GDP 2009 -1.7% ; OPR At 2.25%

GDP
The Najib administration recently announced the 2009 GDP figure of -1.7% . As with most Malaysians I am surprised with this better number. Achieving such a good 4th quarter number is applaudable.


OPR
On March 4 Bank Negara Malaysia decided to increase the OPR rate to 2.25% thus the floor rate is 2% and the ceiling rate is now 2.5%. It is my view that this increase is too soon and too much. A 10 basis increase is more agreeable.


FUEL SUBSIDY SCHEME

The Najib administration was taking the right step to do away the new fuel subsidy scheme. Since everybody wants to be subsidized whether rich or poor,action taken by Najib is acceptable for time being. BUT I still prefer the Pak Lah's way of giving cash money to car owners.


NISSAN RECALL

While Mr Akio Toyoda has answered to the congress,Nissan has also taken the steps to recall millions of cars in the US. The question I'm asking is what was wrong with those car manufacturers? Now that even GM has to make some recalls, the question asked is are those car manufacturers nuts in making unsafe cars? To all car makers - Please make good and safe automobiles.

The outlook of the auto industry is at stake if this trend continues....................

Thaipusam, Speculators, Toyota $ Honda and Fuel Subsidy.

THAIPUSAM

Hindus in Malaysia celebrate Thaipusam this week end. This is the festival where Hindus redeem their sins for the past year.

1997 Currency Crisis

Some people ask me if I really learned Finance instead of Engineering why I did not write something about the 97 crisis. I will write about the speculators etc one day provided I meet two persons I dearly missed,one an Asian women who hailed from Johor and the other a Caucasian women whose family came from Outlook Saskatchewan Canada.
The fact is I don't remember many things. I cannot remember the day I left Saskatoon in Oct 1990 or the airline I flew from Saskatoon to Vancouver (either Air Canada or Canadian).I cannot remember the flight from Vancouver to Hong Kong,the hotel I stayed in Hong Kong 14th Oct 1990 or even the person I talked to then.I don't think it was Japanese Airline which flew me from Vancouver to HK and obviously I talked to a Caucasian blond lady while in Hong Kong.
But one thing which was certain, in 1995 The Malaysian Economy was in bad shape although the GDP was 7% or 8%. I was working for a month at the Golden Arches then...
I can be as blunt as Tun Dr Mahathir but the fact is I passed my Finance course.I did three years of business school and I was NOT A DROP OUT in October 1990.
I remember during an interview between 1991-1995 the women laughed when I told her about Lotus 123 spreadsheet or NCSS (Number Cruncher Statistical System). So maybe she will laugh again if I mention Excel formulas.


TOYOTA

I presume it is really painful for Mr Akio Toyoda to apologize to Toyota owners regarding the recall. But on behalf of my late father who went to a Japanese school during 2nd world war, I accepted his apology.


HONDA

Now that Honda too have to make some model recalls, I wonder if other car makers will follow suit.


NEW FUEL SCHEME

Commencing May 2010, the Najib administration will introduce a new fuel subsidy scheme. Fuel would be sold according to engine cc and Malaysians have to show their My Kad I/C everytime we refuel. This showing of My Kad is NOT a good idea. Even the Petronas Mesra Card can easily be swapped with the lower point cards.
Obviously if you can afford to buy a big cc car then you are not entitle to the fuel subsidy.

The Proton Persona 1.6 Automatic is a good car. To me LOTUS handling is non comparable.


Happy VALENTINE Day to my Valentine $$$$$$$$$$$$$$$$$$$$
Gong Xi Fa Cai to my Chinese readers

Remembering Haiti

Let us observe a moment of silence to the victims of Haitians quake. May God bless them and let us recite Al Fatehah to the Muslim victims.

2009 REVIEW

Finally we are now in the first 10 days of 2010. Obviously to me 2009 was a very sad year because I lost many people whom I dearly missed. First my father died 3oth December 2008 then my mother's auntie died of breast cancer. Another uncle died of H1N1 - v - . My grandmother died on 10 November 2009. I was in the bus to Kuala Terengganu with my younger brother (to pick up my brother's car)when my father's sister lost her husband as he prepared himself for Maghrib prayer.

This is what I called fate. It is HIM ALLAH the almighty which created us thus we are bound by His Rulings. Who knows I might die suddenly tomorrow, we are just humans. I believe there is One God which is ALLAH and Mohammed is his prophet. As a Muslim I believe Jesus is one of the 25 prophets a Muslim must know AND JESUS IS NOT THE SON OF GOD.

Those were the things I thought a lot since last Christmas. All of the sudden I remember 'Cengkaring'. I know it was a place but where.Then when the Tanah Abang mall tragedy struck I remember that it was Cengkaring Jakarta airport. I was in Jakarta for 2 weeks from Christmas 1986 to 8 January 1987.

Clearly after the failed Christmas plane attack I would expect a harsh and thorough body inspection if I were to travel to the western world. Certainly it would be nicer if I'm inspected by a female with blond hair.

May 2010 be a prosperous year!!

Tunku Abdul Rahman Putra Al Haj

It is the morning of commemorating the 1941 Pearl Harbor attack. Yesterday 6 December marked the 19th year of the death of Malaysia's first PM Tunku Abdul Rahman Putra. I still remember in 1990 (during my busy days commuting between Kuala Pilah and Kuala Lumpur to arrange my father's car insurance claim) when the news broke out Malaysia was silent for a while. Economic activity stopped. People weep,some broke into tears while others won't believe that The Father of Independence had died.

If the Sultan of Melaka is still alive he would be elated that his mistakes of losing Melaka to the Portuguese in 1511 hence the fall of the Melaka Sultanate was paid for by another royal household i.e. Tunku who was the son of a Kedah Sultan.

Tomorrow 8 December will mark the 22nd year my grandfather died. May God bless him.

Now that Malaysia has two submarines bearing the name of Tunku Abdul Rahman and Tun Razak (2nd PM), Malaysia is one step further to become a developed nation. If anyone reads the biography of the late Tunku one must realize that PM Najib's One Malaysia vision was based on Tunku's ideas too. I like to read Tunku's book "Looking Back"

Al Fatehah!

GST in 2011

It is now confirmed that Malaysia will introduce GST in Fall 2011. The rate is merely 4%. During my forgotten days between 1991 to 1997 I always wonder what was GST. And the same with VAT. It was only after my auntie died in September 1998 that I began to remember that I used to pay tax in Canada whenever I buy something i.e.provincial tax. If I'm not mistaken the rate for Saskatchewan provincial tax was 7% then.

By this time everyone should be doing some Christmas shopping. I remember during the 1987 Christmas shopping season I bought a Taiwan made stereo at Sears Mid town plaza Saskatoon for CAD 400. I still remember I met a granny with typical British accent although she said she was a Canadian. I know she is still alive.I hope I could meet her again. I wonder if I paid any Saskatchewan tax at that time...

Back to GST. In 1993 when the Canadian PC Mulroney government was defeated by Liberals Jean Chr'etian, I remember how my Saskatchewan friends used to say Chr'etian as the short tongue politician. The reason being Chr'etian never really honor his words because instead of repealing GST ,he introduced Harmonized Sales Tax HST.

I am eager to know the details of Malaysian GST. What sectors will be affected? I know hotels and fast food outlets are already imposing sales tax.(I worked as a trainee at McDonalds in 1995).What about small traders in rural Felda areas? Big items such as cars... If Gst is imposed then will cars be much cheaper? I remember then I did not pay any tax for gas in Saskatchewan.(remembering that PetroCanada gas station where I used to get free car wash although I paid only CAD 10 for gas and that blond counter girl)


GM

Now that GM is searching for new CEO, I wonder if GM can really choose someone who loves cars instead of the big perks. From 1991 - 1997 Proton and Perodua appointed CEOs from outside who were merely interested in big bucks. So the cars which Proton and Perodua made were not world standards.

It is the same thing if the government appoints someone who hates traveling to become diplomats. (no matter how good his language ability other than English was)


Malaysia is having mega sale again until January 2010. Come to Malaysia for your Christmas shopping.

Welcome to Melaka because Visit Melaka is Visit Malaysia.

Perodua MPV "ALZA"

A few days ago Perodua i.e. the second National Car (Perusahaan Otomobil Kedua) launched its version of MPV. Clearly the Alza is next after Proton Exora. I was at the showroom yesterday. Perodua is obvious in maintaining its Japanese partners identity i.e. Toyota and Daihatsu. Rarely I see a vehicle with center meter panel but for Alza, Perodua has made the move of change. I'm not into MPV but I know Exora and Alza are good products. Even when I was in Saskatoon the only mpv I drove was my then landlord's GM Dodge. It was huge and I felt as if I was driving a container truck.

Walking back from the showroom I remember a song which I downloaded last week. The title was "Surat Terakhir" or the "Final Letter" and sung by 70s singer Salamiah Hassan. As I listened to the song the lyric which really touched my heart was
"I hope no other women will receive the same rejection letter"

I remember I listened to the same song over and over again as I was driving alone from Saskatoon Saskatchewan to Thunder Bay Ontario during the 1989 mid term break. It was one hell of a blizzard and very very cold.

At the Seremban Public Library I looked at the latest issue of The Economist. Thank God my calculation on GDP was correct because The Economist estimate a -2.4% GDP for 2009 while I calculated -2.8% ( the variance is small )

The government's estimate for 2009 deficit at less than 6% is far less than The Economist figure of 8%. But bear in mind that PM Najib has revised the 2009 budget before tabling the 2010 budget.

For readers who like sentimental songs I strongly suggest downloading Surat Terakhir from Salamiah Hassan. There are some Korean and Japanese songs which I loved to hear. For example "Winter Sonata" a Korean song.

Thumbs UP Proton and Perodua !

GDP Q309 at -1.2%

BNM announced the third quarter GDP yesterday. I must admit the figures are interesting.

Q309 GDP -1.2%
Clearly this figure is acceptable for the time being. Since Q309 is better than Q209 I must also revise my estimate on 2009 GDP. Thus I say the 2009 GDP will be -2.8%


CPI
Q209 at 1.3%
Q309 at 2.3%
If I go to the wet market during this rainy season the price of fish, prawn and squids are quite high. Will it reflect the Q409 CPI?


Financial Sector
RWCR at 14.5% , CCR at 12.9% , Net NPL at 2.1%
Insurance Capital Adequacy Ratio at 214% compared to Q209 at 208%
It must be noted that NPL is classified between 1 to 3 months


Trade
Despite the reduced trade (imports down 18.3% , exports down 22.3%) a trade surplus of RM26.7 Billion is attained while reserves maintained at $96 Billion US.
The decision of the US Government to abandon FTA with Malaysia is understandable. I wonder if the US is keen on GSP with Malaysia again. To me FTA is good with a few set backs. As a result of the US Canada FTA 1989 the Canadian government was forced to relent to the CAW demands and bailed out General Motors Co last summer. If the Ontario government decides to save Canadian taxpayers money then many CAWs are jobless.


FDI
Q209 RM91 Billion, Q309 RM62 Billion
Honestly I don't understand this figure. A lower FDI while there is no more FDI committee? To me increasing interest rate per se will not attract much FDI.


Perhaps my earlier prediction of a lower consumption spending does not materialize. Obviously H1N1 has little impact on Malaysians. I guess I overlooked this particular aspect.


I look forward to a positive GDP Q409 number.

Correction - Tuanku Muhriz

The correct spelling of the new installed Negeri Sembilan ruler is:

Tuanku Muhriz ibni Almarhum Tuanku Munawir.

Please forgive me for the mistake.