The Gift

I am not sure what gotten into my wife but she asked me to go shop for Christmas gifts for her brothers and my sister. Now, I am never into buying gifts for Christmas for the same reason I don't buy gifts for Valentine. To me, I don't want a commercialised event to create an unnecessary tradition, more so when giving should be freely from one's heart regardless of occasion.

Source: http://www.belhurst.com/Gift-Certificates.html

Then again, there are exceptions like gift exchange event organised by my former employer last year.

The funniest thing I noticed when I made my rounds in these shopping centres hunting for gifts is the amount of attention given to this particular holiday season. Perhaps it is just me but I noticed for Deepavali, Mid Valley only allocated a corner to do a customary Deepavali commemorative decoration of sort while for Christmas, their left, centre and right courts along with that little corner they used to do their Deepavali decoration was fully decorated with Christmas themes.

On top of that, it is really amazing considering the main focus are always about Christmas trees, Santas, reindeers and of course gift boxes accompanied of course by the evergreen Rudolph and Santa songs.

I am not complaining but I can't help but notice that Christmas is THE event this year since somehow the decorations in these shopping centres eclipse that of Hari Raya and Chinese New Year!

I am amazed and can't help but acknowledge that money plays a big part in all of this and what is better than pushing for an event which encourages shoppers to part with the monies from their wallets? Afterall, isn't this the season of giving?

Source: http://ihmnew.marywood.edu/3.OurSpirituality/ChapelWindows.htm

In the last 100 years, I wonder what happened to the story of the manger where all these started? Isn't it about The Gift where it is God's provision for mankind for all times? I guess retailers don't like controversies. More so The Gift was delivered by an unmarried virgin in a taboo and moral conscious society.

So to all everyone out there, if you have time, to read about controversies, read about the Nativity.

As for those celebrating The Gift God freely gave us:

A very Merry Christmas!

Fuel Taxes Since Nov 1...

Datuk Sharir Samad today revealed two things on the pump prices:

i) They have stop subsidising since Nov 1, and

ii) At the old rate of RM1.92 per litre, they still have "surplus".

which is what Malaysian Insider take it to mean Malaysians are effectively paying fuel tax since Nov 1.

Thanks to the secrecy encompassing the fuel price computation formula, we will not know how to compute this discretionary taxes we are paying but the Government assures us that the Government can afford to lower the price to RM1.92 per litre and still attain positive collection. So effectively, we may be subsidising the Government at 5% (if not more) per litre (I take it that they can afford to lower it by 10 sen but we will never know).

From the little the Government has revealed when the crude oil prices fall below USD65 per barrel, they have stopped subsidising our pump prices. As of today, it is about USD55.25 per barrel. Imagine if the fuel prices continue to fall to USD30 per barrel as some predicted (which I personally doubt it will go that low).

Source: http://affordablehousinginstitute.org/blogs/us/2007/01/immobile_homes_2.html

Anyway, I wonder if the Government will continue lowering the pump prices? We can see now they somehow didn't lower it to RM1.92 despite their clear ability to do so...

I mentioned in my previous entry, "No floor please..." in support for the removal of pump price subsidy under the general idea that it should be left to market forces to dictate the pricing. But to burden the people by excessively taxing them under the pretext that the Government is more efficient in allocating resources to the needy, that is a very bad notion. Like I previously suggested, why not just impose a clear cut consumption tax or at least reveal the formula and input data?

I wonder if this hidden tax requires an amendment to the Income Tax or Excise Tax Acts since effectively they are now collecting taxes? Would there be any dissenting MPs who dare to voice this up on hidden taxes the rakyat has to bear?

The ones to be bear the brunt are again the poor.

UPDATE @ 6:13 PM:

From the Malaysiakini article, "Shahrir: No need for petrol subsidies", I have extracted the following:

He added that the government might still make a "a bit of income" if prices shrink back to pre-June 5 prices of RM1.92 for RON97.

"The petrol subsidies disappeared once the global price of crude oil went down to US$65 per barrel," said Shahrir, explaining that the price is now around US$55 per barrel.

At present, the cost price of RON97 is below RM1.61, said the minister. This means that consumers are currently paying 39 sen above the actual price.

Shahrir said even after considering the 19 and 12 sen revenue per litre going to the energy companies and kiosk operators respectively - the government can still marginally profit from pump prices at the RM1.92 per litre level.

So technically, if we take the 39 sen excess we are paying to minus out the payments going to energy companies and kiosk operators, there will be an excess of 8 sen. This, at RM1.92 per litre (RM1.61 plus 19 sen plus 12 sen), translates to 4.2% discretionary hidden tax imposed on all motorists using RON97.

That is assuming it is based on a "current actual price" which we will never know unless the Government graciously tells us. And yes, perhaps they need the Cabinet to declassify the information too as it might be under OSA. Sigh...

Much Ado About Nothing: On Choices...Again

After a long lull, I decided to write someting after reading zewt's blog entry this morning. He talks on usage of children as shields from police action, criticism for that actions and that in looking at the big picture, many also invoke the names of their children to do just about nothing at all even in the sight of great injustice.

As I wrote down my comments to his entry, I realised that it is again about choices. For instance, when I read the online news for the past week or so, I noticed there are much of about the same thing being rehashed, recycled and reported. I noticed there are little for me to put my views on as it seemed redundant to repeat myself. Or in other instances, it is nauseating to even bother writing such as on oxymorons pertaining to some leaders blowing clarions on the need to fight/resist/or simply I-don't-use money politics.

And also due to my home internet connection running at snail pace of late. I can't even view my favourite animes on crunchyroll.com.

So anyway back to choices.

Source: http://fly4change.wordpress.com/2008/06/06/consumerism-whats-your-first-reaction/

In life we make many choices - some mundane, others important; some impromptu, others after much careful considerations. There are many trade-offs we can make that will seem better for the future after looking at the direct consequences of my actions. And popular ones too.

We can quote many reasons to support our actions like how the police have reasons to act by arresting peaceful demonstrators for fear of causing national insecurity. Fear afterall, is another prime motivator for doing just about nothing and everything possible to keep things per status quo.

But ultimately, from the choices we make, who is to judge if it is really good or bad? Afterall, everyone has their stories to tell. Not everyone place equal weightage of the same factors as us. Will we see them lesser or greater for the choices they make? So by what standards do we use to measure?

How nice is it that we can live in a carefree life where we don't have to make difficult choices. Just making simple choices like whether to have foie gras for appertiser or perhaps a simple mushroom soup with warm bread instead. We have no one to blame and everyone is our friend.

But knowing that few, if any, has such choices, I guess one other choice we have is what we make out of the consequences of choices others made. We can choose to be upset or worry or just wait and see. Like when I ordered that tong yuen in ginger soup dessert and wondered if I should do the same for my friends though they have asked for me to order for them. They weren't upset. They ended up ordering things the like instead.

Reflections Of Times Such As These

My one and only big sister just had her wedding on Saturday. I am glad she is blessed with a good husband and I hope their union will last their lifetime. One could say that the companion one has in part define the type of person one is. It is during such times that I have an opportunity get a small glimpse into her life by the friends she has and the kind of person her husband she is married to.

But I also noted an interesting observation during this happy occasion. The lunch caterers and hotel where she had her wedding banquet hired foreigners as waiters. Now, I find these foreign waiters are neither exceptional in terms of quality of service provided nor well versed with Bahasa and English. I wonder why then do we still resort to employ foreigners? More so when everyone is forecasting a grim outlook and placing their bets on global recession?

Source: http://www.sfgate.com/cgi-bin/blogs/sfgate/category?blogid=26&cat=622&o=30

My cup of tea are often not refilled unless I request for it (this is despite the promise by the hotel management that we will have a ratio of 1 waiter to 1 table), they are rough in handling food resulting in spillage and mess and they don't quite understand the need to smile. So what makes them better than our locals? Or to look from another perspective, are locals shunning this sort of work? Can we still afford to be choosy these days?

As I read Malaysian Insider, I am perturbed by two articles published i.e. DBS to cut 900 jobs and US job gloom drives Singaporean grads home. I worry for my friends working in the financial sector in Singapore more so for those in DBS. If they are retrenched, it is likely they will return to Malaysia and I am worried they might find difficulties in securing jobs here as most financial institutions here has slowed their recruitment drives. As these professionals return home, wouldn't our weaker labour and wages market be further pressed?

As there is so much the rakyat can do to help themselves, we naturally look to the Govt for leadership, guidance and assistance. With our uninspiring Govt announcing RM7 billion stimulus package, is it enough? DAP certainly don't think so.

And what if it is really not enough? Are our Govt prepared to pump more when they cap their budget deficit of 4.8% for 2009? Wouldn't that send more worring signals to investors that our Govt can't keep their words?

With so little faith reservoir to draw from, ultimately, can this Govt last? I guess if they manage to steer the nation away from troubles, they would win supporters. If not, history are repleted with a lot of references of what happens to indifferent governments to the pains suffered by their people.

In ancient China, dynasties fell because the emperors lost "the mandate of heaven" to rule. And they fell not because some natural disaster hit the palace and kill the whole royal family. Instead, it is the ordinary lives of their citizenry undergoing hardships, extensive suffering and lost triggered by economic troubles which followed from natural disasters that caused a groundswell for rebellion to be built as the citizenry take these signs are cue from the heaven to uproot the "illegitimate" sons of heaven.

Source: http://rosenblumtv.wordpress.com/2007/05/

Also, Louis the XVI and his wife, Marie Antoinette were removed from power and executed for exactly the same reason. Their crimes: Indifference and basking in opulent wealth while witnessing persistent, prolonged and widespread economic suffering faced by the French citizenry.

So which will it be then for Malaysia? A story we can tell our grandchildren on our successes or missed opportunities? Only time will tell...

High Court Releases RPK!

Alert! Alert!

I got the following from Malaysiakini:

Court orders Raja Petra's release

Nov 7, 08 9:46am

The Shah Alam High Court this morning ruled that the detention of well-known blogger Raja Petra Kamarudin under the ISA was illegal and ordered his immediate release. MCPX The judge ordered that Raja Petra be produced in court by 4pm today after which he should be immediately released.

The only problem is I am afraid the police might re-arrest him when he sets foot out of the door. Let's pray and hope this will not happen.

Envy and Pursue

My friend recently told me he has been offered an attractive position in another organisation where he is tasked to set up a whole new unit of which he will act as the head. I am envious of course considering how far he has come but I am glad he has moved so much further ahead.

Unlike him, I never stayed put in one job for long. In my quest for something better, whatever the better is, I have move around in search of a better paying job with greater challenges. Yet at the same time, I yearn for a slower pace of life where I can achieve some sort of work life balance. I have to admit that wherever I move to, there is much to observe and learn. Yet, with more knowledge comes realisation. The impressions I have as an outsider turn insider more often than not changes for the worse; I realised the shiny and beautiful scenes behind the windows I see as an outsider are actually quite limited, tainted and blurred.

I have made a move or two on the basis of simple greed because I felt compelled by impatience to move forward. Besides, the money is good so why not since I have real needs. In fact, when I first bought my house, I am doubtful if I could afford it then when my salary is not enough to cover my basic expenses and at that time, I relied heavily on balance transfers to make do until year end bonus to end up with a clean slate. I know I can be reckless but looking back, I am quite glad I made that impulse buy back then.


Anyway, my other friend once told me that he only makes a move if it is a upward progression as he strongly believes horizontal moves would only provide short term gains. With many changed jobs later and a little reflection, I guess my accidental self experiment proves that point somewhat. I hate it when I recall the I-have-more-experience-in-life look of my everknowing dad repeating that old adage, "A rolling stone gathers no moss" over dinner.

Yet the conflict inside me often makes me wonder if I am at the right position where I am today. Am I doing the right job which long term prospect in mind? I am of course tired of jumping here and there. I don't like the "new guy" label too with all the happy introductions when what I really want to do is just get the job done and go on and do what I want to do; a bit anti-social I must say.

My boss recently told me my next step in progression upwards. Technically, I am better than most people at my current job level in my organisation. But for me to make the next step, I have to step up and take up middle management role. I would have to rely more on my people skills, interaction and dealing with clients i.e. build my own portfolio. Am I truly ready? My heart sort of sank a bit as the room seemed darker and hotter as he uttered those words.

Source: http://www.designedlearning.com/Articles/FeaturedAffiliate/NewsForAChange/Sept1998.htm

I sense he is genuinely grooming and showing concern to me but I can't help but feel somewhat inadequate. The future looked so bleak as I walked to the carpark recollecting the words he spoke to me. Like a blind man reading the stars, where will my future be as I grappled with the surrounding darkness. I have grown comfortable to be lead and to me, the whole aspect of leading is a very fearful prospect. Yet, that is the only progression available from the way he pointed out to me. I wonder if that is really what I want. I wonder if this is an indication of severance under the guise of independence.

Oh well, I just have to walk one step at a time and plan ahead with an umbrella ready should rain start falling. But which path should I take? There are often no road maps and again another adage comes to mind, "Life's a journey, not a destination."

Gosh, I hate adages. What's with these wise people anyway? Do they really have that much free time?

Valuecap: More Questions From Assurances

I am perplexed. I tried re-reading the articles again and again trying to figure out what makes the Valuecap shareholders so happy that they are willing to settle for mere 3.5% coupon rate and RM135 million dividend for an investment they made back in 2003 which technically was restructured in 2006.

The fact that there are 3 shareholders namely, Khazanah, KWAP and PNB investing in Valuecap and lending them monies with such low returns makes me wonder what was the other factors that Khazanah, KWAP and PNB would have considered lending Valuecap RM5 billion facility with 3-year tenor.

Source: http://goal-exchange.com/?p=104

I mean PNB paid its investors annual dividends of more than 7% per annum while KWAP is tasked with managing the pension funds of the civil servants. Surely settling for something akin to inflation rate is not going to help much with the growing burden of supporting the pensioners or getting close to the more than 7% annual dividend PNB unitholders look forward to right? As for Khazanah, well, they still have to answer for a lot of weird investments like Silterra so for this purpose, I will just leave it out for now.

I wonder, in providing financing, would they have asked themselves as they quietly ponder their investment papers on how Valuecap is going to pay back the principal back? Afterall, with Valuecap main activities revolve around buying undervalued stocks which technically need a medium to long term timeframe to exit, is it unreasonable for them to ask for a timeline of sort for orderly disposal and building up of cash reserve to repay (since it is safe to assume now that these debts consist of bullet repayment).

Again, they may have nagging feeling that considering the size Valuecap was investing in, if Valuecap was forced to sell at the last moment i.e. around Feb 2006, that would negate the reason Valuecap was set up at that time which was to provide support and build confidence in our local share markets and undervalued counters. So did they?

For further assurance, not that they don't trust their fellow GLC or state agencies, being independent and with interests of stakeholders such as pensioners and unitholders at hand, shouldn't they too requested for undertakings from Valuecap to ensure that they stick to some sort of sell down schedule?

For PNB and KWAP, which are no strangers to managing funds and investing in the share market, wouldn't they too might have considered that in the event Valuecap can't sell down, they could settle for in-kind like taking the shares at that point in time (with perhaps a slight discount) as payments rather than settling for cash if Valuecap fails to follow the dsupposed isposal schedule? But did they asked and considered such possibilities?

Or perhaps in lending, did the Government also guaranteed the RM5 billion advanced in 2003 and that perhaps has been the major scoring point the lenders take into consideration in lending those monies in the first place? If such is the case, why didn't they call on that guarantee in 2006?

Source: http://www.bowmancoaching.co.uk/coaching.html

And now we are back to the same question, why then are they happy to settle for mere 3.5% coupon rate and RM135 million dividend return made over close to 6 years investment?

Meanwhile, left with more questions rather than assurances from the Minister himself, I am not too glad he only allowed for employees to voluntarily reduce EPF contribution by 3% for the next 2 years. I wish he should have been more specific, like for those with housing loan, they can opt to not contribute for 2 years and use their monies to pay off their housing loans.

Surely that would have encouraged more people to consider settling their loans faster. That may free up more monies and encourage the banks to lend more as their loans to deposit ratio will reduce further.

Unlike the Government, I will admit why I favour that as I do have an ulterior motive. I just want to contribute as little as possible into a forced savings plan I don't trust and sure as hell want to pay for something I am quite happy to live with.

So can we have less beating about the bush and just more frankness in the explanations given?

And it comes in 5s

Today is Monday. I dread Mondays. Monday is the day signifying the start of the working week. And on these days, I have to wake up 5 minutes past 6. I have to leave my house 15 minutes before 7 in hope that I will reach my wife's office about 45 minutes later.

Source: http://drewmaniac.blogspot.com/2007/10/chucks-and-mondays.html

I know I have to work late on Mondays because it usually takes longer to get the working mood in order. I left around 9.35 pm today and I paid my RM5 parking as well.

On Sundays, I usually lament around 5 pm as the sun slowly sets at the western horizon and I dread the next day which reminds me the 5 working torturous days ahead. Oh how I dread Mondays.

And today, guess what?

I was surprised that Valuecap owes its shareholders RM5 billion which it does not seem to be able to pay. And EPF is supposed to loan them RM5 billion on the basis that they are a good investment company which will profit from taking advantage of undervalued stocks (but for the fact that Valuecap's superior-investment-research-technique-investing-on-portfolio-basis includes getting the lenders to lengthen their repayment by another 3 years which was conveniently forgotten to be mentioned by both current finance ministers and the immediate past one as well).

Will EPF face the same come whenever it is supposed to collect back its principal loaned? Well we know Valuecap has set a precedent which it may or may not follow. It really depends on its superior-investment-research-technique-investing-on-portfolio-basis.

And before the day concluded, I read about Tony Pua was upset with the RM5 billion or so losses Silterra suffered. And guess what Silterra and Valuecap has in common? Khazanah Nasional as their main shareholder and creating an impression that monies grow on trees.

Source: http://library.thinkquest.org/J003358F/trivia.html

Sigh... if only I bury my head under the pillow and let the Mondays and 5s pass right by...

No floor please...

I guess the title said it all.

I am against setting a floor price for petrol even if the average world crude oil prices fall below US$65 per barrel. Instead, I am for removal of the subsidy by stalling the announcement of revision of the petrol prices until such time when the fallen average prices fully eliminates the current 30 sen blanket subsidy petrol pump given.

Source: http://adsoftheworld.com/media/ambient/jobsintown_de_petrol_pump?size=_original

In other words, if average crude oil prices hovers between US$65 to US$70 per barrel and the 30 sen blanket subsidy reduces to say 10 sen, then we should keep the present RM2.15 even if it justifies the Government reducing to RM1.95 to maintain the 30 sen blanket subsidy.

However, if the average prices falls below US$65 per barrel and the real petrol pump prices without subsidy is at RM1.90 (if not lower), why should we keep it at a RM1.92 floor price? I don't see why it should turn into indirect taxes of 2 sen imposed on the rakyat by setting a floor price when global crude prices fall further below US$65 per barrel.

His argument that the public would not be wise in spending if the Government allows this essential item to be treated as a cheap product is a double talk as far as I see it. If the Government can tell the rakyat to buckle up when the petrol pump prices are revised upwards thereby implicitly credit the rakyat's ability to be prudent, why shouldn't the same implicit concept be assumed when the prices are falling? There are 2 reasons that Sharir should be aware of as Domestic Tade and Consumer Affairs Minister namely:

Firstly, the volatility in petrol prices would ensure the rakyat be aware that they now directly contribute to increasing petrol prices and the Government is not going to give them blanket subsidies like in the past hence some prudence on their part is needed.

Secondly, this is the golden opportunity for the Government to use the savings to implement proper public transportation system as well as channel it to developing other regions to take away the over-development activities in places like Klang Valley. This will slow further inter-state migrations and in the longer term, place less stress on existing public infrastructure, deferring things like building a 3rd lane to existing 2-lane carriageways because more people decided to live in suburbs near KL and PJ.

Source: http://mindacergas.wordpress.com/2007/06/11/smart-tunnel-and-kl-floods/

If the Government is genuinely concerned with the rakyat treating petrol as dirt cheap essential item, then impose a tranparent consumption taxes (like the 5% sales tax). I am sure it is easier for the rakyat to know how the Government price their probably "imprudent" spending behaviour. Or alternatively, give us the rakyat the formula and timely data (audited and checked by our Auditor General) to gauge for themselves how the pump petrol prices are derived. Unlike , I am are quite happy with itemised biling.

As for the RM2.70 petrol price ceiling, our outgoing PM only promised to keep it until 31 December 2008. Within the next 59 days, barring any sudden spike in average crude oil prices, I doubt this ceiling resolve will be tested and from 1 January 2009, the Government are not obliged to keep any ceiling prices.

The Government should see this as an opportunity as Shahrir said, to use the monies allocated for subsidies to instead direct to much needed development spending to build up our economy.

But no floor price please (or ceiling for that matter)...

Bailouts

I received the following cartoons from an e-mail. I am not sure who are the creative artists who did it but credit goes to them nonetheless. Enjoy!

And It Gets Louder

My family dog, is a very smart golden retriever. Each time when I open the automatic gate to drive my car into the driveway, he will try to dash out to the neighbourhood. I guess the desire for freedom and discovery is great. But he also fears heat. So, me being me, I decided to test my dog one afternoon by driving to the gate. I noticed his head popped up from his afternoon nap and he was looking at my car. He didn't move much really and from that distance and the glaring sun in between, it appeared that he is tied up.

But I know I was previously fooled by his antics so I waited. True enough, patience blew his cover when he stood up and moved near the flower pot. But he was standing right under the shade of the roof. And there was a standoff of sort. Luckily, I am not too stupid myself.

I got out of the car and called out his name. He came running to the gate. He was of course excited. I then clicked the button to open the gate. He quickly moved towards the opening caused by the parting gates. Just then as the gate parted wide enough for my hands to catch hold of him, I quickly grabbed him and pulled the collar. He struggled a bit as he tried his best to run away. At the same time, I had to remind myself not to look at his eyes. Just like those in the picture below.

Source: http://www.moviexclusive.com/review/10promisestomydog/10promisestomydog.htm

After struggling for awhile, he gave up. So he quietly went with me inside so as I can put on the leash.

On other occasions however, he is quite smart too. He once hid behind a column which blocks my view when I drove and stopped just right outside the gates. I was unsure if my mom tied him elsewhere so I waited for awhile but he never made any appearance until I opened the gates.

I guess one cannot outwit a dog all the time and similarly, one should not underestimate a dog's cunning persistence even if it appears cute, innocent and innocuous at other times.

On another note, I notice of late MCA is becoming more vocal in raising issues. From supporting multi-lingual signage, demanding for abolishing the 30% bumiputra equity requirements and reviewing ISA, it seemed that they are not afraid of ruffling some UMNO feathers.

Source: http://lucialai.org/2008/04/21/abolish-isa/

Of course when it comes to Uncle Kit asking MCA and Gerakan to sign a petition to support for a debate on ISA, we don't quite hear much from these loud speakers.

In fact, I am surprised that Chew Mei Fun also made known her stand in supporting the Selangor MB in appointing a woman to helm PKNS. Yet not too long ago, I remembered she once said this in Mandarin.

“If we do not have enough representation in the Barisan Nasional, then to the Chinese community, the lesson of 1969 is sufficient. I think we cannot afford another such scenario.”

It is interesting how lessons can be learnt from defeat. Just like how my family dog used wit and patience to achieve his run for freedom...:)

But of course, each time when I drive towards the front gate, I have made a mental note to myself that the dog would run out and may use all kind of "smart" moves to achieve his goal. Afterall, it is hard to change a dog, what more to deprive him what he truly desires after a long day running round the garden compound.

Azalina: Finance Minister Material...Not

So, why am I being so critical of our Tourism Minister? Surely being a qualified lawyer with masters in law, she would have chosen her words rather carefully right? To me, lawyers are quite concise and precise with their words and often, their choice of words are well suited to the occasions and all the many lawyers I know, almost all are pleasant speakers.

So anyway, this is not about lawyers. This is about why I think she is no Finance Minister material. Of course, one can say I am being hasty with my judgements as who is to know if she is capable unless she is tasked with such responsibilities?

I therefore humbly submit the following extracts from an article published on the Edge online on why I find her assessment of things are rather questionable if not downright silly.

Point 1, on the ministry's three-pronged strategy to boost tourism:

“We want to increase domestic tourist activities to act as a buffer, in case there is a decline in foreign tourists. We can also encourage locals to spend more here than abroad.

“The other plan we have is to define Singapore as a domestic market. The country is by far our most important target market, as a substantial number of arrivals are from there. Singaporeans’ shopping and travelling habits are similar to Malaysians, so it makes sense to include them as domestic tourists,” she said.

Azalina said the third strategy was to emphasise on niche travel markets like eco-tourism.

Source: http://www.smh.com.au/articles/2006/02/27/1140888775438.html

Noticed something weird? How in the world classifying Singapore as domestic market will boost tourism? Aren't each and every one of the tourist entering and exiting a tourism site count the same? Just because one is labelled as Singaporean (foreign), it wouldn't count for two or three right if we designate as domestic?

And point 2, on whether the ministry was worried by recent reports that local credit card debts stood at some RM20 billion:

“Banks are becoming prudent in lending, and this could translate into prudent spending habits among cardholders. If we look at what card issuers are saying, spending habits have remained somewhat steady, so I don’t see this as a problem,” she said.

Source: http://heyugly.org/

How is a prudent lending policy translate into prudent spending habits? This really made me wonder. Let's tackle this from the perspective of existing and new borrowers.

For existing borrowers who have been spending less than prudent but manage to service the minimal payments most of the time, how is the lenders implementing prudent policy will make these people be prudent?

For new cardholders, how will the borrowers' prudent lending policy ensure that they don't have potential reckless spenders on hand? Assuming the lenders do manage to filter some of these who incurred huge credit card bills out, how will they filter the ones approved from turning reckless at later stage?

So, yes, based on this two points alone I wouldn't trust her with Finance Ministry. In fact, I often wonder why our ministers say the darnest things. Are they aware of the implications of what they are saying?

Festival of Lights...

Source: http://www.smh.com.au/news/good-living/sweet-beginnings/2006/10/16/1160850866376.html

To all who celebrates this festival of lights, in remembrance of goodness prevailing over evil,

Happy Deepavali / Diwali!

Valuecap: Superior Fundamental Investment Research?

It seems information about Valuecap has been pouring these days from the media and one of the most revealing thing I read about Valuecap was reported by the Edge Daily yesterday entitled, "Valuecap in the black as of end-2007".

Basically much have been said and one of the thing highlighted was a wholly owned subsidiary of Valuecap, i-Vcap has felt the impact of drop in share prices i.e. the ETF established by this subsidiary has seen its NAV decreasing by 40% since its inception in Jan 28 this year.

But that is not my focus here. My focus is on the list of investees Valuecap has invested in (see my reproduction below). 20 companies below has been directly extracted based on the Edge revelation with the other 8 being extracted based annual reports published by these companies in Bursa Malaysia (look for the top 30 shareholders list though it is not necessarily show complete stakes held by the shareholders as they may use nominee accounts).


Noticed something perculiar? Valuecap actually invested in almost the same companies as EPF. The only difference is the amount invested in each counter (I guess that is why it is called on portfolio basis *wink, wink*).

Apparently Valuecap invested in about 70 companies listed in KLCI. I am not sure how many counters EPF has invested in but I would like to roughly gauge their exposures for comparison purposes.

But I need to add a qualifier though before we proceed: The table below is not an accurate representation as "these professionals investment entities" do trade from time to time and below is only a snapshot of what they have invested. The further the historical data is from today, the more likely it might change. Anyway, would any of us know for sure what they have today since they are not required to disclose to us? So... assuming the number of shares are the same since 31 December 2007 until today, you can see for yourself the value of these investments.

Note: Click on the picture to see it clearer

To be fair, the actual mark-to-market losses may not be as severe as we see above (just compare like for like columns which have been computed based on share prices on different dates). Yet, I am not surprised if both EPF and Valuecap are quite badly affected by the fall in these equity prices.

But what seemed to be quite odd to me is, if they do mark-to-market these losses, wouldn't EPF technically have more room to invest? Maybe they have been increasing the purchases over this period on their own and have hit the limit or they had have enough of the equity market. Oh well, who really knows right? Afterall, our paternalistic 2nd Finance Minister keep releasing press releases to assure us EPF just can't do it and they have to loan Valuecap monies to do it..:P

Again, using whatever superior fundamental investment research Valuecap possesses argument, are they truly free to sell the shares when they smell trouble? Take Maybank's shares for instance. If they sold half of it on 31 December 2007, they would have locked in RM300 million+ in cash. But that would have surely pushed Maybank's share prices down quite significantly due to the multiplier effect which the Govt is banking on to support the market.

So effectively, can Valuecap really exit from these investments? If not, how is Valuecap going to pay back? Via dividends from their investees???

Also, Nor Mohamed blamed foreigners for causing "fundamentally strong" companies value to fall plus the herd mentality exhibited by our domestic investors. So Valuecap is supposed to be one of those "instruments" employed by the state to "stem" this "irrational" phenomenon. But again, if these companies are so fundamentally strong, why can't EPF do it on their own?

Or better still, why don't the Govt employ and sponsor 3rd party independent research analysts to explain why are these companies so good that the general public should take out their savings to buy them rather than taking their retirement monies and getting questioned left, right and center?

Why Big E? Why?

I am not sure what kind of signal EPF (or fondly called Big E by zewt) is sending to contributors like us. It seems Big E is quite generous because they have willingly provide a loan to the Govt to inject the proceeds into Valuecap Sdn Bhd to buy undervalued listed companies on portfolio basis based on superior fundamental investment research.

Source: http://www.kwsp.gov.my/index.php?lang=en

In my Value Investment??? blog entry, I mentioned based on whatever little public information I can find i.e. press releases from the Govt, Valuecap apparently only grew at the 4 years and 10 months CAGR of 4.7% per annum. Lo and behold, Malaysian Insider then reported sometime in the evening today quotes from our 2nd Finance Minister that....

He said this was based on the past performance of Valuecap which has grown its portfolio from RM5 billion initially to RM8 billion now.

Wow, I know it is just me but I felt like the Govt somehow connects to people like me who are obviously concerned about paltry returns like 4.7% per annum. To allay these concerns, he tried to justify Big E's decision by telling us how good Valuecap is.

"I believe that they (Valuecap) will do well and EPF will certainly get their returns.

"Valuecap has done well. It has a good infrastructure, good staff that know better about the market and have a knowledge on what is happening in the global market," he told reporters after giving a closing remark at the Khazanah Megatrends Forum 2008, here today.

Aren't we all assured? I mean on the surface, using my 4 years and 10 months CAGR simple formula calculation to derive the growth of the portfolio, it grew by 10.2% per annum!

Isn't that great? It certainly is no Temasek (22% per annum) but it appears to be slightly better off than KLCI (8% per annum). Surely our savings in EPF are being well taken care in an efficient and reliable manner right?

Well, it appears not quite the case. I mean, look Big E, you have the monies, why don't you do it yourself? Afterall, you are a professional investment entity and you gave the assurance that you will seek optimum returns from your approved investments as what you said in your website.


Let's take a look at the yield currently derived from AAA papers or simply MGS, the staple of Big E investments.

Source: http://www.bpam.com.my/

From the above, assuming Quasi-Govt returns, the best Big E expects to get in 20 years horizon is 6.19%. That is 20 years ok. If we take a look at 5 years yield to try to match as close as what Valuecap is currently doing with its RM8 billion portfolio, the best they can hope for is 4.73%.

So Big E, are you happy with just 4.73% for a 5 years horizon? (Wait, this 4.73% is so eerily familiar... I wonder...) Anyway, is that THE optimum return you think the members are happily enjoying when you forsake the chance to make 10.2% per annum if you set out on your own?

Afterall, isn't your approved investment also include equity???


Don't you also have good staff that knows the better about the market and what is happening in the global market?

Makes one wonder isn't it?

Value Investment???

Honestly, since conception of this Value Cap Sdn Bhd back in 2003, I don't hear much about what they do, what they invest in and what is their performance like (except one small news about Value Cap making RM250 million for financial year 2003 (FY2003)). Though they are equally funded by Khazanah Nasional Berhad (Khazanah), Permodalan Nasional Berhad (PNB) and Kumpulan Wang Persaraan Diperbadankan (KWAP), much of what they did remains a secret other than buying into "undervalued" companies listed in Bursa Malaysia on "portfolio" basis.

Source: http://www.khazanah.com.my/portfolio.htm

Originally it was envisioned to invest RM10 billion in KLSE but somehow, it only invested RM5 billion based on the limited information I have extracted from the press. And now the Government is happy to invest another RM5 billion to make it into RM10 billion. I wonder how much profit has Value Cap generated over the years and whether these returns have benefited the rakyat? No one knows and since KLCI goes up and down, values are created and lost.

So is propping up the KLCI the agenda of the government of the day? Or really seeking real value companies? Well, let's not be prejudicial towards the Government of the day. Let's just use a simple comparison to see how this policy has faired today shall we?

When Value Cap first started investing on 10 January 2003, the KLCI was at 625.76 points. Today's closing is at 909.51 points. That means over the course of roughly 4 years and 10 months, KLCI grew at about 8% per annum. Have Value Cap grew at that rate or more given it selectively chooses the undervalued investments?

Though this is not an exact science, using whatever little I have and assuming no distributions made by Value Cap to their shareholders, let's connect the dots and see what Value Cap made.

On 14 February 2004, Nor Yaakob was quoted by the Star Online that:

“ValueCap has used just RM4bil of the RM10bil it has,'' he told the media after the KLSE Corporate Awards 2003 in Kuala Lumpur yesterday.

As of today, the Edge Online reported that:

The government will invest an additional RM5 billion into Valuecap Sdn Bhd to double the latter's funds to RM10 billion, Deputy Prime Minister Datuk Seri Najib Razak said today.

So using simple Compound Annual Growth Rate (CAGR) formula for a period of 4 years and 10 months, the annual return of Value Cap works out to be about 4.7% per annum. Now compared it to KLCI performance in the same period (see above).

Source: http://www.temasekholdings.com.sg/index.htm

Let's not look too far for other comparison, let's look at Temasek. Voila... you can download their latest annual report here. You know what is amazing?

From FY2004 to FY2008, Temasek made an average return of equity of 11.4% per annum, saw its profit after tax before minority interests grew by 25.4% and shareholders' equity grew at 22.2% per annum.

Yup, their shareholders funds grew from FY2004 at SG$ 64.5 billion to SG$ 144.1 billion during about the same period Value Cap was picking up under value companies in KLCI using RM4 billion to grow to RM5 billion.

Speaks volume isn't it?

In an age where converting a simple word document to PDF version is only a few clicks away and publishing it on the net is not a very complicated procedure, why don't the Government choose to be accountable and reveal what they have been doing for the rakyat to judge for themselves?

Afterall, wouldn't it be fair to the Government if we can have the figures (not just Value Cap, but its shareholders as well) to do a simple comparison with performance of the likes of Temasek?

Lost And Uncertain

Well, that is only part of what I am feeling as I pen this down. Honestly, I feel bad but at the same time, I don't feel I am fully responsible. But to a person I care, what more can I say or do?

So here's the story.

I took leave on Friday to get some errant done. It included amongst other, conducting an informal interview, sending my car for servicing and submitting a financing-related application. Anyway, by the time I was done, I am tired and the weather didn't look too promising. All I was looking forward to was to get some rest and relax session in front of my TV, computer or book or simply, on the bed (depending on the mood).

That was when my wife called to inform me my friends asked if we wanted to have dinner together. I explained to my wife I don't feel like going without stating much reason but all I heard from her was "I want to go though." Sigh... it is that guilt trip feeling I am getting. I could have been more firm and insisted on not going but I relented. That was around 3.15-3.20 pm.

Source: http://news.bbc.co.uk/2/low/in_pictures/6908612.stm

Anyway, I took the lift to go back to my unit and just as I stepped out from the lift, I heard the sound of heavy torrential rain falling. Shit... heavy rain. I think I don't want to inconvenient my friends so I made a call to my wife to cancel this dinner arrangement. I told her I don't think I want to go as it was raining cats and dogs. Besides, coming all the way to the condo will not be a good idea. She told me it would be ok as my friend's wife will be picking him up at the LRT station nearby. So it wouldn't be a hassle. Sigh... reluctantly I agreed to the original plan.

So, I walked around the unit and as I looked out the window, it is very heavy rain and I am dead tired. I really wanted my rest. Around 4 pm, I sent my wife a SMS to tell her I don't think I want to go and I will be taking a nap. I left it as that.

Around 5.50 to 6 pm, I was rudely awaken by my screaming handphone. My wife was frantically telling me that my friend is coming to the unit. I asked her why is he bothered to come since I sent her a SMS that I am not going? Apparently, she didn't receive it (Is this a common phenomenon?) and she was upset. She said I should have told her earlier or at least inform my friends that I am not going. Somewhat surprised, I told her that it has always been a common arrangement that one person liaise with the other and there is no need for everyone to call on another on these sort of impromptu arrangements. Being all upset, I cut off the line and tried calling my friend. His phone was engaged. So I sent a SMS to let him know I am not going.

Source: http://www.lindatreash.com/old-town-stairs.htm

Anyway, I was sleepy so I just slumped back on my bed. About 5 or so minutes later, my phone rang again. According to my wife, my friend is in the building. And he climbed up more than 10 storeys and rang the bell but no one opened the door. And he went down to call his wife to call my wife or something like that to tell us that no one open the door. I was surprised. I didn't hear a single bell ring. I told her I didn't hear anything and I couldn't reach him on the mobile. She then said it was because he didn't bring his mobile. She told me to wait at the door as he will come by the unit.

I presume he never did or maybe he did but I didn't hear the door bell being rung.

Around 6.20 pm, my wife came home and threw tantrums. She was upset and scolded me for not opening the door for my friend and she ran off to look for him. I was dazed. I tried to call her but I realised she left her handphone in the house. And my friend's wife called her mobile. I answered and she said she is waiting downstairs. I told her my wife is not around and she is looking for her hubby.

Anyway, it turns out later he went off to my in-laws business premise nearby. My wife was angry and scolded me for breaking the arrangement last minute. I told her I sent the message at 4 pm, only 1/2 an hour later from the first call she made about that impromptu dinner arrangement (is that last minute????). She said she didn't receive the message and I should have called them to let them know I am not going (which I find it kind of weird considering all other arrangements were made via a single person from this side to the other side out of ease rather than a formal meeting of sort).

Source: http://blog.dirkschuetze.de/

So I called my friend. He sounded angry. I tried explaining the whole situation, where I sent a message to my wife thing and how she didn't receive it. He then mentioned he is disappointed I didn't bother to open the door when in the past I will open the door. I told him I was in the room sleeping unlike the past where I am at the study room (where the bell is just next to the entrance). Anyway, he said it has passed so he didn't want to talk about it and he will proceed with his wife to have dinner and they are now stuck in the jam. All I say is I am sorry even though to be frank, I am more sorry that he had to walk all the way (contrary to my understanding his wife is picking him up at the LRT station) and climb more than 10 storeys to reach my unit (my condo requires special access cards to use the lift but somehow the management forgot about locking the fire escape stairwells).

Looking at hindsight, there are many things I could have done like giving my wife a call at 4 pm instead of sending a message. But seriously, what is the point of sending a message and then giving a call? More so when she is busy with work and she may not pick up the phone? Anyway, am I suppose to doubt whether every message I send out will be received by the other party?

Based on hindsight again, I could have called my friends but our usual arrangement has always been 1 person from this side will contact the other side and vice versa. I don't see why I should change this arrangement unless I have premonition shit is going to hit the fan.

I feel bad but honestly, why is everyone pointing fingers at me when I pulled out from an impromptu arrangement merely 1/2 an hour when it was set? I also don't want my friends get caught in the jam, climbing 10 storeys of steps and feeling cut off.

Sigh... anyway, I am not sure how to invite my friend out this coming weekend. I know his birthday is around the corner. I am at a loss. Should I just call and pretend like nothing happened or should I just call and apologise again?