Category: Economics

Categories
Economics Politics & government Society

[1324] Of a grim signal for the opposition and possibly a bad survey

In both Turkey and Japan, voters’ main concern is the same: the health of the economy.

The Merdeka Centre for Opinion Research conducted a survey earlier in June and this is the result:

A survey by the Merdeka Centre for Opinion Research in June found that 76 per cent of Malays thought the economy was favourable, but only 45 per cent of Chinese and 58 per cent of Indians shared their view. [News Focus: Economy, crime main concerns of Malaysians. Darshni, Shamini. NST. August 7 2007]

That does not sound good for any opposition party that depends on Malay votes.

Regardless, this might be a result of a very confusing question:

Asked whether they thought Malaysia was lagging other economies but if programmes and other government efforts would help the country catch up, 24 per cent of Malays, 44 per cent of Chinese and 45 per cent of Indians disagreed. [News Focus: Economy, crime main concerns of Malaysians. Darshni, Shamini. NST. August 7 2007]

Do the participants disagree to the statement “the economy is lagging” or “government effort helps to catch up”?

And these results do not make sense, or at least something is missing.

On Islamisation, 91 per cent of Malays said they supported the idea while 82 per cent of Chinese and 58 per cent of Indians did not. [News Focus: Economy, crime main concerns of Malaysians. Darshni, Shamini. NST. August 7 2007]

Do read that together with:

Among those who felt the Islamisation process had a positive effect, 29 per cent said it instilled noble values and eight per cent said the religion helped reduce social ills and indecency. [News Focus: Economy, crime main concerns of Malaysians. Darshni, Shamini. NST. August 7 2007]

Only 29% of the sample agrees that Islamization instill noble values and only 8% agrees that religion reduces social ills but 91% of Malays support Islamization. Odd.

I believe a more meaningful way of presenting the results is to either divide the result regarding instillation of noble values into ethnic groups, or to have the percentage out of the total sample related to the question of support for Islamization instead of having it in its current form. Only through either one method does one could compare an apple to an apple. By reading this article from the New Straits Times, it is either the reporter has bad critical writing skill or the Merdeka Centre conducts unreliable survey.

I tried to clarify some of my confusion by looking for the actual survey. The Merdeka Centre’s site however is disappointing: nothing relevant could be found there.

But putting technical questions aside, could it be that the reason behind support for Islamization is neither about promoting noble values nor reducing social ills but mostly caused by something else?

And finally:

On Islamisation, 91 per cent of Malays said they supported the idea while 82 per cent of Chinese and 58 per cent of Indians did not. [News Focus: Economy, crime main concerns of Malaysians. Darshni, Shamini. NST. August 7 2007]

A concrete fact to support my earlier post.

Categories
Economics Politics & government

[1322] Of lesson from Japan

The recent Turkish election, which saw the conservative AKP gaining control of the Turkish legislature with a strong majority, taught the world the importance of a healthy economy. The recent Japanese upper house election unmistakably rings the same bell:

The vote was a rejection of Mr Abe’s priorities, which emphasise ideological issues of nationhood, such as instilling patriotic education, rewriting the pacifist constitution and expanding the role of the Japanese armed forces. Many Japanese are not opposed to such measures, but they rate them far below pocketbook concerns: a shortage of decent jobs for the young; stagnant wages; rising health-care costs; uncertain pensions; and swathes of the depopulated countryside missing out on the economic recovery that has taken hold in Tokyo and other big cities. Mr Abe’s blunder, contend Richard Katz and Peter Ennis from the Oriental Economist, a newsletter, was to think that the recovery would take care of these concerns by itself. [Keeping his head just above water. The Economist. August 2 2007]

What lesson do you think the upcoming Malaysian election will teach us?

Parties like DAP and PKR better memorize this lesson to heart before it is too late.

Categories
Economics

[1319] Of has the time for a downturn come?

In the US, the warning finally meant something:

The Standard & Poor’s 500-stock index fell 2.7 percent yesterday, with much of the decline coming after Bear’s conference call started around 2 p.m. The Dow Jones industrial average lost 281.42 points, or 2.1 percent. And the dollar fell noticeably against the euro and the British pound.

While consumers continue to express confidence in the outlook for the economy, the government’s monthly employment report, released yesterday morning, added to worries about the spreading impact of the housing slump. The economy added only 92,000 jobs last month, down from 126,000 in June and the unemployment rate ticked up to 4.6 percent.

[…]

“I have never seen it happen so quickly,” said Steve Walsh, a mortgage broker in Scottsdale, Ariz. “Banks always do these little cutbacks here and there. What they are doing now is a liquidity crunch. It’s a credit freeze.”

[…]

Despite all the worries about credit markets, however, the economy continues to plow ahead and even yesterday’s jobs report was not weak enough to suggest that the Federal Reserve would cut its benchmark short-term interest rate when it meets next week.

But the risks to the economy do seem serious enough that investors now expect the Fed to cut its rate to 5 percent, from 5.25 percent by November, based on the price of a trading instrument that is tied to Fed policy. And the yield on the 10-year Treasury note fell to 4.68 percent from 4.77 percent Thursday evening.

[…]

Wall Street analysts say they are increasingly concerned that consumer spending will weaken as more people in housing and related sectors lose their jobs. They also worry that many homeowners will cut back as they find it harder to refinance or borrow against the value of their homes. [Markets Fall as Lender Woes Keep Mounting. NYT. August 4 2007]

Please do not look at the S&P 500. Instead, look at the issue in the housing sector.

That cold might spread to Malaysia. That huge government spending under the Ninth Malaysia Plan however could mitigate the effect of a slowing US economy, at a price of course.

Anyway, I am still holding on to that bet.

Categories
Economics Humor

[1317] Of honesty to cause liquidity trap

LOL!

Can money from the sky bump the Japanese out of their liquidity trap? Not if they don’t pick it up!  For some, it is just too creepy. “People thought it was too eerie to touch”, AFP reports. And many of those willing to handle the loot have dutifully returned it to the police. It’s okay, people. Just spend it. [It’s raining yen! Free Exchange. July 31 2007]

Categories
Economics

[1316] Of we must liberalize fuel prices

Have you ever found yourself short on gas and there was no gas station in sight?

I have. I had traveled through roads that offer no refueling opportunity for miles and miles but I had never thought I would have to relive that experience here in Malaysia.

KUALA LUMPUR: The 3,200 petrol stations nationwide, including those along highways, will close at 10pm and open at 7am, with or without the approval of the Government.

This was decided at the annual delegates conference of the Petrol Dealers Association of Malaysia (PDAM) here yesterday.

Frequent armed robberies, increased security costs, higher wages for workers, low night sales, soaring rentals and electricity bills were cited as the key reasons for this decision. [10pm closing time for all petrol stations. The Star. August 2 2007]

Do you realize what does this mean?

Congestion at gas stations just before 10PM and after 7AM.

This would also discourage traveling. I would not want to drive in the middle of the night while the tank is low on gas.

Furthermore, through the same rationale, logistics firms that operate during the night to escape traffic congestion during the day would be adversely affected. This problem would flow to the retailing industry as well as many others that rely heavily on uninterrupted logistics services that run 24/7. In short, this might hurt the economy as a new constraint increases cost of doing business.

Maybe it is time for the government to liberalize fuel prices and allow individual station to set its own prices to cope with their own cost as well as the supply and demand curves they face.

Enough of central planning already.

Mohd Hafiz Noor Shams. Some rights reserved Mohd Hafiz Noor Shams. Some rights reserved Mohd Hafiz Noor Shams. Some rights reserved

Do compare that previous report, which the report below, which was published earlier:

KUALA LUMPUR: Fill up your tank before 10pm.

The Petrol Dealers Association of Malaysia wants to close petrol stations at 10pm daily, citing escalating costs and security risk as the reasons.

Association president Alang Zari Ishak said about 200 delegates will attend the association’s annual general delegates conference today to endorse a resolution to close business earlier.

“We want to close for business at 10pm and reopen at 7am every day,” he added.

Alang Zari, however, said that petrol stations along highways would remain open 24 hours. [Fill up at petrol station before 10pm. The Star. August 1 2007]

I think The Star is confused…