Saturday, December 24, 2011

That will be the day, MACC

When I came across the headline "No one will be spared in NFC case, says MACC", in the Malaysia Chronicle, one song immediately came to mind

NOW SHOWING : The NFC Cow Scandal. NEXT CHANGE: The Navy Vessel Scandal

Over the last 10 years, we lost over RM1 trillion through illicit transfer.
To say that the Barisan Nasional government hides a monumental submerged portion of financial excesses and rip offs is an understatement.
In this context the current National Feedlot Corporation fiasco involving RM250 million is just a tip of the iceberg.
We are, in fact, readying ourselves now for the exposure of the next big financial scandal…and the next!
Immediately the next possible source of financial legerdemain, with all the necessary ingredients of manipulations and underhand moves, is certainly the cost of six offshore patrol vessels from Boustead Naval Shipyard Sdn Bhd at RM1 billion each.
The cost has now increased by an unexplainable RM3 billion. How does Boustead get into the vessel building business?
Now, the history of the Malaysian Navy’s purchase of weaponry is a dismal one.
So, let’s get into a little history lesson.
Contract cost ballooned
The original contractor chosen to build Malaysia’s first generation naval vessels was PSC-Naval Dockyard. It was controlled by Amin Shah Omar Shah and his brothers.
(Amin Shah, 53, was reportedly a high-profile tycoon known for his close ties to former Finance Minister Daim Zainuddin. This was during the era of former prime minister Tun Dr Mahathir Mohamad.
(Under the 1990s privatization programme advocated by Mahathir, Amin Shah was among the few bumiputera entrepreneurs who were able to secure government concessions and contracts. And one of these key contracts was the Naval Dockyard in Lumut.
(In 1995, the government privatised the Naval Dockyard to the then PSC Industries Bhd (PSCI), for RM300 million. Amin Shah had a substantial stake in this and the dockyard was renamed PSC-Naval Dockyard Sdn Bhd.
(In 1998, PSC-Naval Dockyard was awarded a mammoth RM24 billion contract to build 27 offshore patrol vessels for the Royal Malaysian Navy.)
By mid 2006, only two of the 27 offshore vessels (worth RM24 million) were delivered. But both failed to pass the pre-delivery trials.
There were 298 recorded complaints about the two boats, which were also found to have 100 and 383 uncompleted items aboard them respectively.
The original RM5.35 billion contract ballooned to RM6.75 billion by January 2007.

No payment vouchers or documents
The auditor also reported that the Defence Ministry had paid out RM4.26 billion to PSC up to December 2006 although only RM2.87 billion of work had been done, an overpayment of RM1.39 billion, or 48 percent.
In addition, Malaysia’s cabinet waived late penalties of RM214 million.
According to the Auditor General, 14 “progress payments” amounting to RM943 million were paid out to PSC from Dec 1999, but there were no payment vouchers or relevant documents dealing with the payments.
How did the government explain such blatant abuses of financial discipline?
On what authority was the ministry authorized to pay money for jobs not yet completely done or not even done yet?
The Auditor General attributed the failure to serious “financial mismanagement” and “technical incompetence” stemming from the fact that PSC had never built anything but trawlers or police boats before being given the contract.
These terms must be the world’s biggest oversimplification.
“Financial mismanagement” is plain corruption and “technical incompetence” is mental deficiency.
[Source: FMT]

Thursday, December 22, 2011

Will Mahathir ever learn to keep his mouth shut when it does not concern him

This is a letter written by one Siddharthya Swapan Roy based in Maharashtra, India, who was incensed by the uncalled for remarks made by Mahathir about his country. He was in India where he advised that great democracy like India, with a history 8,000 years in the making, to be “less democratic and more dictatorial so that it can be rich like China”. Still, democracy was the best he hastened to add as his Indian listeners glared at him.
He also did not mention his own iron-fisted two decades-long rule which has brought Malaysia to a step away from ruin, but more likely than not, they already knew since his racist reputation precedes him whether he chooses to admit it or not.
Dear Dr Mahathir,
A couple of days back I woke up to newspaper reports which quoted you as saying that India’s democracy is a hindrance to its development and, if we did away with the nuisance of democracy, we will become developed.
Well, sir, it is heartening to see your concern about India’s future, especially now that our own elected government has orphaned us. To read that someone from the outside cares about our development sounds so very nice.
But you see, sir, your (apparently) good intentions notwithstanding, your advice to Indians is, well how should I put it… ill-advised.
I’m not really sure if you know much about the history of our nation. Don’t get me wrong.
Going by facts like the general absence of news from Malaysian newspapers; the absence of anything but song and dance in your electronic media; the absence of bookstores that sell knowledgeable books (for example, ones from which you can learn about history and not how to get rich in six steps); the abundance of malls and the stark absence of libraries; the abundance of coaching centres that can make masseurs, air hostesses and a host of quick-fix technicians and the relative absence of centres of higher learning especially in the social sciences; and, above all, the fact that this insanely consumerist and hedonist Malaysia was made under your tutelage, makes me doubt your knowledge of the history of India or any nation for that matter.
So allow me to apprise you of the story of our independence.
We won independence from colonial rulers waging a long and tortuous battle. A battle that sought to replace a discriminatory, unjust and violent regime that had enslaved huge populations with one which was based on the principles of liberty, equality and fraternity.
India was home then, as is now and as will always be, to an immense diversity of people who spoke different tongues, prayed to different Gods, wore different clothes and had different political beliefs. These diverse people said to each other that – we, despite our differences, will strive to live and flourish together and make a sovereign nation which will be democratic, socialist and secular.
We did not anywhere say that we want to be Malaysia or for that matter China or the US.
In India, no one is above the law
We want to become a nation with a system that treats all its citizens as equal unlike your country that officially accords special rights to Malay Muslims calling them first-class citizens while relegating thousands of people of Tamil, Chinese and other ethnic origins.
Despite the fact that they have known no other land than Malaysia as their own, you denigrate them with the tag of being second-class citizens.
We try to work towards having a system wherein a person will grow according to his merit and hard work earning what she or he has rightfully earned.
You may be surprised to know that here in India making cartels based on identity, even if under the name of a holy cow called “Bumipuetra” or son of the soil is looked down upon by most of us.
Here, promoting the selective interests of one’s self or that of his kin is called corruption and nepotism and not, as you call it, development.
We are in fact fighting tooth and nail to arrest the scourge of corruption and (you’ll be shocked to know) get the guilty punished.
Here in India no one is above the law and many a times powerful public figures go to jail for being corrupt or subverting the law.
Now that we are at it, sir, I’m sure it would be interesting to know what the minorities of your country have to say – especially the jailed and beaten ones – about the development-democracy debate.
In fact, sir, your idea of development is largely at odds with many of us here.

Development is no substitute for values
What you did to the tropical forests and water bodies of Malaysia (that is, raze vast acres of them into oblivion to make way for big-buck oil palm plantations and piggeries and so on) would cause huge outrage among many of us who are looking for sustainable development.
We are yet to be unanimously convinced that making cemented roads – however broad, lining them with buildings, even if glass-covered and glossy, and putting cars on them, however fast – is a substitute for our valued bio-diversity.
Many of us are very convinced that displacing huge populations of native people for useless things like racing tracks is a blot on the word “development”.
There are many of us who find it a shameful and cruel hypocrisy that while your country has abundant and openly advertised sex tourism, it still whips women for being licentious!
Thanks to the culture of reading here, many of us know of your penchant for cruelty in your personal career.
A career during which you enacted despotic and violent acts at times in the name (your contorted version of) Islam and at times in the name of security and national interest.
We could recount how you rose to power annihilating huge numbers of your opponents and stayed there for over two decades, continuing your devious rule using tactics and schemes which are far beyond Machiavelli.
Many of us know about your vile Internal Security Act, which you used to crush political opposition – jailing them and putting in place a frail and near-sham democracy and placing the entire nation under a one-man rule of Umno for over two decades.
You will note that I have used words like “most of us”, “many of us” and have tried to stay away from absolute claims.
Misconstrued understanding of ‘development’
Besides the age-old Indian practice of accommodating different opinions, it is meant to recognise that there are people in this country, too, who think like you and will have applauded you for saying what you did.
They, too, think that roads are all that important and not the humans who walk on them or the ones who sleep beside them.
They have misconstrued the word development as development of personal wealth and that this “development” is a holy cow and everything including the rights and lives of fellow humans is of lesser priority.
Their money power helps them buy a lot of print space and electronic bandwidth so they may appear like the majority, but thankfully the truth is they aren’t.
The majority of us recognise and are willing to admit – and even discuss at length – that there are problems in our nation – including bad roads.
But they’ll quickly add that we intend to solve those not by lessening democracy but by ncreasing it.

Wednesday, December 21, 2011

Vokkswagen slashes price of 2012 Passat by $7,000 (RM22,000), undercutting Japanese rivals

Here is the news. Unfortunately for us this news is from the USA . .

Volkswagen on Thursday announced that it is cutting the price of the redesigned 2012 Passat by $7,180 (RM22,760) versus the 2010 Passat, thus undercutting the base 2011 Toyota Camry and Honda Accord.

The base 2012 Volkswagen Passat 2.5L starts at $20,765 (RM65,825) compared to $27,945 (RM88,585) for the 2010 Passat.

The top-of-the-line 2012 Volkswagen Passat SEL Premium starts at $33,720 (RM106,892), including shipping.

The pricing strategy slots the new Passat — which is longer, wider and roomier than its predecessor — below the base Camry and Accord.
The 2011 Toyota Camry starts at $20,995 (RM66,554).
The 2011 Honda Accord starts at $21,930 (RM69,518).
VW offers a choice of three engines in the Passat, including a four-cylinder turbodiesel that is expected to deliver 43 mpg on the highway, the company said in a statement. The Passat with the 2.0-liter TDI starts at $26,765 (RM84,845), including shipping..

VW is providing free scheduled maintenance for three years or 36,000 miles..

Read here and here.

Folks, you can drool or salivate. But I think we should be getting angry. What does this mean? It means that we are in the Third World.

How do you describe a Third World country? A Third World country is a country where the people (who want to become the First World) handcuff themselves or tie themselves up with silly policies which actually makes them poorer when compared to the First World (which they are aspiring to be).

How do they become poorer compared to the First World ? Well in the Third World, the people are silly enough to tolerate paying FOUR TIMES the prices for basic goods and services compared to the First World . This is a good description of silly Third World people.

So if the First World pays RM1.00 for a cup of 1st Class Baskin Robbins Ice Cream, we are willing to pay RM4.00. Why? Because we are the Third World . This means we are not clever. We are silly. Nak kata bodoh pun boleh lah.

So please read this. A 2.5 Litre super duper Volkswagen Passat is now selling in the United States for RM 65,825 ONLY. That is less than the price of a Proton Waja in Malaysia or slightly more than the price of a Perodua Alza.

Folks, they also throw in free scheduled maintenance for three years or 36,000 miles. The Camry sells for RM66,000 and the Honda Accord 2.4 sells for RM69,000 in the US.

Over in Malaysia the Volkswagen Passat 2.0 (NOT the 2.5) sells in excess of RM245,000. This is FOUR TIMES the price they pay in the United States.
Their cost of living is much higher. Their land costs are higher than Malaysia, rents are higher than Malaysia, salaries and labour costs are higher than Malaysia, transport and logistics costs are higher than Malaysia, yet they can sell the same car FOUR TIMES cheaper than we suffer here in Malaysia.
Ini tak masuk akal langsung. 

Why are we willing to suffer paying FOUR TIMES the price for cars? Because we are silly. We are not a clever people. We tolerate silliness. WE tolerate the bankrupt AP regime where cronies get APs to import cars which sends the prices of cars to the sky. We tolerate silly duties and taxes all of which are levied to protect a domestic car industry that is becoming increasingly NOT viable - day by day. .
It is becoming more ridiculous. .

Kepada sahabat-sahabat yang tak faham niaga, yang tak faham kira kos sara hidup dsbnya - here is some basic comparison..

The Americans pay RM65,000 for a 2.5 Litre VW Passat - a marvel of modern engineering "Made in Germany ". In Malaysia , you pay RM245,000 for the same car. But lets forget about the VW Passat.

In Malaysia, even if you buy a WAJA you pay about RM70,000. Sekarang cuba fikir ok, if the Americans pay ONLY RM65,000 for a VW Passat 2.5L, then how much do you think they will pay for a WAJA in their country? RM15,000? RM20,000? They will definitely NOT pay RM65,000 for a WAJA.

If they pay RM20,000 for a WAJA, then they save RM45,000 already (COMPARED TO YOU THE MALAYSIAN CAR BUYER). So for the same car, we are paying much, much more than the Americans, FOUR TIMES MORE. We pay more but we get less. Why? Because we are Third World - we are silly.

So the Americans save RM180,000 on the VW Passat alone. For the WAJA they may save RM45,000. That is a lot of money.  With the money that they save (compared to us) the Americans can send their children to private schools, to attend music classes, to college, for overseas holidays, they can buy more things to make their lives better. We cannot. We make ourselves poor because we pay FOUR TIMES the price for the same car. With the money they save, the Americans can also come to Malaysia on holidays, sit in the hotels where our sons and daughters become waiters, to serve them food and drinks. Sometimes the Americans may give our sons and daughters some tips - for which we feel grateful. Baiknya Mat Salleh..
Why? Because we are silly. Nak kata bodoh pun boleh. 

I once sat beside the man who at one time ran Proton (not Tengku Mahaleel).  I sat beside him for about an hour and we spoke about Proton and his other business ventures. 

He said quite proudly that he loved to "turn around" failing Government businesses. Most of these businesses were monopolies. His trick was very simple. He bought the failing Government businesses at cheap, fire sale prices. When the business is sold so cheap, and it has a monopoly licenses (for example express bus company with lucrative routes) of course you can turn it around. Even the "orang buta yang main music" at Jalan Masjid India can turn around this type of business. .
But that is what this ex-Proton Boss was saying quite happily. He did not seem to realise (or rasa malu sikit punthat he was actually profiting from a huge subsidy. His own value added was almost zero.

Folks, if the Government sells Malaysia Airlines to me at RM1.00 - I can turn it around in a week. OK maybe not RM1.00 but some other deep discounted price lah - if the Government slashes the price far enough, yes of course I can turn around MAS.

Here is some simple arithmetic. Say MAS tak untung and tak rugi - zero profit and zero losses - just breaking even. Say the company is worth RM10.0 billion. Say hutang is RM5.0 billion. This means tolak hutang, the net value of MAS is RM5.0 billion. I will buy MAS from the Government for RM5.0 billion. But I have connections. I tell the Government I will buy MAS for RM2.0 Billion only. The Governmnet agrees. This means I already make a 'buta profit' of RM3.0 Billion. 

How do I cash out? First I buy from the Govt at RM2.0 billion. Then I sell MAS to a real airline company for say RM4.0 billion. I pocket RM2.0 billion. The airline company will pay the RM4.0 billion beause they also get 'buta' value RM1.0 billion.
That is the business model the ex-Proton Boss was talking about. This is not business lah kawan. It is called m.a.k.a.n s.a.b.s.i.d.i. At the cost of the taxpayer. At the cost of silly Third World people like us who are willing to pay RM245,000 for a VW Passat when the car should actually cost RM65,000. 

Third World silly people who are willing to pay RM70,000 for a tin can car when for the same amount of money they can buy a VW Passat 2.5 Litre 'Made in Germany' car. .
So we remain poor.

Monday, December 19, 2011

Monday Humour




*CEO* --Chief Embezzlement Officer.
*CFO* -- Corporate Fraud Officer.
*BULL MARKET* -- A random market movement causing an investor to mistake himself for a financial genius.
*BEAR MARKET* -- A 6 to 18 month period when the kids get no allowance, the wife gets no jewelry.

*VALUE INVESTING* -- The art of buying low and selling lower.
*P/E RATIO* -- The percentage of investors wetting their pants as the market keeps crashing.
*BROKER* -- What my broker has made me.
*STANDARD & POOR* -- Your life in a nutshell.
*STOCK ANALYST* -- Idiot who just downgraded your stock.
*STOCK SPLIT* -- When your ex-wife and her lawyer split your assets equally between themselves.
*FINANCIAL PLANNER* -- A guy whose phone has been disconnected.
*MARKET CORRECTION* -- The day after you buy stocks.
*CASH FLOW*-- The movement your money makes as it disappears down the toilet.
*YAHOO* -- What you yell after selling it to some poor sucker for $240 per share.

*WINDOWS* -- What you jump out of when you're the sucker who bought Yahoo @ $240 per share.
*INSTITUTIONAL INVESTOR* -- Past year investor who's now locked up in a nuthouse.
*PROFIT* -- An archaic word no longer in use

Sunday, December 18, 2011

Malaysia vs Indonesia, and these are the facts

Some years ago, I had an invitation from one government agency to travel to Kota Bahru to conduct a series of training programmes. Prior to the commencement of my journey, there was so much apprehension in me as I would be traveling to an Islamic state administered by PAS.  After a few days stay, my fears became totally unfounded as everything that was highlighted by MCA, Gerakan and UMNO, turned out to be false.  The truth is we could get bah kut teh along Jalan Besar, beers and stouts were sold openly but minused the promotional signboards.  You could even feel safe walking around the town without being mugged.  After I returned to KL, I told my wife that our next holiday would be Kota Bahru.

Now what about Indonesia, a nation which is predominantly Muslim. Anyone who knows Indonesia well can confirm on the facts mentioned and just hope that the gloomy prediction do not come too soon.

Differences between Indonesia & Malaysia from a retired German
lecturer P. Feisenberg who had worked in Penang during Tunku's days and in Jakarta in Suharto's time. An interesting account of his observations & gloomy prediction of the future of a young nation ...

A big divide between the two countries yet they live next to each
other and both are Muslim countries.

Is this because there is a Mahathir ( and an UMNO ) in one whereas there is none in the other?

I always tell my friend that Indonesia is not the best country in the world to work and live but since working in Indonesia for about 5 years, I don't have the feeling that I am living in a Muslim country despite 93% of Indonesians are Muslim. 99.9%  of my colleagues are Muslim and we go for lunch and dinner together and sometimes to a Chinese restaurant that served pork and there is no fuss about it. (For your information - the people who sell pork are Muslim -  bosses are Chinese and employ Indonesian Muslim to cut and sell pork in the wet markets)

All 5-star hotels served pork bacon and ham for breakfast and are
prepared by Muslim.

Alcohol is sold everywhere in the street… and Indonesia No 1 selling beer is "Bintang" and is brewed locally and is consumed by all Muslim openly. No issue….

During fasting month the Muslims are free to decide if they want to fast or eat as normal No issue at all and no one catches them.

The president and vice president are elected by the people and so are the governors of the city (in Malaysia we call them Mentri Besar). No one is appointed by the President or in Malaysia by the PM.

National holidays - Hari Raya Idul  Fitri is 2 days and Chinese New Year is 1 day but Christian enjoy 3 days  - Christmas, Ascension of Christ and Good Friday. The Hindu in Bali has 1 day for Hari Raya Nyepi celebrated only in Bali . Wesak day is also a public holiday.

A Muslim can convert to a Christian tomorrow and then to a Buddhist the next day…and back to a Muslim. ….no issue at all.

In supermarket pork is sold side by side with chicken and beef….no issue at all.

I can go on and on ... in short Indonesia is a very liberal Muslim country.. definitely not Malaysia . FYI our Malaysian senior government officer "suka Indonesia" … you know why!!!

So now the question is, are we moving forward or are we going backwards?