Most Popular
1. It’s a New Macro, the Gold Market Knows It, But Dead Men Walking Do Not (yet)- Gary_Tanashian
2.Stock Market Presidential Election Cycle Seasonal Trend Analysis - Nadeem_Walayat
3. Bitcoin S&P Pattern - Nadeem_Walayat
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
4.U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - Raymond_Matison
5. How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - Nadeem_Walayat
7.Bitcoin Gravy Train Trend Forecast 2024 - - Nadeem_Walayat
8.The Bond Trade and Interest Rates - Nadeem_Walayat
9.It’s Easy to Scream Stocks Bubble! - Stephen_McBride
10.Fed’s Next Intertest Rate Move might not align with popular consensus - Richard_Mills
Last 7 days
Nvidia Numero Uno in Count Down to President Donald Pump Election Victory - 5th Nov 24
Trump or Harris - Who Wins US Presidential Election 2024 Forecast Prediction - 5th Nov 24
Stock Market Brief in Count Down to US Election Result 2024 - 3rd Nov 24
Gold Stocks’ Winter Rally 2024 - 3rd Nov 24
Why Countdown to U.S. Recession is Underway - 3rd Nov 24
Stock Market Trend Forecast to Jan 2025 - 2nd Nov 24
President Donald PUMP Forecast to Win US Presidential Election 2024 - 1st Nov 24
At These Levels, Buying Silver Is Like Getting It At $5 In 2003 - 28th Oct 24
Nvidia Numero Uno Selling Shovels in the AI Gold Rush - 28th Oct 24
The Future of Online Casinos - 28th Oct 24
Panic in the Air As Stock Market Correction Delivers Deep Opps in AI Tech Stocks - 27th Oct 24
Stocks, Bitcoin, Crypto's Counting Down to President Donald Pump! - 27th Oct 24
UK Budget 2024 - What to do Before 30th Oct - Pensions and ISA's - 27th Oct 24
7 Days of Crypto Opportunities Starts NOW - 27th Oct 24
The Power Law in Venture Capital: How Visionary Investors Like Yuri Milner Have Shaped the Future - 27th Oct 24
This Points To Significantly Higher Silver Prices - 27th Oct 24
US House Prices Trend Forecast 2024 to 2026 - 11th Oct 24
US Housing Market Analysis - Immigration Drives House Prices Higher - 30th Sep 24
Stock Market October Correction - 30th Sep 24
The Folly of Tariffs and Trade Wars - 30th Sep 24
Gold: 5 principles to help you stay ahead of price turns - 30th Sep 24
The Everything Rally will Spark multi year Bull Market - 30th Sep 24
US FIXED MORTGAGES LIMITING SUPPLY - 23rd Sep 24
US Housing Market Free Equity - 23rd Sep 24
US Rate Cut FOMO In Stock Market Correction Window - 22nd Sep 24
US State Demographics - 22nd Sep 24
Gold and Silver Shine as the Fed Cuts Rates: What’s Next? - 22nd Sep 24
Stock Market Sentiment Speaks:Nothing Can Topple This Market - 22nd Sep 24
US Population Growth Rate - 17th Sep 24
Are Stocks Overheating? - 17th Sep 24
Sentiment Speaks: Silver Is At A Major Turning Point - 17th Sep 24
If The Stock Market Turn Quickly, How Bad Can Things Get? - 17th Sep 24
IMMIGRATION DRIVES HOUSE PRICES HIGHER - 12th Sep 24
Global Debt Bubble - 12th Sep 24
Gold’s Outlook CPI Data - 12th Sep 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Investing in Malaysia and my take on the Stock Market Falls

Stock-Markets / Emerging Markets Mar 15, 2007 - 09:03 AM GMT

By: Money_and_Markets

Stock-Markets

I'm writing to you from the 33rd floor of the Kuala Lumpur Hilton, in the capital and largest city of Malaysia. One of three main Malaysian territories, metropolitan Kuala Lumpur is home to 6.9 million of Malaysia's 26.6 million citizens.

I've been here in the city, which locals call “KL,” for three days. Let me sum up what I've observed: KL, and Malaysia in general, are hotter than hot! And I don't mean just the weather, which is 97 degrees and humid. I'm talking about the country's economy.

Chic, vibrant, youthful, exciting, buzzing — those are just some of the words I'd use to describe the scene here. Like other Asian cities, KL is a melting pot. There are people of original Malay descent, along with Chinese, Indians, and other indigenous ethnic backgrounds.


Islam is the predominant religion in Malaysia.. As I walked around the city, I saw devout Muslims chatting on their cell phones, working wirelessly on their laptops, and shopping for luxury Western goods in droves. From Louis Vuitton to Harry Winston Jewelers, the luxury shops of the famous Golden Triangle shopping area in KL are jam-packed seven days a week.

Another thing that really caught my attention: Almost everyone here speaks English, largely due to the British occupation from 1795 to 1957, after which the independent Malaysia was formed. This widespread use of English is a huge plus, especially when you put it into the context of economic growth.

The country's largest industry is manufacturing, which accounts for 30.7% of the economy. Malaysia boasts booming auto manufacturing businesses, vibrant furniture factories, and thriving electronics and semiconductor chip makers.

Tin and base metals account for another 15% of the economy, and the country's financial services industry now comprises another 16%. Other important areas are agriculture (palm oil and rubber), trade, construction, and tourism.

Malaysia's economy expanded at a very healthy 5.9% last year, more than twice as fast as the U.S. economy. With only $39 billion in gross domestic product, the country is tiny by comparison, but its GDP looks set to keep soaring in the years ahead. Foreign direct investment in Malaysia is also exploding higher, reaching a record $5.7 billion in 2006, up more than 12% from 2005.

Why Malaysia Will Be One
Of the Fastest-Growing Islamic
Economies in the World

Malaysia clearly has an economic advantage because of its vast natural resources in agriculture, mining, and oil. It also has strong roots in British law and that large English-speaking population that I mentioned.

But Malaysia has another unique advantage that I believe will help push its economy ahead at solid growth rates for several more years: It is home to the largest Islamic capital markets in the world!

The Malaysian government has always been sensitive to the Islamic religion, and, unlike many other Muslim countries, it has kept the religion's principals in mind when it comes to monetary matters.

Case in point: Malaysia is the first Islamic country to have its own Islam-based stock exchange, the Bursa Malaysia Berhad. This subset of the country's main stock market was launched on March 18, 2005.

The exchange lists equities, derivatives, and offshore markets — but only those that adhere to Islamic tenets. For example, companies cannot actively seek revenues from interest income, gambling, life insurance, tobacco, or alcohol.

In short, Malaysia has done what no other country has done — accommodated the tenets of Islamic law in its economy and its stock market by setting up separate listings. These companies allow the devout to invest with a conscience and help foster the Islamic economy.

This Malaysian system wouldn't work in many other areas of the world. But it gives tens of millions of Muslim investors a unique solution to today's rapidly changing financial markets.

There are over 1.5 billion Muslims in the world today, representing 24% of the world's population. Key developments like Malaysia's Bursa Berhad help to bring them into modern society while addressing their religious needs.

My view: Malaysia's economy is poised for loads more growth in the years ahead. Its stock markets have recently pulled back, and now look very attractive to me.

Meanwhile ...

My Signals for U.S. Markets Remain In Sell Mode!

Please don't get me wrong ... I love the U.S. But I'm also a realist, and today's economic growth is not going to be found in the States.

Indeed, as I noted two weeks ago, the U.S. economy seems headed for a recession. It's been floating on a magic carpet ride for the past three years, via artificially low interest rates, strong real estate prices, and blind optimism.

I also told you that my indicators strongly suggested a Dow close below 12,242 — which we got on February 27 — would be an important sell signal, indicating the potential for further sharp declines in many U.S. stocks.

We saw another wave of selling on Tuesday, but I don't think that's the worst of it. Don't be complacent! I fully expect that there are more waves of selling ahead. I continue to like many natural resource stocks, but many other U.S.-based companies look vulnerable to additional sharp declines.

Best wishes,

By Larry Edelson

P.S. Continue following my recommendations in Real Wealth Report . If you're not yet a subscriber, you can join now and get a one year subscription for just $99 . The important March issue goes to press this Friday. Get on board for a full update on why I think you must own gold!

This investment news is brought to you by Money and Markets. Money and Markets is a free daily investment newsletter from Martin D. Weiss and Weiss Research analysts offering the latest investing news and financial insights for the stock market, including tips and advice on investing in gold, energy and oil. Dr. Weiss is a leader in the fields of investing, interest rates, financial safety and economic forecasting. To view archives or subscribe, visit http://www.MoneyandMarkets.com


© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Comments

Graham
12 Jul 09, 11:15
Malaysian bursa

Larry, not sure whether the Malaysian bursa runs on such strict Islamic lines as you suggest. Guinness Anchor Berhad & Carlsberg Brewery Malaysia Berhad are both listed beer businesses in Malaysia.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in