- Oil price is highly driven by hedge funds and futures market. The rise has been almost 50% in the market since early this year versus a mere 10% oil stock gain.
- Endowment funds from Harvard, Yale and Princeton are also the culprits. However US congress has passed bills to restrict hedge funds from manipulating the price of commodities.
- Yes, we cannot compare ourselves with Singapore but we need to compare ourselves with other oil producing nations. Firstly, our production is a minute 600,000 barrels per day and consumption eats 75% of that. Although Indonesia produces more, close to 1.1M barrels per day, they sell the cheap shit at the pumps, RON90. Of course, income per capita needs to be compared too, and that's a separate issue. That's all about the well being of economics and the purchasing power of the Ringgit.
- Yes, because of the higher oil price, Petronas makes more profit. Profit is reinvested into acreage outside the country. Should we negate growth for the sake of distribution? That's a classic socialist stand and we're not going there I hope. Why should every walk of life enjoy the subsidy at the pumps? Surely there are better ways for redistributing wealth. The impact or efficiency of the current distribution method is a topic of a separate issue.
- Yes, because Petronas is an efficient money making machine, Government makes more year in year out. Petronas is in no position to decide how royalty and tax money is spent. That's up to the Minister of Finance. Even the former Finance Minister was against the former PM on subsidies and now he is promising another false hope that he would give back the subsidy if he is crowned PM. Any populist could do that.
- Government subsidizes not just petrol, but education (which is close to RM7B a year and that's just up to secondary edu), scholarships, funds for universities, natural gas for power consumption and cooking, palm oil for cooking, LRT, feeder buses for LRT. Funny how the people who benefit from scholarships and tertiary education are the same people criticizing the Government (let's generalize the term Government, we may argue about the difference in leadership present and past, etc). They should join the struggle and not just become arm chair critics.
- Suddenly everyone is interested about how the Government spends our money. Has anyone checked the Budget every year? Has anyone read the 9th Malaysian Plan? Has anyone researched the mid term report by Finance Minister at Parliament? How much do you think we need to pay the salary and pension for more than 1 million civil servants? What's the cost of purchasing equipment and gear for our cops and soldiers to protect and serve? Without subsidies, how much do you think a medical checkup for flu would cost? I reckon no one cares.
- We also talked about government efficiency. My take: we can't just blame the civil servants. We should stream line operations and make it efficient; need to discard irrelevant ministries and merge overlapping authorities. The US has 15 cabinet secretaries managing 250 million people, surely we don't need 31 to manage 26M. This requires balls made of steel and strong political will. Obviously it would not happen in a fortnight especially with the fact that although UMNO is the backbone of BN, they are not a big majority and still requires co-operation from component parties. That is the dilemma.
- On NEP: if people are against the NEP, what is a better economic solution to stimulate growth? Should we invite capitalism to dinner? Should we let the strongest and fittest run over the mom and pop shops? It's the same argument with globalization.
Branch level will commence their meetings on 19th July. Remember that who you choose at Branch level will impact those at division level, consequently national level. Make the right choice. I have yet to decide on my choice; it's all about the lesser of two evils.