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Tuesday 7 October 2008
Singapore Investor Oei Predicts Financial Crisis Will Worsen
Oei Hong Leong, the Singapore investor who made S$7 million ($4.8 million) from trading American International Group Inc. shares last month, said the credit crisis will worsen as Europe’s financial institutions falter. PDF
Singapore Investor Oei Predicts Financial Crisis Will Worsen
By Chen Shiyin 7 October 2008
(Bloomberg) – Oei Hong Leong, the Singapore investor who made S$7 million ($4.8 million) from trading American International Group Inc. shares last month, said the credit crisis will worsen as Europe’s financial institutions falter.
The U.S. Treasury’s $700 billion bailout plan for banks won’t be enough to restore confidence in global financial markets, Oei said at an event in which he donated the profit from the AIG stock to the National University of Singapore’s Lee Kuan Yew School of Public Policy. European governments, who pledged this week to restore confidence, may also fall short of funds, he said.
A global rout in equities yesterday erased about $2.2 trillion in value after the German government was forced to bail out Hypo Real Estate Holding AG and Fortis was broken up. Europe’s largest finance companies have posted write-down and credit losses of $227.5 billion, more than a third of the $586 billion incurred worldwide, according to Bloomberg data.
“The situation is getting worse,” said Oei, who was ranked 27th in the list compiled by Forbes magazine of Singapore’s 40 richest people this year, with an estimated fortune of $210 million. “You’ve got $5 trillion of assets that’s going to be de-leveraged. The $700 billion is far from enough.”
Oei bought AIG shares on Sept. 16 for $1.80 each, betting the U.S. government wouldn’t allow the insurer to fail, the Straits Times reported on Sept. 25. He sold the stock on Sept. 22 at $5 apiece after the federal government helped avert a collapse with an $85 billion loan, the Singapore-based newspaper said.
“At that time, I thought American institutions like AIG were too big to fail,” Oei said. “Today, it’s worse. The European banks are too big to be saved.”
AIG, once the world’s largest insurer, has plunged 93 percent in New York trading this year. The company said Oct. 3 it will sell its life insurance and retirement operations in the U.S., Europe, Latin America and Japan to repay the loan.
The Lee Kuan Yew school will start an endowment fund and offer scholarships for students from China, said Kishore Mahbubani, the school’s dean.
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Singapore Investor Oei Predicts Financial Crisis Will Worsen
By Chen Shiyin
7 October 2008
(Bloomberg) – Oei Hong Leong, the Singapore investor who made S$7 million ($4.8 million) from trading American International Group Inc. shares last month, said the credit crisis will worsen as Europe’s financial institutions falter.
The U.S. Treasury’s $700 billion bailout plan for banks won’t be enough to restore confidence in global financial markets, Oei said at an event in which he donated the profit from the AIG stock to the National University of Singapore’s Lee Kuan Yew School of Public Policy. European governments, who pledged this week to restore confidence, may also fall short of funds, he said.
A global rout in equities yesterday erased about $2.2 trillion in value after the German government was forced to bail out Hypo Real Estate Holding AG and Fortis was broken up. Europe’s largest finance companies have posted write-down and credit losses of $227.5 billion, more than a third of the $586 billion incurred worldwide, according to Bloomberg data.
“The situation is getting worse,” said Oei, who was ranked 27th in the list compiled by Forbes magazine of Singapore’s 40 richest people this year, with an estimated fortune of $210 million. “You’ve got $5 trillion of assets that’s going to be de-leveraged. The $700 billion is far from enough.”
Oei bought AIG shares on Sept. 16 for $1.80 each, betting the U.S. government wouldn’t allow the insurer to fail, the Straits Times reported on Sept. 25. He sold the stock on Sept. 22 at $5 apiece after the federal government helped avert a collapse with an $85 billion loan, the Singapore-based newspaper said.
“At that time, I thought American institutions like AIG were too big to fail,” Oei said. “Today, it’s worse. The European banks are too big to be saved.”
AIG, once the world’s largest insurer, has plunged 93 percent in New York trading this year. The company said Oct. 3 it will sell its life insurance and retirement operations in the U.S., Europe, Latin America and Japan to repay the loan.
The Lee Kuan Yew school will start an endowment fund and offer scholarships for students from China, said Kishore Mahbubani, the school’s dean.
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