Going the Opposite

Economics teaches about Demand and Supply. When Demand is higher than Supply, price of goods goes up. When Demand is Lower than Supply, prices goes down.

Singapore went through years of economy downturn, starting with the Asian Financial Crisis to SARS. The economy recovered and experienced economical growth since 2006. The property price upheaval during the period of June to October/November 2007 saw huge profits for property investors. Investors became more affluent during this period.

With 2 years of high growth, people began to splurge on big ticket items, such as changing to better cars with higher engine capacity, etc. While many spent on such luxuries, I choose to go the opposite.

Going the opposite to me is, when the demand is high, when everybody else is spending on big ticket items, don't buy, don't spend. During good times, demand for goods, especially high ticket items, goes up. The increased demand will force prices of goods to go upwards and the main stream people tends to spend during this period.

During this time, I choose to invest my funds into some good vehicle that gives good yield. Years later, my original amount would have grown/multiply.

During bad times, demand naturally falls. The drop in demand will force price downwards. People runs out of funds, digs into savings, starts selling their high ticket items. This contribute to further price erossion. I will be spoilt for choice. With lesser money, I can buy the same item that people used to pay much more for.

When the economy faces a recession next time, I hope my investments now will give me enough funds to plough into bargin investments that will give even better yield later on.

Go the opposite.