibowo rate, the policy of the holding period of one month is good. However, coordination should be accompanied with the Ministry of Finance to avoid speculation SBN made due to excess liquidity event.
As the improving outlook for the Indonesian economy, the international rating agency Moody’s yesterday raised Indonesia’s debt rating outlook in the domestic and foreign currency from stable to positive. Positive Outlook indicates the possibility of Indonesia to increase the ranking in one year ahead, in which Indonesia needs two more notch to investment grade from Moody’s.
In a press release, Moody’s explained, a positive outlook also reflects the strengthening of the Indonesian economy to grow a sustainable, balanced by the effectiveness of fiscal and monetary policy stability
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Different Securities in the Market
There are different securities in the market today that we can choose from. They are all forms of investments or different ways to keep you money somewhere besides a bank. They can offer great returns if you know what you are doing. If you don’t, I suggest you seek the help of a professional before you start investing blindly.
Let’s start with Mutual Funds. This is one of the most common investment vehicles that people use in today’s world. Most employees who invest in a 401k have mutual funds in their portfolios. They are pooled investment accounts that allow the employee to invest if different things with little money. You can invest in a wide range of things when it comes to mutual funds. They are generally stocks and bonds for most people. Most of them are managed by professional money managers that you hire. They are paid from the investments that they make for you. Check with a professional to learn more before you get started.
Stocks are also an option that you can use to invest. Stocks are where you buy shares of ownership of a specific company. The value of the shares will move up and down with the market and with the company’s overall performance. Once again, check with a professional before getting started.
Exchange Traded Funds are another form of investment. They are generally called ETF’s and are pooled investments that mirror a market or index. They are traded by individuals mostly. They offer the investor a way of investing without the cost associated with professional management. You still need to seek professional education before investing. They have become very popular over the past 15 years. Lots of people use them.
Unit investment trusts are fixed groups of different investments whose shares are sold to individual investors. Many ETF’s are sold and organized into these trusts.
Closed end mutual funds are another type of investment trust. They are trust that is fixed groups of securities that are traded by individual investors and are professionally managed.
Investing takes education just like everything else. Please seek to have a good education before you think about investing. This will save you from loosing lots of money in your life if you just spend a little time learning from someone who has been there already.
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Indonesia Opens Doors to Foreign Investment
Indonesia on Wednesday raised foreign ownership caps in sectors such as agriculture and health care in a bid to lure offshore investment and remove legal uncertainty. President Susilo Bambang Yudhoyono signed a decree intended to clear up doubts about foreign ownership which have hobbled investment across a range of industries, officials said.
In particular it will open up the staple food plantation sector for the first time, though foreign holdings were capped at 49 percent of individual companies. “This comes into immediate effect,” Investment Coordinating Board chairman Gita Wirjawan told AFP.
“The most significant thing about this is that there is a rule, a regulation, that tells them (foreign investors) how much they can invest… Everything is clear now.”
Indonesia’s expanding middle class, natural resources, low wages, political stability and domestic market of some 240 million people have made it an increasingly attractive destination for foreign investment. But investors complain that they are being held back by red tape, overlapping regulations, corruption and a lack of legal certainty despite Yudhoyono’s promises to remove “investment bottlenecks”.
“The aim is to basically provide a clear-cut and simple explanation as to the extent to which foreign investors can invest in any particular sector. This was not the case previously,” Wirjawan said.
The ceiling for foreign ownership in hospitals rose to 67 percent nationwide compared to 65 percent in certain major provinces only. But the lowering of barriers to foreign investment did not go as far as telecommunication towers, despite strong overseas interest.
Actual foreign direct investment dropped around 20 percent in 2009 to 10 billion dollars from a year earlier amid the global economic crisis. The Bin Laden Group from the Middle East last year cancelled a plan to invest around one billion in a food estate project in Papua province because the government planned to cap its share in the project at 49 percent.
The opening up of the hospital sector could pave way for some regional healthcare providers, such as Singapore’s Parkway Holdings, to enter the world’s fourth most populous country, analysts said.
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Getting a Business Line of Credit
Entrepreneurs frequently encounter difficulties managing their cash flow as a result of seasonal credit demands and time gaps between capital needs and revenue realization. This is especially true of business start-ups during their early stages of development when they have not diversified enough to generate a constant positive cash flow. Once inventory has been purchased, it is necessary to ride out the cycle until accounts receivable have been collected. Without sufficient working capital, a serious cash flow problem could develop. These types of cash flow problems have forced many entrepreneurs to close down businesses that were making money on paper, but just ran out of cash.
Lines of credit accommodate the seasonal credit demands of your business along with ups and downs in your cash flow. They also enable you to purchase inventory in anticipation of future sales. Discuss establishing a line of credit with your bank at the beginning of your relationship. If you are just starting your business, the bank will probably not grant a credit line immediately.
A line of credit is a standard service provided by many banks that serve small businesses. Getting the loan approved depends on the business’s ability to repay and/or the personal assets of the owner, for example, a second mortgage on a home, assignment of stocks and bonds, or assignment of the cash value of life insurance policies.
Banks will extend a secured line of credit to most start-up ventures. The line may be unsecured if the business can demonstrate consistent earnings, an excellent capital position, and multiple sources of repayment. Traditionally, banks will commit a specified maximum amount of funds from which you are permitted to draw on as needed. You have the right to repay and re-borrow during the agreed-on time, which usually will not exceed a year. You pay interest only on the outstanding principal.
In addition, the bank needs to know how you will repay the line when your first source of repayment does not come through. Bankers look for enough elasticity in your operations to accommodate temporary reversals in adverse situations. What happens when you discover that your inventory is not selling as projected? What secondary sources of repayment are available?
Banks may also require you to pay down your line of credit when you have not followed your payment schedule, even though the total amount of money that you borrowed is not due for several more months. Banks do not like to approve lines of credit for use in managing cash flow. Instead, lines of credit are intended for cyclical borrowing needs at identified pay-down intervals. A failure to pay back the money on schedule indicates a potential problem in your ability to manage cash.
Smart tips for establishing a Line of Credit
1. Most likely a bank will not issue a line of credit to a new venture without the owner’s personal guarantee of repayment.
2. If your business is relatively new and the bank is not satisfied with the primary and secondary sources of repayment, it may ask for personal collateral life you to secure the loan.
3. If the venture is a partnership or corporation with more than one principal, the bank will most likely collateralize the loan from all the principals involved to obtain a line of credit.
4. You must present reasonable financial documents that follow standard accounting practices to obtain a line of credit.
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Prudential Cancel to Purchase AIA
One of the British insurer Prudential Plc announces to withdraw from the deal valued at USD35, 5 billion for its plans to buy the Asian American International Group Inc. one of the largest life insurance businesses owned by AIA.
This decision came out a day after AIG “reminding” re-bid is lower than Prudential and the company will save England from an embarrassing defeat at the hands of shareholders next week.
“We listened carefully to our shareholders over the price and start renegotiating terms with AIG. Unfortunately, it is not possible to reach an agreement. So we pulled out of the transaction,” said Prudential’s official, Harvey McGrath said in a statement, as reported from Reuters, Wednesday (02/06/2010).
Observed, Prudential shares are listed on the Stock Exchange of Hong Kong jumped by 7.1 percent to 68 Hong Kong dollars, while the London Stock Exchange rose 6.3 per cent per share in trading Tuesday. Prudential said the party withdrew from the transaction, which is intended to become the world’s largest insurers.
British insurance giant, had been declared immediately obtain fresh funds worth 14.5 billion pounds (USD21 billion) from selling new shares to help fund the takeover of the Asian AIA insurance.
“Prudential today announced more information about the proposed combination of the Prudential Group and the Group AIA, including a rights issue to raise funds 14.5 billion pounds,” Prudential said.
AIA on purchase plan by Prudential that was delayed almost two weeks earlier, causing the amount of funds required to acquire the business unit of American International Group (AIG) is.
These transactions will be recorded as the largest corporate action on the insurance sector, although regulators amid concerns about capital strength in the company. Prudential announced last March that they had agreed to buy the Asian AIA AIG insurance group valued at USD35, five dollars (29 billion euros)
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