WHAT a grim Monday it has turned out to be.
It has been raining almost non-stop since this morning and, in the markets, the haemorrhaging continues unabated.
The foul weather only adds to the dark mood which investors are experiencing, as they watch the value of their portfolios melt away.
This morning, the benchmark Straits Times Index sliced through the 1,500 support without attracting much buying interest.
As I write, STI has fallen to 1,473 – the intraday low touched on October 28 when global markets were suffering from a rout which was triggered by heavy hedge fund redemptions.
Stocks such as DBS, OCBC and United Overseas Bank have now fallen to levels last observed during the dark days of the Asian financial crisis over a decade ago.
My colleague, Lee Sushyan, reminded me that there was a form of torture in ancient China which describes the pain which investors are undergoing.
It is called “death by a thousand cuts” - a gruesome way to punish a prisoner convicted for high treason, by cutting him up slowly and making sure that he stays alive long enough to watch himself disintegrating.
But I still believe that sooner or later, the market rout must come to an end. Even in a bear market, stock prices don't move down in a straight line.
Many people, who don’t trade or normally buy stocks, have been asking me if they should be buying something, since prices have fallen to such depressed levels.
Some have even asked if they should buy Citigroup in the United States since it now costs little more than a buck. Even a bowl of wonton noodles costs twice as much.
I take this as a contrarian indicator that there are probably more people waiting to get into the market, than getting out.
But these are probably small players who can hold on to their purchases for years.
The big selling probably isn’t over yet.
HSBC Holdings in Hong Kong has fallen by 13 per cent today, as the deadline to its rights issue approaches on Thursday. It has lost one-third of its value since it launched a US$17.7 billion cash call a week ago.
One writer noted that HSBC had proudly rested on a golden triangle – Asia, Europe and the US – to generate the bulk of its profits.
But last year, the once golden triangle has become a Bermuda triangle for the bank, as it tried to navigate through the wide-spread destruction triggered by the sub-prime crisis in the United States.
As investors, we are facing our own Bermuda triangle. Besides HSBC, many other firms are launching their own cash-calls to protect themselves against the emerging slowdown in the global economy.
Are we throwing good money after bad? Whatever the answer, it may be too late for any of us to panic and jump ship now.