I was going through old photos today and I found this: the Anzac Bridge.
I used to go to this spot quite often, because I lived nearby. I have lived in several places in this world and I think it is hard to beat Glebe in Sydney. I would wake up every day and every time walked out of the house, there, the Harbo(u)r Bridge would greet me. And the Anzac Bridge too. And that lazy black cat just down the road.
I have read in the media of allegation that the weaker ringgit is contributing to the rising inflation in Malaysia.[1]
The allegation makes sense. If Malaysia imports stuff, which the country does, and if the ringgit gets weaker, which it has (at least against several currencies and namely the US dollar), a weaker ringgit should contribute to domestic inflation. In the absence of data, I would support the idea of weaker currency is contributing to inflation.
Except, I am not entirely convinced by the data. In fact, the data is possibly telling me something to the opposite.
I have done some modeling in the past and it is hard to get a relationship between currency and inflation. At least, my modeling skills are not there yet, I would suppose. Even if I ignore all those econometric tests which the models failed, the effect of currency fluctuation under normal times, as I remember from those models, are so small that I would rather ignore them.
But here is something that does not rely on my econometrics. It is more straight forward in answering whether a weaker ringgit is contributing to domestic inflation. There are two possible proofs dismissing the role of the weaker ringgit.
The first is the producer price index (PPI) for imports. Crazily enough, it is still deflating and it has been deflating since January 2013 at the very least:
One would expect, if the weaker ringgit was contributing to domestic inflation, the PPI for imports would increase and from there, the PPI inflation would somehow transmit to the consumers, affecting the CPI. I have not modeled this but the result for the a priori expectation that one needs to make the assumption that the weaker ringgit is contributing to domestic inflation is not going well here.
The second involves the import value and import volume growth. I have not thought of this thoroughly but if a weaker currency is contributing to domestic inflation, I would expect faster growth on import value than import volume growth. But in December, total import value (the one you see often in the press) rose 14.8% YoY. Volume grew 15.1% YoY. That means imports really are getting cheaper, corroborating the signal from the PPI imports.
So, is the depreciating ringgit contributing to the rising domestic inflation?
No. On the contrary, imports are a counteracting factor against inflation.
Again, this is just a preliminary thought that I just had. If my thinking holds, then I do not think the weaker ringgit is contributing to domestic inflation. At least not yet.
Right now, it seems, the rising CPI inflation in Malaysia is all caused subsidy cuts and domestic demand.
Two kids somewhere south of Mandalay. They were following me around and they were more than happy to pose for a photo when I pointed my camera at them.
Notice that they are smiling but the monk child in maroon has his right foot bandaged. And look at the feet of the kid at the front, and his clothing too. Yet, they are smiling.
I am at that stage when I am way too lazy to blog serious stuff. I blame it on Twitter.
So, more pictures. Let us hope with this one, I am less careless with the grammar. I have re-read some of the recent entries, and oh my god, embarrassing. Still…
I present to you, the Shwedagon pagoda.
Shwedagon is big and it is impressive but I think multiple writings exaggerate how it dominates Rangoon’s skyline. It might have in the old days, but you will not see it from downtown Rangoon. Nor at night, the lights reflected from Shwedagon’s golden stupa would fill the night sky (okay, maybe it did a little bit). This is just not the Empire State Building or the Petronas Twin Towers where you can spot it miles away. Those writers just have too much poetic license.
The approach to Shwedagon is great nevertheless. I walked from the downtown to Shwedagon, which was probably 4km-5km apart. At first I saw nothing. Just houses and barracks and trees. After awhile, a huge golden structure appeared at the end of that long road I was on.
I spent about 3 to 4 hours there. Not that it takes that much time to go explore the pagoda. This is not Angkor Wat or even Borobodur. It lacks details. You see them and you walk to the next thing. There is not Churning of the Milky Ocean kind of thing.
It was just that the human behavior was so interesting. It provided me with countless opportunities for photography. I wished I had a tripod with me since it got more interesting after sundown.
At some point while watching tourists snapping pictures of monks and praying Buddhists, a thought came to me: has Buddhism become a touristic attraction itself?
I mean, visitors just go round and round, coming in none stop, taking pictures of devotees and monks. While it is nice to have the religion being so friendly and open to tourists and outsiders, I do feel, somehow, the religion has been… commercialized, becoming a subject of camera shots.
A way of life becomes nothing but a product of tourism.
I remember in Mandalay, as monks walked across the Amarapura bridge, a tourist with his big camera probably worth thousands of dollars, with lens so big, you would need a stand to support it, pointing it to a monk, almost to the face, if I can have that poetic license to myself. The monk was miffed. Such disrespect, I would think he said. The monk made a gesture, telling him no.
A revolt from commercialization, maybe?
As a libertarian, I have a strong dislike for the cultish reverence towards a person, where one puts a picture of a political leader everywhere almost to the point of worshiping them. It is not the excessive putting of portraits really. It is the attitude of revering too much. It is the worldview that that person is a god’s representative on this earth (even that, on its own, is against everything that I believe in).
That happens in Malaysia in government buildings and sometimes elsewhere too. Recently, the Malaysian education ministry sent out circulars to display portraits of Malaysian government leaders (read Barisan Nasional leaders) in classroom to encourage patriotism. We all know what that means. Starting them young is the best way to manufacture obedient robots. And it is not limited to Barisan Nasional either. And the picture of the Agong is another thing although the practice of rotating the seat every five years among so many of Malaysian sultans, rajas and a Yamtuan Besar does make it less ominous.
Thailand has too many pictures of their king. When I was in Bangkok, I was told I was not supposed to put banknotes in my wallet, because I would sit on my wallet. I do not if that was a make-believe but that is to me, cultish. I have never been to North Korea but through my readings, I would think the North Korean government would like their citizens to worship Kim Jong-un. To some extent, I do have trouble with teenagers worshiping some popstars but let us not get there.
One person that keeps popping in my travels in Burma was Aung San Suu Kyi. I completely understand why she stands out. In a country where the military rules without democratic legitimacy, she is the symbol of opposition to that dictatorship.
When I was buying a book in the streets of Rangoon, the shopkeeper pointed his finger to the wall and said, “That’s Aung San Suu Kyi, our leader. Do you know her?”
At that point I really had no problem with her popularity. After all, she has done so much and for that, she deserves the respect.
So, things get a little bit disturbing for me when I spotted this calendar somewhere 20-30 minutes south of Mandalay:
The calendar, is somewhere to me, a sign of, in my own neologism, cultish reverence.
I have that skepticism because I always fear power and in a democratic society, popularity and power come in the same sentence. A person with so much power, especially in a illiberal democracy where the liberal safeguards are weak or simply does not exist, that popularity means the popular leader can do no wrong to the eyes of the majority. That means tyranny of the majority.
But this is Burma under military dictatorship and she has only limited power within the limited and guided democracy that the country has. Maybe I should cut her some slack.