Exiting grief
1 year ago
Monday, March 30, 2009
Every Cloud Has A Silver Lining
In difficult times, the main challenge is survival and to maintain liquidity. Bad times don’t last forever. Often such times make better people. If dark clouds are forming, be prepared with an umbrella. It does not mean you have to stay indoor during the rain. It is your choice. In the economic rain, many can still find new fortune and success. So be ready to chase after the opportunities that many others may miss out due to complacency, lack of preparedness and courage to brave the economic storm!
Thursday, March 26, 2009
Village For Sale
Sheep dot green hills. Pheasants hop across country lanes. Quaint cottages sit next to a tiny stone church. Neighbours who have known each other since birth greet strangers warmly.
And for at least 23 million pounds (about $32 million), this leafy, nostalgic slice of England could be yours.
The village of Linkenholt's 21 cottages, grand manor house, lush green cricket pitch and accompanying pavilion are part of an estate that also encompasses 1,500 acres (600 hectares) of farmland and another 425 acres (170 hectares) of woods. The only piece of property not for sale is St. Peter's, built on the site of a 12th century church. According to the estate agent – "that is owned by God."
The 40 or so residents, many of whom have lived here all their lives, hope any new owner will keep the estate together and resist the urge to parcel off the land located in Hampshire only 75 miles (120 kilometers) southwest of London.
It's not the first time the estate has gone up for sale. It was bought for 2,000 pounds in 1629 and sold about 60 years later for 12,000 pounds - a kingly sum in those times.
The estate remained in the same hands until the 19th century. Roland Dudley bought it in the 1920s. Herbert Blagrave took ownership in the 1960s - and after he died without heirs, his charitable trust became the owner. The trust is trying to diversify its interests, which is why it has chosen to sell. Despite the challenging economy, Linkenholt is expected to generate interests. It is a unique purchase as there isn't really anything like this on the market.
I am definitely interested as the other instruments like FD, unit trust and shares are not sexy at the moment. However the asking price was way too steep. Like it or not have to give it a pass.
Perhaps the political frogs can retire happily ever after over there. Perhaps the few high profile missing individuals can be found there. Turn it into a Malaysia village. Dot it with pomelo, durian and angsana trees. The cricket pitch is useless because chances are the only cricket the new owners know is the insect, so just tear it up and build condominiums!
If the condominiums are not selling well, run to the authorities for bailout. Then make another round of money by selling the land to the authorities for 200%. The authorities need the land to build a sports academy to produce world beaters. They have discovered that our sportsmen were constantly ‘frozen’ on big stage tournaments because they did not acclimatize well with the weather!
That’s not the end. Get the contracts to build the academy, to supply materials and services, to maintain the infrastructure and the list goes on and on…..
Majulah Sukan Untuk Negara.
And for at least 23 million pounds (about $32 million), this leafy, nostalgic slice of England could be yours.
The village of Linkenholt's 21 cottages, grand manor house, lush green cricket pitch and accompanying pavilion are part of an estate that also encompasses 1,500 acres (600 hectares) of farmland and another 425 acres (170 hectares) of woods. The only piece of property not for sale is St. Peter's, built on the site of a 12th century church. According to the estate agent – "that is owned by God."
The 40 or so residents, many of whom have lived here all their lives, hope any new owner will keep the estate together and resist the urge to parcel off the land located in Hampshire only 75 miles (120 kilometers) southwest of London.
It's not the first time the estate has gone up for sale. It was bought for 2,000 pounds in 1629 and sold about 60 years later for 12,000 pounds - a kingly sum in those times.
The estate remained in the same hands until the 19th century. Roland Dudley bought it in the 1920s. Herbert Blagrave took ownership in the 1960s - and after he died without heirs, his charitable trust became the owner. The trust is trying to diversify its interests, which is why it has chosen to sell. Despite the challenging economy, Linkenholt is expected to generate interests. It is a unique purchase as there isn't really anything like this on the market.
I am definitely interested as the other instruments like FD, unit trust and shares are not sexy at the moment. However the asking price was way too steep. Like it or not have to give it a pass.
Perhaps the political frogs can retire happily ever after over there. Perhaps the few high profile missing individuals can be found there. Turn it into a Malaysia village. Dot it with pomelo, durian and angsana trees. The cricket pitch is useless because chances are the only cricket the new owners know is the insect, so just tear it up and build condominiums!
If the condominiums are not selling well, run to the authorities for bailout. Then make another round of money by selling the land to the authorities for 200%. The authorities need the land to build a sports academy to produce world beaters. They have discovered that our sportsmen were constantly ‘frozen’ on big stage tournaments because they did not acclimatize well with the weather!
That’s not the end. Get the contracts to build the academy, to supply materials and services, to maintain the infrastructure and the list goes on and on…..
Majulah Sukan Untuk Negara.
Wednesday, March 25, 2009
Right Time To Invest?
The outlook of the investment industry remains uncertain amid continued risk aversion, volatility and flickering signs of hope in capital markets, industry players said.
Sales may improve this year as equity markets locally and abroad were starting to look attractive due to cheap valuations. Although sales had started to slowly pick up since early this year, it may be impacted severely if the market continues to fall to lower levels.
According to Federation of Malaysian Unit Trust Managers, the number of unit trust agents exiting the industry last year is less than 10%. The decline was much lower compared with other agency-related industries. Most consultants are in for the long haul and understand that the recent market volatility is temporary. Despite the poor investor sentiment, there had not been any panic selling of unit trusts.
Now is the right time to invest. In the current market where uncertainty prevailed, it was best to accumulate assets using the method of dollar-cost averaging, whereby a fixed amount of investment is regularly made regardless of how the market is performing.
As for investors who prefer to invest in one lump sum, they can invest based on the principle of asset allocation. Their money is divided into three portions, namely aggressive or equity-based funds, moderate-risk funds or lower-risk segments such as bonds or money market funds.
Last week, Amanah Saham Nasional Bhd (ASN) announced an income distribution of 6.25 sen per unit for Amanah Saham Malaysia unit holders. The dividend announcement was for the financial year ending March 31, 2009 (FY09). The dividend was the lowest ever declared by ASN. However it is more attractive than Fixed Deposit rate of 2%.
Sales may improve this year as equity markets locally and abroad were starting to look attractive due to cheap valuations. Although sales had started to slowly pick up since early this year, it may be impacted severely if the market continues to fall to lower levels.
According to Federation of Malaysian Unit Trust Managers, the number of unit trust agents exiting the industry last year is less than 10%. The decline was much lower compared with other agency-related industries. Most consultants are in for the long haul and understand that the recent market volatility is temporary. Despite the poor investor sentiment, there had not been any panic selling of unit trusts.
Now is the right time to invest. In the current market where uncertainty prevailed, it was best to accumulate assets using the method of dollar-cost averaging, whereby a fixed amount of investment is regularly made regardless of how the market is performing.
As for investors who prefer to invest in one lump sum, they can invest based on the principle of asset allocation. Their money is divided into three portions, namely aggressive or equity-based funds, moderate-risk funds or lower-risk segments such as bonds or money market funds.
Last week, Amanah Saham Nasional Bhd (ASN) announced an income distribution of 6.25 sen per unit for Amanah Saham Malaysia unit holders. The dividend announcement was for the financial year ending March 31, 2009 (FY09). The dividend was the lowest ever declared by ASN. However it is more attractive than Fixed Deposit rate of 2%.
Tuesday, March 24, 2009
Difficult To Sustain Above 5%
Employees Provident Fund (EPF) contributors may have to be contented with lower returns in the coming years as the fund struggles to boost income amid steep falls in interest rates and a weak equity market.
Analysts said given the fund’s size and strict mandate, it would be very difficult to sustain payouts of above 5% in the coming years. The fund has already hinted that this year’s payout would be less than that for 2008.
In the near term, weak equity markets will continue to hurt EPF but in the longer term, the performance will also be determined by the returns it gets from investing in low-risk assets such as government bonds. EPF had allocated a quarter of its RM342bil investment funds for higher yielding government papers. But as these higher yielding notes expire, the fund must purchase new issues which will now come with lower returns.
Malaysian Government Securities (MGS) debt papers maturing in three and five years are currently yielding less than 4%. In comparison, MGS five-year notes yielded more than 5% a decade ago and above 7% during the 1997/98 Asian financial crisis.
Another big chunk of EPF holdings is in highly rated corporate bonds and low-risk guaranteed loans. However, the global economic turmoil has cut the supply of new bonds coming into the market. Cheaper lending rates had also reduced interest income from loans given out.
EPF was able to fork out steady dividends of above 5% between 2004 and 2007 was mainly due to gains from investments in equities. However current market scenario had eroded the value of EPF’s shareholdings, forcing it to make a provision of RM4.69bil to account for the lower value of its shares, both domestically and abroad.
The KL Composite Index fell 40% in 2008. The economic slowdown has also dragged down corporate profits. This, in turn, has impaired their ability to pay out dividends to shareholders, further reducing the return on investments for EPF.
The EPF has stakes in more than 100 companies listed on Bursa Malaysia, as well as smaller stakes in a number of big listed firms overseas. Income from equities accounted for 35%, or RM6.67bil, of EPF’s total gross investment income last year.
Just how bad EPF’s dividend payouts will be affected by the current market situation remains to be seen. It is worth noting that under the law, EPF has to maintain a dividend rate of at least 2.5% annually. The dividend must come from income generated from its investments.
Analysts said given the fund’s size and strict mandate, it would be very difficult to sustain payouts of above 5% in the coming years. The fund has already hinted that this year’s payout would be less than that for 2008.
In the near term, weak equity markets will continue to hurt EPF but in the longer term, the performance will also be determined by the returns it gets from investing in low-risk assets such as government bonds. EPF had allocated a quarter of its RM342bil investment funds for higher yielding government papers. But as these higher yielding notes expire, the fund must purchase new issues which will now come with lower returns.
Malaysian Government Securities (MGS) debt papers maturing in three and five years are currently yielding less than 4%. In comparison, MGS five-year notes yielded more than 5% a decade ago and above 7% during the 1997/98 Asian financial crisis.
Another big chunk of EPF holdings is in highly rated corporate bonds and low-risk guaranteed loans. However, the global economic turmoil has cut the supply of new bonds coming into the market. Cheaper lending rates had also reduced interest income from loans given out.
EPF was able to fork out steady dividends of above 5% between 2004 and 2007 was mainly due to gains from investments in equities. However current market scenario had eroded the value of EPF’s shareholdings, forcing it to make a provision of RM4.69bil to account for the lower value of its shares, both domestically and abroad.
The KL Composite Index fell 40% in 2008. The economic slowdown has also dragged down corporate profits. This, in turn, has impaired their ability to pay out dividends to shareholders, further reducing the return on investments for EPF.
The EPF has stakes in more than 100 companies listed on Bursa Malaysia, as well as smaller stakes in a number of big listed firms overseas. Income from equities accounted for 35%, or RM6.67bil, of EPF’s total gross investment income last year.
Just how bad EPF’s dividend payouts will be affected by the current market situation remains to be seen. It is worth noting that under the law, EPF has to maintain a dividend rate of at least 2.5% annually. The dividend must come from income generated from its investments.
Monday, March 23, 2009
Investment - Was It All Worth It?
CIMB group CEO Datuk Seri Nazir Razak said “Investors should diversify their portfolios and preserve their capital under the current downbeat and uncertain economic climate. Look out for companies that are well managed. At times like this, the risk-reward equation is greatly amplified, so invest in companies with astute leadership that is well-aligned with shareholder value creation; the right managers can make highly profitable and transformative acquisitions or diversifications.”
He also cautioned investors to ensure that their asset management companies had high integrity and able to withstand temptations to be less transparent and ethical in the face of adversity.
Hmm.. Well managed companies, astute leadership, well-aligned with shareholder value creation, high integrity, transparent and ethical – love all these words.
Unfortunately we are not living in a perfect world! Thus the selection is pretty uncomplicated as there is only a handful of choices right here right now!
Definite no-no to those which are closely linked with the political parties or his big brother! These companies are the exact opposite. Worst still, they are probably managed by some Little Napoleons or some sons in law!
Perhaps, it is time to discard our investor’s cap (FD is only paying a miserable 2%, lower than inflation rate) and put on our spender’s cap!
He also cautioned investors to ensure that their asset management companies had high integrity and able to withstand temptations to be less transparent and ethical in the face of adversity.
Hmm.. Well managed companies, astute leadership, well-aligned with shareholder value creation, high integrity, transparent and ethical – love all these words.
Unfortunately we are not living in a perfect world! Thus the selection is pretty uncomplicated as there is only a handful of choices right here right now!
Definite no-no to those which are closely linked with the political parties or his big brother! These companies are the exact opposite. Worst still, they are probably managed by some Little Napoleons or some sons in law!
Perhaps, it is time to discard our investor’s cap (FD is only paying a miserable 2%, lower than inflation rate) and put on our spender’s cap!
Friday, March 20, 2009
Never Ending Story
Samuel Johnson, 18th century literary sage, evaluated a manuscript of an aspiring writer - "Your work is both original and good. Unfortunately, the parts that are good are not original and the parts that are original are not good!"
More outbursts on AIG (See my posting 2 days ago).
The CEO of insurance giant AIG told furious members of Congress that some of the firm's executives have begun returning all or part of bonuses totaling $165 million paid.
Overall, AIG has paid $220 million in retention awards to its financial products employees - $55 million in December and $165 million had to be paid this month.
President Obama, said: "I know Washington's all in a tizzy and everybody's pointing fingers at each other and saying, 'It's their fault, the Democrats' fault, the Republicans' fault.' Listen, I'll take responsibility. I'm the president."
(That’s why he is a respected statesman unlike most leaders – thou should not be named -who will not take responsibilities but blame it on the rain, act of God or hide under the ‘abused’ kangaroo court!)
"We didn't draft these contracts. It is appropriate when you're in charge to make sure that stuff doesn't happen like this. These bonuses, outrageous as they are, are a symptom of a much larger problem. It's a culture where people made enormous sums of money taking irresponsible risks that have now put the entire economy at risk. I think people have a right to be angry. I'm angry."
(We are angry too!)
The government has intervened heavily, fearing that AIG's collapse could have unraveled America's, and, perhaps, the global financial system. AIG has taken $170 billion in federal bailout money. AIG now is 80% owned by the government, meaning any profit or loss directly effects long-term taxpayer indebtedness.
(Similarly back home, MAS, RapidKL, Time and counting, were being bailed out by taxpayers. The culprits went off richer by cashing out the government’s coffer!)
More outbursts on AIG (See my posting 2 days ago).
The CEO of insurance giant AIG told furious members of Congress that some of the firm's executives have begun returning all or part of bonuses totaling $165 million paid.
Overall, AIG has paid $220 million in retention awards to its financial products employees - $55 million in December and $165 million had to be paid this month.
President Obama, said: "I know Washington's all in a tizzy and everybody's pointing fingers at each other and saying, 'It's their fault, the Democrats' fault, the Republicans' fault.' Listen, I'll take responsibility. I'm the president."
(That’s why he is a respected statesman unlike most leaders – thou should not be named -who will not take responsibilities but blame it on the rain, act of God or hide under the ‘abused’ kangaroo court!)
"We didn't draft these contracts. It is appropriate when you're in charge to make sure that stuff doesn't happen like this. These bonuses, outrageous as they are, are a symptom of a much larger problem. It's a culture where people made enormous sums of money taking irresponsible risks that have now put the entire economy at risk. I think people have a right to be angry. I'm angry."
(We are angry too!)
The government has intervened heavily, fearing that AIG's collapse could have unraveled America's, and, perhaps, the global financial system. AIG has taken $170 billion in federal bailout money. AIG now is 80% owned by the government, meaning any profit or loss directly effects long-term taxpayer indebtedness.
(Similarly back home, MAS, RapidKL, Time and counting, were being bailed out by taxpayers. The culprits went off richer by cashing out the government’s coffer!)
Thursday, March 19, 2009
Don't You Cry!
“Acceptance does not mean being weak and allowing people to push us around. It means being strong enough to accept that we cannot alter everything to suit us and it does make our life easier by getting rid of those futile feelings of wanting to change everyone and everything” - Anonymous
When factory supervisor Anusia heard that all employees had to abide by drastic cost-cutting measures, she knew that her employer of 12 years had not been spared from the dreadful global financial crunch. Since December last year, the Japanese company manufacturing hard disk drives had sent 600 foreign workers back and cut the salaries of the local workers by 20%. This month, they work only 11 days. That has shrunk Anusia’s income by at least half.
“The situation is really bad. Orders have dropped by 50% and are still dipping. We are constantly reminded to be prepared as we have to leave if things get worse. If the company shuts down, more than 1,000 will lose their jobs”.
Anusia has indeed prepared well. She is ready to face the possible perilous days ahead.
“After paying off the monthly commitments like car and house instalments and insurance, I have only RM100 left. How can I ever survive with that?”
Instead of being a cry baby and feeling sorry, she took a bold step into an unchartered territory. She joined a direct-selling company. What started as just a source of extra revenue during her free time has become a financial cushion in trying times. She uses the extra days off to do more sales. She sees the impending retrenchment as a turning point in her life that would propel her into a more exciting and lucrative career in marketing.
“I am glad that I am mentally and physically prepared for the worst. You have to work something out. Everybody can do it. You just need the determination and enthusiasm. Your relatives may help when you are jobless for the first few weeks, but you can’t keep on asking help from them. You have to stand up to help yourself.”
Well done Anusia. Take a leaf from her. Those who are in the same predicament, just do it – Everybody can do it. Explore the alternative jobs like direct selling, selling unit trust, insurance etc (that are legal!). It could indeed be a lucrative career!
When factory supervisor Anusia heard that all employees had to abide by drastic cost-cutting measures, she knew that her employer of 12 years had not been spared from the dreadful global financial crunch. Since December last year, the Japanese company manufacturing hard disk drives had sent 600 foreign workers back and cut the salaries of the local workers by 20%. This month, they work only 11 days. That has shrunk Anusia’s income by at least half.
“The situation is really bad. Orders have dropped by 50% and are still dipping. We are constantly reminded to be prepared as we have to leave if things get worse. If the company shuts down, more than 1,000 will lose their jobs”.
Anusia has indeed prepared well. She is ready to face the possible perilous days ahead.
“After paying off the monthly commitments like car and house instalments and insurance, I have only RM100 left. How can I ever survive with that?”
Instead of being a cry baby and feeling sorry, she took a bold step into an unchartered territory. She joined a direct-selling company. What started as just a source of extra revenue during her free time has become a financial cushion in trying times. She uses the extra days off to do more sales. She sees the impending retrenchment as a turning point in her life that would propel her into a more exciting and lucrative career in marketing.
“I am glad that I am mentally and physically prepared for the worst. You have to work something out. Everybody can do it. You just need the determination and enthusiasm. Your relatives may help when you are jobless for the first few weeks, but you can’t keep on asking help from them. You have to stand up to help yourself.”
Well done Anusia. Take a leaf from her. Those who are in the same predicament, just do it – Everybody can do it. Explore the alternative jobs like direct selling, selling unit trust, insurance etc (that are legal!). It could indeed be a lucrative career!
Wednesday, March 18, 2009
AIG Almost in Grave!
President Barack Obama was angry. He issued a blistering attack on American International Group and pledged to stop the insurance giant from paying out millions in executive bonuses. After taking $170 billion in federal bailout funds, the company announced that it was bound contractually to pay out $165 million in executive bonuses, prompting a storm of criticism from Mr President to every Damn Yankee.
"It's hard to understand how derivative traders at AIG warranted any bonuses, much less $165 million in extra pay. How do they justify this outrage to the taxpayers who are keeping the company afloat? All across the country, there are people who work hard and meet their responsibilities every day, without the benefit of government bailouts or multimillion-dollar bonuses. And all they ask is that everyone, from Main Street to Wall Street to Washington, play by the same rules."
This move to pay bonuses amounted to "rewarding incompetence and failure.” A lot of these people should be fired, not awarded bonuses. It is outrageous.
AIG reported that it had lost $61.7 billion for the fourth quarter of last year, the largest corporate loss in history. The bulk of the payments at issue cover AIG Financial Products, the unit of the company that sold credit default swaps, the risky contracts that caused massive losses for the insurer.
It also was revealed that AIG used more than $90 billion in federal aid to pay out foreign and domestic banks, some of whom had received their own multibillion-dollar U.S. government bailouts. Some of the biggest recipients of the AIG money were Goldman Sachs at $12.9 billion, and three European banks - France's Societe Generale at $11.9 billion, Germany's Deutsche Bank at $11.8 billion, and Britain's Barclays PLC at $8.5 billion. Merrill Lynch, which also is undergoing federal scrutiny of its bonus plans, received $6.8 billion as of Dec. 31.
The money went to banks to cover their losses on complex mortgage investments, as well as for collateral needed for other transactions.
I am not surprise if similar ‘concept’ is being practiced in Malaysia. However I can bet there is one glaring difference. The public will make lots of noises but the authorities will suddenly turn deaf at that particular moment (selective deafness?) and proceed to "rewarding incompetence and failure”. After all, they have a lot in common!
"It's hard to understand how derivative traders at AIG warranted any bonuses, much less $165 million in extra pay. How do they justify this outrage to the taxpayers who are keeping the company afloat? All across the country, there are people who work hard and meet their responsibilities every day, without the benefit of government bailouts or multimillion-dollar bonuses. And all they ask is that everyone, from Main Street to Wall Street to Washington, play by the same rules."
This move to pay bonuses amounted to "rewarding incompetence and failure.” A lot of these people should be fired, not awarded bonuses. It is outrageous.
AIG reported that it had lost $61.7 billion for the fourth quarter of last year, the largest corporate loss in history. The bulk of the payments at issue cover AIG Financial Products, the unit of the company that sold credit default swaps, the risky contracts that caused massive losses for the insurer.
It also was revealed that AIG used more than $90 billion in federal aid to pay out foreign and domestic banks, some of whom had received their own multibillion-dollar U.S. government bailouts. Some of the biggest recipients of the AIG money were Goldman Sachs at $12.9 billion, and three European banks - France's Societe Generale at $11.9 billion, Germany's Deutsche Bank at $11.8 billion, and Britain's Barclays PLC at $8.5 billion. Merrill Lynch, which also is undergoing federal scrutiny of its bonus plans, received $6.8 billion as of Dec. 31.
The money went to banks to cover their losses on complex mortgage investments, as well as for collateral needed for other transactions.
I am not surprise if similar ‘concept’ is being practiced in Malaysia. However I can bet there is one glaring difference. The public will make lots of noises but the authorities will suddenly turn deaf at that particular moment (selective deafness?) and proceed to "rewarding incompetence and failure”. After all, they have a lot in common!
Tuesday, March 17, 2009
Not Good Enough
The Employees’ Provident Fund (EPF) Board declared a 4.5% dividend blaming the lower rate of returns on the global economic crisis. It is the lowest returns of dividend since 2003. In comparison, the EPF dividend primed at 8.5% dividend in 1987, and then slipped to the lowest ebb of 4.25% in 2002. Subsequently, it climbed to 4.5% in 2003, 4.75% for 2004, 5% for 2005, 5.15% for 2006 and 5.8% for 2007.
It decided to declare a lower dividend despite the fact that it earned a record RM20bil in gross income last year, up 9.36% from the RM18.29bil recorded previously. Is the money being retained to perform more bailouts? Last year, it loaned RM5 billion to Valuecap Sdn Bhd for its activities to buy Malaysian stocks and left us wonder if we would get this money back! It is time for account holders to demand a full disclosure of the performance and portfolios of investment. It is time a mechanism is proposed to scrutinize the performance.
The worker unions are certainly unhappy. National Union of Bank Employees (Nube) quoted "EPF is a cash rich entity. There is something wrong if there are no reasonable and acceptable dividends being paid out to workers. This has been going on for years where money from EPF has been used to fund government projects and to bail out ailing companies which later rake in huge profits with CEO and managements enjoying fat bonuses of between 20 to 30 months. What about the poor workers in the private sector whose money were used for these bailouts, what are they getting? We have also, time and again, questioned EPF's investment decisions in certain companies. The scrutiny of the EPF board of directors is questionable as the majority of its members are government officers and there are only a few workers' representatives."
Malaysian Trade Union Congress (MTUC) executive said the economic downturn "is not a good enough excuse for paying low dividends because the global downturn only struck in late 2008".
Just compare the return to a similar but much smaller fund manager. The Lembaga Tabung Angkatan Tentera (Malaysian Armed Forces Fund) is rewarding its contributors with a 7% dividend, 3% bonus and 6% special bonus!!! More reasons to be upset!!!
Read my previous articles on EPF.
It decided to declare a lower dividend despite the fact that it earned a record RM20bil in gross income last year, up 9.36% from the RM18.29bil recorded previously. Is the money being retained to perform more bailouts? Last year, it loaned RM5 billion to Valuecap Sdn Bhd for its activities to buy Malaysian stocks and left us wonder if we would get this money back! It is time for account holders to demand a full disclosure of the performance and portfolios of investment. It is time a mechanism is proposed to scrutinize the performance.
The worker unions are certainly unhappy. National Union of Bank Employees (Nube) quoted "EPF is a cash rich entity. There is something wrong if there are no reasonable and acceptable dividends being paid out to workers. This has been going on for years where money from EPF has been used to fund government projects and to bail out ailing companies which later rake in huge profits with CEO and managements enjoying fat bonuses of between 20 to 30 months. What about the poor workers in the private sector whose money were used for these bailouts, what are they getting? We have also, time and again, questioned EPF's investment decisions in certain companies. The scrutiny of the EPF board of directors is questionable as the majority of its members are government officers and there are only a few workers' representatives."
Malaysian Trade Union Congress (MTUC) executive said the economic downturn "is not a good enough excuse for paying low dividends because the global downturn only struck in late 2008".
Just compare the return to a similar but much smaller fund manager. The Lembaga Tabung Angkatan Tentera (Malaysian Armed Forces Fund) is rewarding its contributors with a 7% dividend, 3% bonus and 6% special bonus!!! More reasons to be upset!!!
Read my previous articles on EPF.
Monday, March 16, 2009
Life Is ....
Life is a suffering, understand it
Life is a sorrow, overcome it
Life is a tragedy, face it
Life is an obstacle, live it
Life is a puzzle, solve it
Life is a mystery, unfold it
Life is a journey, complete it
Life is an adventure, dare it
Life is a challenge, meet it
Life is a gamble, watch it
Life is a game, play it
Life is a duty, perform it
Life is a dream, realize it
Life is a promise, fulfill it
Life is a song, sing it
Life is a bliss, embrace it
Life is a beauty, admire it
Life is a romance, enjoy it
Life is a love, love it
Life is a joy, spread it
Life is an opportunity, grasp it
Life is a gift, cherish it
Life is a gem, strive it
Life is a sorrow, overcome it
Life is a tragedy, face it
Life is an obstacle, live it
Life is a puzzle, solve it
Life is a mystery, unfold it
Life is a journey, complete it
Life is an adventure, dare it
Life is a challenge, meet it
Life is a gamble, watch it
Life is a game, play it
Life is a duty, perform it
Life is a dream, realize it
Life is a promise, fulfill it
Life is a song, sing it
Life is a bliss, embrace it
Life is a beauty, admire it
Life is a romance, enjoy it
Life is a love, love it
Life is a joy, spread it
Life is an opportunity, grasp it
Life is a gift, cherish it
Life is a gem, strive it
Wednesday, March 11, 2009
Crude Oil
Supertankers that once raced around the world to satisfy an unquenchable thirst for oil are now parked offshore, fully loaded, anchors down, their crews killing time. In US, vast storage farms for oil are almost out of room. As demand for crude has plummeted, the world suddenly finds itself awash in oil that has nowhere to go.
It has been less than a year since oil prices hit record highs. But now producers and traders are struggling with the new reality: The world wants less oil, not more.
Oil-producing countries have pumped millions of barrels of their own crude into idle tankers, effectively taking crude off the market to halt declining prices that are devastating their economies. Traders have always played a game of store and sell, bringing oil to market when it can fetch the best price.
We thought the market would keep rising to $200, even $250, a barrel. Now the strategy is storage. Anyone who can buy cheap oil and store it might be able to sell it at a premium later, when the global economy ramps up again.
The oil tanks that surround Cushing, Oklahoma, in a sprawling network that holds 10 percent of the nation's oil, have been swelling for months. It is approaching capacity. There are other storage tanks in the country with plenty of extra room to take on oil, but Cushing is the delivery point for the oil traded on the New York Mercantile Exchange. So the closer Cushing gets to full, the lower the price of oil goes.
On these supertankers, rented by oil companies such as Shell, there is little for crews to do but paint and repaint the decks to pass time. More than 30 tankers, each with the ability to move 2 million barrels of oil from port to port, now serve as little more than floating storage tanks.
On the other hand, as storage units on land have filled up, the companies that own the tankers have profited. Tanker companies charge an average of $75,000 a day, three times as much as last summer, to hold crude.
Demand for oil began to increase steadily in the early 1980s, and it went into overdrive in recent years as the Chinese economy surged and as producers pumped lakes of oil out of the ground to take advantage of a spike in prices. Then recession gripped the globe, frozen credit markets made things worse, and inventories swelled. Refineries in the U.S. have cut way back on production of gas as the economy weakens and millions of Americans, many of them laid off, keep their cars in the garage.
The latest records show U.S. inventories are bloated with a virtual sea of surplus crude, enough to fuel 15 million cars for a year. Inventories have grown by 26 million barrels since the beginning of the year alone. Oil from Saudi Arabia, the United Arab Emirates and Nigeria is finding few takers, even though much of it is used to make gasoline in the United States.
One fear is that with oil prices so low, companies will slash drilling and production, setting the world up for an energy crunch that would send prices soaring. Others say prices would plummet if companies forced millions of barrels onto the market at once.
It has been less than a year since oil prices hit record highs. But now producers and traders are struggling with the new reality: The world wants less oil, not more.
Oil-producing countries have pumped millions of barrels of their own crude into idle tankers, effectively taking crude off the market to halt declining prices that are devastating their economies. Traders have always played a game of store and sell, bringing oil to market when it can fetch the best price.
We thought the market would keep rising to $200, even $250, a barrel. Now the strategy is storage. Anyone who can buy cheap oil and store it might be able to sell it at a premium later, when the global economy ramps up again.
The oil tanks that surround Cushing, Oklahoma, in a sprawling network that holds 10 percent of the nation's oil, have been swelling for months. It is approaching capacity. There are other storage tanks in the country with plenty of extra room to take on oil, but Cushing is the delivery point for the oil traded on the New York Mercantile Exchange. So the closer Cushing gets to full, the lower the price of oil goes.
On these supertankers, rented by oil companies such as Shell, there is little for crews to do but paint and repaint the decks to pass time. More than 30 tankers, each with the ability to move 2 million barrels of oil from port to port, now serve as little more than floating storage tanks.
On the other hand, as storage units on land have filled up, the companies that own the tankers have profited. Tanker companies charge an average of $75,000 a day, three times as much as last summer, to hold crude.
Demand for oil began to increase steadily in the early 1980s, and it went into overdrive in recent years as the Chinese economy surged and as producers pumped lakes of oil out of the ground to take advantage of a spike in prices. Then recession gripped the globe, frozen credit markets made things worse, and inventories swelled. Refineries in the U.S. have cut way back on production of gas as the economy weakens and millions of Americans, many of them laid off, keep their cars in the garage.
The latest records show U.S. inventories are bloated with a virtual sea of surplus crude, enough to fuel 15 million cars for a year. Inventories have grown by 26 million barrels since the beginning of the year alone. Oil from Saudi Arabia, the United Arab Emirates and Nigeria is finding few takers, even though much of it is used to make gasoline in the United States.
One fear is that with oil prices so low, companies will slash drilling and production, setting the world up for an energy crunch that would send prices soaring. Others say prices would plummet if companies forced millions of barrels onto the market at once.
Friday, March 6, 2009
Whopping $62 Billion Loss in 92 Days
American International Group Inc. managed to lose $62 billion in just 92 days. That's nearly $470,000 a minute. And it's more money than Bill Gates' net worth.
The insurance giant's quarterly loss reported Monday was the biggest in corporate history, topping the previous record of about $45 billion set by Time Warner Inc. during the fourth quarter of 2002.
That news came as the government said it would plunge another $30 billion in taxpayer money into the ailing New York-based company, which already has received some $150 billion in U.S. aid since September. The government is bailing out AIG as it could not afford another ‘Lehman Brothers’ which cause a series of serious consequences in the financial market. ($150 plus $ 30 billion and counting – whopping sum for a single bailout and dwarfed our very own bailout in previous downturn!)
The company, first wounded when the housing slump and credit crisis decimated the value of its investments in mortgage-backed securities, is now being hurt by the recession as well. AIG's quarterly loss totaled $61.7 billion for the October to December period, about 12 times the $5.3 billion it lost in the same quarter of 2007. AIG lost more in the fourth quarter of 2008 than it made from 2001 to 2007, when net income totaled more than $58 billion.
This super-sized loss stands out. Take a look at followings:
AIG's loss is more than Bill Gates' net worth of $57 billion as of last September, according to Forbes magazine's "400 Richest Americans" list.
The government provided $62 billion for immediate relief and rescue efforts in the months after Hurricane Katrina in 2005.
If $62 billion was spread across the U.S. population, Americans could each get about $200.
AIG's loss amounts to 92 percent of the $67.4 billion that Americans spent at world largest retailer Wal-Mart in the fourth quarter, which includes the holiday season.
It would take a person spending $1 million per day, everyday, the next 169 years to spend as much money as AIG lost during the fourth quarter, which lasted just 92 days.
The insurance giant's quarterly loss reported Monday was the biggest in corporate history, topping the previous record of about $45 billion set by Time Warner Inc. during the fourth quarter of 2002.
That news came as the government said it would plunge another $30 billion in taxpayer money into the ailing New York-based company, which already has received some $150 billion in U.S. aid since September. The government is bailing out AIG as it could not afford another ‘Lehman Brothers’ which cause a series of serious consequences in the financial market. ($150 plus $ 30 billion and counting – whopping sum for a single bailout and dwarfed our very own bailout in previous downturn!)
The company, first wounded when the housing slump and credit crisis decimated the value of its investments in mortgage-backed securities, is now being hurt by the recession as well. AIG's quarterly loss totaled $61.7 billion for the October to December period, about 12 times the $5.3 billion it lost in the same quarter of 2007. AIG lost more in the fourth quarter of 2008 than it made from 2001 to 2007, when net income totaled more than $58 billion.
This super-sized loss stands out. Take a look at followings:
AIG's loss is more than Bill Gates' net worth of $57 billion as of last September, according to Forbes magazine's "400 Richest Americans" list.
The government provided $62 billion for immediate relief and rescue efforts in the months after Hurricane Katrina in 2005.
If $62 billion was spread across the U.S. population, Americans could each get about $200.
AIG's loss amounts to 92 percent of the $67.4 billion that Americans spent at world largest retailer Wal-Mart in the fourth quarter, which includes the holiday season.
It would take a person spending $1 million per day, everyday, the next 169 years to spend as much money as AIG lost during the fourth quarter, which lasted just 92 days.
Tuesday, March 3, 2009
Connecting People
Some people think of networking as a way to get connected solely for their own advancement in life. In that respect a person might feel that it is unethical to network. This line of thinking stems from the idea that advancement will always come at the expense of someone else. Success in life is a zero sum game. In reality it does not work that way. Networking does not have to be at anybody’s expense. It actually rewards people for helping others to succeed. In that respect it may very well be the almost ethical business model today.
There are different types of networkers. The hunters create lots of negativity. They go for quick kill. They operate without regard of the others’ interest. Thus they will not last long before their true colours shine. They are the bad boys.
The farmers spend a lot of time sowing and nourishing relationships. They invest and energise their network. They use but never abuse their network. A true networker will always keep the interests of others in mind. These networkers are often very likeable and people like to interact with them.
Networking is not a bad word after all. Networking is a skill!
There are different types of networkers. The hunters create lots of negativity. They go for quick kill. They operate without regard of the others’ interest. Thus they will not last long before their true colours shine. They are the bad boys.
The farmers spend a lot of time sowing and nourishing relationships. They invest and energise their network. They use but never abuse their network. A true networker will always keep the interests of others in mind. These networkers are often very likeable and people like to interact with them.
Networking is not a bad word after all. Networking is a skill!
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