Indonesia Stock Top Gainers

Adaro Energy Tbk

2012-04-30T01:41:00.007+07:00

Weekly Commentary :

Date

Recommendation

Candlestick

30-Apr-12

BUY

Bullish Piercing Line Pattern

07-May-12

SELL

X False Signal

14-May-12

ADARO ENERGY TBK ( ADRO.JK )

ABOUT

PT Adaro Energy Tbk is an Indonesia-based integrated coal mining company. The Company, through its subsidiaries, is engaged in coal mining and trading and other related services, such as coal infrastructure and logistics. The Company’s subsidiaries include PT Alam Tri Abadi, PT Saptaindra Sejati, PT Adaro Indonesia, PT Dianlia Setyamukti, PT Indonesia Bulk Terminal, PT Satya Mandiri Persada, Coaltrade Services International Pte Ltd, PT Sarana Daya Mandiri and Orchard Maritime Logistics Pte Ltd.
Company Address
Floor 23, Menara Karya
HR Rasuna Said Rd, Block X-5
Lot 1-2
JAKARTA 12950
P: +6221.5211265
F: +6221.57944687

Analyst recommendations

Date

Price

Recommendation

% Change

30-Apr-12

1830

BUY

X False

Global Crisis of 2011 Will be Worse Than 2008

2011-09-21T08:29:00.003+07:00

There is a view of the fundamental differences between the current global crisis with the crisis in 2008 have different weights. In 2008, the crisis occurred because the collapse of world financial companies, but this time the bankrupt the state.

The current crisis will be very heavy compared to 2008. Because most major problem was that the crisis countries, used to be a financial sector crisis that began with Lehman Brothers, the company could shut down all, but if my country can not be closed!

As the pattern of previous crises will occur the spread of the financial sector to the real sector. Indonesia certainly affected the demand side of export markets, especially from Europe.

We can see our rupiah weakened. Cause of the crisis in Greece was because he could not pay and default. The IMF and the Euro is not helped. How are we if he defaults. If Greece hit, the banks of France was hit, straight down the price.

The most potent solution to the current crisis and the future is to control the domestic market. In addition, Indonesia's infrastructure continues to push the economy so that stretching may be higher.

Stock Market Crash of 2011

2011-08-06T13:14:00.003+07:00

Legendary investor Jeremy Grantham of GMO LLC is predicting a “Stock Market Crash” and suggested that investors should consider selling their stocks around July 2011. Going back to 1960, the first 7 months of the third year of a presidential cycle (like 2011) produced inflation-adjusted returns of 20 percent for the 48-month presidential cycles. Meanwhile, the remaining 41 months of the cycle returned only 1 percent.

Therefore, Grantham suggested that investors should “Sell in May” of Year 3 and go away for 41 months, a variation of the Wall Street adage of “Sell in May and Go Away” — going by Grantham’s 48-month cycle pattern, the sell date would be July instead of May.

In addition to this historic tendency, he listed four more reasons to get out around this time period.

1. There is still the risk of the Middle East and North Africa unrest spreading to important oil producers like Saudi Arabia.
2. Japan’s earthquake-tsunami disaster can potentially have a prolonged impact on the global production of certain small production parts for which Japan holds a near “Monopoly” in.
3. The Federal Reserve’s program of QE2 is ending on June 30, 2011. Prominent investors like PIMCO’s Bill Gross are so bearish on this development that he is now short Treasuries. If Treasuries do decline and yields go up, it could spell disaster for the stock market and economy.
4. The relentless rise in resource prices is beginning to act as an economic drag.

Previously, Grantham thought the Federal Reserve’s loose monetary policy could carry the stock market until at least October 2011. However, due to the combination of the factors listed above, he has turned bearish. He said “now is not the time to float along with the Fed, but to fight it.”

Stock Market Crash of 2008

2011-08-05T11:14:00.000+07:00

Only time will tell the full story of the stock market crash of 2008, but on Monday October 6, the stock market would start a weeklong decline in which the Dow Jones Industrial Average would fall 1,874 points or 18.1%. While the exact cause of this crash may differ from those of 1929 and 1987, they share one common element - they all began in October.

In this article, we're going to provide a brief summary of the market movements between October 1, 2008 and October 10, 2008. We'll also discuss some of the events leading up to this market collapse. Finally, we're going to talk about human nature, and how investor reaction can often provide the fuel necessary for a volatile market.

October 2008 Stock Market Crash

Although history may state the actual market crash occurred on Monday, October 6, 2008, the market experienced eight consecutive trading days of negative movement starting on October 1, 2008. The table below shows the decline of the Dow Jones Industrial Average from October 1st through October 10th.

Date	DJIA Close	Point Change	% Change
1-Oct-08	10,831.07	(19.59)	-0.18%
2-Oct-08	10,482.85	(348.22)	-3.22%
3-Oct-08	10,325.38	(157.47)	-1.50%
6-Oct-08	9,955.50	(369.88)	-3.58%
7-Oct-08	9,447.11	(508.39)	-5.11%
8-Oct-08	9,258.10	(189.01)	-2.00%
9-Oct-08	8,579.19	(678.91)	-7.33%
10-Oct-08	8,451.19	(128.00)	-1.49%

During these eight trading days, the DJIA would drop a total of 2,399.47 points or 22.11%. The market would rebound sharply on Monday October 13, and rise 936.42 points, only to drop 733.08 points on Wednesday of that same week.

October was shaping up to be a volatile month, as investors began reacting to the worrisome credit market news that started back in March 2008.

The Credit Market Collapse

During the years preceding the credit market collapse, the sub-prime mortgage industry thrived. Individuals with poor credit were given access to loans they really couldn't afford. But as long as home prices were on the rise, these poor lending practices were simply ignored.

Lenders could afford to write bad loans as long as the homeowner's equity in their house outpaced their desire for new debt. If borrowers were to fail to pay back their loans, lenders could always foreclose on the home, since it was an asset with ever-increasing value.

The credit market's problems began when housing prices started to fall in 2007. Homeowners frequently found themselves with underwater loans. They owed lenders more than the home was worth. When faced with these facts, homeowners no longer feared the threat of foreclosure. Even more disturbing was the fact that some families abandoned their homes; choosing to start their lives anew elsewhere rather than worry about paying off their debts.

Bear Stearns' Collapse

As mortgage defaults started to rise, the national economy started to falter, and fear crept into the credit markets. Despite the efforts of the Federal Reserve, the destabilization of the credit market quickly spread to the national financial system. Lenders began to fear borrowers could no longer repay their loans.

Bear Stearns was the first investment bank to fall victim to this fear. Investors, as well as other financial institutions, began to worry that money borrowed by Bear Stearns would not be repaid, and they began pulling money back from Bear Stearns.

On March 13, 2008, Bear Stearns advised the Federal Reserve that its liquidity position had deteriorated, and that it would file for bankruptcy unless alternative sources of funds were made available. Two days later, Bear Stearns agreed to merge with JP Morgan Chase in a deal that wiped out 90% of Bear Stearns' market value.

Fannie Mae and Freddie Mac Fall

By the year 2008, the Federal National Mortgage Association (FNMA or Fannie Mae) and the Federal Home Loan Mortgage Corporation (FHLMC or Freddie Mac) either owned or guaranteed nearly $6 trillion in mortgage loans. With a mortgage crisis in the United States, these two corporations quickly began showing signs of financial distress.

On September 7, 2008, the governing authority over these two agencies, the Federal Housing Finance Agency, or FHFA, placed both Fannie Mae and Freddie Mac under their conservatorship. In addition, the U.S. Treasury department began supplying funds to help stabilize these companies, raising the national debt ceiling by $800 billion in the process.

Financial Instability Grows

On September 14, 2008, Bank of America agreed to acquire Merrill Lynch for $50 billion, as a second wave of volatility began in the financial community. On September 15, 2008, concerns over the ability of financial institutions to cover their exposure in both the sub-prime loan market as well as credit default swaps led to further market instability. That same day, Lehman Brothers would be forced to file for Chapter 11 bankruptcy protection.

On September 16, 2008, American International Group would fall victim to a liquidity crisis, as AIG's shares lost 95% of their value and the company reported a $13.2 billion loss in just the first six months of the year. By September 22, 2008, AIG was removed from the DJIA, replaced by Kraft Foods.

The Crash of 2008 Begins

Although the market arguably started its crash back on October 1, 2008, the Black Week began on October 6th and lasted five trading sessions. During that week, the Dow Jones Industrial Average would fall 1,874 points or 18.1%. In that same week, the S&P 500 would fall more than 20%.

After a brief uptick in mid-October, the market would begin a second decline later in that same month. On October 24th, the Dow would fall 312.30 points to 8,378.95. This was its lowest level since April 25, 2003. The S&P 500 would fall 31.24 to 876.77, its lowest level since April 11, 2003. Finally, the Nasdaq Composite would fall 51.88 points to 1,552.03, its lowest level since May 23, 2003.

Stock Market Sell-Offs

Many market theorists believe that stock market crashes feed on themselves. Once destabilization of the stock market occurs, this incident may be followed by a series of events that trigger an even larger decline in the market. One of these events has to do with investor fear, and the other has to do with stop losses.

Investor Fear and Market Losses

Investors may reach a "loss threshold" where they are unwilling to continue to risk additional losses. Unfortunately, selling stocks well into a bear market is a good way to lock in losses, and this type of panic selling often backfires as an effective strategy to combat such losses in a down market.

Stop Loss Orders

Investors can place stop loss orders in advance with brokers. These orders programmatically sell a security when it reaches a certain price. The intention of a stop loss order is to limit the potential decline of a security's value. During the onset of a market crash, stop loss orders can lead to a sell-off of stocks, and an even further decline in stock prices. As the market gets flooded with sell orders (from stop loss orders), the prices of the underlying stocks begin to drop rapidly as the supply of stocks overwhelms their demand.

Stock Market Crash Coming for Stocks by 09-2011

2011-08-01T11:44:00.000+07:00

The first quarter comes to a close today with major averages at or near multi-year highs. Expect “substantial” further gains for stocks before a “major top” occurs in late summer, says noted forecaster Harry Dent, founder of HS Dent and The Dent Method.

The good news, for those long, is Dent predicts the Dow will trade as high as 13,200 by mid-summer and the S&P 500 as high as 1430, or more-than 7% above current levels. The bad news is then we could see another “Major Crash“, Dent says, forecasting the Dow could trade as low as 3300 in a worst-case scenario. “Bubbles go back to where they started or a little lower,” he says. “The stock market bubble started at (Dow) 3800 in late 1994.”

While Dent predicts the Dow’s crash will play out over several years, he sees clear and present danger in gold, silver, oil and other commodities. “All investors should lighten up on or sell oil, silver, and gold as the U.S. dollar looks like it has bottomed and should rise ahead,” he writes in the March issue of HS Dent Forecast.

In the accompanying video, Dent further explains his thinking for why commodities will stumble ahead of stocks, which is the opposite of what happened in 2007-08. In sum, he believes efforts by global central bankers to fight inflation — with the notable exception of the Fed — will hurt growth in emerging markets as well as demand for many commodities.

As for the Fed, they are “checkmated,” Dent says, suggesting the Ben Bernanke & Co. are damned if they do QE3 — because the bond market will freak out — and damned if they don’t — because the economy and financial markets are so dependent on easy money.

Stay tuned for additional segments to hear Dent’s views on the economy, housing and the deflationary pressures detailed in his latest book The Great Depression Ahead, a bookend to his 1992 best-seller The Great Boom Ahead.

Indosiar Karya Media Tbk

2011-07-08T17:19:00.018+07:00

Weekly Commentary :

Date

Recommendation

Candlestick

5-Aug-11

SELL

Long Black Candlestick

29-Jul-11

SELL - IF

Bearish Harami

22-Jul-11

HOLD

Long White Candlestick

INDOSIAR KARYA MEDIA TBK ( IDKM.JK )

ABOUT

PT Indosiar Karya Media Tbk is an Indonesia-based company engaged in the provision of

television advertisement services in Jakarta. The Company provides administration, management and consultancy services. It is also engaged in trading of technical equipment, machinery and spare parts, as well as acting as a supplier, distributor, agency and representative of other companies in the domestic market and abroad. As of December 31, 2009, the Company’s subsidiaries were PT Indosiar Bandung, PT Indosiar Surabaya, PT Indosiar Medan, PT Indosiar Padang, PT Indosiar Pekanbaru, PT Indosiar Jambi, PT Indosiar Palembang, PT Indosiar Bengkulu, PT Indosiar Lampung, PT Indosiar Ambon, PT Indosiar Jayapura, PT Indosiar Dewata, PT Indosiar Manado, PT Indosiar Pontianak, PT Indosiar Semarang, PT Indosiar Balikpapan, PT Indosiar Lontara, PT Indosiar Banjarmasin, PT Indosiar Kupang, PT Indosiar Lintas Yogya, PT Indosiar Batam and PT Indosiar Pangkalpinang.

Analyst recommendations

Date

Price

Recommendation

% Change

8-Jul-11

950

BUY

Emiten IHSG

2011-07-02T10:14:00.003+07:00

Ticker	Description	Remark
AALI.JK	ASTRA AGRO LESTA ORD
ABBA.JK	MAHAKA MEDIA TBK ORD
ABMM.JK	ABM INVESTAMA
ACES.JK	ACE HARDWARE IND ORD
ADES.JK	AKASHA WIRA INT ORD
ADHI.JK	ADHI KARYA TBK ORD
ADMF.JK	ADIRA FINANCE ORD
ADMG.JK	POLYCHEM INDONES ORD
ADRO.JK	ADARO ENERGY TBK ORD
AGRO.JK	BANK AGRONIAGA ORD
AHAP.JK	AHAP TBK ORD
AISA.JK	TIGA PILAR SEJAH ORD
AKRA.JK	AKR CORPORINDO ORD
ALDO.JK	ALKINDO NARATAMA ORD
ALMI.JK	ALUMINDO LIGHT M ORD
AMAG.JK	AS MULTI ARTHA G ORD
AMFG.JK	ASAHIMAS FLAT GL ORD
AMRT.JK	SUMBER ALFARIA T ORD
ANTM.JK	ANEKA TAMBANG ORD
APIC.JK	PACIFIC STRATEGI ORD
APLI.JK	ASIAPLAST INDUST ORD
APLN.JK	AGUNG PODOMORO ORD
APOL.JK	ARPENI PRATAMA O ORD
ARNA.JK	ARWANA CITRAMULI ORD
ARTI.JK	RATU PRABU ENERG ORD
ASBI.JK	ASURANSI BINTANG ORD
ASDM.JK	AS DAYIN MITRA ORD
ASGR.JK	ASTRA GRAPHIA ORD
ASIA.JK	ASIA NATURAL RES ORD
ASII.JK	ASTRA INTL TBK
ASRI.JK	ALAM SUTERA REAL ORD
ATPK.JK	ATPK RESOURCES ORD
AUTO.JK	ASTRA OTOPARTS ORD
BABP.JK	BANK ICB BUMIPUT ORD
BACA.JK	BANK CAPITAL IND ORD
BAPA.JK	BEKASI ASRI PEMU ORD
BAYU.JK	BAYU BUANA ORD
BBCA.JK	BNK CENTRAL ASIA ORD
BBKP.JK	BANK BUKOPIN ORD
BBLD.JK	BUANA FINANCE ORD
BBNI.JK	BANK NEGARA INDO ORD
BBRI.JK	BANK RAKYAT INDO ORD
BBTN.JK	BANK TAB NEGARA ORD
BCAP.JK	BHAKTI CAPITAL ORD
BDMN.JK	BANK DANAMON ORD
BEKS.JK	BANK PUNDI ORD
BHIT.JK	BHAKTI INVESTAMA ORD
BIPI.JK	BENAKAT PETRO ORD
BIPP.JK	BHUWANATALA INDA ORD
BISI.JK	BISI INTERNATION ORD
BJBR.JK	BANK P JAWA BARA ORD
BKDP.JK	BUKIT DARMO PROP ORD
BKSL.JK	SENTUL CITY TBK ORD
BMRI.JK	BANK MANDIRI TBK ORD
BMTR.JK	GLOBAL MEDIACOM ORD
BNBA.JK	BANK BUMI ARTA ORD
BNBR.JK	BAKRIE BROTHERS ORD
BNGA.JK	BANK CIMB NIAGA ORD
BNII.JK	BK INTL INDONES ORD
BNLI.JK	BANK PERMATA TBK ORD
BORN.JK	BORNEO LUMBUNG ORD
BPFI.JK	BATAVIA PROSPER ORD
BRAM.JK	INDO KORDSA TBK ORD
BRAU.JK	BERAU COAL ENERG ORD
BRMS.JK	BUMI R MINERALS ORD
BRNA.JK	BERLINA ORD
BRPT.JK	BARITO PACIFIC ORD
BSDE.JK	BUMI SERPONG DAM ORD
BSIM.JK	BANK SINARMAS ORD
BTEK.JK	BUMI TEKNOKULTUR ORD
BTEL.JK	BAKRIE TELECOM ORD
BTON.JK	BETONJAYA MANUNG ORD
BTPN.JK	BANK TAB PENSIUN ORD
BUDI.JK	BUDI ACID JAYA ORD
BULL.JK	BUANA LISTYA TAM ORD
BUMI.JK	BUMI RESOURCES ORD
BUVA.JK	BUKIT ULUWATU ORD
BVIC.JK	BANK VICTORIA ORD
BWPT.JK	BW PLANTATION ORD
BYAN.JK	BAYAN RESOURCES ORD
CEKA.JK	CAHAYA KALBAR ORD
CFIN.JK	CLIPAN FINANCE ORD
CLPI.JK	COLORPAK INDONES ORD
CMNP.JK	CITRA MARGA NUSA ORD
CNKO.JK	EXPLOITASI ENERG ORD
CNTB.JK	CENTEX TBK SP PRF
COWL.JK	COWELL DEVELOPME ORD
CPIN.JK	CHAROEN PI ORD
CSAP.JK	CATUR SENTOSA AP ORD
CTRA.JK	CIPUTRA DEVELPM ORD
CTRP.JK	CIPUTRA PROPERTY ORD
CTRS.JK	CIPUTRA SURYA ORD
CTTH.JK	CITATAH INDUSTRY ORD
DART.JK	DUTA ANGGADA ORD
DEWA.JK	DARMA HENWA TBK ORD
DGIK.JK	DUTA GRAHA INDAH ORD
DILD.JK	INTILAND DEVELOP ORD
DKFT.JK	CENTRAL OMEGA RE ORD
DOID.JK	DELTA DUNIA MAKM ORD
DPNS.JK	DUTA PERTIWI NUS ORD
DSFI.JK	DHARMA SAMUDERA ORD
EKAD.JK	EKADHARMA INTERN ORD
ELSA.JK	ELNUSA ORD
ELTY.JK	BAKRIELAND DEVEL ORD
EMDE.JK	MEGAPOLITAN DEVE ORD
EMTK.JK	ELANG MAHKOTA TE ORD
ENRG.JK	ENERGI MEGA PERS ORD
EPMT.JK	ENSEVAL PUTERA M ORD
ESTI.JK	EVER SHINE TEXT ORD
ETWA.JK	ETERINDO WAHANA ORD
EXCL.JK	XL AXIATA ORD
FASW.JK	FAJAR SURYA WISE ORD
FISH.JK	FKS MULTI AGRO ORD
FORU.JK	FORTUNE INDONESI ORD
FPNI.JK	TITAN KIMIA NUSA ORD
FREN.JK	SMARTFREN TELECO ORD
GDST.JK	GUNAWAN DIANJAYA ORD
GEMA.JK	GEMA GRAHASARANA ORD
GEMS.JK	GOLDEN ENERGY MI ORD
GGRM.JK	GUDANG GARAM ORD
GIAA.JK	GARUDA INDONESIA ORD
GJTL.JK	GAJAH TUNGGAL ORD
GOLD.JK	GOLDEN RETAIL ORD
GPRA.JK	PERDANA GAPURAPR ORD
GREN.JK	EVERGREEN INVESC ORD
GSMF.JK	EQUITY DEVELOPME ORD
GTBO.JK	GARDA TUJUH BUAN ORD
GZCO.JK	GOZCO PLANTATION ORD
HADE.JK	HD CAPITAL ORD
HDFA.JK	HD FINANCE ORD
HEXA.JK	HEXINDO ADIPERKA ORD
HITS.JK	HUMPUSS INTERMOD ORD
HMSP.JK	HM SAMPOERNA ORD
HRUM.JK	HARUM ENERGY ORD
IATA.JK	IND AIR TRANSPOR ORD
ICBP.JK	INDOFOOD CBP ORD
IDKM.JK	INDOSIAR KARYA MEDIA TBK
IGAR.JK	CHAMPION PASIFIC ORD
IMAS.JK	INDOMOBIL SUKSES ORD
INAF.JK	INDOFARMA TBK ORD
INAI.JK	INDAL ALUMINIUM ORD
INCO.JK	INCO INDONESIA ORD
INDF.JK	INDOFOOD SUKSES ORD
INDR.JK	INDO RAMA ORD
INDS.JK	INDOSPRING ORD
INDY.JK	INDIKA ENERGY ORD
INKP.JK	INDAH KIAT PAPER ORD
INPC.JK	BANK ARTHA GRAHA ORD
INRU.JK	TOBA PULP LESTAR ORD
INTA.JK	INTRACO PENTA ORD
INTP.JK	INDOCEMENT ORD
INVS.JK	INOVISI INFRACOM ORD
IPOL.JK	INDOPOLY SWAKARS ORD
ISAT.JK	INDOSAT ORD
ITMG.JK	INDO TAMBANGRAYA ORD
JAWA.JK	J.A. WATTIE ORD
JIHD.JK	JKT INTL HOTEL ORD
JKON.JK	JAYA KONSTRUKSI ORD
JPFA.JK	JAPFA COMFEED ORD
JPRS.JK	JAYA PARI STEEL ORD
JSMR.JK	JASA MARGA ORD
JTPE.JK	JASUINDO TIGA PE ORD
KAEF.JK	KIMIA FARMA ORD
KARK.JK	DAYAINDO RESOURC ORD
KBLI.JK	KMI WIRE N CABLE ORD
KBLV.JK	FIRST MEDIA TBK ORD
KBRI.JK	KERTAS BASUKI RI ORD
KIAS.JK	KERAMIKA INDONES ORD
KIJA.JK	INDUSTRI JABABEK ORD
KKGI.JK	RESOURCE ALAM IN ORD
KLBF.JK	KALBE FARMA ORD
KOIN.JK	KOKOH INTI AREBA ORD
KPIG.JK	GLOBAL LAND DVLP ORD
KRAS.JK	KRAKATAU STEEL ORD
KREN.JK	KRESNA GRAHA SEK ORD
LAMI.JK	LAMICITRA NUSANT ORD
LCGP.JK	LAGUNA CIPTA GRI ORD
LMAS.JK	LIMAS CENTRIC IN ORD
LMPI.JK	LANGGENG MAKMUR ORD
LPCK.JK	LIPPO CIKARANG ORD
LPGI.JK	LIPPO GENERAL IN ORD
LPIN.JK	MULTI PRIMA SEJA ORD
LPKR.JK	LIPPO KARAWACI ORD
LPPS.JK	LIPPO SECURITIES ORD
LSIP.JK	LONDON SUMATRA ORD
LTLS.JK	LAUTAN LUAS ORD
MAIN.JK	MALINDO FEEDMILL ORD
MAMI.JK	MAS MURNI SB ORD
MAPI.JK	MITRA ADIPERKASA ORD
MASA.JK	MULTISTRADA ARAH ORD
MBSS.JK	MITRABAHTERA SEG ORD
MBTO.JK	MARTINA BERTO ORD
MDLN.JK	MODERN LAND ORD
MDRN.JK	MODERN INTERNASI ORD
MEDC.JK	MEDCO ENERGI INT ORD
META.JK	NUSANTARA INFRAS ORD
MFIN.JK	MANDALA MULTIFIN ORD
MFMI.JK	MULTIFILING MITR ORD
MICE.JK	MULTI INDOCITRA ORD
MIDI.JK	MIDI UTAMA ORD
MITI.JK	MITRA INVESTINDO ORD
MLIA.JK	MULIA INDUSTRIND ORD
MLPL.JK	MULTIPOLAR ORD
MNCN.JK	MEDIA NUSANTARA ORD
MPPA.JK	MATAHARI PUTRA ORD
MRAT.JK	MUSTIKA RATU ORD
MREI.JK	MAREIN ORD
MTDL.JK	METRODATA ELECT ORD
MTFN.JK	CAPITALINC INVES ORD
MTLA.JK	METROPOLITAN LAN ORD
MYOH.JK	MYOH TECHNOLOGY ORD
MYOR.JK	MAYORA INDAH ORD
MYRX.JK	HANSON INT SB ORD
MYRXP.JK	HANSON INT SP PRF
MYTX.JK	APAC CITRA CENTE ORD
NIKL.JK	PELAT TIMAH NUSA ORD
NIPS.JK	NIPRESS ORD
NISP.JK	BANK OCBC NISP ORD
OKAS.JK	ANCORA INDONESIA ORD
PANR.JK	PANORAMA SENTRA ORD
PANS.JK	PANIN SEKURITAS ORD
PBRX.JK	PAN BROTHERS TBK ORD
PGAS.JK	P GAS NEGARA TBK ORD
PICO.JK	PELANGI INDAH CA ORD
PJAA.JK	P JAYA ANCOL ORD
PKPK.JK	PERDANA KARYA PE ORD
PLAS.JK	POLARIS INVESTAM ORD
PLIN.JK	PLAZA INDONESIA ORD
PNBN.JK	BANK PANIN ORD
PNIN.JK	PANIN INSURANCE ORD
PNLF.JK	PANIN FINANCIAL ORD
POLY.JK	ASIA PACIFIC FIB ORD
PRAS.JK	PRIMA ALLOY ORD
PTBA.JK	TB BUKIT ASAM ORD
PTPP.JK	PP PERSERO ORD
PTRO.JK	PETROSEA ORD
PTSN.JK	SAT NUSAPERSADA ORD
PTSP.JK	PIONEERINDO GOUR ORD
PUDP.JK	PUDJIADI PRESTIG ORD
PWON.JK	PAKUWON JATI ORD
PYFA.JK	PYRIDAM FARMA ORD
RAJA.JK	RUKUN RAHARJA ORD
RALS.JK	RAMAYANA LESTARI ORD
RBMS.JK	RISTIA BINTANG M ORD
RICY.JK	RICKY PUTRA GLOB ORD
RIGS.JK	RIG TENDERS ORD
RIMO.JK	RIMO CATUR LESTA ORD
R-LQ45X.JK	LQ45X ETF
RMBA.JK	BENTOEL INT INVE ORD
RODA.JK	ROYAL OAK DEVELO ORD
ROTI.JK	NIPPON INDOSARI CORPINDO
RUIS.JK	RADIANT UTAMA IN ORD
SAIP.JK	SURABAYA AGUNG I ORD
SCMA.JK	SURYA CITRA MEDI ORD
SDMU.JK	SIDOMULYO SELARA ORD
SDPC.JK	MILLENNIUM P INT ORD
SDRA.JK	BANK HMP SAUDARA ORD
SGRO.JK	SAMPOERNA AGRO ORD
SHID.JK	HOTEL SAHID JAYA ORD
SIMP.JK	SALIM IVOMAS PRA ORD
SIPD.JK	SIERAD PRODUCE ORD
SMAR.JK	SMART TBK ORD
SMCB.JK	HOLCIM INDONESIA ORD
SMGR.JK	SEMEN GRESIK ORD
SMMA.JK	SINAR MAS MULTI ORD
SMRA.JK	SUMMARECON AGUNG ORD
SMRU.JK	SMR UTAMA ORD
SMSM.JK	SELAMAT SEMPURNA ORD
SONA.JK	SONA TOPAS TOUR ORD
SPMA.JK	SUPARMA ORD
SRAJ.JK	SEJAHTERARAYA AN ORD
SRSN.JK	INDO ACIDATAMA ORD
SSIA.JK	SURYA SEMESTA IN ORD
SSTM.JK	SUNSON TEXTILE M ORD
STAR.JK	STAR PETROCHEM ORD
SULI.JK	SUMALINDO LESTAR ORD
SUPR.JK	SOLUSI TUNAS PRA ORD
TBIG.JK	TOWER BERSAMA ORD
TBLA.JK	TUNAS B LAMPUNG ORD
TIFA.JK	TIFA FINANCE ORD
TINS.JK	TIMAH ORD
TIRT.JK	TIRTA MAHAKAM ORD
TKIM.JK	TJIWI KIMIA ORD
TLKM.JK	TELKOM INDONESIA ORD
TMPI.JK	AGIS ORD
TMPO.JK	TEMPO INTI MEDIA ORD
TOTL.JK	TOTAL BANGUN PSD ORD
TOWR.JK	SARANA MENARA ORD
TPIA.JK	CHANDRA ASRI PET ORD
TRAM.JK	TRADA MARITIME ORD
TRIL.JK	TRIWIRA INSANLES ORD
TRST.JK	TRIAS SENTOSA ORD
TRUB.JK	TRUBA ALAM M ENG ORD
TSPC.JK	TEMPO SCAN PAC ORD
TURI.JK	TUNAS RIDEAN ORD
ULTJ.JK	ULTRAJAYA ORD
UNIT.JK	NUSANTARA INTI C ORD
UNSP.JK	BAKRIE SUMATERA ORD
UNTR.JK	UTD TRACTORS ORD
UNVR.JK	UNILEVER INDON ORD
VIVA.JK	VISI MEDIA ASIA ORD
VOKS.JK	VOKSEL ELECTRIC ORD
VRNA.JK	VERENA MULTI FIN ORD
WEHA.JK	PANORAMA TRANSPO ORD
WICO.JK	WICAKSANA OVERSE ORD
WIKA.JK	WIJAYA KARYA ORD
WINS.JK	WINTERMAR OFFSHO ORD
WOMF.JK	WAHANA OTTOMITRA ORD
YPAS.JK	YANAPRIMA HASTAP ORD
YULE.JK	YULIE SEKURINDO ORD
ZBRA.JK	ZEBRA NUSANTARA ORD

Nippon Indosari Corpindo Tbk

2011-07-01T19:30:00.004+07:00

Weekly Commentary :

Date	Recommendation	Candlestick
5-Aug-11	SELL	Long Black Candlestick
29-Jul-11	SELL - IF	Bearish Harami
22-Jul-11	HOLD	White Opening Marubozu

PT Nippon Indosari Corpindo Tbk ( ROTI.JK )

ABOUT

PT Nippon Indosari Corpindo Tbk is an Indonesia-based company engaged in the production of bread. The Company is marketing its products under the brand names Sari Roti, Boti and Sari

Cake. The company has seven kinds of Sari Roti bread and 22 varieties of sweet bread. Its Sari Cake products are Chiffon Pandan, Chocolate Cup Cake and Pandan Cup Cake. The Company distributes its products in hypermakert, supermarket, minimarket and through traditional network in Jabodetabek, West Java, Yogyakarta, East Java, Lampung and Bali, Indonesia. The Company’s two factories are located in Cikarang and East Java, Indonesia.

Analyst recommendations:

Date	Price	Recommendation	% Change
01-Jul-11	2.700	BUY

Astra International Tbk

2011-06-24T19:47:00.006+07:00

Weekly Commentary :

Date	Recommendation	Candlestick
5-Aug-11	SELL	Long Black Candlestick
29-Jul-11	SELL - IF	Bearish Harami
22-Jul-11	HOLD	White Candlestick

PT Astra International Tbk
( ASII.JK )

ABOUT

PT Astra International Tbk is an Indonesia-based automotive manufacturer. It comprises five

business divisions: Automotive, Financial Services, Heavy Equipment and Mining, Agribusiness, and Information Technology (IT). The Company is engaged in an integrated automotive business with operations ranging from automotive and component manufacturing, distribution and after sales services throughout Indonesia, car rental, used car sales, consumer finance for automotive products, insurance and infrastructure. It has partnerships with several automotive entities, such as Toyota, Honda, Daihatsu, Isuzu, BMW, Peugeot, Lexus and Nissan Diesel.

Analyst recommendations:

Date	Price	Recommendation	% Change
24-Jun-11	58.300	BUY

Japfa Comfeed Indonesia Tbk

2011-05-06T19:32:00.003+07:00

Weekly Commentary :

Date

Recommendation

Candlestick

29-Jul-11

SELL

Black Candlestick

22-Jul-11

SELL IF

Bearish Dark Cloud Cover

15-Jul-11

HOLD

White Candlestick

PT Japfa Comfeed Indonesia Tbk ( JPFA.JK )

ABOUT

PT Japfa Comfeed Indonesia Tbk is an Indonesia-based agro-food company. The Company has eight divisions, namely animal feeds, which involves the production of animal feeds; commercial farm, which involves operation of farms and slaughter house; consumer products, which involves production of meat nuggets and beverages; aquaculture, which involves shrimp feed production and shrimp hatchery and farming; day old chick, which involves breeding of day old chicks; general trading, and others, which involves real estate, plantations and vaccine production. The Company’s manufacturing plants are located in East Java, West Java, South Sulawesi, West Sumatera and South Kalimantan, Indonesia.

Analyst recommendations:

Date	Price	Recommendation	% Change
06-May-11	3.600	BUY

Arwana Citramulia Tbk

2011-04-08T19:52:00.003+07:00

Weekly Commentary :

Date	Recommendation	Candlestick
15-Jul-11	SELL	Short Black Candlestick
8-Jul-11	SELL IF	Bearish Harami
1-Jul-11	HOLD	White Candlestick

PT Arwana Citramulia Tbk ( ARNA.JK )

ABOUT

PT Arwana Citramulia Tbk is an Indonesia-based company engaged in manufacturing and marketing of ceramic tiles. The Company's subsidiaries include PT Arwana Nuansakeramik, PT Sinar Karya Duta Abadi and PT Primagraha Keramindo, which are engaged in the manufacture and distribution of ceramic products. All products are sold under a brand name of Arwana Ceramic Tiles. The Company’s production facilities are located in Jatiuwung, Tangerang and Banten, Indonesia.

Analyst recommendations:

Date	Price	Recommendation	% Change
08-Apr-11	265	BUY

Polychem Indonesia Tbk

2011-03-25T17:35:00.010+07:00

Weekly Commentary :

Date

Recommendation

Candlestick

5-Aug-11

SELL

Long Black Candlestick

29-Jul-11

SELL - IF

Bearish Harami

22-Jul-11

HOLD

White Candlestick

PT Polychem Indonesia Tbk ( ADMG.JK )

ABOUT

PT Polychem Indonesia Tbk is an Indonesia-based manufacturing company. The Company manufactures polyester chips, polyester filaments, engineering plastic, engineering resin, ethylene glycol, polyester staple fiber and petrochemical. It also engaged in knitting, weaving and textile manufacturing, as well as fishing net yarn manufacturing. The ethylene glycol plants produce one main product, mono-ethylene glycol (MEG), and two by-products, di-ethylene glycol (DEG) and tri-ethylene glycol (TEG). The Company marketed its products domestically and internationally, including Asia, the United States, Europe, Australia and Africa. It subsidiaries include PT Filamendo Sakti, PT Sentra Sintetikajaya and GTPI Netherlands B.V.

Analyst recommendations

Date	Price	Recommendation	% Change
25-Mar-11	188	BUY

Charoen Pokphand Indonesia Tbk

2011-03-11T19:25:00.007+07:00

Weekly Commentary :

Date	Recommendation	Candlestick
29-Jul-11	HOLD	High Wave
22-Jul-11	HOLD	White Opening Marubozu
15-Jul-11	HOLD	Bearish Deliberation

PT Charoen Pokphand Indonesia Tbk ( CPIN.JK )

ABOUT

PT Charoen Pokphand Indonesia Tbk is an Indonesia-based manufacturer. The Company is engaged in the production of cattle, poultry, fish and shrimp feed, as well as processed chicken meat, poultry and other animal husbandry. The Company's subsidiaries include PT Charoen Pokphand Jaya Farm, which is a poultry farm company; PT Poly Packaging Industry, which is a plastic packaging manufacturer; PT Feprotama Pertiwi, which produces and distributes animal feed; PT Primafood International, which is a trading company, and PT Vista Grain, which produces and distributes animal feed. The Company has branch offices in Sidoarjo, Medan, Tangerang, Balaraja, Serang, Lampung, Semarang, Surabaya, Makassar and Denpasar.

Analyst recommendations:

Date	Price	Recommendation	% Change
11-Mar-11	1.500	BUY

Ciputra Development Tbk

2011-02-25T19:16:00.006+07:00

Weekly Commentary :

Date	Recommendation	Candlestick
29-Jul-11	HOLD	White Candlestick
22-Jul-11	HOLD	White Closing Marubozu
15-Jul-11	HOLD	White Candlestick

PT Ciputra Development Tbk ( CTRA.JK )

ABOUT

PT Ciputra Development Tbk is an Indonesia-based property and real estate company. It is engaged in the development, construction and sale of housing complexes, office buildings, commercial centers, industrial complexes and their supporting facilities, including restaurants, entertainment centers, golf courts and family clubs. Its residential and township projects include CitraGarden City, CitraRaya, CitraIndah, Bukit Palma, CitraHarmoni, CitraGarden, The Taman Dayu, Citra Grand City, CitraLand City, Citra BukitIndah and Citra I, II and V housing complexes in Jakarta, while its commercial properties include Ciputra Mall & Hotel, Somerset Grand Citra, Ciputra World and Ciputra Golf. The Company is a member of Ciputra Group.

Analyst recommendations:

Date	Price	Recommendation	% Change
25-Feb-11	295	BUY

Stock Market Crash of 1987

2010-10-19T10:54:00.001+07:00

Stock Market Crash of 1987

The Stock Market Crash of 1987 is a good follow-up to our article on the Stock Market Crash of 1929. Some historians argue that there were similarities between the two crashes, and we tend to agree. We also think that there were some distinct differences between the two crashes. That being said, let's take a look at what was happening in the stock market 25 years ago.

The Stock Market before October 1987

In the first half of 1987, the U.S. dollar experienced a steep decline in value relative to other world currencies. This made U.S. goods and services less expensive, and resulted in increased exports. The increase in exports provided U.S. companies with a strong earnings outlook, and the commensurate rise in stock market valuations.

In fact, most of 1987 was marked with one stock market record after the other. There had been a great deal of corporate restructuring in the years proceeding 1987, and American companies were promising strong future earnings growth. International investors also took notice of the improvements in the U.S. market outlook, and the rate of foreign investment doubled between 1986 and 1987, driving stock prices upward. By August, the Dow Jones Industrials was up over 800 points, which translated into a 41% rise in value.

In September 1987, the economic concerns over the weak dollar and rising interest rates started making investors nervous. Volatility in the market increased dramatically as both good and bad economic information was in the news. A record single day point gain for the Dow was set on September 22nd, only to be followed by the largest single day point loss on October 6th. During the three days of October 14th through 16th, the Dow fell over 260 points and the S&P 500 declined 10%. The volatility of the market created a great deal of anxiety over the weekend. Investors were left wondering what would happen on Monday.

October 19, 1987 - Black Monday

On Monday October 19, 1987, the stock market plummeted right from the opening bell. No one was looking to buy stocks that day, and the problems in the stock market soon spread to the futures market. The technology advances in the stock exchanges began to kick in, and these computerized systems accelerated the decline.

Program trading was a new tool, and was introduced to take advantage of rapid market movements. On Black Monday, program trading moved millions of shares, and clients as well as investment houses were left wondering what their actual market positions were like for most of the day.

Portfolio insurance professionals also contributed to the stock market crash of 1987 through their electronic trading systems. As these computerized systems analyzed the event of the days prior to Black Monday, they flooded the market with sell orders early on Monday.

Portfolio insurance and program trading were intended to help investors take advantage of short-term market fluctuations. Unfortunately, these two systems, along with a lack of investor confidence, drove the Dow Jones down 508 points. This was a 22% decline in value in just a single day. Investors in the stock market would lose over $500 billion on Black Monday.

What Caused the Stock Market Crash of 1987?

In the days between October 14 and October 19, 1987, major indexes of market valuation in the United States dropped 30 percent or more. On October 19, 1987, a date that subsequently became known as"Black Monday," the Dow Jones Industrial Average plummeted 508 points, losing 22.6% of its total value. The S&P 500 dropped 20.4%, falling from 282.7 to 225.06. This was the greatest loss Wall Street had ever suffered on a single day.1

According to Facts on File, an authoritative source of current-events information for professional research and education, the 1987 crash"marked the end of a five-year 'bull' market that had seen the Dow rise from 776 points in August 1982 to a high of 2,722.42 points in August 1987." Unlike what hapopened in 1929, however, the market rallied immediately after the crash, posting a record one-day gain of 102.27 the very next day and 186.64 points on Thursday October 22. It took only two years for the Dow to recover completely; by September of 1989, the market had regained all of the value it had lost in the '87 crash.2

Many feared that the crash would trigger a recession. Instead, the fallout from the crash turned out to be surprisingly small. This phenomenon was due, in part, to the intervention of the Federal Reserve. According to Facts on File,"The worst economic losses occurred on Wall Street itself, where 15,000 jobs were lost in the financial industry."3

A number of explanations have been offered as to the cause of the crash, although none may be said to have been the sole determinant. Among these are computer trading and derivative securities, illiquidity, trade and budget deficits, and overvaluation. Below we have quoted representative analyses.

CAUSE #1: DERIVATIVE SECURITIES

Bruce Bartlett, senior fellow with the National Center for Policy Analysis of Dallas, Texas:

Initial blame for the 1987 crash centered on the interplay between stock markets and index options and futures markets. In the former people buy actual shares of stock; in the latter they are only purchasing rights to buy or sell stocks at particular prices. Thus options and futures are known as derivatives, because their value derives from changes in stock prices even though no actual shares are owned. The Brady Commission [also known as the Presidential Task Force on Market Mechanisms, which was appointed to investigate the causes of the crash], concluded that the failure of stock markets and derivatives markets to operate in sync was the major factor behind the crash.

CAUSE #2: COMPUTER TRADING

In searching for the cause of the crash, many analysts blame the use of computer trading (also known as program trading) by large institutional investing companies. In program trading, computers were programmed to automatically order large stock trades when certain market trends prevailed. However, studies show that during the 1987 U.S. Crash, other stock markets which did not use program trading also crashed, some with losses even more severe than the U.S. market.

CAUSE #3: ILLIQUIDITY

During the Crash, trading mechanisms in financial markets were not able to deal with such a large flow of sell orders. Many common stocks in the New York Stock Exchange were not traded until late in the morning of October 19 because the specialists could not find enough buyers to purchase the amount of stocks that sellers wanted to get rid of at certain prices. As a result, trading was terminated in many listed stocks. This insufficient liquidity may have had a significant effect on the size of the price drop, since investors had overestimated the amount of liquidity. However, negative news to investors about the liquidity of stock, option and futures markets cannot explain why so many people decided to sell stock at the same time.

While structural problems within markets may have played a role in the magnitude of the market crash, they could not have caused it. That would require some action outside the market that caused traders to dramatically lower their estimates of stock market values. The main culprit here seems to have been legislation that passed the House Ways & Means Committee on October 15 eliminating the deductibility of interest on debt used for corporate takeovers.

Two economists from the Securities and Exchange Commission, Mark Mitchell and Jeffry Netter, published a study in 1989 concluding that the anti-takeover legislation did trigger the crash. They note that as the legislation began to move through Congress, the market reacted almost instantaneously to news of its progress. Between Tuesday, October 13, when the legislation was first introduced, and Friday, October 16, when the market closed for the weekend, stock prices fell more than 10 percent -- the largest 3-day drop in almost 50 years. In addition, those stocks that led the market downward were precisely those most affected by the legislation. [Ultimately, the legislation was stripped of the provisions that concerned the stock market before being enacted into law.]4

CAUSE #4: U.S. TRADE AND BUDGET DEFICITS

Bruce Bartlett:

Website, University of Melbourne:

Another important trigger in the market crash was the announcement of a large U.S. trade deficit on October 14, which led Treasury Secretary James Baker to suggest the need for a fall in the dollar on foreign exchange markets. Fears of a lower dollar led foreigners to pull out of dollar-denominated assets, causing a sharp rise in interest rates.

One belief is that the large trade and budget deficits during the third quarter of 1987 might have led investors into thinking that these deficits would cause a fall of the U.S. stocks compared with foreign securities (this was the largest U.S. trade deficit since 1960). However, if the large U.S. budget deficit was the cause, why did stock markets in other countries crash as well? Presumably if unexpected changes in the trade deficit were bad news for one country, it would be good news for its trading partner.

CAUSE #5: INVESTING IN BONDS AS AN ATTRACTIVE ALTERNATIVE

Long-term bond yields that had started 1987 at 7.6% climbed to approximately 10% [the summer before the crash]. This offered a lucrative alternative to stocks for investors looking for yield.

CAUSE #6: OVERVALUATION

Many analysts agree that stock prices were overvalued in September, 1987. Price/Earning ratio and Price/Dividend ratios were too high [Historically, the P/E ratio is about 15 to 1; in October 1987 the P/E for the S&P 500 had risen to about 20 to 1]. Does that imply that overvaluation caused the 1987 Crash? While these ratios were at historically high levels, similar Price/Earning and Price/Dividends values had been seen for most of the 1960-72 period. Since no crash happened during that period, we can assume that overvaluation did not trigger crashes every time.

THE LEGACY OF THE '87 CRASH

What the 1987 crash ultimately accomplished was to teach politicians that markets heed their words and actions carefully, reacting immediately when threatened. Thus the crash initiated a new era of market discipline on bad economic policy.

Dirgantara Eyes Big Share of MRO Market

2010-08-24T17:22:00.002+07:00

PT Dirgantara Indonesia said it wants 30 percent of the national market for aircraft maintenance, repair and overhaul (MRO) after it was appointed an authorized provider of spare parts and MRO service forRussian-made Sukhoi Superjets, says the state aerospace company ’s chief.

Dirgantara president director Budi Santoso said in Jakarta on Monday that the appointment would allow the Bandung-based airplane manufacturer to handle MRO bids for all variants of the Russian-made aircraft.

“Currently, we have secured just 5 percent of the MRO market share by servicing 100 aircraft per year, but with the appointment we hope we can increase our market share to 30 percent,” he said.

Private airline company PT Kartika Airlines, which recently signed a US$951 million contract to buy 30 Sukhoi Superjet 100 (SSJ-100) airplanes, will be Dirgantara’s first client for the maintenance of the Russian-made medium-overhaul passenger planes.

Budi said that Kartika had named Dirgantara to handle the MRO works for its new fleet of Superjets.

Financial Crash of 1929

2010-07-25T17:34:00.001+07:00

The economy had been growing robustly for most of the so-called Roaring Twenties. It was a technological golden age as innovations such as radio, automobiles, aviation, telephone and the power grid were deployed and adopted. Companies who had pioneered these advances, like Radio Corporation of America (RCA) and General Motors, saw their stocks soar. Financial corporations also did well as Wall Street bankers floated mutual fund companies (then known as investment trusts) like the Goldman Sachs Trading Corporation. Investors were infatuated with the returns available in the stock market especially with the use of leverage through margin debt. On August 24, 1921, the Dow Jones Industrial Average stood at a value of 63.9. By September 3, 1929, it had risen more than sixfold, touching 381.2. It would not regain this level for another twenty five years. By the summer of 1929, it was clear that the economy was contracting and the stock market went through a series of unsettling price declines. These declines fed investor anxiety and events soon came to a head on October 24 (known as Black Thursday) and October 29 (known as Black Tuesday).

On Black Tuesday, the Dow Jones Industrial Average fell 38 points to 260, a drop of 12.8%. The deluge of selling overwhelmed the ticker tape system that normally gave investors the current prices of their shares. Telephone lines and telegraphs were clogged and were unable to cope. This information vacuum only led to more fear and panic. The technology of the New Era, much celebrated by investors previously, now served to deepen their suffering.

Black Tuesday was a day of chaos. Forced to liquidate their stocks because of margin calls, overextended investors flooded the exchange with sell orders. The glamour stocks of the age saw their values plummet. Across the two days, the Dow Jones Industrial Average fell 23%.

By the end of the week of November 11, the index stood at 228, a cumulative drop of 40 percent from the September high. The markets rallied in succeeding months but it would be a false recovery that led unsuspecting investors into the worst economic crisis of modern times. The Dow Jones Industrial Average would lose 89% of its value before finally bottoming out in July 1932.

The Financial Panic of 1873

2010-07-24T17:27:00.002+07:00

The Panic of 1873 has been described as "the first truly international crisis." The optimism that had been driving booming stock prices in central Europe had reached a fever pitch, and fears of a bubble culminated in a panic in Vienna beginning in April 1873. The collapse of the Vienna Stock Exchange began on May 8, 1873 and continued until May 10, when the exchange was closed; when it was reopened three days later, the panic seemed to have faded, and appeared confined to Austria-Hungary. Financial panic arrived in America only months later on Black Thursday, September 18, 1873 after the failure of the banking house of Jay Cooke and Company over the Northern Pacific Railway. The Northern Pacific railway had been given 40 million acres of public land in the West and Jay Cooke sought $100,000,000 in capital for the company; the bank failed when the bond issue proved unsalable, and was shortly followed by several other major banks. The New York Stock Exchange closed for ten days on September 20.

The financial contagion then returned to Europe, provoking a second panic in Vienna and further failures in continental Europe before receding. France, which had been experiencing deflation in the years preceding the crash, was spared financial calamity for the moment, as was Britain.

Others have argued the depression was rooted in the 1870 Franco-Prussian War that hurt the French economy and, under the Treaty of Frankfurt (1871), forced that country to make large war reparations payments to Germany. The primary cause of the price depression in the United States was the tight monetary policy that the U.S. followed to get back to the gold standard after the Civil War. The U.S. was taking money out of circulation to achieve this goal, therefore, there was less available money to facilitate trade. Because of the monetary policy described above the price of silver started to fall causing considerable losses of asset values, however, by most accounts, after 1879 production was growing, thus further putting downward pressure on prices due to increased industrial productivity, trade and competition.

In America the speculative nature of financing due to both the greenback which was specie issued to pay for the US Civil War and rampant fraud in the building of the Union Pacific Railway up to 1869 culminated in the Credit Mobilier panic. Railway overbuilding and weak markets collapsed the bubble in 1873. Both the Union Pacific and the Northern Pacific lines were center in the collapse; another railway bubble was the UK railway mania.

Because of the Panic of 1873, governments depegged their currencies, to save money. The demonetization of silver by European and North American governments in the early 1870s was certainly a contributing factor. The Coinage Act of 1873 in America was met with great opposition by farmers and miners, as silver was seen as more of a monetary benefit to rural areas than to banks in big cities. In addition, there were Americans who advocated the continuance of government-issued fiat money (United States Notes) to avoid deflation and promote exports. The western US states were outraged--Nevada, Colorado, and Idaho were huge silver producers with productive mines, and for a few years mining abated. The resumption of the US government buying silver was enacted in 1890 with the Sherman Silver Purchase Act.

Monetarists believe that the 1873 depression was caused by shortages of gold that undermined the gold standard, and that the 1848 California Gold Rush, 1886 Witwatersrand Gold Rush in South Africa and the 1898-99 Klondike Gold Rush helped alleviate such crises. Other analyses have pointed to developmental surges (see Kondratiev wave), theorizing that the Second Industrial Revolution was causing large shifts in the economies of many states, imposing transition costs, which may also have played a role in causing the depression.

The most important event of President Grant's second term in office was the severe financial depression by which it was marked. The era of high prices and business activity which had followed the war yielded its legitimate effect in an abnormal growth of the spirit of speculation. The inevitable consequence followed. In 1873 came a financial crash that carried ruin far and wide throughout the country. It began on October 1, in the disastrous failure of the banking firm of Jay Cooke & Co., of Philadelphia, the financiers of the Northern Pacific Railroad. Failure after failure succeeded, panic spread through the whole community, and the country was thrown into a condition resembling that of 1837, but more disastrous from the fact that much greater wealth was affected. Years passed before business regained its normal proportions. A process of contraction set in, the natural change fron high war-prices to low peace-prices, and it was not till 1878 that the timidity of capital was fully overcome and business once more began to thrive.

Industry and trade had flourished beyond precedent during the first years after the war. The high protective tariff contributed its share to the general rush of enterprise. In 1873 railroad mileage had doubled itself since 1860, and this was a prolific cause of rash speculation. While business was expanding the currency was contracting. Paper money had depreciated, and the conditions foreboded a crash. The Jay Cooke firm stood at the head of the great banking concerns. This house had handled most of the government loans during the war, and as already stated, were financing the doubtful Northern Pacific scheme. When this firm broke, strong institutions tottered and thousands of people in every rank of life were stricken with absolute ruin or sufferings that were none the less poignant for being outside the category of direct financial failures. The blow was felt for years in impaired credit, pressure for payment of dues, the lowering of securities and general dread of even safe enterprises. United States bonds fell from five to ten per cent. Savings were exhausted and many banks went under. Labor felt the cruel stroke for long after in the shutting down of factories and the half-time employment. The country was in a state of alarm and disgust at the bitter consequences of questionable acts in Congress, by the Administration, and in the realm of finance, and its indignant resolve to change things for the better was expressed in the heated contest which replaced the Grant administration with that of President Hayes, in 1876.

Return to The Great Republic by the Master Historians (Vol 3)

IDX On The Road To 3.000

2010-07-13T11:49:00.002+07:00

We believe that the total solar eclipse (11/7) and new moon (12/7) will impact a market peak. Therefore, the Jakarta Composite Index (IDX) is possibly to continue advances to a higher level. From the pattern analysis, we see that IDX is moving in wave 5:5 since there was no an overlap section, and then its indicates a trend rather than a correction. The next high probability target of the IDX is around 3,020-3,060 on 14-15 Jul or 22 Jul 10, just 3 - 4 days from the total solar eclipse event, also Venus Trine Pluto on 14 July 10. This financial astrological event might lift the IDX to a better value.

Traders and investors could consider to buy finance, automotive, cement and consumer stocks. BUMI JK is also attractive with short-term target Rp2,150. Meanwhile BMRI JK has opportunity to reaches Rp6,500 then Rp6,750.

Have a good trading day.

Bakrie Group Deposits in Bank Capital Indonesia

2010-07-13T11:47:00.000+07:00

Indonesia Stock Exchange (IDX) will investigate cash and time deposits worth Rp9.07 trillion saved by Bakrie Group in PT Bank Capital Indonesia Tbk (BACA).

"We will invite Bank Capital and management of Bakrie Group in relation to Bakrie Group deposits in Bank Capital," said IDX Director Eddy Sugito said as reported by Detikfinance today.

In March 2010 financial statement, Bank Capital booked Rp3.75 trillion of total asset and managed third parties deposit and saving worth Rp2.69 trillion.

The fact is 7 publicly listed of Bakrie Group have put cash and time deposits worth Rp9.07 trillion in Bank Capital. The question is where is the remaining Rp6.38 trillion?

Based on March 2010 financial reports, each company under Bakrie Group has reported cash and time deposits in Bank Capital. Here is the detail:

PT Bakrie & Brothers Tbk (BNBR) has put time deposit worth Rp3.76 trillion in Bank Capital.

PT Bakrie Sumatera Plantations Tbk (UNSP) has put time deposit worth Rp3.50 trillion in Bank Capital.

PT Energi Mega Persada Tbk (ENRG) has put time deposit worth Rp1.14 trillion in Bank Capital.

PT Bakrie Telecom Tbk (BTEL) has also put cash and time deposit worth Rp255.95 billion in Bank Capital.

PT Bakrieland Development Tbk (ELTY) has put cash and time deposit worth Rp210.87 billion in Bank Capital.

PT Darma Henwa Tbk (DEWA) has put cash worth US$21.05 million in Bank Capital.

PT Bumi Resources Tbk (BUMI) has put cash of US$1.09 million in Bank Capital.

Bank Capital is owned by Danny Nugroho (21.70%), Mount-8 HoldGS offshore Ltd (19.86%), Inigo Investment Ltd (15.44%), Zen Gem Investment Ltd (14.34%), TFI (X)-TRA Ordinary I (11.86%), and public holders (16.80%).

Market Flat in Lead-up to Inflation Rate Announcement

2010-06-30T13:11:00.002+07:00

Summary. The Jakarta Composite Index (JCI) is most likely to remain flat in the 2,900-2,950 range in the lead-up to the inflation rate announcement. We also look forward to minor corrections that may appear over the next 1-2 days. We do not see a big threat from the inflation issue. Buy on weakness.

Inflation rate and market movements. Most Indonesian stocks did not make Analyst impressive gains yesterday. The market was flat on low volume. It is highly likely that the market is waiting for Indonesia’s inflation rate announcement on 1 July 10. As such, we expect the market to remain flat or to consolidate until that day.

Wave analysis of inflation rate. Based on historical data for 2009-10, the inflation rate moved in an impulsive wave downtrend rally until it hit the bottom in Dec 09, concluding as wave 5. We expect to see three wave corrections after the completion of wave 5. In fact, the inflation rate is making higher highs and higher lows, indicating a corrective rally or a new bull trend. We conclude that the inflation rate in Indonesia will tend to move stronger with a typical target rate of 5.7% (wave 3 or C) this year.

Negative correlation between JCI and inflation rate. We have found a negative correlation of 0.87 between JCI and Indonesia’s inflation rate between Jan 09 and Jun 10. Therefore, when the inflation rate rises, we expect a short- term correction in JCI. Buy on weakness.

The full moon impact on JCI. The full moon (26/6) impact remains strong. We will soon find support for blue chips in the wake of this event. Thus, traders should take advantage by buying blue chips when they are undergoing a correction.

Good short-term trading stocks. We see more opportunities in BUMI JK, ASII JK, BMRI JK, UNVR JK and INDF JK.

Summary: The IDX could move in an impulsive wave 3 of 5 with a potential target price of Rp3,020. It should not fall below 2,873, as is the typical characteristic of an impulsive wave 3. Buy on weakness.

Summary: Based on our observation, BMRI JK is moving in a potential broadening pattern. Currently, it is likely to be forming wave E. However, we believe Rp5,400 will act as a short-term support for short-term trading. Buy at Rp5,400 with protective stop loss at Rp5,200 and take profit target at Rp5,800. As an alternative trading plan, we could buy BMRI IJ when it breaks Rp6,100. This strategy assumes the continuation of the impulsive wave rally. Thus, Rp6,150 is our buying price with stop loss at Rp 5,800 and take profit target at Rp6,800.

The coming Great Inflation, real or imagined

2009-12-31T10:19:00.003+07:00

By: Pedro Nicolaci da Costa

A historic economic crisis has left Americans with plenty of things to worry about. But is inflation one of them? And is there a risk that fretting over higher prices may actually bring them about?

The answers to these questions will help define the timing of the Federal Reserve's pullback from an unprecedented level of monetary stimulus, deployed to combat the worst financial panic since the Great Depression.

In justifying its pledge to leave interest rates near zero for the foreseeable future, the Fed takes comfort in inflation expectations, which policymakers deem comfortably restrained.

On the surface, that appears true. The most recent Reuters/University of Michigan consumer survey showed a 0.2 percentage point decline in expected inflation one-year out, to 2.5 percent. Market-based barometers have fluttered higher, though not alarmingly so.

Yet beneath the weak economic backdrop keeping prices in check, economists and consumers are increasingly uneasy about the prospect of a continuous loss of purchasing power -- the very definition of inflation.

"We have the most potentially inflationary policy I have ever observed in a developed country," said Alan Meltzer, a Fed historian and professor of political economy at the Carnegie Mellon Tepper School of Business in Pittsburgh.

According to widely used economic models, the way consumers perceive the prospect of future inflation has clear implications for prices themselves. Once higher costs are taken for granted, they are more easily tolerated.

Several indicators are already hinting at that possibility.

The price of gold, often viewed as a hedge against inflation, has set record after record, peaking above $1,200 an ounce earlier this month before retreating to below $1,100. A recent JPMorgan survey of clients found that 61 percent expected U.S. inflation to be "above target" between 2011 and 2014.

Another consumer confidence survey, published by The Conference Board, showed Americans expect prices to climb a troubling 5.1 percent over the next 12 months.

And Google Trends, a websearch database, shows a sharp spike in the number of U.S. users looking up the word "hyperinflation" in late 2008 and early 2009.

"There is a real risk that inflation expectations will rise above a certain threshold that suggests a loss of credibility of the Fed," said Laurence Meyer, a former Fed governor now at Macroeconomic Advisers in Washington, DC.

MIND OVER MATTERS

That may seem surprising considering the world has faced a crippling financial crisis that many economists warned might lead to deflation. But it makes sense in the context of the extraordinary measures taken to halt the meltdown.

Experts who have studied bouts of inflation, most common in poor or developing countries, say the makings of an inflationary psychology are already in place in the United States. It begins, they say, when unfathomably large figures are bandied about as if they were mere change.

A cascading series of government bailouts certainly fits into that category. The Treasury spent nearly $800 billion on a stimulus package that has helped ease the pace of job losses but not yet begun to reverse them. The Fed committed to buy more than $1.7 trillion in Treasury and mortgage bonds and expanded credit in the banking system to over $2.2 trillion.

"There is an unprecedented amount of latent inflation represented by the $2 trillion monetary base," said Michael Pento, senior market strategist at Delta Global Advisors. "Unless the Fed can sell those holdings and raise interest rates in a timely manner, intractable inflation will be in our future."

ENTER THE SLACKERS

Another camp of economists say all the hand-wringing is overdone. They point to the labor market, in its worst shape since the 1980s, as a sure sign that the economy is sufficiently weak to keep price pressures at bay.

Japan provides the most obvious model for how such "slack" can affect prices. As bubbles popped in the housing and stock markets, the Japanese economy was stuck in a deflationary rut for the better part of two decades, despite heavy government spending.

During America's last run-in with inflation in the 1970s, wages were a key channel for price increases. Stronger unions meant workers could demand cost-of-living increases to keep up with the ever-rising consumer price index. With that dynamic largely absent today, say skeptics, inflation fears are misplaced.

So far, the hard figures corroborate their view. Consumer prices rose just 1.8 percent in the year through November, and were up 1.7 percent, excluding food and energy, well beneath the recent yearly average.

Such tame readings notwithstanding, anxiety about the longer-term outlook is rising and has been reinforced by the resilience of energy costs in the face of a global recession.

"We will emerge from the crisis with an excess money supply because, despite their independence, central bankers are still feeling the pressure from finance ministers to allow slightly higher inflation in order to be able to service large public debts more easily," said Jorg Kramer, chief economist at Commerzbank.

Source: REUTERS
Editing by: Padraic Cassidy

Wall St ends a tad higher; Dow, Nasdaq at '09 highs

2009-12-30T10:26:00.001+07:00

By: Caroline Valetkevitch
NEW YORK

U.S. stocks ended a smidgen higher in very light trading on Wednesday as a stronger-than-expected report on Midwest U.S. business activity was offset by investors taking profits in some of the year's better performers.
Still, the Dow and the Nasdaq eked out fresh highs for the year. The Standard & Poor's benchmark index is up 25 percent for 2009, putting it on track for its best year since 2003.

Most of the advance is the result of the nine-month rally the market has seen as investors turned bullish on prospects for the economic recovery. The S&P 500 is up a whopping 66.5 percent since its March 9 closing low.

On Wednesday, the Institute for Supply Management-Chicago business barometer surged to a four-year high, topping forecasts, on a recovery in employment and an acceleration in new orders.

DuPont (DD.N), a Dow component, gained 0.5 percent to close at $34.05 on the New York Stock Exchange.

On the down side, Microsoft Corp (MSFT.O), up 59.3 percent for the year, was among the biggest drags on both the Dow and the Nasdaq. The stock slipped 1.4 percent to $30.96 on Nasdaq.

"We've had such a nice run up over the last two weeks. I think the best-case scenario is probably baked into stock prices at this point," said Angel Mata, managing director of listed equity trading at Stifel Nicolaus Capital Markets in Baltimore.

Oracle Corp (ORCL.O), up 41 percent for 2009, was down 0.3 percent at $24.93.

In its run higher this year, the market has been underpinned by strength in the technology and materials sectors on expectations the economic recovery will spur capital spending and increase demand for natural resources. The S&P information technology sector .GSPT is up 62 percent since the start of the year, while the S&P materials index .GSPM is up 47 percent.

The Dow Jones industrial average .DJI rose 3.10 points, or 0.03 percent, to end at 10,548.51 on Wednesday. The Standard & Poor's 500 Index .SPX edged up just 0.22 of a point, or 0.02 percent, to finish at 1,126.42. The Nasdaq Composite Index .IXIC gained 2.88 points, or 0.13 percent, to close at 2,291.28.

Wednesday's tiny gains followed a modest decline in Tuesday's session, when stocks snapped a six-day streak of gains.

Investors appeared unfazed by a brief evacuation of the Nasdaq Times Square, New York, offices amid an investigation of a suspicious vehicle near its building. Nasdaq said trading was not affected.

While investors looked to the data for signs a recovery is taking hold, some traders have moved to safer assets like the dollar to lock in profits after a strong 2009.

The U.S. dollar hit a three-month high against the yen on year-end flows in thin trade and the belief that the U.S. economy is on the road to recovery.

Semiconductor stocks gained after Kaufman Bros upgraded both Marvell Technology Group Ltd (MRVL.O) and Nvidia Corp (NVDA.O) to "buy," saying they could benefit from improved demand for personal computers.

The Philadelphia Semiconductor index .SOXX gained 1.5 percent. Marvell added 2.8 percent to $20.83 and Nvidia shot up 3.6 percent to $18.67, both in Nasdaq trading.

On the New York Stock Exchange, only 644.39 million shares changed hands, well below last year's estimated daily average of 1.49 billion. On the Nasdaq, about 1.33 billion shares traded, also sharply below last year's daily average of 2.28 billion.

Declining stocks outnumbered advancing ones on the NYSE by a ratio of 8 to 7.

On the Nasdaq, the opposite trend prevailed, with 14 stocks rising for every 13 that fell.

Source: REUTERS
Additional reporting by: Ryan Vlastelica; Editing by Jan Paschal)

Behind the Great Stock Rally of 2009

2009-11-29T10:29:00.000+07:00

By Roben Farzad and Tara Kalwarski

"There may not be much to the rally beyond herd-like momentum, but that could keep the stock market going even into next year"

The U.S. economy is coping with alarmingly high double-digit unemployment, a widening commercial real estate bust, and over-indebted consumers. Few think the economic recovery now under way will be a spectacular one in 2010. So why has the stock market surprised skeptics by powering higher in recent weeks? One explanation being bandied about by equity strategists and portfolio managers is that the stock market may be in the midst of a momentum-driven trading phenomenon known as a "melt up" that has precious little to do with economic fundamentals.

A melt up is a rapid and mass rush by investors into an asset class after a belated realization by market players that worthwhile gains are to be had there. Part herd mentality, part self-fulfilling prophecy, this trading behavior is amplified by the age-old tendency of fund managers and retail investors to chase returns in the hopes of making up for lost time and lagging performance. The U.S. stock market is enjoying an explosive rally that has humbled plenty of bears, who have been predicting a deep correction for several months now. Instead, the Standard & Poor's 500-stock index has soared 63% since its Mar. 9 low and is up 22% for 2009.

Where's the Support?
That has left plenty of money pros rethinking their market outlook. "We've spent a considerable time of late assessing the conditions for a melt up," admits Bernie Schaeffer, chief executive of Schaeffer's Investment Research. He says he is baffled at how the market's rally this year has essentially been devoid of improved investor sentiment and big inflows into domestic equity funds. While bond funds have taken in nearly $330 billion so far this year, U.S. stock funds have lost almost $28 billion. A handful of big institutional investors and hedge funds, rather than retail investors, have been responsible for the lion's share of buying this year.

In fact, overall there is far greater investor enthusiasm for asset classes other than U.S. equities. Emerging markets, which have outperformed their American counterpart, are being deluged with fresh money. The red-hot junk bond market is also attracting heavy investor interest. Even gold coins are being hoarded as the yellow metal keeps breaking records.

Mom-and-pop investors in U.S. stocks, meanwhile, are only slightly less bearish than they were in March, when the market hit a 12½-year low. Yet that could change, given the impressive performance this year in the S&P 500 and Nasdaq Composite Index (NDAQ), up about 38% in 2009. "If 2010 starts out strong as well," says Schaeffer, "the fear of missing out on stock returns could prove irresistible." Not coincidentally, January happens to be high season for personal finance introspection—with outsized attention paid to the past year's performance column and the coming year's retirement account funding.

A bigger and more pronounced money shift into stocks early next year could be also induced by diminishing returns in many segments of the bond market. There is every indication that investors are scraping the bottom of the fixed-income barrel. Three-month Treasury bills, that redoubt of ultraliquidity and safety, are yielding just 0.03%. A negative yield, where people actually pay the government to safeguard their money, could be in the offing. On the other end of the curve, the 10-year Treasury note yields 3.3%, a rate that skeptics argue does not begin to buffer holders from the real risk of inflation a few years out.

The Federal Reserve doesn't just slash short-term interest rates to help banks; it does so to make sitting on cash painful enough to force investors back into the risk-reward economy. Which might not be that difficult an undertaking if there weren't so much idle cash out there—a remnant of last year's panic and subsequent spate of bank failures and bailouts, the likes of which made "return of money" outprioritize "return on money."

Pressure to Get into the Stock Market
After nearly touching $4 trillion in January, money fund assets were last clocked at $3.339 trillion, according to the Investment Company Institute. Barring another crisis, the hunt for yield will prompt more drawdowns from this sizable balance and perhaps shift more funds into stocks. "What I'm expecting is people being forced to get in," says Peter Grandich, a veteran investor newsletter editor. "The vast majority of money is managed by professionals who are gauged and measured on performance, a lot of which is judged by the quarter," he adds. "In 2008 people yelled at them for not getting them out; in 2009, people are getting yelled at for not getting in. The pressure to finally commit will be on, whether managers like it not."

Of course, melt ups—like so many trends that involve investor psychology and behavioral economics—are, by definition, almost always unpredictable. Who is to say that investors haven't been rendered so skittish by the repeated heartbreaks from U.S. stocks that they would make their bets on companies in China, Brazil, and beyond before getting reacquainted with Citigroup (C), General Electric (GE), and Microsoft (MSFT)? Or that the full-fledged return of the individual investor, should it come, to the Dow, S&P, and Nasdaq wouldn't actually be a red flag for the smart money to bail?

Indeed, the last time financial pros talked of the prospect of a melt up was in early 2007, when buyout shops were snapping up companies left and right and hedge funds were putting everything else in play. Money was cheap; risk seemed overrated. So much so, in fact, that the prevailing worry then was that investors would realize there simply wasn't enough stock to go around to accommodate the flood of buy orders that were supposed to prompt a renaissance for the American stock market. It all ended in tears, of course. Wall Street cratered and took the world economy down with it.

Few are predicting a reprise of the U.S. and global market collapse of 2008 that destroyed trillions in wealth around the world. Yet until this rally attracts a broader base of investors and is supported by robust economic fundamentals instead of short-term trading strategies, it is hard to see a multiyear bull market taking hold.

SOURCE: BUSINESSWEEK

BusinessWeek Senior Writer Farzad covers Wall Street and international finance. Kalwarski is Numbers department editor at BusinessWeek.

How Stock Market Works - A Jokes

2009-11-28T18:27:00.003+07:00

Once upon a time in a village in India, a man appeared and announced to the
villagers that he would buy monkeys at $10 each.

The villagers, seeing that there were many monkeys around, went into the
forest and started catching them. The man very gentlemanly bought thousands
of monkeys at $10 each,but as supply started to diminish, the villagers
slowed down and eventually stopped their efforts.

The man then announced that he would now buy at $20. This renewed the energy
and efforts of the villagers and they started catching monkeys again. Soon
the supply diminished even further, and people started going back to their
farms.

The offer was then increased to $25 each, but the supply of monkeys became
so little that it was a almost a miracle to even spot a monkey, let alone
catch one.

The man now announced that he would buy monkeys at $50 ! However, since he
had to go to the city on some business, his assistant would transact on his
behalf.

In the absence of the man, the assistant assembled the villagers and told
them : " Look at all these monkeys in the big cages that the man has
collected. I will sell them to you at $35 each, and when the man returns
from the city, you can in turn sell them to him at $50 each. Deal or no deal
? "

The excited villagers, smelling a quick-profit killer opportunity,
immediately rounded up all their savings and bought all the monkeys. Then
they never saw the man nor his assistant again, and there were just monkeys
everywhere!