GIC’s director of economics and strategy, Yeoh Lam Keong, made an interesting statement on Tuesday that there will be further weakness in financial markets. He advises investors to go for gold, hold government bonds and currencies such as the yen, yuan and Canadian dollar. The US dollar is to be avoided “like the plague” as the United States monetise their debt by printing money.
That is all rather belated and even, ironical, considering GIC’s multi-billion dollar stakes in Citigroup and UBS. Nevertheless, it serves no purpose crying over spilt milk. As a matter of fact, I don’t believe any investors have been immune in this period of wealth destruction. The world’s richest are collectively poorer, with $2 trillion of wealth vaporized. Warren Buffett sufffered his worst year ever, losing $25 billion, but is still the second richest man.
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