When only bad news pervade the air space and Internet, it is only fair that the positive side of it is made known and propagated. One cannot be too sceptical or critical all the time. It only makes one unrealistically negative.
The problem is there is a rising segment of the population that refuse to listen to both sides of an issue but quick to make conclusion and pass judgement on limited information. The national leadership should be made aware or it will be their last term in government.
In a previous posting "Bought and sold on rating agencies", it was a sceptic tone against rating agencies. Such is the mood set, the positive part maybe overshadowed.
And there are the positives like current account surplus, reducing fiscal deficit, stable growth, increase private sector investment, etc.
Choice
There was recently positive comments worthy to be highlighted by AMP Capital of Australia and have been highlighted by few bloggers. The video from ABC Australia below:
Don't quite familiar with AMP Capital, but their Chief Economist gave positive words for Malaysia for it's resilient economy and "determination to succeed".
Though mentioned that the economic growth is dependent on government spending and domestic demand, thus raising concern on household debt, he feels it is a long way to go. He feels government will do the adjust and take corrective measures.
Credit Suisse Economist Santitam Sathirathai see the economy rebounce as long as tax reform and GST stays according to plan. Dato Najib must have the political will to continue to carryout unpopular measures like slashing subsidy, and broadening tax. Concern on capital flight was also raised.
The difficult choice for Najib will be between realising the "I Love PM" campaign and doing the unpopular steps promoted by "the market". In the past, his unpopular measures is balanced with popular measures which negate the measures taken to improve the bottom lime.
Recently, he called tax evaders as traitor. It brought a cynical remarks from Dato A Kadir Jasin. To quote him, below:
THE PM sounded desperate. Untypical. All this while we have been told and assured repeatedly that everything is OK - the government has money, the Treasury is filled, revenue collection is good and billions of ringgit of foreign investments are flowing in.Read his posting in full here.
In the video, Shane claimed GST is a good tax when compared to income tax and others in the sense it does not give rise to market distortion.
On the other hand, the segment of the public with highest marginal propensity to spend, which is almost 100% of their income is the lower end segment, will face the immediate impact. It will be like taxing the poor and saving the rich. So it depends on the list of goods and services. Fresh from their annual conference, opposition will go to town on GST.
There will be a talk on GST tomorrow (Saturday) 8:30 AM at Kelab Sultan Sulaiman, Kg Baru by Persatuan Pengguna Islam Malaysia. The list of goods should be made known.
The question is to what extend will be the political fallout and economic impact from the recent sharp increase in property assessment in Kuala Lumur and Pakatan states of Selangor and Perak, rising salary of Menteri Besar, Exco and State Assembly positions, removal of sugar subsidy, hike in fuel prices, sharp rise in property prices, etc.
Downside
With an economic growth languishing at the 5% and as the video report described the economy's reliance on government spending, domestic demand and credit, the choice of policy makes the Mat Salleh so-called expert happy. However, it is inflationary and consequently have a dampening effect on growth, income and employment.
The government mentioned graduate unemployment at 76,000 but that is practically the same figure being spinned by the post currency crisis NEAC. If University students are worried of their future prospect upon graduation, it is more serious. It must be about 200,000.
It shows Dato Idris Jala's high income model, which was recently highlighted to us that it had deviated from NEAC II's original New Economic Model, have not trickled down. Only the urban top executives are getting 5-6 figure monthly income and multi million annual salary but industries are reluctant to increase salary and wages for lower level jobs.
The employment market is also not creating economic confidence and stability by placing entry level graduates as contract employee and subjected to KPI to keep their jobs but not sufficiently lucrative reward for meeting the KPI.
The voters profile for the next general election will see the 40 and below constitute more than 65%. They are not a happy lot to please with them opening their ears to the generally younger profile opposition leaders.
The implementation of minimal income is facing a snag. Both the GLC and government Ministries itself does not respect and support the minimal income proposal promoted by MIC's Dato Subramaniam. A case study to follow.
One problem happening and this blog have long advocated a serious solution to the problem is the absence of an economic sectoral leader.
In the era of Tun Dr Mahathir, there was manufacturing to bring in the growth but Tun Abdullah shelved the Industrial Masterplan (IMP) by turning the 5 year plan into a 15 year plan. Malaysia had not seize the opportunity from emerging new growth sector.
The economy still rely on low growth agriculture, infrastruture spending, credit driven domestic spending, and financial-related sector including property.
The country need more to quote one commentator yesterday, "believer of hardwork, ideas, innovations and intellectual proprietorship".
The commentator went on to caution, "Capitalism from certain standpoint breeds GREEDS whilst other smaller economies really does not learn from the fiasco of Wall Street - subprime and the rest?"
Impending crisis
There must be concern and caution.
Not only the domestic economy still need work but an impending concern from abroad. There are a sampling of videos to watch (if you have the time).
Another one on the country also spying on us.
The UK as a indication fo the future of Europe, below:
The video below is seeing crisis in EU and concern on modest growth slowdown adjustment in China:
Whilst, the video below claim indicative signs of distress and slowing down in China:
Whether we like it or not, the government is justified to take the necessary steps.
Confidence
The only problem is our policies seemed incoherent. On one hand, it is doing this but on the other hand, it may seemed contradictory.
That is the reason the opposition is poking on the Prime Minister's wife recent middle eastern trip on government's private jet. It is the simplest, easily understandable and emotionally explosive issue to highlight government's in-coherency and inconsistency. It is a home-run out of the ballpark.
It brings us to issue confidence.
The government's penerangan machinery is out-moded in their approach and cliquish in their delivery. It is as good as good as defective. The propaganda team to counter opposition's lies seemed to be sleeping, defensive and in disarray after the general election.
It does not help that our leaders are silent and our Ministers are not able to communicate coherently. Read the on critical mode Outsyed The Box here, here, here, here and many more here. And he is racing up the pro-UMNO ranking chart.
How many bother to response like this SMS forwarded to us from a "third party":
Assalam Bro... Read ...post. We r doing what we think r d right measures for d country. Not easy nor popular. But will do so responsibly. Govt & corporates borrow fm d market. Credit rating determines d cost of borrowings. So when we do d right things, we hope rating agencies will respond positively.
I apologise if I appeared to 'gloat' when I mentioned Fitch as no 3. Just wanted to put across d point that there r 3 rating agencies and Fitch is the 3rd one. When Fitch revised their outlook on Msia to -ve, the other two maintained their outlook at stable. Of course Moody's has revised it to +ve now.
It is our hope Fitch will eventually revise their August 2013 assessment that "prospects for budgetary reform and fiscal consolidation to address weaknesses in the public finances have worsened since...general elections". Tks for support.Thanks for forwarding.
Sure we should not be too sceptical and negative, at times listen to the positives but we remaine concern and caution. Its an unpredictable and volatile world out there.
Take care and have a nice weekend cause we are ....
A 1968 bluesy version from Canned Heat.