Did You Miss This?

Yes, my fellow Ipoh-mali, Patrick Teoh, is back on the airwaves. Nothing controversial this time ... but he did touch on Rose Chan lol. Patrick spun songs for two hours which were popular when we were celebrating our Merdeka for the first time. Though I am not a big fan of the 50s, it was fun listening to songs my parents loved. I believe he will be spinning songs from 50s-80s .... 

p/s one FB fan wrote that its called Pick of the Pops because Patrick is picking the songs ... geddit.

Facebook Makes Me Mad Sometimes (Updated)

Posted this back in 2011. Well, its been nearly 2 years since my Facebook rants ... and plenty of changes have passed then ...  I think the users have more than tripled or more ... and my FB friends have surged to just over 100, still manageable ... but the inherent silliness still prevails.

I can appreciate the wonders of Facebooking, to keep in touch and to share, in a manner that is more intimate and profound than say just by emails.

After sitting at a computer typing all day, the last thing I want to do when I get home is sit in front of another computer so that I can read the fascinating facts and fancies on "25 Random Things About Me" from 3 of my friends.

I also don't feel the need to constantly update an entire network of friends about the daily minutiae of my life. My life is to be lived, not to be updated. And the mf box "What's on your mind" ... I mean if I tell you what is really on mind mind, I would have no friends left??!! I mean, how to say "I have been thinking of screwing with the cleaning lady ten minutes ago"??!!

The silly mf strategy games they play ... so you have grown the world's largest cabbage, go and eat it yourself.... so you are looking for carrots and manure, fuck me silly if I am bothered to even care. My eyes have glazed over hundreds of time whenever I open my Facebook. Soon, I will be doing a Linda Blair, my eyeballs will make a 360 degrees revolution from too much eyes rolling.


(Coffee Bean sure did not have locals at management level when they issue these cups in Malaysia and Singapore ... does not quite have the same meaning)

Then, there are the friends who will update you at least 5 times a day, as if sooo many people are so interested in the most mundane aspects of your lives. I mean, I seriously get postings such as: "... sigh, just wondering about nothing ..." I mean, seriously, go fuck yourself silly, even your own mum would be cursing under her breath. Stop the narcissist in you, no more "look at me, look at me...".

Don't just simply whack without offering solutions, I always say. Well, I hope Facebook will make all users to flag all their comments to 5 categories: if you are making a senseless comment that only your wildest fan or stalker will enjoy hearing, flag that as "1"; if its about something that is mildly important or things you found funny from some obscure site, then click "2"; if its and opinion that some may enjoy, then click "3"; if its a major development in your personal life or career, click "4"; if its absolutely must be viewed by all your friends, then click "5". Your friends , like me, who have a low tolerance of everything and anything, will possibly allow comments and updates that are "4" or "5" to filter to my account.

If by chance you have a nonsensical update and you put that as a "4", I guarantee you I will go and write a load of b.s. on your fucking wall for not being able to decipher what is "value add commentary / opinion" and what is crap.

For now, I cannot go and tell all my friends that they are idiots for writing what they wrote cause its so prevalent. Till today, after nearly one year, I still have less than 40 friends (now just over 100), and proud of it.

I won't be wasting time 'poking' cyber friends. Pick up the phone/mobile and call to ask them out for lunch or dinner, poke here poke there for fucks!!??

People make friends like they are collecting sand, ... "today I made another 4 friends", ... well, fuck me, I did not make four new friends the whole of last month in real life. It waters down the concept of who is a friend, and what a friend is to you. That definition is getting shallower by the day with the advent of the internet.

I guess my plea to my friends is to try and make Facebook work for us, to bring us closer together, not to agitate and piss the shit out of others, and waste our time and resources over inane stuff. Use Facebook as a tool, if you let Facebook take over your life, then you are the tool. Enjoy and maintain relations with family, friends and relatives ... in person as much as you can.


 THIS IS WHAT I REALLY WANT ON MY FACEBOOK PAGE

This Is Called Wit - AbFab

The big difference between American humour and British humour, skilfully exemplified here, dry, sardonic, cutting, sarcastic, word play to the max ... from the ever brilliant John Cleese.



ALERTS TO THREATS IN 2013 EUROPE

From JOHN CLEESE

The English are feeling the pinch in relation to recent events in Syria and have therefore raised their security level from "Miffed" to "Peeved." Soon, though, security levels may be raised yet again to "Irritated" or even "A Bit Cross." The English have not been "A Bit Cross" since the blitz in 1940 when tea supplies nearly ran out. Terrorists have been re-categorized from "Tiresome" to "A Bloody Nuisance." The last time the British issued a "Bloody Nuisance" warning level was in 1588, when threatened by the Spanish Armada.

The Scots have raised their threat level from "Pissed Off" to "Let's get the Bastards." They don't have any other levels. This is the reason they have been used on the front line of the British army for the last 300 years.

The French government announced yesterday that it has raised its terror alert level from "Run" to "Hide." The only two higher levels in France are "Collaborate" and "Surrender." The rise was precipitated by a recent fire that destroyed France 's white flag factory, effectively paralyzing the country's military capability.


Italy has increased the alert level from "Shout Loudly and Excitedly" to "Elaborate Military Posturing." Two more levels remain: "Ineffective Combat Operations" and "Change Sides."


The Germans have increased their alert state from "Disdainful Arrogance" to "Dress in Uniform and Sing Marching Songs." They also have two higher levels: "Invade a Neighbour" and "Lose."

Belgians, on the other hand, are all on holiday as usual; the only threat they are worried about is NATO pulling out of Brussels ..

The Spanish are all excited to see their new submarines ready to deploy. These beautifully designed subs have glass bottoms so the new Spanish navy can get a really good look at the old Spanish navy.

Australia, meanwhile, has raised its security level from "No worries" to "She'll be right, Mate." Two more escalation levels remain: "Crikey! I think we'll need to cancel the barbie this weekend!" and "The barbie is cancelled." So far no situation has ever warranted use of the last final escalation level.


Regards,
John Cleese ,
British writer, actor and tall person


And as a final thought - Greece is collapsing, the Iranians are getting aggressive, and Rome is in disarray. Welcome back to 430 BC.

Lead A Purposeful Life

No matter your background, rich or poor .... the moment you hear Nick shares his life and his message, you will have tears because he connects with us on so many levels.

Do You Know Crystal Lee

If you read Chinese papers you may know her already. Crystal Lee, a lovely Malaysian girl, talented beyond her years, has been making waves in singing competitions and motion pictures. As good as her singing is, her talent in acting is at a much higher level.

She won already in the local Golden Awards and recently garnered Best Actress for her significant yet highly watchable role in Unbeatable at the Shanghai International Film Festival.

Try Dissing Feng Shui Market Predictions Again!!!

Well, you can argue and debate, but man ... the CLSA feng shui predictor has more rights than wrongs ... and eerily correct so far this year. Hope the chart continues to be correct, which means a swift rebound.

The real trouble with economics

I pretty much agree with everything Mark Thoma says here in pointing to sociological factors within academic economics as the source of recent problems. Anyone who has read this blog knows I'm not so sanguine about the supposed "sophistication" of the analytical models currently used in macroeconomics, but, that to one side, Thoma is right that the real problem has been a lack of imagination and willingness to build models (probably messy and inelegant ones) that would inform us in a practically useful way about possible market instabilities:

 "I talked about the problem with the sociology of economics awhile back -- this is from a post in August, 2009:

In The Economist, Robert Lucas responds to recent criticism of macroeconomics ("In Defense of the Dismal Science"). Here's my entry at Free Exchange's Robert Lucas Roundtable in response to his essay:

Lucas roundtable: Ask the right questions, by Mark Thoma: In his essay, Robert Lucas defends macroeconomics against the charge that it is "valueless, even harmful", and that the tools economists use are "spectacularly useless".

I agree that the analytical tools economists use are not the problem. We cannot fully understand how the economy works without employing models of some sort, and we cannot build coherent models without using analytic tools such as mathematics. Some of these tools are very complex, but there is nothing wrong with sophistication so long as sophistication itself does not become the main goal, and sophistication is not used as a barrier to entry into the theorist's club rather than an analytical device to understand the world.

But all the tools in the world are useless if we lack the imagination needed to build the right models. Models are built to answer specific questions. When a theorist builds a model, it is an attempt to highlight the features of the world the theorist believes are the most important for the question at hand. For example, a map is a model of the real world, and sometimes I want a road map to help me find my way to my destination, but other times I might need a map showing crop production, or a map showing underground pipes and electrical lines. It all depends on the question I want to answer. If we try to make one map that answers every possible question we could ever ask of maps, it would be so cluttered with detail it would be useless, so we necessarily abstract from real world detail in order to highlight the essential elements needed to answer the question we have posed. The same is true for macroeconomic models.

But we have to ask the right questions before we can build the right models.

The problem wasn't the tools that macroeconomists use, it was the questions that we asked. The major debates in macroeconomics had nothing to do with the possibility of bubbles causing a financial system meltdown. That's not to say that there weren't models here and there that touched upon these questions, but the main focus of macroeconomic research was elsewhere. ...
The interesting question to me, then, is why we failed to ask the right questions. For example,... why policymakers didn't take the possibility of a major meltdown seriously. Why didn't they deliver forecasts conditional on a crisis occurring? Why didn't they ask this question of the model? Why did we only get forecasts conditional on no crisis? And also, why was the main factor that allowed the crisis to spread, the interconnectedness of financial markets, missed?

It was because policymakers couldn't and didn't take seriously the possibility that a crisis and meltdown could occur. And even if they had seriously considered the possibility of a meltdown, the models most people were using were not built to be informative on this question. It simply wasn't a question that was taken seriously by the mainstream.

Why did we, for the most part, fail to ask the right questions? Was it lack of imagination, was it the sociology within the profession, the concentration of power over what research gets highlighted, the inadequacy of the tools we brought to the problem, the fact that nobody will ever be able to predict these types of events, or something else?

It wasn't the tools, and it wasn't lack of imagination. As Brad DeLong points out, the voices were there—he points to Michael Mussa for one—but those voices were not heard. Nobody listened even though some people did see it coming. So I am more inclined to cite the sociology within the profession or the concentration of power as the main factors that caused us to dismiss these voices.

And here I think that thought leaders such as Robert Lucas and others who openly ridiculed models they disagreed with have questions they should ask themselves (e.g. Mr Lucas saying "At research seminars, people don’t take Keynesian theorizing seriously anymore; the audience starts to whisper and giggle to one another", or more recently "These are kind of schlock economics"). When someone as notable and respected as Robert Lucas makes fun of an entire line of inquiry, it influences whole generations of economists away from asking certain types of questions, some of which turned out to be important. Why was it necessary for the major leaders in macroeconomics to shut down alternative lines of inquiry through ridicule and other means rather than simply citing evidence in support of their positions? What were they afraid of? The goal is to find the truth, not win fame and fortune by dominating the debate.

We need to take a close look at how the sociology of our profession led to an outcome where people were made to feel embarrassed for even asking certain types of questions. People will always be passionate in defense of their life's work, so it's not the rhetoric itself that is of concern, the problem comes when factors such as ideology or control of journals and other outlets for the dissemination of research stand in the way of promising alternative lines of inquiry.

I don't know for sure the extent to which the ability of a small number of people in the field to control the academic discourse led to a concentration of power that stood in the way of alternative lines of investigation, or the extent to which the ideology that markets prices always tend to move toward their long-run equilibrium values caused us to ignore voices that foresaw the developing bubble and coming crisis. But something caused most of us to ask the wrong questions, and to dismiss the people who got it right, and I think one of our first orders of business is to understand how and why that happened.

I think the structure of journals, which concentrates power within the profession, also influence the sociology of the profession (and not in a good way)."

S&M Show Podcast Wednesday

TOPIC:  What If I Knew At 20, What I Know Now

Blurb:  Advice for young professionals thinking of playing shares. Pointers from the presenters' years of experience in losses, mis-steps, dos and don'ts .... with Salvatore Dali, Khoo Hsu Chuang, Julian Lim and David Chew.

http://www.bfm.my/snm-show.html

Song pick :  A brilliant, very uplifting song by The Fifth Dimension .... Up, Up & Away.

The political problem

Several years ago, immediately post-crisis, I wrote a short article for Nature exploring new ideas about modelling economic and financial systems. I wrote about agent-based models and other similar ideas, nothing all that earth shaking really. In an early draft, I recall adding a section toward the end of the piece making the point that, of course, better models, better science, etc., would never be enough because ultimately policy making has an irreducible political element; financial crises can almost always be traced back to the political influence of powerful forces who shape policies to help themselves (or to try to do so), with little thought for the welfare of others. To my surprise, my editor at Nature took that section out saying something like "we'd like to stick to the science."

I thought that was unfortunate and hugely misleading. Corruption is real, and I really do think that no amount of better economics will eliminate financial and economic crises, because of the reality of politics. No avoiding it. Simon Wren-Lewis has a great post on this topic today, looking at why it would not actually be that hard -- conceptually -- to make the financial system more stable. The only barrier is the intimate connection between finance and politics ("quite frankly, the banks own this place" as U.S. Senator Dick Durbin once put it), which means that banks won't actually have to do things that might help the public good and the nation as a whole:

There is one simple and straightforward measure that would go a long way to avoiding another global financial crisis, and that is to substantially increase the proportion of bank equity that banks are obliged to hold. This point is put forcibly, and in plain language, in a recent book by Admati and Hellwig: The Bankers New Clothes. (Here is a short NYT piece by Admati.) Admati and Hellwig suggest the proportion of the balance sheet that is backed by equity should be something like 25%, and other estimates for the optimal amount of bank equity come up with similar numbers. The numbers that regulators are intending to impose post-crisis are tiny in comparison.

It is worth quoting the first paragraph of a FT review by Martin Wolf of their book:

“The UK’s Independent Commission on Banking, of which I was a member, made a modest proposal: the proportion of the balance sheet of UK retail banks that has to be funded by equity, instead of debt, should be raised to 4 per cent. This would be just a percentage point above the figure suggested by the Basel Committee on Banking Supervision. The government rejected this, because of lobbying by the banks.”

Why are banks so reluctant to raise more equity capital? One reason is tax breaks that make finance using borrowing cheaper. But non-financial companies, that also have a choice between raising equity and borrowing to finance investment, typically use much more equity capital and less borrowing. If things go wrong, you can reduce dividends, but you still have to pay interest, so companies limit the amount of borrowing they do to reduce the risk of bankruptcy. But large banks are famously too big to fail. So someone else takes care of the bankruptcy risk - you and me. We effectively guarantee the borrowing that banks do. (If this is not clear, read chapter 9 of the book here.  The authors make a nice analogy with a rich aunt who offers to always guarantee your mortgage.)

The state guarantee is a huge, and ongoing, public subsidy to the banking sector. For large banks, it is of the same order of magnitude as the profits they make. We know where a large proportion of the profits go - into bonuses for those who work in those banks. The larger is the amount of equity capital that banks are forced to hold, the more the holders of that equity bear the cost of bank failure, and the less is the public subsidy. Seen in this way it becomes obvious why banks do not want to hold more equity capital - they rather like being subsidised by the state, so that the state can contribute to their bonuses. (Existing equity holders will also resist increasing equity capital, for reasons Carola Binder summarises based on the work of Admati and Hellwig and coauthors.)

This is why the argument is largely a no brainer for economists. [1] Most economists are instinctively against state subsidies, unless there are obvious externalities which they are countering. With banks the subsidy is not just an unwarranted transfer of resources, but it is also distorting the incentives for bankers to take risk, as we found out in 2007/8. Bankers make money when the risk pays off, and get bailed out by governments when it does not.

So why are economists being ignored by politicians? It is hardly because banks are popular with the public. The scale of the banking sector’s misdemeanours is incredible, as John Lanchester sets out here. I suspect many will think that banks are being treated lightly because politicians are concerned about choking off the recovery. Yet the argument that banks often make - holding equity capital represents money that is ‘tied up’ and so cannot be lent to firms and consumers - is simply nonsense. A more respectable argument is that holding much more equity capital would translate into greater costs for bank borrowers, but David Miles suggests the size of this effect would not be large. (See also Simon Johnson here, John Plender here and Thomas Hoenig here.) In any case, public subsidies are bound to be passed on to some extent, but that does not justify them. Politicians are busy trying to phase out public subsidies elsewhere, so why are banks so different?

There is one simple explanation. The power of the banking lobby (and the financial industry more generally) is immense, from campaign contributions to regulatory capture of various kinds. It would be nice to imagine that the UK was less vulnerable than the US in this respect, but there are good reasons to think otherwise. [2] As a result, the power and influence of banks and bankers within government has hardly suffered as a result of the Great Recession that they played a large part in creating.

This point bears repeating -- indeed, it ought to be repeated every day for the rest of the year. All the technical and semi-technical articles now being published about measures for getting at systemic risk and improved schemes for weighting capital and so on, however clever and interesting they may be, actually only serve to draw attention away from this most serious problem, which is institutionalized corruption plain and simple. If every finance professor wrote one article on this topic -- after all, shouldn't this really be THE main topic in finance today? -- we might one day get somewhere with fixing the financial system.

What has nature done for us?

I had the opportunity last week to speak at the Edinburgh International Festival of Books alongside Tony Juniper, British environmentalist and former head of Friends of the Earth. I highly recommend his new book, What has nature ever done for us?, which examines the many ways that the natural world contributes to our well being considered in economic terms. "Many ways" is of course an absolutely absurd understatement, as the natural world essentially provides everything that makes our lives possible. But if you turn off your brain, swallow hard and actually do calculations of environmentally produced economic value -- sadly, it seems that only this approach has influence in our world where everything comes down to economic costs and benefits -- you find (without any surprise) that the value of "ecosystem services" on a yearly basis is many times current global GDP.

Personally, I think it is obvious that this is a vast underestimate, but if it is necessary to convince people who cannot think in any other terms, then so be it. The Earth's ecosystems produce the oxygen we breath. How much value is there in that? I would say it is pretty much infinite, although I'm sure someone will argue that we could, with the right hypothetical technology, produce our own oxygen and so replace those messy natural resources with industry based on our own knowledge, perhaps we'd even boost the economy in the process! Bollocks. Juniper's book is a beautifully written corrective to such nonsense.

We've evolved in delicate interdependence with our natural world; we didn't create ourselves above and beyond nature with rational thought and technology, although this is the modern illusion. Although it comes from a very different context -- A Recipe for Happiness by Rabbi Ari Kahn (courtesy of Mitch Julis of Canyon Partners) -- I think the following words hold great wisdom:

Modern man, intoxicated with his own success, is prone to hubris. He sees himself as a self-made man, and worships his ‘creator’ every time he glances in the mirror... Like Narcissus gazing into the water while perched on a rock, modern man no longer recalls where he came from, and his own self-absorption mesmerizes him. He is isolated, and because he has forgotten the past, he has no humility, no perspective, no context. At the same time, he jeopardizes his connection with the future: Only when we transmit historical consciousness to our children, and live beyond the narrow confines of the present, do we stand a chance of being appreciated by our children – rather than being rejected, in turn, as a relic from the past.

Being Malaysian

As the day draws closer to celebrating another Merdeka and Malaysia Day, the overall population runs the risk of not knowing our roots. How we came to be as a nation, as a group of people with so much shared history and legacy. As less and less of our population remember the time when they were around during the torturous Emergency years of 1948-1953 ... our country runs the risk of losing the very fabric of our existence.

As we marvel on grand property projects now, we talk of five figure a month jobs, we talk about traveling the world, buying the latest fashionable product, argue about share prices, look at your children living a normal life  ... all that would be very different had the 5-6 years of history turned out differently, and it could very well have.

I know all cinemas will be playing the national anthem for a week leading to Merdeka Day ... just how much of chest thumping will that bring. If you are not already feeling like a Malaysian, that tactic will do very little for you. You are not going to say, wow, I feel more Malaysian already. Sloganeering and antics are just so pathetic.

It would do brilliantly if we were to feature the following documentary by History Channel to all movie goers. How about broadcasting it 3x a day 7 days leading up to Merdeka? After watching it, you will feel very different about being a Malaysian. We are not that worthy ... so many army personnel, police officers, civilians, foreign soldiers, Gurkhas ... so many lost their lives to preserve a chance to lead a simple democratic way of life. So much collateral damage.

To have that 5-6 years of undeclared war following the horrendous Japanese occupation ... calling that period tough would be unfair and minimising the severe hardships all Malaysians who lived through that period. And that was just 60-70 years back.

We see remembrances of old foggies at graveyards in the papers every now and then, we flip flippantly through those news articles, we do not bother to even finish reading it ... In places like God's Little Acre @ Batu Gajah, the grand sacrifices by them allow us to be where we are. There are still many living heroes ... and they could very well shout now that the rest of the nation has been largely ungrateful, they could scream that if it was not for their sacrifices, we'd  not get to enjoy life as we know it now. They could, but they would not ... if respect has to be demanded, its not respect but a filtered down version.

Watch the documentary, make your children watch the documentary, be a true Malaysian. We should all know how we got here ... thus far.



p/s you know what is sad, this You Tube video has only 5,000 views ... yet we have hundreds of thousands for the cute dogs and cats or other inane stuff

Things To Ponder As The Market Volatility Rises

S&M Show Podcast

Stock Picks For A 3 Month View & A 2 Year View -  looks at the views of stock picking for the short term and longer term; portfolio management tips; and the perils of investing.

http://www.bfm.my/snm-show.html

http://www.bfm.my/sm-salvatore-dali-malaysiafinance-stock-picks-210813.html

Volatility In Emerging Markets - A Snapshot

Some say its a repeat of 1997. Let's look at the whys and hows.

Firstly:

a) its not 97, where the amount of foreign liquidity permeating into Asia was ginormous; hence when they exited, it was severe

b) in 97 the easy money debt was taken by listed companies, much of which went round and round to support ever higher prices; to that end, today the corporates are like church choir with their indebtedness

c) fears from Fed tapering was more pronounced last month, I believe the height of the foreign funds exit was last month, not now ... it looks more like a concerted effort by some hedge funds to target India and Indonesia; that being the case, if they wanted to exit, they have largely exited already, we are only seeing the remnants

 Markets routed the worst were Indonesia, Thailand and India .... this was not across the board. Yes, the exit by foreign funds from equities and bonds were severe, but there was differentiation. Hence it was not treating all emerging markets or all Asia Pac markets as one. This also showed that many international funds are now more savvy in segregating each market on their own merits.

 Australia and Malaysia were least affect in terms of equity markets but that does not mean we did correct elsewhere already - our ringgit has lost a lot of value, which in itself like the AUD have supported the export competitiveness. People look for our countries to hike their interest rates, but over the short to medium term, a significant currency weakness is tantamount to a hike in yields.

 This is a CURRENT ACCOUNT deficit issue. However, its not exactly how much of a deficit you are on, its the likelihood of reversing that deficit. Both Thailand and Malaysia are in the same category with India and Indonesia, but it is fair to say that the general assessment is that the deficit for both will persist and enlarge even over the next 12 months. The situation for Thailand and Malaysia is a bit different. Historically the deficit is an anomaly, a recent depreciation in their currencies should be able to reverse the course of the deficit, coupled with sound fiscal policies.

 Malaysia's ringgit has already depreciated substantively to compensate for a lot of the worries. Any further weakness in the ringgit will be overdone. Bank Negara has kept quiet, and rightly so. Bank Negara would be wise to allow the ringgit a weker range to arrest the fears.

 This is critical. Spike in bond yields translates to what it takes to attract foreign buyers of our bonds. The spike is to compensate for the eventual rise in yields for US Treasuries, hence the yield differentials needed to be maintained. If you take into account the rise in bond yields for Malaysia, coupled with the ringgit's weakness, it may be safe to say that future bond rollovers over the next 6 months will see foreign buyers owing to the weaker ringgit and higher yields. Thus eradicating the contagion fears somewhat.

 This is where the problem lies. This selling was probably done by very large hedge funds going short. They basically used the "Fed tapering" excuse to press down the currencies and equities of Indonesia and India primarily. It is easiest to concentrate on the weakest links. The amount of import covers basically also means you have the least amount of bullets to shore up your currency in an attack.

Lastly, its not a household debt thingee. Yes, they are high for certain countries but thats to be expected for a vibrant property sector in most countries. Look at Indonesia, its so obvious the funds were targeting them and India for other reasons. That does not mean that we do not have to address our household levels of indebtedness.

Funnies From China

English is a hard language when its not your mother tongue ... things get lost in translation sometimes. In Malaysia it happens, in particular when we get zombies trying to do the English subtitles for movies. These are from China, in now way am I singling them out. Japanese ones are funny as well ... there are also the ones from India, Indonesia, Thailand ... but one at a time.






Some guys (assholes) should really go to the second room.




Hey, might as well be honest while you are at it!




The police/army are so considerate.


We certainly need this sign in Malaysia ... car showrooms and Pavilion.


Awww ... shucks.




I will definitely try that!!!


What an awesome gift for some of my friends the next time I travel to China.

Hiring The Well-Connected ... Errr SEC, You Are Opening A Can Of Whoop-Ass

I guess things must be really slow at the SEC for them to tinker with "scandalous hiring of the well-connected". Plus they had to go and whack the US big investment houses operating in China. As if that is going to achieve brownie points against China. Beijing is going to come back with a "look at your own fucking house first" before questioning others. Maybe its a bit more prevalent in China, heck... it is also pervasive in Malaysia. Even Singapore, although its a bit more muted, in that ex-Ministers and Parliamentary Secs there get into most big companies' boards, or is it a coincidence. 

Hiring someone based on connections is not bad per se. I guess what the SEC is getting at is when the hiring is highly correlated to the awardment of business contracts. Its such a pervasive thing, how is the SEC going to regulate that? Where do you draw the line between connection-network-influence, as to when it is a bribe and when it is considered as "business experience and networking"???

I don't think the SEC has thought this through at all, as to how the endgame will be, how will they prosecute, how will you regulate and fine trespassers, ... I think even the courts are shaking their heads at these developments, how in hell will they write their judgments.

If the SEC is just targeting the princelings / children (less than 5 years job experience), well, maybe they have some legs to stand on. Even then, the SEC will have to prove that a) they are: not capable / under-qualified and that b) the hiring company actually benefited. Both are not easy to prove, especially the latter.

I am, of course, not for these privileged hirings ... but its not for the SEC to make the call especially when its on foreign territory. You should clean it up in the US first. Then maybe other regulators will take a leaf from it. I guess our SC should be looking at this as well. However, good intentions can always be thwarted by political goodwill and pressure. Still, its an important issue to address.

It is well known that many listed company owners send their children to "hard to get internships" or "critical job openings at investment banks" to give a headstart ... hey, your resume looks brilliant with so-and-so as your first job. It is easy to get that to work for very rich people as they may have big private banking accounts and/or other business transactions that flow through them.

Its not right, but its prevalent, but its also so hard to regulate. That is also why the rich gets richer. If you are not well connected or have the right parents ... then you better be very smart, industrious and better than them to succeed.

Dealbook/NYT:

HIRING THE WELL-CONNECTED ISN’T ALWAYS SCANDALOUS  | An investigation by the Securities and Exchange Commission into whether JPMorgan Chase had hired the children of powerful Chinese officials to help the bank win business “is sending shudders through Wall Street,” Andrew Ross Sorkin writes in the DealBook column.

“If JPMorgan Chase is found to have violated the Foreign Corrupt Practices Act by hiring the children of the elite, then the entire financial services industry is probably in a heap of trouble. Virtually every firm has sought to hire the best-connected executives in China and, more often than not, they are the ‘princelings,’ the offspring of the ruling elite.”

Hiring the children of powerful executives “is hardly just the province of banks doing business in China: it has been a time-tested practice here in the United States.”

Bill Clinton; Stephen Schwarzman of the Blackstone Group; Martin Sorrell of WPP; and Robert Rubin, a Clinton administration official. All four have children who held jobs in companies with an arguable interest in their parents.

Businessweek: If American regulators are really intent on looking at companies that hire nieces and nephews of China’s high and mighty, the SEC and others will have their hands full for a long time. Hiring people with good connections has long been a standard way of doing business for multinationals in China—and often, those people with good connections turn out to be relatives of high officials. Since that’s such an accepted way of doing business in the country, proving a quid pro quo between a foreign company and a Chinese official is difficult.

Companies also long ago recognized the need to be especially careful when hiring offspring of Chinese officials. Usually, the jobs young Chinese from important families receive are genuine jobs, not just fake positions created to funnel money crudely back to the official’s family. Recognizing the potential risk of action under the Foreign Corrupt Practices Act, companies have put together policies to show that everything was kosher when they made their hiring decisions.

In other words, if suddenly confronted by regulators asking questions, foreign companies want to be able to demonstrate that the person was qualified and the company went through a routine and regular hiring process before hiring him or her. And companies want to be able to say with credibility that this person who just happens to come from a well-connected family was not hired with any corrupt intent of winning business from his or her high-profile relative in China.

Constructive, Vindictive Or Destructive

I am all for constructive analysis and commentary. An open progressive society should always have that. However, is our society somehow more like the cartoon below ... always finding something negative to say, ... never considering the backdrop or context. It is easy to just criticise and complain, somehow by shading something darker, it makes our pitiful life bearable. In much the same way, we run the danger of branding ourselves by what we do not like, we have no problem telling others what we don't like. How do people describe you? Is it "oh, she doesn't like lamb dishes, she cannot stand Sungai Wang complex, she hates Justin Beiber,  ...." or is it "she loves dogs, she goes gaga for Baskin Robbins, she loves to climb hills ..."

Cooking With Dali - Curry Pork Ribs

How to go wrong with pork ribs? This is my adjusted, tweaked, simplified recipe that all can try at home.

All the ingredients are pictured here. Note that I only used half of the belacan in that white paper box. Oops, you can't see the candlenuts (buah keras).

I don't really like to measure much, mostly agak-agak and taste along the way. Generally, for about 1.5kg of pork ribs:
- 3-4 big sized potatoes (get the ones from Indonesia, softer and nicer)
- 2 stalks lemon grass
- 6 to 7 candlenuts
- small piece of belacan
- A1 rempah for meat  (3-4 tbs)
- 12 pieces of shallots
- 6 pieces of garlic cloves
- 5 to 6 dried chilli (cut up finely)
- curry leaves
- tumeric poweder (1 tbs)
- 1/2 cup coconut milk

First, put the cut up ribs in a plastic bag, throw in 1tsp sea salt and 1 tbs white pepper and make sure they get a good rubbing down. Put in 3 tbs corn flour, close the bag and shake liberally. Check to make sure all are covered with flour. Put in fridge for at least 2 hours, the longer the better.


Here comes the muscle part, into your pestle and mortar, gradually add shallots, garlic, candlenuts, dried chillies, tumeric powder ... at the same time ....

Lightly grill some belacan till dry and fragrant both sides, drop in belacan int mix and pound. Trick is not to pound the whole thing into a paste, when its about 3/4 done, thats fine, it gives out better texture and aromas.

Fry the pork ribs in oil till brown. Set aside.


Use about 5 tbs oil, its ok, you can scoop up excess oil later. You need oil to fry the ingredients. Throw in the pounded paste, fry for 2 minutes, throw in curry leaves and lemon grass (bruised), fry for another 2 minutes. Then put in the A1 rempah. Fry for another 2 minutes.


Put in the pork ribs and mix gently, can add one to two glasses of water so that the sauce covers the ribs. Slow fire for 45 minutes, turning every minute or so in order for the thing not to be burnt. See the diced potatoes on the side, fry that in medium heat in another wok till brown, set aside.


You are almost there, pour in half cup coconut milk. Add the potatoes. Last trick, put in two tbs of sugar to round off the taste, and 1tbs of soy sauce. Taste and adjust to your liking. Simmer another two minutes and you are done.

Previous cooking postings:

http://malaysiafinance.blogspot.com/2012/09/cooking-with-dali-drunken-chicken.html

http://malaysiafinance.blogspot.com/2012/09/cooking-with-dali-pig-trotters-vinegar.html

http://malaysiafinance.blogspot.com/2013/07/cooking-with-dali-pasta-baby.html

Malaysia's Best Home Minister

A timely op-ed from Malaysian Insider. For every situation, there are a number of choices we can take ... with great position of power comes with it even greater responsibility.

Can you name Malaysia’s best Home Minister ever? - Malaysian Insider

AUGUST 15, 2013
LATEST UPDATE: AUGUST 15, 2013 06:32 PM

Someone wondered the other day: who was Malaysia's best Home Minister?

The question was in response to the increasingly irrational behaviour of Datuk Ahmad Zahid Hamidi, who has only one move in his playbook: use the sledgehammer to pummel and bully his way to hero status in Umno.

Justice, fairness, moderation are words that have no place in Zahid's small world, crowded out by grandstanding.

The question was also in response to a growing sense that the country is in a tailspin, buffeted from every side by worsening race relations, intolerance, a crime epidemic and in serious need of a firm but fair hand.

So who was the best Home Minister? Was it Ghazali Shafie? Was it Musa Hitam? Was it Dr Mahathir Mohamad? Was it Abdullah Badawi? Was it Syed Hamid Albar? Surely you remember Syed Hamid - he detained a journalist under the Internal Security Act to protect her, he said! What about Hishammuddin Hussein? He who was taking a serious view of this or that while crime was unravelling on the streets.

But seriously, on stature, standard and principle, none of the above comes even close to Tun Dr Ismail Abdul Rahman. This Home Minister was called into action following the May 13 riots, when feelings among the different races were raw and legitimate questions were being raised whether the nascent democracy of Malaysia had gone up in smoke. This was a dangerous time: lives were lost, property destroyed and talk of a land of milk and honey almost foolish to entertain.

Dr Ismail could have played the race and religious card and become the most popular politician in Umno. He didn't.

Instead he went on television and delivered a stark message, edited by his friend Robert Kuok, on the death of democracy. It was his way of telling Malaysians that this would be the outcome for the country if people didn't put away their prejudices and work with the government towards reconciliation.

With the carrot came the stick. He ordered the arrest of troublemakers with no regard to their race, Malay, Indian or Chinese. And warned Malay ultras to expect no mercy if they agitated. Once he remarked that he would arrest his own mother if she did anything illegal.

Former deputy prime minister Musa Hitam watched the television broadcast and recalled "a sense of relief came over us, the sheer force of the man's reputation for fairness was magic".

Chet Singh of Penang Development Board remembered feeling comforted on hearing news that Tun Dr Ismail was returning as Home Minister.

This is how Tengku Razaleigh Hamzah described the Home Minister's performance during the darkest period in Malaysian history: "Ismail was a principled man - and was seen that way by the different races... once he decided on something you could be sure that he had gone through the relevant details and studied them. What is confidence unless it is based on the people's belief in the leader?"

Kuok said: "He was a lovely man with the strength of character, high principles and a great sense of fairness. In my opinion, he was probably the most non-racial, non-racist Malay I have ever met. Doc was a stickler for total fair play, for correctness."

Going through the excellent book, "The Reluctant Politician" by Ooi Kee Beng and culling information from various other articles on Tun Dr Ismail, these words crop up: firm, fair, principled, moderate.

Till today, older Malaysians across the racial and political divide remember Dr Ismail with rare affection. And then fall into a valley of despair when they compare him with the likes of Hishammuddin and Zahid.

He may have ticked off the dog trainer of the video clip fame but no way would he have agreed to have her remanded like a common criminal. Similarly he would have frowned on the Singaporean resort owner who allowed a Buddhist group to use the surau for meditation but you can't see him stoking the fires by talking about stripping the Singaporean of his permanent residence.

Why? Because those who knew him intimately said he never seemed interested in cultivating a loyal group of followers. Or, as Ooi Kee Beng wrote: "His style of politics, infused with the reluctance he had felt about going into politics, did not involve populist tactics."

In short, he did not grandstand at the expense of fair play or audition for a higher position in Umno as Zahid Hamidi seems to be doing on a daily basis.

These days there is little care that the take-no-prisoners approach of Zahid Hamidi and other Umno leaders is creating a them-versus-us undercurrent in Malaysian society. There is little sense of fairness or proportion to how Government reacts to a prickly situation.

Umno politicians have the slogans but few of them understand that fairness and justice are critical building blocks of nationhood.

The end result: a lack of respect among the public for the moral standing or competence of government leaders. And a growing sense of desperation for that one leader who can halt the country from sliding further into the abyss of despair with that combination of firmness, fairness and moderation.

This is what Abdullah Ali said about Tun Dr Ismail in the book, The Reluctant Politician: "He believed fully in the oneness of Malaysia, and worked on that belief. He did not care whom he had to fight. He was absolutely neutral. When you had to deal with him, you knew you would get fair treatment."

Best Home Minister? Without a doubt. A towering Malaysian. What a shame we only have pygmies today. - August 15, 2013.

S&M Show Podcast

Topic:  Is The Local Housing Market In A Bubble?

Examining the local housing market and its sub-sectors; looking at affordability issues, build then sell concept, what the regulators should be doing to safeguard the sector.


http://www.bfm.my/snm-show.html

http://www.bfm.my/sm-salvatore-dali-malaysiafinance-property-market-140813.html

Song Pick:  Native New Yorker by Odyssey

Fight the Smear Campaign against the Oil Palm Industry

By Koon Yew Yin

A few weeks ago the sky was covered with smoke from the burning of forests in Sumatra to clear land for agriculture. Many in Malaysia and Singapore were affected by the haze.  Some observers in the west used it as an occasion to bad-mouth the oil palm oil further. In this article, I will try to share some facts of life in the oil palm industry so that Malaysians will not join the western world in their smear campaign.

Firstly, we must remember that the west had cut down their forests and trees centuries ago to develop their countries.  Malaysia and Indonesia are both new comers in the development scene and have been felling our forests for only a few decades now.  Of our tropical agricultural crops, oil palm is the most recent cash crop commodity.

Although there has been a rapid rate of exploitation, it still occupies a small proportion of our total land area.  The oil palm industry in Malaysia accounts for 15.5 per cent of total land area and only 4.5 per cent of total land area of Indonesia.  A large proportion of the oil palm plantations are also not newly felled forest but are old rubber plantations that have been converted to this more lucrative crop.

Many in the public know of my views which are critical of many developments in the country.  However, praise needs to be given when it is deserved; and our home grown oil palm industry is one which deserves all our support. This support is important in view of the sustained criticism made against the oil palm industry by lobby groups that have their origin in the west.

Why We Should Support Our Oil Palm Industry

There are many good reasons to support our oil palm industry in Malaysia and Indonesia. These are some of the most important.

1.    Firstly it is not only Felda settlers that are dependent on the crop for a livelihood. Malaysia’s annual US$25 billion (RM79.75 billion) palm oil exports support some two million jobs and livelihoods along the sprawling value chain. This means that one in every five working Malaysian is dependent for his or her livelihood on the crop. 

2.    Plantations have borne the brunt of the bad publicity. However, the small farmers are also affected. More than 40 per cent of oil palm planters in Indonesia are smallholders whilst in Malaysia they contribute to 38 per cent of the country’s palm oil output.

3.    Environmental activist groups such as World Wildlife Fund, Friends of the Earth and Greenpeace have launched many campaigns alleging that the expansion of oil palm plantations have destroyed forests, threatened endangered wildlife and robbed indigenous peoples of their land. Many of their arguments are not based on fact but are sensationalized from a small and atypical number of cases.

4.    The anti-oil palm lobby in the west includes pro-soya bean and rape-seed groups who see oil palm as a major competitor and have recruited food lobbyists to play on fears of the health hazards of palm oil consumption. . Together with environmental activists, these well-funded groups have created trade barriers to the global oil palm trade under the pretext of environmental activism.

5.    In a fair contest amongst competing vegetable oils, palm oil will win hands down. The oil palm tree is the world’s most efficient oil crop because one can harvest five tonnes of oil per hectare. This is 10 times more productive than soya bean planted in the West, including United States and five times more productive than rapeseed, Europe’s main oil crop.

6.    It is an undeniable fact that palm oil is the cheapest and most popular form of cooking oil for consumers, including many poor families in the west. Should trade barriers to benefit rapeseed farmers who are already heavily subsidised by the European Union (EU) government be successfully implemented, this will hurt consumers all over the world.

7.    Also should alternatives to oil palm be grown, more land would be needed to produce an equivalent volume of oil to replace palm oil, resulting in more deforestation and problems for Mother Earth.

8.    Oil palm smallholdings and plantations meet the United Nation’s Framework Convention on Climate Change which defines a forest as an area of 0.5 to one hectare having more than 30 per cent canopy cover and having a potential height of two to five metres. To accuse the industry in Malaysia and Indonesia of contributing to global warming is sheer nonsense. In fact oil palm trees just as with other forest species, produce oxygen for us to breathe and act to counter coal and oil emissions which are the major cause of global warming.

9.    Finally, the western environmental activists’ campaign against oil palm plantation expansion, in the name of “saving rainforests”, is a violation of international norms and Malaysia’s and Indonesia’s sovereignty.

Appeal to Malaysians

In a keynote address to over a thousand delegates at a conference organised by the Incorporated Society of Planters (ISP) in Sibu, Sarawak, recently, Datuk Amar Abdul Hamed Sepawi, Chairman of Sarawak Plantation Berhad warned,   “We’re at a crossroads. It’s time for oil palm planters to adapt to the fast-changing world of ruthless vegetable oil politics if we want to stay relevant in this market”.

Conclusion:

I trust all Malaysians will circulate this article to all their contacts to fight against the smear campaign against our palm oil industry and eventually I hope consumers, all over the world, will not buy soyabean or rapeseed oil which is more expensive and not really superior to palm oil.