So the gauntlet has been thrown down for the non-Malay leaders in Barisan Nasional to explain to their respective communities the necessity for having and supporting the New Economic Policy. Go ahead, explain in good details and as widely as possible. The people need to understand the policy fully.
You must be honourable in your political endeavour. You need to be transparent with the voters. Explain to them the NEP and tell them about your stand. If the voters believe in you and the NEP principles, they will vote for you. Don't keep the voters in the dark because you are afraid to lose votes.
As to whether the non-Malays accept the NEP now, the next general election will be the best test. If the non-Malay candidates win en masse, it testifies that the non-Malay communities support the NEP. However, if the non-Malay candidates fared badly, then the reverse must be true.
Tuesday, July 17, 2007
Thursday, July 12, 2007
People too must be responsible for their security
V K Chin's Comment in the Star on 12.7.07 said that JB people expect policeman to be guarding every street or even every house. This, I don't think is true.
The security situation in JB was quite bad untill recently. Snatching of handbags, extortion of valuables, break-ins and rapes are quite rampant. The first two crimes are conducted openly and in broad daylight. I was in a police station reporting a snatch thief case some time ago. In the same room, there were at least three other people making reports on snath thieves. Isn't that bad?
I don't think JB residents expect the town to be completely free of crimes. However, when you don't feel safe to walk in the streets in town in the day, then there is a problem. We only want the police to be more conspicious so that would be crimminals are deterred from committing their crimes. Don't let them think that this place is lawless. Reduce the incidences of crimes.
The other aspect the police has to work hard on is solving the crimes. Bring the criminals to book. One criminal booked is one less on the street. The efficiency in solving the cases will also be a deterrent to other bad hats.
Increase the police force so that these two objectives are met. As to the actual numbers needed, the top management of the force should know. Mr. Chin cannot be of any help here too.
Self help is a good idea. Rukun Tetangga was implemented in the early 80s. However, it was found to be not too effective. Only break-in cases were reduced. Also, there is a cost involved in the scheme. All employees were given a day off after their overnight duty. The cost involved must have been found to outweigh the benefits and the scheme was stopped after some time.
The police cannot be in a no-win situation. They must always be in a win-win position. Otherwise, the criminals will rule and it will be a sad day for the country. Any success by the police must be appreciated. But, there should not be a case of a medal for each crime solved. After all, it is their job to look after security.
The security situation in JB was quite bad untill recently. Snatching of handbags, extortion of valuables, break-ins and rapes are quite rampant. The first two crimes are conducted openly and in broad daylight. I was in a police station reporting a snatch thief case some time ago. In the same room, there were at least three other people making reports on snath thieves. Isn't that bad?
I don't think JB residents expect the town to be completely free of crimes. However, when you don't feel safe to walk in the streets in town in the day, then there is a problem. We only want the police to be more conspicious so that would be crimminals are deterred from committing their crimes. Don't let them think that this place is lawless. Reduce the incidences of crimes.
The other aspect the police has to work hard on is solving the crimes. Bring the criminals to book. One criminal booked is one less on the street. The efficiency in solving the cases will also be a deterrent to other bad hats.
Increase the police force so that these two objectives are met. As to the actual numbers needed, the top management of the force should know. Mr. Chin cannot be of any help here too.
Self help is a good idea. Rukun Tetangga was implemented in the early 80s. However, it was found to be not too effective. Only break-in cases were reduced. Also, there is a cost involved in the scheme. All employees were given a day off after their overnight duty. The cost involved must have been found to outweigh the benefits and the scheme was stopped after some time.
The police cannot be in a no-win situation. They must always be in a win-win position. Otherwise, the criminals will rule and it will be a sad day for the country. Any success by the police must be appreciated. But, there should not be a case of a medal for each crime solved. After all, it is their job to look after security.
Saturday, June 23, 2007
The mighty Yen
Don't be mislead by the weakening exchange rate of the Yen against the other major currencies into thinking that the Japanese economy is doing badly. On the contrary, the Japanese economy is on positive growth. The weak exchange rate is just an aberration caused by the exceptional low interest rate in Japan. At the current exchange, the Yen is very much undervalued.
The official lending rate in Japan is only 0.5% - the lowest among the major economies. There is a substantial interest rate differential between Japan and the other countries, especially New Zealand. This has encouraged huge outflow of funds in so called carry trades. Japanese are, in droves, using margin accounts to borrow Yen and place deposits in higher yielding foreign currencies. This has caused the higher yielding currencies like the Kiwi and Aussie dollars to rise.
Hedge funds have also been borrowing Yen to invest in higher yielding assets like Chinese stocks. The unwinding of the carry trade on Chinese stocks was blamed for nearly causing a global market meltdown in late Febraury this year.
The Japanese government is expected to raise interest rates later this year. What happens when the local interest rate is deemed high enough and the Japanese start to unwind their carry trades. Will it cause a tremor in the global financial market. Lets hope that this unwinding will be done gradually and hence not cause too much of a ripple in the market.
The official lending rate in Japan is only 0.5% - the lowest among the major economies. There is a substantial interest rate differential between Japan and the other countries, especially New Zealand. This has encouraged huge outflow of funds in so called carry trades. Japanese are, in droves, using margin accounts to borrow Yen and place deposits in higher yielding foreign currencies. This has caused the higher yielding currencies like the Kiwi and Aussie dollars to rise.
Hedge funds have also been borrowing Yen to invest in higher yielding assets like Chinese stocks. The unwinding of the carry trade on Chinese stocks was blamed for nearly causing a global market meltdown in late Febraury this year.
The Japanese government is expected to raise interest rates later this year. What happens when the local interest rate is deemed high enough and the Japanese start to unwind their carry trades. Will it cause a tremor in the global financial market. Lets hope that this unwinding will be done gradually and hence not cause too much of a ripple in the market.
Friday, June 15, 2007
Makes no economic sense
This is one strange incidence where the government wants the manufacturer / retailer to increase the price of the good. Yes, I am talking about cigarettes. It is as though the cigarette companies are not making enough money.
The logic for the action is not very convincing. If the tax on a pack of 20 is RM3 and the companies are selling them at RM3.50 or RM3.80, very good. And if you want to set a minimum price of RM5 to discourage smoking, then just increase the tax to say RM4.50 per pack. Why force the tobacco firms to make extra profits.
The extra tax collected could definitely be put to good use. Public health services could surely use more funding.
If setting the minimum price of cigarettes too high would encourage smuggling, then you just have to tackle the smuggling problem. Beef up your anti-smuggling units and impose heavier penalty on those caught smuggling. You can't say you wouldn't increase the price of cigarettes because you are scared of the smugglers.
The logic for the action is not very convincing. If the tax on a pack of 20 is RM3 and the companies are selling them at RM3.50 or RM3.80, very good. And if you want to set a minimum price of RM5 to discourage smoking, then just increase the tax to say RM4.50 per pack. Why force the tobacco firms to make extra profits.
The extra tax collected could definitely be put to good use. Public health services could surely use more funding.
If setting the minimum price of cigarettes too high would encourage smuggling, then you just have to tackle the smuggling problem. Beef up your anti-smuggling units and impose heavier penalty on those caught smuggling. You can't say you wouldn't increase the price of cigarettes because you are scared of the smugglers.
Wednesday, June 6, 2007
Time to run?
I suppose the smart money (foreign funds) is getting out of the KL market now. This is evidenced by two occurences.
One. The Ringgit is losing ground to the US dallar. It was trading at RM 3.18 to 1 USD late last month. Now it is close to RM3.42 to 1 USD. This could be due to foreign funds liquidating their stocks and converting their Ringgit to US dallars and transferring their USD out.
Two. The premium on the foreign tranche of shares on the Bursa is shrinking. Misc-F is trading at par with the local shares now. The premium on PBbank-F is only about 30 sen. This points to more selling than buying by foreigners.
One. The Ringgit is losing ground to the US dallar. It was trading at RM 3.18 to 1 USD late last month. Now it is close to RM3.42 to 1 USD. This could be due to foreign funds liquidating their stocks and converting their Ringgit to US dallars and transferring their USD out.
Two. The premium on the foreign tranche of shares on the Bursa is shrinking. Misc-F is trading at par with the local shares now. The premium on PBbank-F is only about 30 sen. This points to more selling than buying by foreigners.
Monday, June 4, 2007
Greed
Greed is a dirty word. In fact, it is slanted on the evil side.
Greed is what brought an ex prime minister into exile. Greed is what made the China stock market bubble and its subsequent collapse. It is the emotive force that drives rogue lawyers to run away with their client's money. It is what causes CEOs to engineer their company's accounts.
Then again, we live in a very materialistic world. Success is in part measured by the material possessions one holds. Thus, we are tempted to be greedy. The only difference is the degree you embraces greed. I suppose the extend of your greediness defines the standard you live your life.
Greed is what brought an ex prime minister into exile. Greed is what made the China stock market bubble and its subsequent collapse. It is the emotive force that drives rogue lawyers to run away with their client's money. It is what causes CEOs to engineer their company's accounts.
Then again, we live in a very materialistic world. Success is in part measured by the material possessions one holds. Thus, we are tempted to be greedy. The only difference is the degree you embraces greed. I suppose the extend of your greediness defines the standard you live your life.
Wednesday, May 30, 2007
The Transmile saga
The extend of the overreporting of the revenue for Transmile shocked many. What is worst is that the overreporting is not only for the accounts of financial year 2006 but also for 2005.
Its external auditors were suspicious of revenues of about RM300 millions (prorated for 18 of the 20 companies whose receivables were in doubt) for 2006. However, they (whether the same company or not I don't know) certified the accounts for 2005. It is now discovered that there was probably an overstatement of revenue of RM197 millions for 2005. So, how did they miss a doubtful revenue of close to RM200 millions?
This brings me to the next question. Are there any more 'Transmiles' out there? There were many companies on Bursa which recorded very good growths during the last few years. Were their CEOs all honest? Did their auditors all do a good job and not miss out on doubtful figures? This, only time will tell.
Its external auditors were suspicious of revenues of about RM300 millions (prorated for 18 of the 20 companies whose receivables were in doubt) for 2006. However, they (whether the same company or not I don't know) certified the accounts for 2005. It is now discovered that there was probably an overstatement of revenue of RM197 millions for 2005. So, how did they miss a doubtful revenue of close to RM200 millions?
This brings me to the next question. Are there any more 'Transmiles' out there? There were many companies on Bursa which recorded very good growths during the last few years. Were their CEOs all honest? Did their auditors all do a good job and not miss out on doubtful figures? This, only time will tell.
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