Tuesday, December 30, 2008

Bartering - Is it Really A Primitive Option Now?


I stumbled upon this interesting article about bartering. US consumers are saving up every penny they can. Spending has gone down a fair bit. Luxury item sales have plummeted. Banks are running out of liquidity to support businesses. Businesses on the other hand cannot establish solid cash flow to survive. Is it primitive to research whether bartering could be a transitional fix?

With US being bankrupt with excessive toxic debts and every sector having a plastic cup in their hands at the Hill, Tun Mahathir had urged numerous times to switch to Gold Dinar, practically back in the old days where currency produced is proportionate to gold reserve. The monetary rule correlating currency to gold was governed by the Bretton Woods Agreement, signed by 44 countries after the second World War. In addition, TDM also suggested that if a country trades RM10M worth of goods to a nation that exchanges that trade with products worth RM1M, only the difference of RM1M will be paid, which is how banks handle cheque payments with other banks.

"Most people associate bartering with poor or undeveloped societies, or with small, infrequent, and informal exchanges made within economies that use traditional currency. Bartering has also had a role when once robust economies falter. During the Depression, for example, farmers directly traded crops and other services with each other, since what little money the farmers had was of negligible value. And after the Soviet Union fell apart, inflation was so high that individuals and businesses found it safer to trade goods and services directly. (Traditional currency was still used, but the street value of the currency stretched to fit the need of the purchased item: rubles used to buy staples such as food were considered to be of greater value than rubles used to buy luxury items such as fur coats.)

We now see a growing movement of individuals and businesses that prefer to use bartering in a wide variety of transactions, including multi-million-dollar purchases. In New Zealand, a house and surrounding property, valued at 5.1 million United States dollars, was sold for 1.7 Barterdollars (BDs), a form of credit used by about 9,000 individuals and 50 businesses in four countries. Though the deal did not involve legal tender, it is not illegal, and a contract secured the sale through business property owned by the buyer. In this case, the seller will use most of the BDs to obtain plumbing and electrical work -- for both office space and his new home -- from the buyer, who owns a business that provides these services. The seller is under no obligation to use the BDs this way, however, and can spend them elsewhere or simply save them as credits for later use. There is, however, little incentive to save, because, as with most barter systems, the currency does not generate interest. This also applies to loans: several bartering organizations have set up facilities that lend currency in exchange for an agreement that stipulates that the borrower will "pay" it back with products and services over a set period of time, interest-free, though a transaction fee is charged.

Community-based non-profit bartering is generally not subject to taxation, but virtually all governments consider bartering by businesses identical to cash transactions, and taxes need to be paid accordingly. However, the nature of these transactions has made them harder for governments to track, especially as bartering on the Internet has become more popular. Determining the value of the terms of a barter can also be problematic. If A designs a website for B in exchange for barter credits, A should pay taxes on the value of the services provided, while B can consider the credits as a business expense. For tax purposes, A has an incentive to underestimate the value of the transaction and B has an incentive to overestimate. To minimize this sort of problem, some governments have set a standard, so that 1 credit in a non-governmental but nationally recognized barter system corresponds to a certain valuation of the official currency".

Friday, December 26, 2008

Right of Return


By Tun Dr Mahathir Mohamad

1. Bismillahhirohmanirrohim.
Assalamualaikum warahmatullahiwabarakatuh.

2.Firstly I would like to thank the Government of Syria for the hospitality extended to me and for its unfailing support for the Palestinian cause.

3.All Praise be to Allah by whose grace we are able to gather here today to remember, to not forget the injustice perpetrated upon our brothers and sisters, the peoples of Palestine 60 years ago, in May 1948.

4.On that infamous day in May 1948 our brothers and sisters, their fathers and mothers and their children were expelled from their country, from their land and their homes, expelled cruelly by Zionist forces as the British, the Americans and the Russians looked on and basically abetted in these heinous crimes. The rest of the world cared nothing for the catastrophe, the Nakba the tragedy that had been deliberately visited by the Zionist upon the people who had been their hosts before, who had allowed them to immigrate and settle on their land thinking that as in the past, during the great days when Muslims ruled the land, the newcomers would live in peace with them.

5. But the immigrants from Europe and elsewhere had other intentions. They came not to live in peace with the Palestinian people but to seize the country and make it their own.

6. Perhaps it is not strange at all to see the Americans and the British aiding and abetting the Zionists. The British and the Americans had done this very thing to a lot of other people before. In the Americas, Australia and New Zealand they had also seized other peoples’ land and committed genocide in the process.

7. This is the way of the British and other Europeans. This is the way of the Americans. Seizing other people’s land and setting and committing genocide is normal and proper to them.

8. It is not surprising therefore that in order to atone for their crimes against the Jews they should abet in the seizure of other people’s land to create a Jewish state.

9. The expectation of these people who seized other people’s land is always the same. They expect their past black deeds to be forgotten and their ownership of the land they had stolen would in time no longer be disputed. But their seizure of other peoples land must never be forgotten.

10. That is why this gathering is very important.

11. The Palestinians must not forget the Nakba and the world must also not be allowed to forget this injustice.

12. Today the Palestinians have to live outside their land as refugees, living mostly in makeshift camps, without proper facilities, housing etc. They are denied their rights to live like normal people.

13. There are now 4 million of them, deprived of their rights as citizens of their country. Their children do not have the same rights and future as other children.

14. The Palestine refugees are not even allowed to return to the land which was theirs before.

15. Everyday more and more of their land is stolen. Illegal Jewish settlers build permanent settlements on their land. They are not even allowed to use the roads built on their land. And they are forcibly separated by walls from their own kith and kin. Even villages are split by the wall. The Jews have learnt a lot about Nazi methods.

16. Truly no other people have been treated the way the Palestinian people have been treated.

17. The world talks of human rights. If one Chinese man is denied the right to speak against his own Government the whole world would condemn this deprivation of a minor right of just one person. But when four million Palestinians are expelled from their own country, are not allowed to return, are frequently attacked by the Zionists and their American and British allies, the world is deathly silent.

18. There really is a lot of hypocrisy in the world today.

19. I am against violence. I am against war. But when people are violently attacked they have a right to defend themselves.

20. When people are deprived of their country and are not able to fight conventional wars to liberate their country then then they will have to resort to other ways.

21. Blowing oneself up is not the most pleasant way to die. But when this is the only way to attack the oppressors, to defend yourself, then, pleasant or not you will have to blow yourself up.

22. If by doing this your enemies are blown up together with you, can these desperate suicide bombers be called terrorists? If they are terrorists because they allegedly commit acts of terror, because they terrify people, don’t the people who drop bombs on innocent people, who fire missiles at people, don’t they terrify their victims? If they terrify people, are not their acts also acts of terror? Are they not terrorists?

23. Actually more people, ordinary civilians are terrified of being bombed and killed by trained military murderers than are the people who are terrified and killed by suicide bombers. By any standard the bombers and people who launched missiles at human targets are worst terrorists. They do not even risk being killed or injured. Whereas the suicide bombers invariably get killed when they explode their bombs, the trained bombers will go back to celebrate over glasses of beer their murderous acts.

24. If we do not want to see suicide bombers blowing themselves up, than the people who drop bombs or launch missiles against innocent people should stop such acts of terror.

25. If we do not want to see both acts of terror, if the world abhors terrorism then the world must not close their collective eyes to the injustice perpetrated against the Palestinian people.

26. Let us not hear of the Jews being the first people in Palestine and that there never were a Palestine or Palestinian people. If the first people must be recognised as having a greater right, then let us see America, Australia and New Zealand return to the Red Indians, the aborigines of Australia and the Maoris of New Zealand their lands. If the world would not accept this kind of claim then the Jews should not use this as the basis for their claim.

27. The fact is that the Palestinian people had been living in Palestine long before the Crusades. When the Crusaders came Palestinians were under the rule of the Arabs. The people the Crusaders seized the country from were Arabs. The people who re-conquered Palestine and ruled it until after the First World War were Arabs. The Palestine that was made a Mandated territory under the British was the Palestine of the Palestinian Arabs. It was not the Israel of the Jews, though there were Jews in Arab Palestine.

28. At no time did the Crusaders or the First World War Allies deal with a Jewish Government or with Jews when they conquered Palestine, or when they made Palestine a Mandated territory.

29. The Jews who were involved in setting up Israel on Palestine soil were never the inhabitants of the land the world recognized as Palestine. They were foreigners, most of whom were citizens of European countries.

30. At the time when Palestine became a mandated territory there was only a tiny number of Jews in Palestine. These were mainly the descendants of the Jews who had lived in the land they called Palestine. They never called it Israel, nor claim that the Palestinian Arabs were living in their State of Israel.

31. So how can the Jews claim they have a legitimate right to the land of the Palestinians which they now call Israel? The State of Israel is totally artificial – a creation of people foreign to the land, a creation of non-Jews of Europe in collaboration with European Jews.

32. It is this artificial state unjustly created by foreigners on Palestine land which ever since its creation has plunged the region and indeed the whole world into violence, terrorism and wars.

33. It is this disregard for the rights of the Palestinians, in particular the right of return that has triggered off tension between people who had for centuries lived together in peace.

34. It is this gross injustice which has made a reality of the clash of civilization.

35. The clash, the tensions, the violence and the wars will not end until justice is done to the most unfortunate victims.

36. The Palestine peoples whether Muslims or Christians must continue their struggle for the right of return.

37. Theirs is a just struggle and justice must triumph finally.

38. The cost will be high for the Palestinians but the cost will be higher for those who aided and abetted in this act of injustice.

39. We are with the Palestinians in their just struggle and we will support it till justice is done.

40. Thank you.

Thursday, December 25, 2008

UMNO Going Down The Path of The Republicans


The Economists reported in November that the Republican Party's defeat on November 4th was due to primarily losing the battle of the brains. Allow me to elaborate. President-Elect Obama won more college graduates than McCain. Obama also won more voters with post-graduate degrees and voters with household income of more than $200,000. The Republican's Energy Policy was 'Just drill, baby, drill. That was enough to send a message to the educated Americans. It was clear that the Republican Party has separated themselves from the Intellegintsia of America. The separation was clearly enhanced during George Bush's 2 terms as the President, a President now made famous from the shoe-throwing incident in Iraq. Iraq War was ran by an incompetent Commander-In-Chief with no clear national vision. Katrina was handled disastrously. New Orleans still looks like a war-torn country. Notice the state of economy of which Bush will hand over to Obama.

The election in the US had more educated Americans this time around. More than a quarter of Americans graduated with degrees, that's approximately 60,000,000 people, while 20% of households earn more than $100,000 a year, an increase of 16% since 1996, according to the Economist. Almost 69% of those 20% people are professionals. The Republican's "red neck" strategy had blown up in their faces. Their ads tried to portray Palin as the Hockey mom who was just concerned about fuel price and day-to-day affairs. November 4th told them it was quite the contrary.

Does this sound familiar in Malaysia? Leaders must realize that the voters' sophistication has changed. If they fail to acknowledge this, then prepared to be changed out.

Wednesday, December 24, 2008

Passing Out Parade 2008

It's been awhile since I woke up early.  Thanking God that RMC taught me one of the most crucial skills in life, the change parade, I took a quick shower, grabbed my clothes and clocked 10 minutes from PJ to Sungai Besi Army Camp.

Even after years of development in Kuala Lumpur, Sungai Besi seemed to have escaped it.  The old mamak where OPs normally congregate is still there, still packed with customers at 0630h. We had our official Malaysian breakfast of roti canai before rushing to our alma mater, the only high school in this country with Royal colors.  

The Passing Out Parade commenced after the arrival of Datuk Wira Abu Seman, Deputy Minister of Defence, Mindef SecGen and a barrage of 2-star and 3-star Generals.

The most ostensible change of format in the parade was the parade inspection by the saluting officer.  RMC has now adopted the usual trend in the Armed Forces of using the ceremonial jeep.

Foxtrot company came in 2nd place and it was quite shocking to learn that Alpha grabbed the covetous Commandant Trophy for best performing coy (was there any element of money politics at the Boy's Wing?)!  Foxtrot came in second for the second consecutive year.  The lucky number 8 went to the boys at Block A second floor.

I noticed a group of youngsters in their mid 20's donning sandals and t-shirts with graffitti, walking around the perimeters of the parade square, the holy ground of any military installation, with their uncombed spiky hair and loud yelling, taunting the "Pengawal Medan" during the parade.  The young OPs of recent years.  Bloody idle, disrespectful and lopong.  What went wrong, only God knows.


Rukun Putera?  This is something new.

Foxtrot boys, the eager fourth formers who just got promoted to the rank of senior

Even after 12 years since our passing out, this place still gives me the goose bumps.




Monday, December 22, 2008

Parti Peguam Malaysia


So the Bar Council has in recent months been critical of government policies and religious issues, voicing out concerns about numerous issues on the basis of legality. The modus operandi of the council has been of a political party, more than anything else. After its failure to get Zaid Ibrahim to endorse their agenda to taint Mahathir and the infamous 'judicial crisis', which was after all with regards to judges who were dismissed by a panel of judges, they are now trying to extend cheap publicity by demonstrating their "impartiality" and quest for justice as a legal entity.

Both Hindraf and Bar Council have ostensible similarities. They are both run by rich Indian lawyers fighting for the rights of the 'oppressed' Indians in this country. Despite being so called 'luminaries' of the law fraternity, they are against the ISA which is an act of Parliament. In addition, they are instigating the Malays. If the Malays trigger incidents, it would be a pretext for further assault. They are pouring gasoline over the majority Muslims in this country by having an open forum on a religion of which they are not adept. The implication of this forum is such that Islam generates post-marital issues for non-Muslims whose spouses convert to Islam. Are they implying that the religion of 1 billion people are flawed that it merits a scrutiny by lawyers who are not even Muslims?

The recent Jerit rally was justified by the Bar Council as being legit and legal (it's a cycling rally, not a demonstration), even though children were brought along. The use of children in demonstration is an acceptable action says a spokesperson from BC on national tele, stating that children understand the woes of the parents therefore entitling them to participate in demonstrations. Sultan Selangor and IGPs comments.

With all the controversies surrounding the BC with alleged political influences and ties with Hindraf and such, no wonder Members of Parliament were against the BC to be part of the MACC.

I was told that the muslim lawyers in Persatuan Peguam Islam Malaysia are having a turf war with BC leadership. Unfortunately the big Muslim firms are not interested to wage the battle together, therefore leaving the small timers to be eaten alive.

Rocky on Ambiga's double standard
Does Mukhriz have a trump card that we don't know of? Time will tell.

Saturday, December 20, 2008

Calon Barisan Nasional P36 Kuala Terengganu


YAB TPM mengumumkan YB Senator Wan Ahmad Farid Wan Salleh, Timbalan Menteri Dalam Negeri dan juga Ketua UMNO Bahagian Kuala Terengganu sebagai Calon BN untuk Pilihanraya Kecil Parlimen P36 Kuala Terengganu.

Dalam kemelut politik di Terengganu di antara pihak Dato' Seri Idris dan Menteri Besar Terengganu Dato' Ahmad Said, UMNO dan Barisan Nasional perlu menepikan isu-isu dalaman yang remeh dan harus fokus untuk memenangi kerusi ini. Di antara topik-topik yang akan dibangkitkan oleh pembangkang adalah pembelian kereta Mercedes untuk MB dan Exco negeri, pembinaan Masjid kristal, duit royalti minyak (tabung wang ehsan) dan isu perlantikan Menteri Besar selepas pilihanraya umum ke-12.

PAS sekarang kelihatan diketepikan dan diperkecilkan oleh sahabat handai DAP dalam isu-isu agama (seperti perlaksanaan Hudud) dan pentadbiran negeri di Kedah dan Selangor. Sentimen perkauman dan agama jelas diutarakan tanpa menghormati sentimen orang2 Melayu Islam di negara ini. Majlis Peguam Negara juga yang rata-rata mempunyai tali persahabatan yang erat bersama ketua-ketua Hindraf bermain dengan api apabila membuat forum terbuka mengenai pemelukan agama Islam. Hanya YB Zul Nordin (PKR Kulim) yang berani mempertahankan kedaulatan agamanya.

Nak memeluk agama Islam dianggap memberi masalah kepada sesetengah pihak. Azan dianggap bising dan mengganggu ketenteraman awam. Kepala babi dipacak di perkampungan orang Islam. Kedaulatan raja2 dipersoalkan dan dihujah oleh pihak pembangkang. Nak buat jamuan hari raya pun disekat kerana demonstrasi. Nilai adab dan sopan santun yang menjadi kebanggaan sifat orang2 Asia telah lupus di Malaysia. Inilah sahabat2 handai Pakatan Rakyat yang hanya mengambil kesempatan kerana kelemahan Barisan Nasional sendiri.

Persoalannya ialah adakah rakyat Kuala Terengganu akan memangkah PAS kerana menolak sesetengah pemimpin UMNO tetapi sanggup melihat PAS diperlekahkan oleh sahabatnya DAP?

Friday, December 19, 2008

Making His Angle Wider


Huzir Sulaiman, actor and comedian, wrote an article recently in Star which attempted to showcase the rejection of policies for Malay Special Privileges and New Economic Policies among the "children of the establishment", the children of law-abiding, yeoman civil servants before the era of Dr Mahathir Mohamad. These individuals gave their thoughts about what's wrong about the policies encompassing the rights of the Malays. This is coming from another individual who is critical of Malaysian politics while earning comfortable income somewhere else in the globe.

It is obvious that certain characteristics and profiles were chosen to establish an article opining against the concept of Malay constitutional privileges. Sure, Islam promotes equality and ensures the rights of all are protected but Islam also has rules of sovereignty. One can study "Piagam Madinah" and instantly acknowledge that the rule of multiracial nation is also included in the teachings of Islam. Islam also talks about social imbalance and aid to the needy and poor. The New Economic Policy was established to restore these imbalances and above all, to diminish race by economic function.

Datuk Zahim Albakri, (son of Datuk Ikmal Hisham Albakri, the first Malay architect and the first President of Pertubuhan Akitek Malaysia, who designed the National Library, Putra World Trade Centre, and the Bank Bumiputera headquarters in KL) suggested that a non-Malay Prime Minister does not bother him at all. His statement needs some alignment. A non-Malay Prime Minister should not bother any of us if that is the will of the majority in this country. Perhaps Huzir realizes that the country in which he resides is far more democratic than ours, having to declare to the whole world that she is not ready to have a non-Chinese Prime Minister.

Datin Saidah Rastam, the individual interviewed about the concepts of NEP and Malay Special Privileges admitted that she benefited from the NEP, however, doubts that it should be continued because of the abuses. Very convenient of her! This is the same with rich lawyers who benefited from lucrative privatization contracts from the Government and now the biggest critique of them all.

Finally, if Datin-Iskandar Said is not sure of the definition of Malay, she should study the Constitution which clearly defines what constitutes a Malay in the eyes of the law.

The children of the Establishment tackle some difficult issues.

Huzir's blog

Thursday, December 18, 2008

Evaluating our future Deputy Prime Minister (and potentially Malaysia's 7th Prime Minister) Part 3


Enter Tan Sri Muhyiddin Yassin (TSMY), a widely known figure whose strong roots sprouted from the strongest fort of them all, Johor. Having years and years of experience as UMNO Vice President, he is ready to move one notch up.

TSMY stood out since the blood bath of March 8th being the sole critique of the current administration. He was one of the bold ones to open up the can of worms and has been pushing for reform in Barisan Nasional. Although one might say that he carries a resemblance of Tun Mahathir as a Malay ultra, he fully acknowledged the importance of wooing support from the Chinese and Indians to solidify BN's position towards gearing up for the next election. He is after all one of the few cabinet ministers left from the Mahathir era, obviously he will inevitably carry some resemblance of Mahathir's style during his strict, decisive and firm regime. This is a plus point.

Just after the debacle of PRU-12, TSMY was adamant for regime change. He led the pack of recalcitrant ministers to scrap the 2010 transition plan. He patiently waited for DS Najib to announce his intentions before announcing his own, trying to avoid tripping himself and having to contest against DS Najib. A very noble gesture of a loyal confidante to Dato' Najib. The nomination numbers from UMNO divisions proved that TSMY's move has wide support within the party.

He was once affiliated to DS Anwar in 1993 as part of the Wawasan team, together with Md Taib and Dato' Najib. The Wawasan Team led by Anwar displaced Ghafar Baba as Deputy President of UMNO, Pak Lah and Sanusi Junid as Veeps.

He is quite a mysterious figure and does not surround himself with a horde of special officers and advisers. He's fully experienced in the federal and state apparatus (Johor Menteri Besar 82-95), becoming an MP an age 25. He is, without a doubt, poised and confident. In addition, he brings with him vast experience in the international arena. He is definitely in touch with the grass root people, especially the rural Malays. This was enhanced during his short stint as Minister of Agriculture. Lots of praises went around in the Ministry for his numerous initiatives to reinvigorate the slow-moving industry.

With all these credentials, unfortunately, he does not escape controversies. Who does in the political landscape of Malaysian politics? He was widely rumored to have stakes in several lucrative projects during his tenure as Menteri Besar, but the allegations remained as such.

Sin Chew on TSMY
Jebat must die on TSMY

Wednesday, December 17, 2008

Zakat For Non-Muslims


Socialist Kota Damansara State Assemblyman Dr Nasir Hashim was treading on thin ice when he proposed that the Selangor State Government should channel zakat funds to non-Muslims. This created an uproar among the Muslims in his constituency.

Zakat is the fourth pillar of Islam. It is the act of contributing a pre-determined percentage of your wealth that has been immobile for one full lunar calendar year. The State is responsible to distribute the collected funds to the needy and those in reconciliation. People in the "reconciliation" category would be those who are close to embracing Islam or new Muslims or Muallaf. Others include freed slaves, people heavily burdened with debt and so on. There is no clear provision stating that non-Muslims are not included as recipients, however the excerpts attached below would lead us to agree that non-Muslims who are close to embracing Islam and needy at the same time are eligible for the funds.

Having said that, there are also other available provisions in Islam for non-Muslims in need of financial aid such as sadaqah. Some argue that even though non-Muslims may fit into any of the 8 categories of zakat beneficiaries, the sadaqah should be the means of aid, not zakat which is designed for Muslims.

With all the references I manage to sift through given the short period of time, I am still not convinced of a definitive answer. The more solid footing is that Zakat can be given to non-Muslims if it means drawing more crowd of people to inquire more about the beauty of the religion. It's a form of dakwah. At any rate, if this topic is such a controversial and debatable subject, it sure is not wise for a socialist State Assemblyman to propose something without getting proper backing or clearance or reference from religious authorities. Also, considering the current racial tension in the country, the issue at hand should be dealt with greater wisdom and thorough research.

What I'm more interested to know is how our collected Zakat funds have been disbursed. I could not get this information from either the JAIS or JAKIM websites. I was quite impressed with how the Majlis Ugama Islam Singapura presented their distribution for fiscal year 2007.

Pekida's comment

BN's retaliation

Guna wakaf untuk bantu orang bukan Islam

In the Qur'an, God Revealed the beneficiaries of zakat:

إِنَّمَا الصَّدَقَاتُ لِلْفُقَرَاء وَالْمَسَاكِينِ وَالْعَامِلِينَ عَلَيْهَا وَالْمُؤَلَّفَةِ قُلُوبُهُمْ وَفِي الرِّقَابِ وَالْغَارِمِينَ وَفِي سَبِيلِ اللّهِ وَابْنِ السَّبِيلِ فَرِيضَةً مِّنَ اللّهِ وَاللّهُ عَلِيمٌ حَكِيم

"Alms are only for the poor and the needy, and the officials (appointed) over them, and those whose hearts are made to incline (to truth) and the (ransoming of) captives and those in debts and in the way of Allah and the wayfarer; an ordinance from Allah; and Allah is knowing, Wise." [Qur'an 9:60]

Reference 1

Reference 2

Reference 3

Reference 4

Reference 5

Reference 6

Tuesday, December 16, 2008

YB Jerlun questions Halliburton Operations in Nusajaya


This was an issue back in May. I've had it as draft for a while but never published it. Here it goes.

Jerlun MP Dato' Mukhriz Tun Mahathir on why Halliburton was allowed to install an assembly plant in Johor, considering the fact that the multinational was involved in securing contracts during the US invasion of Iraq.

"YB Dato Mukhriz Tun Mahathir meminta Menteri Perdagangan Antarabangsa Dan Industri menyatakan adakah Kementerian sedar bahawa syarikat dari Amerika Syarikat, Halliburton adalah pembekal senjata yang terbesar bagi tentera Amerika Syarikat di Iraq, yang sekali gus melibatkan mereka dalam pembunuhan lebih 1 juta rakyat Iraq yang tidak bersalah sejak tahun 2003, sila jelaskan kenapa Halliburton dibenarkan membuka kilang di Johor". Dewan Rakyat 26th May 2008.

Jawapan Menteri:

"Adalah menjadi dasar kerajaan untuk menarik dan menggalakkan pelaburan termasuk pelaburan asing dalam industri-industri yang terpilih dan berteknologi tinggi. Ini termasuklah industri petroleum dan gas dimana di dalam sektor perkilangan. Ianya melibatkan aktiviti pengeluaran peralatan dan kelengkapan untuk kegunaaan industri petroleum dan gas...."

"Keputusan kerajaan untuk membenarkan syarikat Halliburton Manufacturing and Technology Sdn Bhd membuka kilang di Johor merupakan satu keputusan yang dibuat berasaskan faedah terkumpul yang diperolehi daripada pelaburan tersebut. Kementerian juga mengambil maklum bahawa Syarikat Halliburton sudah tidak lagi terlibat dalam apa-apa perkhidmatan dan peralatan yang berkaitan dengan ketenteraaan sejak awal 2007......"

It is unfortunate to note that numerous companies gained from the invasion in Iraq from the military-industrial complex, oil lobby, logistical businesses and others. Halliburton stuck out like a sore thumb because of Dick Cheney. Cheney served as Sec of Defense under the Presidency of Bush Sr. He then joined Halliburton as Chief Executive before joining Bush Jr's presidential campaign and was inaugurated as US Vice President. The controversies surrounding oil companies, US invasion of Iraq and President Bush are known to many, all in the name of 'national security'.

Kellogg, Brown & Root, Halliburton's construction arm was awarded contracts worth USD12B in Iraq reconstruction project. After the many controversies surrounding KBR, Halliburton announced its severed ties with KBR in 2005. Numerous other private military contractors such as Blackwater subcontracted by KBR to provide security personnel drew fiery criticisms over alleged abuses in Iraq.

Monday, December 15, 2008

Automated Unmanned Rig


Robotic and AI technology have been widely used in the military. The term "Predator" and "FlightHawk" are synonymous to UAV (Unmanned Aerial Vehicle) and UCAV (Unmanned Combat Aerial Vehicle) respectively. The US Navy is also building unmanned submarines and sooner or later, we might develop the technology to turn Honda's famous Asimo to Mercs for hire. In Aus, an oil co is developing an unmanned drilling rig which sets up on seabed and is remotely controlled by a vessel at sea level. Umbilicals will be attached to deliver power, cement, drilling fluids and such. This is an ground-breaking development for the oil patch.

Sunday, December 14, 2008

Short Clips 3: The Bankrupt Nation

In the US, millions no longer define the problems Wall Street has pulled the whole country into. Obama is now talking about trillions of dollars to review the bankrupt country. Where is this money coming when people are losing their jobs, which means less tax revenue for the Government? Where is this money coming from when the US spends billions of dollars to mobilize their troops worldwide? The dollar is no longer backed by gold, so where is this money coming from?

With all the technology, trades and exports from US inc, mega oil companies, successful IT ventures, cutting-edge tech industry, entertainment and so on, one is fascinated to reason, where did all the money go to? Pockets of CEOs, fund managers, owners of Private Military Contractors? Who knows. Obama alone raised almost USD 1B before getting elected as the next President of the United States. Don't forget the money both McCain and Clinton collected during the race. That's just national politics. Where did this money come from? From average American who donated USD20-50 each? It has been reported that Obama intended to avoid withdrawing funds from lobby groups. The world watches as it hopes that the prodigal 44th POTUS carries out his audacious change campaign and not falter and comply to Washington lobbyists demands.

US$75B fraud, how did Wall Street get conned?
RCP article on New York Mayor race

When Thomas Friedman talked about the decline of the US education system and its failings for not generating enough engineers and scientists to sustain the challenges in the 21st century, he claimed that India and China are way ahead by leaps and bounds. However, you still hear of schools in India with teachers getting US35/month and tuition fee at US6/per child. Isn't it amazing that even with these challenges, both giants are still able to produce workforce that ended being the backbone of companies like Microsoft, Google and IBM. Even researches and scientists in top US colleges are typically Asians, mostly coming from China and India.

Check out school for $6 a month

For Obama, what would define his presidency is how he tackles the faltering banks, US foreign policy in Kabul and bankrupt Detroit.

Friday, December 12, 2008

Evaluating our future Deputy Prime Minister (and potentially Malaysia's 7th Prime Minister) Part 2

Chief Minister Dato' Seri Ali Rustam is the next contender to qualify to contest the seat of UMNO Deputy President, subsequently elevating him to the Deputy Prime Minister seat.

He should be given the lime light for putting world-class Malacca on the top spot for tourist attraction in Malaysia and making the state one of the biggest revenue generators for the Federal Government.

A fellow blogger himself, he had urged all Wakil Rakyat to setup blogs to disseminate information more efficiently. Nothing of significant interest in his blog to take note of, besides the normal rhetorics of 'don't question the fatwa' and 'thank you for nominating me for the post of deputy president of UMNO'.

Ali Rustam had urged the People's Progressive Party (PPP), a Barisan Nasional component, to leave the coalition if they were unsatisfied with seat allocation during the election fever this year.

He drew fiery criticisms for suggesting that Shah Rukh Khan deserved a dato'ship for exalting tourism in Malacca. Quoting from one blog, "Nampaknya Majlis Raya-Raja Melayu perlu membuat ketetapan bersama dan peyelarasan dalam kriteria penganugerahan darjah dan bintang kebesaran supaya kualiti, kredebiliti dan reputasi penerima anugerah dapat dipertahankan wibawanya".

"Empat tahun yang lalu, Melaka membuat kontroversi yang sama dengan lambakkan penganugerahan darjah dan bintang kebesaran terbanyak kepada 84 orang penerima walaupun Melaka adalah negeri terkecil selepas Perlis".

2 years ago, DS Ali proposed the extension of ERL to include both Seremban and Malacca on the basis of increased tourist arrivals to the tourist state. He has also requested LRT to be installed in the state. This is to be financed by the savings from the oil subsidies. Not so smart there, considering that KL is in dire need of the funds in the hierarchy of priorities due to its dense and increasing population. Although stats suggest that tourists have increased to 4.6 million in 2006 compared to 4 million in 2004, it doesn't render a strong proposition to build a system just yet. The density of Kuala Lumpur is close to 7,400 residents/km2 compared to Malacca's 430 (not including tourists of course). I don't think not having an LRT system would deter the tourists from visiting a world heritage site.

I do give him credit for setting up Malaysia's first solar panel manufacturing facility. This would augur well for our bid to become more energy sustainable and efficient. The company running the show, Sun Power Manufacturing Malaysia, is a subsidiary of Sun Power Corporation, USA. It will commence operations in August 2009. This will also create close to 4000 jobs.

Credit is also extended for the well-oiled economic prosperity in Malacca resulting from tourism, rubber (RM320M), palm oil (RM300M) & manufacturing. I was not able to verify these numbers and had obtained them from his blog. I'm assuming he writes his own stuff and not getting feedback from aides.

On UMNO reforms, according to him, UMNO will commence online registration in the near future. This is a positive step towards drawing potentials into the party and a clear sign that the party is ready to move on in accordance to technological advancements.

He is not a big fan of debates, which is a downside, in my opinion. Leaders must be able to take up the challenge for healthy debates in order to articulate their views, convictions and opinions. Debating is a fundamental skill that numerous leaders are still struggling with. The idea that debating is a mere political game is unacceptable. US Presidential and Vice presidential candidates take months to prepare for this and the debate between Biden and Palin clearly showed Americans who they were going to vote for (between one who was fluent in foreign policy and one whose vocabulary was limited to 'you betcha'). Of course, the sensitivities here are different, therefore requiring different format, structure or audience if necessary.

Finally, it was not such a good move for Dato' Seri to criticize the Selangor state government over its RM100m pig farm project. He's got one pig farm problem in his back yard, unresolved for scores of years in Pengkalan Balak.

I have yet to hear his stance on a myriad of national education or economic policies, two of the most important workloads for the next deputy prime minister. Managing national policies compared to state administration is analogous to comparing the NBA to coaching collegiate basketball.

The fundamental question is this: desire and democracy put aside, does he make the cut to be the second in command? Unfortunately, the fate of the nation is controlled by a band of no more than 2,500 UMNO delegates. That is scary stuff.

Siapa paling layak?

Tuesday, December 9, 2008

Short Clips 2: Pakatan & KT By-Election

  • Anwar Ibrahim is out of bargaining chips after changing his 'take over' date several times. Sept 16 went and nothing happened. Hari Raya Qorban went and nothing exciting occurred. Instead of focusing on administrating the 4 newly acquired states (which sees nothing different besides free water in Selangor, more lands given out in Perak and Penang and 1 temple demolition) and keeping the coalition together (with all the internal conflicts, no surprise there since it is a young coalition), he is still adamant to get 30 MPs to jump ship. The question that is begged to be asked and answered is whether people still want this? Is PAS still in line with the coalition's objectives after getting assaulted day in and day out by partner DAP from enforcing Islamic laws in Kedah to logging activities and inconsistent views on sales of alcohol and many other provoking issues.
  • The Kuala Terengganu by-election will witness a modicum of interesting challenges. With 3 DUN seats under PAS' control (DUN Wakaf Mempelam, Ladang, Batu Buruk), BN will have a tough time retaining the seat, especially after the issue of the MB selection, the use of Mercedes as official cars, the wrestling of oil royalty funds, Monsoon Cup and the construction of the crystal mosque. BN won the seat by a mere 628 votes (Arwah Datuk Razali garnered 32562 votes vs Mat Sabu's 31934 & Maimun's 685).
  • However, because of PAS' alignment with recalcitrant DAP which seeks to fight to the death to protect vernacular schools from being Malaysianized into one synchronized public school system, there might be some reservations from voters. Might. PAS might also face public pressure for its inability to continue fighting for their predetermined campaign causes before the formation of Pakatan Rakyat. Might. What is their stand on education? It has to be made clear lest they are comfortable being labeled as small time partner in the coalition. Perhaps we should just suggest to Kadazans and Ibans to have their own vernacular schools!
Malaysian Digest

Monday, December 8, 2008

Short clips 1: US Economy

  • More than 1/2 million Americans have lost their job in November alone. Expect more to be retrenched if funds are not channeled into the big 3 giants in Detroit. Obama will be put to task when he promised to create 2.5 million jobs by 2010.
  • Obama is redirecting war efforts from Iraq to Kabul. Already he is under fire from critics with his selection of cabinet members (supposedly not representing a 'progressive' image) and reactivating leaders from the Bill Clinton's era. Guatanamo bay is another blunder he inherited from previous presidents and will be closed if he keeps his campaign promise. If such is the case, what is the strategic methodology to process inmates?
  • His main focus now is reviving the collapsed US economy. He intends to repair US infrastructure from roads, bridges to buildings, hence creating 1 million jobs for the next 2 years. As people are losing jobs from downsizing of major corporations across the US, healthcare must also be another top priority. No job means no health coverage.
  • With the US economy projected to contract by 4.5% next year, can the US afford to sustain another war in Afghanistan? Is it not time to realize that military might is not the best solution in troubled regions such as Kabul and Baghdad? The war in Iraq has a bill of almost USD20B a month, redirecting war efforts to Kabul will not reduce this huge deficit. The US must realize that it cannot solve world hunger if it cannot even resolve domestic issues. Of course, the war efforts will continue as long as Osama is lurking around (perhaps an excuse to extend the 'war on terror') or perhaps pressure from the military industrial complex. Seeing that the banks and auto industries have went bust, the giant defence conglomerates might be next if foreign policies dictate 'softer' approach (Chicago Tribune has filed for Chapter 11 and no one expected the media to go bust).
  • Click here for Robert Gates comments on the Pentagon's coming challenges. "I have learned many things in my 42 years of service in the national security arena. Two of the most important are an appreciation of limits and a sense of humility. The United States is the strongest and greatest nation on earth, but there are still limits on what it can do. The power and global reach of its military have been an indispensable contributor to world peace and must remain so. But not every outrage, every act of aggression, or every crisis can or should elicit a U.S. military response".
  • The DOD is already the biggest oil consumer in the US at 300kbd. Fuel is needed to power up the massive military organization, especially the US Navy which has a bigger fleet than the next 13 largest navies in the world. US military procurement was budgeted at US180B this year alone. Will Obama optimize operating costs for the military to save the economy?

Streamlined Education System

Update 1 (18/12): Chinese whiz kid mastered English

I'm trying to rationalize why there isn't much support for Dato' Mukhriz' proposal to streamline our fragmented educations system. The obvious answer one might put forward is the coming UMNO election. One may rationalize that the others won't follow suit in fear of Mukhriz scoring more points in his bid for the highest helm in UMNO Youth. The other plausible reason is that the Malays are not supportive of the notion. If the former is the reason, then shame on you UMNO leaders for not defending your brethren.

If the reason is the latter, why does it hurt to have a unified education system? Every other developed nation has a unified education system. Is it damaging to have all kids of different races and background receive a uniformed curriculum? Doesn't it enhance integration, racial toleration and in line with the opposition's mantra of 'Malaysia for Malaysians'? Why is it opposed from all quarters and labeled as seditious just talking about it?

Instead of firing verbal projectiles at Mukhriz, I'm interested to hear substantial arguments from Lim Kit Siang, Lim Guan Eng, Samy Vellu and others as to why it is damaging to have this proposal in place? Let's have an educated forum to discuss the pros and cons. I'm sure they'll throw a curve ball and have the New Economic Policy and Malay Special Rights as excuses to have vernacular schools. If we are going to slowly diminish the NEP as the Malays become more competitive, surely we have to slowly integrate all these systems into one. The Sekolah Wawasan concept might do the trick as an introductory or transitional phase to full integration. Or is the funds really the hurdle to integrate the schools?

If we observe multinationals and companies with majority chinese population, the language of choice at work seems to be Mandarin than the national language or English. The multiplier effect comes into play is when job vacancies are advertised with preference of Mandarin language ability.

The Chinese and Indians who are exposed to sekolah kebangsaan system are usually of different cut of cloth. Because of their extended interaction with other races, they tend to communicate more in the national language or English. The ones who are less exposed to other races normally have poor command of the national language or English, only profound in their own mother tongue. Let's not even talk about writing skills. In addition, those who go to sekolah kebangsaan system are looked down by their peers who went to vernacular schools, giving the ones from vernacular system a false position that they are 'more chinese' or 'more indian'. Isn't the goal to be more Malaysian? Does it mean the Chinese and Indians from Sekolah Kebangsaan do not have a strong command in Mandarin or Tamil?

This is not to target just the Chinese and Indians. It also applies to the Malays who are not exposed to interaction with other races. It becomes apparent especially when they are overseas when they cling on to each other, have poor communication skills especially with foreigners and come home with the same language skill level.

The fragmented education system have forced parents with the monetary means to choose private schools for their children. The medium of language is English and the kids are taught extra curriculum involving the arts and science. Because of the better salary that teachers are being offered in the private system, the schools will attract the best teachers naturally. What of the parents with little means to choose private schools?

If we integrate the system, I believe resources can be allocated and shared more efficiently. The additional funds saved from integration could be channeled to training up our teachers and increasing their pay. The command of our NATIONAL LANGUAGE and English as the second language of choice will soar to greater heights (nothing wrong with being fluent in the mother tongue also). Above all, the school will continue to foster unity and tolerance so that in 20 years, they won't be shouting at Parliament at one another for being racist.

Saturday, December 6, 2008

RMC New Campus & Events

Updates of the development of RMC new campus:

  • The Ministry of Higher Education has now intervened in the process for attaining IB status. The Ministry has concluded that the request cannot proceed without the Ministry's approval since IB falls under its purview. The implementation plan has now slipped to 2011.
  • The location of the new campus is now in question as to whether it is on Military reserve land, Government reserve land or some other owner's land.
  • The proposal to position a one-star general as Commandant has been politely declined (the current Commandant's pay grade is lower than the Director of Studies, thus making it extremely difficult for the two to work together and for the Commandant to execute his policies).

The most recent recruitment drive brings a total of 1017 applications nation wide. The criteria for selection is being questioned as to whether the minimum of 6 A's in PMR is based on the trial exam or actual. If one is to acquire 6 or more in his trials, get accepted and then later find out his has failed to achieve minimum of 6 in the actual, does he still qualify? OPA has requested this issue to be clarified.

OPA is also planning to organize a forum featuring YB Nasir Hashim and OP Rahman Embong. The topic will be about the future of race-based politics in Malaysia. This is scheduled to be in January 2009.

The second forum will be in February 2009 showcasing the former MCA president Tun Ling Liong Sik and former Minister Dato' Seri Radzi.

It is unfortunate that the newly constructed bar which was built without the knowledge of the committee will be used for liquor and booze for a Christmas celebration. Perhaps the OPA is becoming more modern and liberal. One OP was ostensibly captivated with this 'joyous' liberalization of alcohol in the building that he emailed his friends to come to show their support for this change in policy.

Tuesday, December 2, 2008

Streamlined Education, why are we so divided?

Demi negara

Update 2: 3/12/08 Storm over vernacular school statement

Update 1: 2/12/08 Dato' Mukhriz proposing a streamlined education

I've always been a strong advocate of a streamlined education system. We indirectly promote segregation by sending our kids to vernacular schools. The Chinese has always been protective of their school systems, refusing to assimilate with the others, yet at the same time demand equal rights as Malaysians.

Tun Dr Mahathir mentioned this yesterday at a seminar at the Perdana Leadership Foundation. Judging from the consistent size of audience he normally attracts, it is obvious that people still seek judgment and wisdom from the Grandmaster.

For OP President and the OPA, this is the best time to promote the Royal Military College which emphasizes co-operation and unity. All are treated equal and trained as one unit. If one makes a mistake, it will be a price everyone pays. There is a lot of respect for each other, regardless of race or religion or family background (sometimes sons of General's get away with things). National service is not too bad but if racial polarization has been indirectly nurtured in our fragmented education system, teaching these kids about unity and racial tolerance at age 17 won't undo the damage. I strongly support a one-education system. Of course, a sudden change in the education system would invite huge protests. It has to be done in stages.

This would also augur more competition at schools. The average Malay students could emulate the bright Chinese students and study together. The english language could be practiced more by the Malays who are not so fluent in it and practice with their chinese and indian friends. There should be an english-speaking day at school. PPSMI (Pengajaran Dan Pembelajaran Sains Dan Matematik) can be better implemented if the students get to practice more with their chinese and indian friends. I think the Malays speak more Malay when they are in the company of other Malays. It is the same with the Chinese. Somehow, we automatically tune ourselves to the English language when talking to our chinese or indian brethrens. At the very least, we change our tune to 'Mangelish'.

Of course, by merging all the schools, there would no longer be additional funds for the chinese and the indian community. Their community and political leaders must accept this if they respect racial tolerance as a virtue.

See my earlier notes on streamlined-education system.

Extensive work ahead
Tolerance is the path to unity
Efficiency in allocating resources
Only UMNO has the weight to change

The new Pakatan Rakyat candidate for Kuala Terengganu?

Update 1: 6/12/08: Nik Aziz picks Mat Sabu as his preferred candidate, stating that Mat Sabu's rhetoric and aggressiveness are to be admired. The recalcitrant PAS State Youth Assembly disagrees with the Mursyidul Am.

Zaid Ibrahim is not a happy camper.
  • He has lost his bid for Ketua Bahagian in the recent UMNO Kota Bharu Division election. He was suspended as UMNO Kota Bharu Division chief 2 terms ago after being charged with money politics.
  • He's annoyed that Tan Sri Muhyiddin is leading the pack in the nomination for Deputy President of UMNO (he had asked TSMY to step down if TSMY is not in agreement with the Prime Minister's transition plans).
  • He made the proposal to allow foreign law firms to set up operations in Malaysia without having local partnership - on the basis that Malaysian law firms especially Malay firms need to learn to be competitive and not be dependent of the NEP.
  • He has also failed to carry out his so-called 'judiciary reform'. The judiciary has lost its trump ever since the so called 'judicial crisis' 20 years which saw the departure of the then Chief Justice and 4 others, according to him. He made the suggestion that the Government should apologize to Tun Salleh. He was later shot down by the Cabinet for not referring to the Cabinet first before making an official statement.
  • He had then proposed to the Cabinet for funds in the vicinity of RM10M to be disbursed to the former judges as ex-gratia payment (neglecting the fact that they have been enjoying pension as well due to the the Prime Minister's kind consideration. Normally pension is not given if sacked from a governmental post) and was upset when the figure was debated in Parliament. By the way, ex-gratia in Latin for 'as a favor'.
  • He resigned as Minister in the Prime Minister's department in charge of law because of his conflicting views of the Internal Security Act, particularly with regards to the detention of Kok because of the azan issue. He was then pressured to give up his senatorship, which he held for quite some time before letting it go.
  • He is likely to be playing devil's advocate by proposing that the concept of "Ketuanan Melayu" has failed (whatever Ketuanan Melayu may mean to different individuals or groups, call it Special Privileges or something else if you like - yes it is that constitutional provision which the non-Malays are not so bubbly about).
  • He also suggested that as long as the out-spoken Tun Dr Mahathir is around, reform in UMNO and in the government is near impossible.
Good on him that he has moved on to other things in life. Expect him to be given a high post in the green Pakatan Rakyat as a true 'reformer' and 'Malaysian for Malaysia' hero. Maybe Pakatan would give him the candidacy for the KT by-election. Who knows.

Friday, November 28, 2008

This is the real Monsoon

Here's a video of the Sarku 2000 in northern Malaysia waters, South China Sea during the monsoon, with 16-ft swells and 40-knot winds.

Thursday, November 27, 2008

Governance Reform in Asia: Cultural Perspectives

SPEECH BY
TUN DR MAHATHIR BIN MOHAMAD
AT THE NATIONAL COMMITTEE ON GOVERNANCE:
2ND ANNUAL TOP EXECUTIVE FORUM ON GOVERNANCE
IN BALI, INDONESIA
ON 28 NOVEMBER 2008

1. When I accepted this invitation to speak on “Governance Reform in Asia: Cultural Perspectives”, the financial problem in the United States i.e. the sub-prime loans by United States banks seemed to be an American problem which had nothing to do with the rest of the world, and certainly not with Asia.

2. The international community was still talking about Globalisation, a borderless world and a free market. Countries, especially developing countries were being urged to change their ideas about political, economic and social management and policies so as to cater to the global village where trade and capital flows should be free and unrestricted, where foreign involvement in local affairs should not be considered as being against the principle of non-interference in the internal affairs of independent nations.

3. Asians are culturally conservative and orthodox. They prefer to do things the way they had done in the past. But Asians also have an inferiority complex and believe that the Europeans are superior people with brilliant ideas and ways of doing things. The Asians subscribe to the Eurocentric world and would always try to emulate the Europeans.

4. Since the first contacts with Europeans some 600 years ago Asians had become accustomed to adopting European ideas about politics, economics and social systems almost without question. This has become a part of the Asian culture.

5. So when the Europeans came with ideas about globalisation, borderless world and free trade, the general tendency was to accept
and to adapt to these ideas despite Asian countries having achieved independence. Reforms of governance must be made so as to accommodate the new vision of the world as a global village, to make possible the free flows of capital and the sanctity of the unregulated markets.

6. But even as these things were being initiated the world came to realize that the American financial crisis was not going to be confined to America alone but would engulf the whole world. All the systems of the west seem to be crumbling. Not only are they not delivering the expected benefits that they seem to have done to the world’s economy in the past but they seem about to destroy it.

7. Since globalisation and a borderless world would actually give better access of the American system and practices to all countries, including those in Asia, the question arises as to whether we should carry out reforms which would facilitate America’s and the West’s financial and economic crisis spreading to our countries.

8. I do not think Asians would want to be dragged down by an economic and financial crisis not of their own making. If we do not want this can we slow down the reforms including reforms in governance so as to minimise the fallout from the crisis in the rich Western countries. Can we in fact introduce reforms which can protect us more effectively than whatever practices that we have in place now?

9. In other words should we be carrying out reforms of governance to facilitate globalisation and free trade as we had planned or have been urged to carry out?

10. We need to rethink. If we are going to initiate reforms in whatever field we need to know what is happening to the world today in these fields. In particular we need to understand banking and finance better. The understanding may help us avoid changes and reforms which may have been the cause of the financial crisis.

11. There is evidently something wrong with the world’s monetary system. The Bretton Woods agreement provided for gold to back currencies. But the rich countries decided to go off the gold standard. Only faith determines the value of currencies including the US Dollar which was designated the reserve currency.

12. Without gold the US Dollar has no backing at all. It is basically a useless piece of paper. Only the demand for the US Dollar to settle trade payments keeps the value of the US Dollar up.

13. It is doubtful if the United States knows how much US Dollar is in circulation in the world. Its very poor security feature also makes it easy to forge.

14. If the United States manages it finances well the faith in the US Dollar would be justified. But the United States owes the world an estimated 14 trillion dollars, an amount which it can never hope to pay. For years the United States suffers from twin deficits. And everyday the United States Government has to borrow 1 ½ billion dollars to finance its administration.

15. On the top of this the United States banks had not been prudent. Without caring about their assets and resources they have lent huge amounts of money to high risk borrowers, particularly for the purchase of houses. The earnings of the banks were based on the expected interest on these loans.

16. To securitize the loans they were bundled up and offered to insurance companies. It was thought that the risk would be taken care of by the insurance companies. The mortgage companies also acquired these loans.

17. What brought down the banks, insurance companies and the mortgage companies was the huge total amount of the loans. They run into hundreds of billions. When the risky non-performing loans became bigger than the good ones and the collaterals have no buyers the banks could not recover the loans. The insurance companies were also unable to pay the banks because of the huge sums involved. Neither could the mortgage companies.

18. The main reason why all these things happen to the United States is because the introduction of numerous high return financial instruments had diverted investments from the real business of producing goods and services to investments in these financial instruments, which include risky loans, secured debts, collateral debt obligations, swaps, derivatives etc etc. Most people don’t even know what they are.

19. The free market also contributed much to the financial crisis. The theory is that markets can regulate themselves. When prices go down because of oversupply, production would be reduced and prices would recover. Governments should leave the markets alone.

20. But markets are about making money, maximising profits. The greedy soon found that shortages and oversupplies can be artificially created and manipulated. By creating an artificial shortage the prices would go up and the seller can make a high profit. When an oversupply situation is created by repeated selling, prices would fall. At that stage the goods could be bought and delivered to the buyers when prices were high, through yet another artificially created shortage.

21. That was what happened when currencies were traded.

22. Seeing what has happened to the United States and Europe should we carry out reforms of governance to enable all the systems and practices in those countries to be freely applied in our countries, in Asia. Although traditionally Asia would follow Europe, should we stick to this tradition, the Asian culture even though if may bring disaster to us.

23. I think we should think very carefully. Opening borders can result in the crisis of the United States and Europe assailing our countries. Yet we still need to deal with these powerful economies.

24. I am not competent to suggest the reforms needed in the circumstances. Asian countries have a need to make adjustments to the realities of the globalised world. We cannot isolate ourselves. In fact our growth had depended on the wealth of the Americans and the Europeans providing us with good markets.

25. If we allow them to go under or we do something that would destroy the economies of these countries we would lose the lucrative market. And we would also lose a source of capital.

26. We cannot simply shut our countries to these collapsing countries in order to protect ourselves. But we can be selective in how we accommodate them based upon the role we play in relation to them and on the basis of our economy.

27. The countries of Asia which have been most affected are those which succumbed to the easy money offered by the many financial instruments created by the brilliant minds in the financial industry in America.

28. On the other hand those which are too poor to invest in these high return instruments via the hedge funds or directly are not much affected.

29. The reforms of governance needed must therefore be selective in character. Whatever may be the reforms, there can be no doubt that Governments must come back to regulate and to supervise. It will make the free market less free perhaps, but that is a small sacrifice to make in order to minimise the effect of this unprecedented economic meltdown.

30. Bailouts must be regulated so that they adhere to legitimate banking practice. Insurance companies and other funds, including pension funds, must be subjected to Government initiated rules and supervision so as to reduce exposure to high risk investments.

31. Inflow of foreign funds must also be overseen. One of the problems faced by unregulated investment in stock market is the massive and sudden dumping of shares when things look bad or are expected to become bad. The sudden outflow of funds will have a deleterious effect on a country’s economy.

32. Foreign holdings in any local company should be limited. This is especially so for banks and insurance companies.

33. Governments must be prepared to regulate free trade. Where necessary import duties and excise duties should be used to protect local industries.

34. Exchange rates need to be realistic. Free floats needs to be looked at with caution. Where possible fixed exchange rates may be adopted and currency trading be made illegal.

35. Whatever the policy adopted to cope with this worldwide economic crisis, reforms of governance must still be made to provide for efficient Government i.e. efficient bureaucracy. Efficient bureaucracy must mean minimal bureaucratic procedures.

36. Corruption is the bane of all countries. It cannot be totally eliminated. But it can be reduced if bureaucratic procedures are minimal and take the shortest time possible. Any delay must suggest corruption and investigations must be carried out.

37. Government requirements in order to gain approval of anything must be very clear and must be made known to the public. Where compliance is full there should be no delay in approvals.

38. Being business-friendly is necessary in order to maximise private sector contribution towards economic development. It is the duty of Governments to find out what complaints the private sector has and to remedy them.

39. Some of what has been mentioned regarding reforms of governance are not really reforms. And some of the others would be too late to prevent the effects of the financial crisis of America and Europe from hitting Asian countries. But they are necessary nevertheless. They may be able to reduce the impact and perhaps enable earlier recovery.

40. The countries of Asia will have very different problems depending on the stages of their development, their resources and how much they are hitched to the global financial systems. Those which have depended on foreign credit or have been involved in investments in foreign funds would suffer most.

41. On the other had those with large reserves in foreign currencies or have big savings may be able to reduce somewhat the impact of the crisis.

42. Whatever may be the impact of the financial crisis the judicious measures in the governance of the economy will still prove helpful. The important thing is to ignore old habits of imitating everything the rich western countries does. Asian countries must in fact initiate changes, including those to the monetary and financial systems.

43. Asians have always believed in the role of Government in regulating institutions. The world is about to view Asian practices and systems more positively. Asian countries must therefore make their voices heard. And this includes the small developing economies as well. It would be fatal for them if they allow, as in the past the rich and the powerful to devise the systems by which they must all function. In particular the banking system and practices need to be looked at from the Asian developing economies point of view and interest.

44. Governance is defined as the act, process or power of governing, As the situation surrounding government changes, there must also be changes to governance to cope with the new situation or surrounding.

45. What needs to be done may constitute reforms of governance.

46. But reforms are often constrained by the culture of the people involved. There is no doubt that Asians subscribe to different values even among themselves but more so between them and the Europeans.

47. In a Eurocentric world Asians tend to accept everything that came from the West i.e. from the Europeans as right and proper. It is difficult for Asians to reject what originates from the Europeans.

48. But that culture, that blind acceptance of the systems and ways of the Europeans must be modified, if not discarded.

49. What we are seeing today is the collapse of a very fundamental European institution, that of money and banking.

50. It is not enough to just tweak our present system of governance. It seems that we must be prepared for radical change. And Asian ideas must find a place in the development of these changes.

51. As the saying goes we have to go back to the drawing board. We have to question the system we have used for centuries. We have to consider redefining them, introduce new rules and regulations and provide for greater governance.

52. We may have to throw out the system altogether and devise a new one.

53. All these are not in our culture. But our culture must not stand in the way of necessary reforms, if it means saving our economies and our states.

Wednesday, November 26, 2008

Corporate Pirates

It's dumbfounded when you review the credit crisis in the US. AIG is in the brink of collapse, yet they have spent almost 1/2 million bucks to send their lackeys for away day, USD20 Gs for spa , USD7,000 for golf and USD150,000 on just food. At the same time, they are crying out for help to get a piece of the USD700B stimulus that was approved by Congress earlier.

On the other hand, corporate titans cringe at the idea of paying too much bonuses to their hardworking staff when their revenues sky rocket in "historic proportions" (to plagiarize Obama's description of the ailing economy). Corporate bosses spend in excess of USD20-50k per trip on their private jets on the basis of time optimization, convenience, security and efficiency (in other words, they don't like to wait in line or wait for the plane to take off). Not to mention their ridiculous pay, stock options and golden hand shakes (see my earlier notes). Don't misconstrue me. I think CEOs and Senior Management should be paid handsomely proportionately to performance, same with their working staff. However, when times are bad, it should also be proportionate. We all work for money, there's no denying that (with the exception of Buffett & Tiger Woods alike). This is when staff morale plummets seeing their big bosses perusing the latest yacht catalog while you see your colleagues being thrown out.

Obama is likely to stir the pot. He has refused lobby money profusely. He is therefore not bounded by pressure from the lobby groups. That is encouraging. The fate of the US economy will affect us and the longer it is hurting, the worse it gets for our exports & services, hence money into the country.

Meanwhile, Main Street is not happy at all. People are flabbergasted to see all their hard-earned money taxed by the Government and given back to the same people and corporations who kicked them out of their homes and took away their jobs.

Sunday, November 23, 2008

Malaysian Economy is Doing Fine?


We read everywhere in international mainstream channels of the plaguing economic horror in the horizon. Some say it will be worse than the Great Depression in the 30's. People are being retrenched in the US and Europe especially by big corporations to reduce operating expenses. Companies are finding it difficult to pay salaries. Investors are exiting to get their hard cash out of the beat up market. Confidence is running low.

In China and India, real estate value has dropped more than half. People in the US are being chased out of their house because of loan default. Airline industry will face yet another challenge with losses in the billions of dollars and will be forced to consolidate even more. Banks are being closed down in heaps in the US. The US Government is forced to pump funds into the ailing banks, lest they will cause the whole economy to collapse. No banks would mean no loans, no homes to pay, no cars to use. Detroit is asking for US25B to stay afloat. Everyone's pulling their hair out.

Somehow, Malaysia's way above everyone else. We're not worried about all this. We're far too embroiled with whether yoga is permissible for Muslims, what language we should use on road signs and whether bloggers need a code of ethics. Meanwhile, crime rate and inflation are increasing, food is becoming less affordable, projects are being shelved, demand in exports is slowly dropping.

Malays are still phobic of losing their Constitutional rights but at the same time not stepping up to the challenge. We scorn at the prosperity of the Chinese and the social imbalance but don't force our kids to learn Math and Science in English, in fear of getting behind further. We don't understand the dangers of subsidy and ask for more. At the same time, we lambast GLCs who are not performing, yet demanding huge 'social obligations' especially to Malay companies. The Penang Government wants Petronas to fund the second Penang bridge but at the same time wants petrol price to be reduced (thus increasing subsidy money from Government's coffers, although it doesn't directly impact Petronas' revenue).

We need to know what inflation is forecasted to be for the next 2 years and how this would affect the middle and low-income groups. We need to know whether the over-issued hire purchase loans for cars would impact the economy, similar to the subprime crisis in the US. We need to know how Petronas would be affected if oil price drops to pre-war price of USD25/bbl, how much this would boost MAS' income and other oil-dependent businesses. We need to know if we have strict enough regulations to avoid issuing too much debt by banks. We need to know if credit card spending and debt will be our 'subprime loan crisis'. How much of our exports are affected? If this reduces, what is the remedy? Will people lose jobs? What is our backup plan? Are we exiting from losing investments in the US?

Reading our dailes, it would seem to an average Joe that all is hunky dory. Perhaps Malaysia's economy is isolated from the rest of the world. We should be fine then!!

*(Headline in Star read: "Inflation rate lower"). If you read the article, the inflation rate went from 8.2% to 7.6% in Oct. That's very soothing to know that inflation rate dropped by 6 points!

Friday, November 21, 2008

Drilling Fluid Coordinator

Job opening at Baker Hughes Malaysia for the position of Drilling Fluid Coordinator. Required experience is 6 years in mud engineering. Primary responsibilities are coordinate operations, provide technical support for clients, prepare tender documents & manage training for engineers.

Well Operations Coordinator

Another job vacancy in Qatar with Air Energi, 6 years of experience, primary responsibility as well works/workover/intervention supervisor, responsible for slickline and E-Line ops.

Thursday, November 20, 2008

All Going South

1. Oil price has plummeted from a high USD140 per bbl to USD53 per bbl in less than 3 months. OPEC has cut down its production in view of the global economic slow down.

2. Because of the low oil price, many exploration and development work have been re-evaluated. This will cause capex reduction by operators and consequently affect service companies. The investment made in reactivating "cold" rigs and aged boats will be in vain.

3. US consumption of retail goods have declined in lieu of paying off high mortgages and credit card debts. The average household now spends close to 70% just to pay off debt. The overspending in US above its mean is a clear cut example of how capitalism and the 'invisible hand' that corrects the market have failed.

4. Detroit has failed to secure USD25B stimulus package to help the ailing auto industries. This in return further dampened market confidence and reduced the Dow Jones by another 6% last night. Japan's Nikkei lost 7% and HK lost 5.5%. Japanese exports declined by7%, the biggest in decades. Trade deficit in Japan is absolutely abnormal.

5. There are over 1.5M jobs lost over the last few months in the US. Rolls Royce has announced its job cut plan recently.

5. Property value will go south due to foreclosures in the US. Property market has always been a good indication of how healthy the market is. Except nothing less in Malaysia as well.

6. Because Asia has been prudent and learned her lesson from 98', the cash-rich Asian countries are not feeling it just yet. That doesn't mean a slow down is not in order. Already we have seen drops in traveling, hotel occupancy, retail business and such.

7. Malaysia is in a better shape, but is not out of the dog house just yet. Viable projects cannot be shelved. Projects will benefit the construction industry and attract investors. The reduction in EPF monthly contribution is not a viable option for the long run.

8. What Malaysia needs is creating value. We are merely making patches for the leaks, but the big flood will come. We have yet to have a strong second engine of growth and oil revenue is not sustainable for the next 20-30 years.

9. Space programs should be shelved for now. Archways and bullet trains can wait. Subsidies have to be reduced. Tax cut could work to reinvigorate local spending. Corporate taxes and wind fall taxes could be studied and expand to businesses shielded from the recession or enjoying subsidized fuel or electricity.

10. The RM7B is too important for a few people to decide where it goes. The National Economic Action Council and other agencies and groups should sit together and ensure that every cent in the stimulus package is put to good use. Parliament should also form a special committee to be part of it, similar to how Congress and President-Elect Obama are handling it. This committee must also include corporate chiefs, leading CEOs and senior economists, not just politicians. Malaysia is eager to know how this money is spent.

11. We need to exit from failed investments abroad (especially the ones in the US) and reorganize our foreign portfolio. It's not a bad idea to pump money into the ailing banks in the US as they will recover from this in the next 5-10 years. The banks are projected to receive at least half of the USD700B stimulus package.

12. The food industry should be monitored and ensure that recession would not hamper food production and price.

13. This is also a good time to study sustainability projects, such as power generation from waste, alternative energy generation. Cost optimization for running the Government (fed, state and local) could also be studied and implemented. Skype and video conferencing should be encouraged. Travels should be reduced unless totally necessary.

14. It's also not a bad idea to scrutinize how zakat money has been spent. An audited account should be made public, if it hasn't. Zakat money will definitely help out the poor & needy to cope with rising food prices.

15. All eyes are on Dato' Seri Najib, our soon-to-be 6th Prime Minister. This single economic challenge will, without a doubt, define his prime ministership. We should all give him our fullest support, despite political affiliation. Malaysia must remain vigil. Get productivity up and stop changing road names....