Global financial system reform

1.       The ribawi-based financial system, the lubricant of economic growth in the developed world and therefore a major mechanism and tool to prolong their economic and political hegemony is under surveillance.

2.       Britain, the Great prefixing its moniker long gone, is now slowly trying to fulfill a global leadership vacuum it lost painfully when Blair was playing lapdog to Bush Jr, and clearly by playing the moral high ground in climate change and the global financial revamp issues. In climate change, it is trying to be the middleman between Obama’s US insisting on self-regulation and the rest of the world who insists the world’s largest polluter should have to answer to some form of polluting taxation.

3.       Now, Adair Turner is cranking up the pressure on the global financial system, insisting it has grown too big for its good and too complex to be controlled.

4.       He has his own ideas, but perhaps the is not yet a ready admission that the alternative should really an equity-based financial instrument which curbs excessive growth of financial instruments based on underlying asset values, aka Islamic finance. Asset bubbles and systemic shocks are painful manifestations of the interest-based system, and it’s interesting that Turner even raised the issue that taxation is leaning towards interest by taxing profits after interest.

5.       Jewish interest groups make it impossible to change their forte in interest management, obtaining unpronounceable amounts of profits since before the days of Rothschild’s and such. Ford’s Zionist Protocols could have something on this – but as ever, I am cynical of what could come out of this. Until and unless the D-8 of the OIC, the OIC itself, the rest of the developing world acknowledge that they too can partake in global leadership and compete on equal footing with the great powers, I doubt they could transform themselves into paragons of virtue and goodness. Bubbles have come, and they have gone, and it still remains as it were. Interest groups reign supreme, and the shadow players behind the scenes are the supremos.

6.       There is so much to do to bring back justice to the world.

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The agenda for a global finance revamp 06 Nov 2009

By David Wessel - The Wall Street Journal Asia 

Date Published : 06 Nov 2009

The repair of the global financial-regulatory system is too important to future prosperity to be left to technocrats and bankers. But the substance is so arcane and complicated that few politicians or informed citizens can grasp the issues, let alone choose solutions.

That puts a premium on public-spirited insiders who think and speak clearly enough for the rest of us to understand, even if only to disagree with their diagnoses and remedies. It is that talent that makes Adair Turner, chairman of Britain's uber-regulator, the Financial Services Authority, worth listening to.

The U.K. didn't, as Lord Turner puts it, have "a good war." A couple of its big banks and several smaller ones imploded. It had a housing boom and bust. Its people put savings in Icelandic banks that collapsed. Its economic engine, finance, is sputtering. Its recession was deep.

And what had been seen by many in the U.S. as a model -- a central bank that stuck to setting interest rates and a single regulator that oversaw banking, securities markets and insurance -- is discredited. The rising Conservative Party wants to undo the structure built a decade ago by now-Prime Minister Gordon Brown and would fold financial supervision into the Bank of England.

Lord Turner, 54 years old, a Cambridge-educated former Merrill Lynch executive and McKinsey consultant, didn't arrive at the FSA until September 2008, well after FSA mistakes that contributed to the crisis. That liberates him to preach without first confessing sin, and preach he does. In a conversation in the London offices of the Climate Change Commission, which he also chairs, he was animated, even passionate, even though he had flown overnight from Washington. The word, according to Lord Turner:

-- One, finance got too big. "We must be more willing to ask . . . whether the financial system is delivering its vital economic functions as efficiently as possible, or whether parts of it can, and before the crisis did, swell beyond their economically efficient size," he said in a recent speech. He clearly favors the latter view: There was more "clever finance" and more trading than desirable to keep the world economy humming. Hence his willingness to consider a global tax on financial transactions, to the horror of many of his peers and the banking establishment.

-- Two, there was too much debt in the system. "There is a huge bias in the tax system towards debt," he said, largely because companies can deduct interest payments before computing taxable profits. "If we can't change that, then the regulatory approach needs to lean against that." Hence all the talk of reducing the leverage of financial firms. While U.S. and U.K. households and businesses did borrow more during the boom, the big run-up was in borrowing among financial firms matched by a huge increase in trading relative to the value of underlying economic activity, he observes. When bankers bellyache, he refers them to point one above.

-- Three, regulators failed to curb excesses, but politicians hardly encouraged aggressive regulation. The cry for "better regulation" meant less regulation, both in the U.K. and U.S. The diagnosis of Britain's economic woes was that regulation was stifling entrepreneurship, he said. No politician asked the FSA: "Why aren't you doing more to restrain this boom?" Few, if any, politicians can point to a speech made three years ago that asked why regulators weren't restraining lending or regulating with less of a "light touch."

-- Four, erecting a wall between ordinary deposit-taking and lending, on one hand, and trading on the other is impractical and unwise. Economies benefit when banks turn loans into securities or hedge their positions -- to a point. But by forcing banks to hold capital in the trading operations to provide thicker cushions to absorb losses -- he calls it "a bias towards conservatism" in trading beyond what is necessary for ordinary banking -- speculative trading will migrate away from banks toward hedge funds and the like, a change Lord Turner welcomes. That makes banks less risky (with smaller profits in boom times and smaller losses in busts), but he said it requires more oversight of big trading firms which, history proves, can endanger the whole system.

-- Five, for all the angst about the slow pace of postcrisis repair of the financial system, global regulators are making surprising progress toward consensus on a new regulatory regime. "We are attempting in 18 months to do changes far more radical than we did in Basel II that took between 12 and 15 years and dealt with some of the areas which proved to be less important," Lord Turner said, referring to the pact regulators reached in the Basel Committee on Banking Supervision that didn't avoid the crisis. Pushed by the newly empowered Financial Stability Board, the process, he said, "has worked better than I would have expected," he said.

Britain, of course, hasn't the clout to rewrite the rules of banking unilaterally. Lord Turner may not have precisely the same job in a year's time, if the Conservative Party takes power and sticks to its promise to abolish the FSA. But with a trenchant voice, he is helping to set the agenda for the most significant revamp of financial regulation in more than half a century.

Deep thinkers

Subhanallah - the beauty of Allah's creation!

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Deep thinkers

The more we study dolphins, the brighter they turn out to be. By Anuschka de Rohan

Anuschka de Rohan
Thursday July 3 2003
The Guardian

http://www.guardian.co.uk/science/2003/jul/03/research.science

At the Institute for Marine Mammal Studies in Mississippi, Kelly the dolphin has built up quite a reputation. All the dolphins at the institute are trained to hold onto any litter that falls into their pools until they see a trainer, when they can trade the litter for fish. In this way, the dolphins help to keep their pools clean.

Kelly has taken this task one step further. When people drop paper into the water she hides it under a rock at the bottom of the pool. The next time a trainer passes, she goes down to the rock and tears off a piece of paper to give to the trainer. After a fish reward, she goes back down, tears off another piece of paper, gets another fish, and so on. This behaviour is interesting because it shows that Kelly has a sense of the future and delays gratification. She has realised that a big piece of paper gets the same reward as a small piece and so delivers only small pieces to keep the extra food coming. She has, in effect, trained the humans.

Her cunning has not stopped there. One day, when a gull flew into her pool, she grabbed it, waited for the trainers and then gave it to them. It was a large bird and so the trainers gave her lots of fish. This seemed to give Kelly a new idea. The next time she was fed, instead of eating the last fish, she took it to the bottom of the pool and hid it under the rock where she had been hiding the paper. When no trainers were present, she brought the fish to the surface and used it to lure the gulls, which she would catch to get even more fish. After mastering this lucrative strategy, she taught her calf, who taught other calves, and so gull-baiting has become a hot game among the dolphins.

"Intelligence" is a term with many definitions and interpretations. It's difficult enough to measure in humans let alone other animals. Large brains are traditionally associated with greater intelligence, and the brain of the adult bottlenose dolphin is about 25% heavier than the average adult human brain. Generally though, larger mammals tend to have larger brains, and so a more accurate estimate of brain power comes from the ratio of brain size to body size - the "encephalisation quotient" (EQ). While river dolphins have an EQ of 1.5, some dolphins have EQs that are more than double those of our closest relatives: gorillas have 1.76, chimpanzees 2.48, bottlenose dolphins 5.6. The bottlenose's EQ is surpassed only by a human's, which measures 7.4 (Australopithecines - hominids that lived around 4m years ago - fall within the dolphin range: 3.25-4.72). But we don't know enough about the workings of the brain to be sure of what these anatomical measurements truly represent. Today, most scientists share the view that it is behaviour, not structure, that must be the measure of intelligence within a species.

Dolphins have invented a range of feeding strategies that more than match the diversity of habitats in which they live. In an estuary off the coast of Brazil, tucuxi dolphins are regularly seen capturing fish by "tail whacking". They flick a fish up to 9 metres with their tail flukes and then pick the stunned prey from the water surface. Peale's dolphins in the Straits of Magellan off Patagonia forage in kelp beds, use the seaweed to disguise their approach and cut off the fishes' escape route. In Galveston Bay, Texas, certain female bottlenose dolphins and their young follow shrimp boats. The dolphins swim into the shrimp nets to take live fish and then wriggle out again - a skill requiring expertise to avoid entanglement in the fishing nets.

Dolphins can also use tools to solve problems. Scientists have observed a dolphin coaxing a reluctant moray eel out of its crevice by killing a scorpion fish and using its spiny body to poke at the eel. Off the western coast of Australia, bottlenose dolphins place sponges over their snouts, which protects them from the spines of stonefish and stingrays as they forage over shallow seabeds.

A dolphin's ability to invent novel behaviours was put to the test in a famous experiment by the renowned dolphin expert Karen Pryor. Two rough-toothed dolphins were rewarded whenever they came up with a new behaviour. It took just a few trials for both dolphins to realise what was required. A similar trial was set up with humans. The humans took about as long to realise what they were being trained to do as did the dolphins. For both the dolphins and the humans, there was a period of frustration (even anger, in the humans) before they "caught on". Once they figured it out, the humans expressed great relief, whereas the dolphins raced around the tank excitedly, displaying more and more novel behaviours.

Dolphins are quick learners. Calves stay with their mothers for several years, allowing the time and opportunity for extensive learning to take place, particularly through imitation. At a dolphinarium, a person standing by the pool's window noticed that a dolphin calf was watching him. When he released a puff of smoke from his cigarette, the dolphin immediately swam off to her mother, returned and released a mouthful of milk, causing a similar effect to the cigarette smoke. Another dolphin mimicked the scraping of the pool's observation window by a diver, even copying the sound of the air-demand valve of the scuba gear while releasing a stream of bubbles from his blowhole.

Many species live in complex societies. To fit in, young dolphins must learn about the conventions and rules of dolphin society, teamwork and who's who in the group. For these dolphins, play provides an ideal opportunity to learn about relationships in a relatively non-threatening way. At Sarasota Bay in Florida, Randall Wells and his team have observed groups of juvenile male bottlenose dolphins behaving like boisterous teenage boys. Using its head to do the lifting, one dolphin may even get another dolphin air borne, actually tossing it out of the water. It's unclear exactly what is going on. It could be play, but more likely these are serious interactions that are defining social relationships.

Dolphins gradually build up a network of relationships, ranging from the strong bond between a mother and calf, to casual "friendships" with other community members. Wells and his team were the first to notice that adult male bottlenose dolphins tend to hang out in pairs. The dolphins' motivation for ganging together is under study but may involve ecological and/or reproductive benefits. Dolphins may also form "supergangs". Richard Connor and his team in Shark Bay, Western Australia, discovered a group of 14 males. The supergang was a force to be reckoned with. In the three years it was studied, it never lost a fight.

To keep track of the many different relationships within a large social group, it helps to have an efficient communication system. Dolphins use a variety of clicks and whistles to keep in touch. Some species have a signature whistle, which, like a name, is a unique sound that allows other dolphins to identify it. Dolphins also communicate using touch and body postures. By human definition, there is currently no evidence that dolphins have a language. But we've barely begun to record all their sounds and body signals let alone try to decipher them. At Kewalo Basin Marine Laboratory in Hawaii, Lou Herman and his team set about testing a dolphin's ability to comprehend our language. They developed a sign language to communicate with the dolphins, and the results were remarkable. Not only do the dolphins understand the meaning of individual words, they also understand the significance of word order in a sentence. (One of their star dolphins, Akeakamai, has learned a vocabulary of more than 60 words and can understand more than 2,000 sentences.) Particularly impressive is the dolphins' relaxed attitude when new sentences are introduced. For example, the dolphins generally responded correctly to "touch the frisbee with your tail and then jump over it". This has the characteristics of true understanding, not rigid training.

Lou Herman and Adam Pack taught the dolphins two further signals. One they called "repeat" and the other "different", which called for a change from the current behaviour. The dolphins responded correctly. Another test of awareness comes from mirror experiments. Diana Reiss and her researchers installed mirrors inside New York Aquarium to test whether two bottlenose dolphins were self-aware enough to recognise their reflections. They placed markings in non-toxic black ink on various places of the dolphins' bodies. The dolphins swam to the mirror and exposed the black mark to check it out. They spent more time in front of the mirror after being marked than when they were not marked. The ability to recognise themselves in the mirror suggests self-awareness, a quality previously only seen in people and great apes.

Not only do dolphins recognise their mirror images, but they can also watch TV. Language-trained chimps only learned to respond appropriately to TV screens after a long period of training. In contrast, Lou Herman's dolphins responded appropriately the very first time they were exposed to television.

Of course, an understanding of TV is of little use in the wild, but the ability to respond to new situations has huge implications. In the shallows of Florida Bay, Laura Engleby and her team have recently discovered an ingenious fishing strategy. A number of the local dolphin groups seem to use a circle of mud to catch mullet. The action usually begins with one dolphin swimming off in a burst of speed. It then dives below the surface, circling a shoal of fish, stirring up mud along the way. On cue, the other dolphins in the group move into position, forming a barrier to block off any underwater escape routes. As the circle of mud rises to the surface, the mullet are trapped. Their only option is to leap clear out of the water and unwittingly straight into the open mouths of the waiting dolphins.

There is still much to learn about these flexible problem-solvers, but from the evidence so far, it seems that dolphins do indeed deserve their reputation for being highly intelligent.

Zoologist Anuschka de Rohan produced last month's Wildlife on One programme, Dolphins - Deep Thinkers? This piece is based on an article in the July issue of BBC Wildlife Magazine, available from newsagents or BBC Wildlife Magazine Subscriptions on 01795 414718.

Prosperity without Growth

1.       All this malarkey about New Growth Model / High-Income Model etc is making me puke. It’s a shameless and misguided call for increasing GDP growth figures so that wealth will create happiness to people.

2.       TDM’s years have actually proven that placing this criteria above all else is mistaken. Back at the peak of the Asian crisis, our GDP growth figures held up reasonably compared to our peers, but that’s because of pump-priming, aka let’s build beautiful buildings in Putrajaya so that we can tell the world how we’ve got it made, and **** the masses cos the spillovers will benefit them. Fast fwd to now, and we have a country building up its debt levels with all these continuous deficit budgets, increased crime, fractured society and blameworthy politicians from both divides. While I’m being disingenuous if I were to blame all these problems to the construction of Putrajaya, I’d like to venture that that was a manifestation of spend to create growth, for GDP growth is the penis envy affliction of some country’s economic administrators.

3.       And here we are repeating the same mistakes with the NGM / MIM thing, and this SWF is lending its full support to execute this.

4.       What we need is a leader who knows that life in Dunya is only as preparation for the Hereafter, but this life in Dunya needs to sustain a happy, sustainable lliving for all. And again, this philosophy is superbly, comfortably captured in the Quran.

5.       The following extracts bring recency to this argument, although intuitively I sense certain gaps are missing as it’s still looking into merely “worldly” things, but it’s a fantastic start, and ideologues for Islamic economics would do well to pick this up.

Source: http://www.happyplanetindex.org/public-data/files/happy-planet-index-2-0.pdf

Excerpts from the report:

“To maintain growth, Western capitalist economies have a structural need to sustain demand for consumption.72,73,74 But this feature of the system sets it at odds with a widely noted fact about human nature – that once our basic material needs are comfortably met, more consumption tends to make little difference to our well-being. This is not just folk wisdom, although it is certainly the case that throughout history, and across all cultures and religions, people have cautioned against an excessive focus on wealth and material possessions. Research suggests that in most reasonably developed countries, material circumstances such as wealth and possessions play only a small role in determining levels of happiness – some psychologists estimate that they explain only around 10 per cent of variation in happiness at the aggregate level.75 Beyond a certain level of income, increasing wealth makes little difference.76 Much more significant are factors relating to individual differences in outlook and to the kinds of activities that people engage in: socialising, participating in cultural life, having meaningful and challenging work and so on.

But the requirement to maintain consumption growth at all costs has led to a situation in which, for decades, we have been presented with a poisonous combination of messages. First, we are constantly bombarded with messages from advertisers and marketers, all pushing the idea that buying this or that new product will make us happier. Added to this, in many countries we have been offered staggeringly easy access to credit with which to keep up our level of consumption. Quite apart from the environmental impacts, this has served us very poorly in a number of ways.

For one thing, levels of debt have soared in recent years; in 2007 and 2008, for the first time on record, UK personal debt exceeded total GDP.77 As recent research from the Institute of Psychiatry in London shows, debt is a large contributing factor to a person’s chances of developing clinically significant anxiety and depression, largely irrespective of their income.78 It is not hard to imagine why this might be. The stress of working just to keep up repayments is exhausting, the fear of defaulting constant and gnawing, and that’s without having to deal with the feelings of despair and inadequacy for having failed.

But there is also a more subtle and no less damaging aspect to all this focus on personal consumption. People who are strongly motivated by the idea of getting rich and famous are what psychologists refer to as materialistic. Using an engaging metaphor, psychologist and author Oliver James describes them as having caught the ‘affluenza’ virus.79 The scientific evidence for the negative impacts of materialism is overwhelming; they range from poorer personal relationships through fewer good moods and lower self-esteem, to increased prevalence of psychological symptoms.80 In short, people whose main aspiration is to be wealthy are inclined to be less satisfied with their lives in general than those who focus their energies elsewhere.81 What is worrying, but perhaps unsurprising, is the extent to which materialism is on the rise. Figure 2 shows data from an annual survey of college students in the USA. The proportion of respondents feeling that being very wealthy is important has doubled since the early 1970s, with a concomitant decrease in the number considering a meaningful philosophy in life to be important.”

Pian Sukro, JDC, School, Pajam and Family

I’m trying my darndest to fill my head with execution-minded stuff now, not the variety with guns or rolling heads, but of the action-oriented, operational variety. At the same time I also try to justify these actions, so it’s a case of filling the gap between stimulus input and feedback, and where there is a more intimate, rolling-the-options-in-the-head justifications to the action. (although, from past records, a lot more, will end up as inaction)

1.       Pian Sukro

I read the report of his very much untimely and premature death this morning with sadness, but Allah knows best. I have the fullest respect for him as a CEO and a leader. Even then I know I may have maligned or disparaged him with my rather indisciplined tongue when discussing TNB or the energy industry with colleagues or fellow discussants, deep down it is nothing but respect.

He had the foresight to execute capex-heavy investments like SAP, the BCG-advised T7 program – the TNB transformation strategy and from which Che Khalib benefitted greatly from and many others. These were the sort of stuff that was needed to be done to drag TNB out of the morass, not merely some financial paper shifting thing. (although Izzaddin did superbly – the best CFO TNB has ever had by a long mile!)

By the by, this is Malaysia, the land of compromises, half-actions, negotiated truths, half-half measures, and there could be a lot more things he could have done were he not constrained by the political and business masters that we all somehow consented to have power over us. All things considered – he did great.

May Allah rest his soul and consider his actions as amal maaruf, and grant him the company of the solehun and mukminun. Al-fatihah to Allahyarham Pian Sukro.

Note – and hopefully the Energy Commission can find someone just as capable (or even better, though unlikely) to replace him,

2.       JDC

Attended my first JDC meeting on Friday night. My first thoughts – strong cliques among the committee arising from the closeness in age and “batch” – and hopefully not too strong a groupthink, there are shades of SPU about the discussion there. IMO we should be thinking strongly of strategic moves to enhance our presence in Cheras, the impressive developments in Balakong and the surrounding Cheras Selatan are good developments we should ride on. Societal changes etc are also opportunities to be considered, and we should refrain from taking the easy way out of doing things. Ie more of Penang and Azlishah’s PJ than the current mindset. Not taking anything away from them, it was my first 2 hours with this group, and I should keep an open mind and share, contribute as necessary. My groupmates were (by seating arrangement) Najib, Zul, Faisal, Ust Zul, Nazeli, Susilawati, Rosliya, Zaini, Amirul. Personal preparation and planning should help – ie towards contributing to the most optimal portfolio.

3.       School and Little Azhar

How strategic are education-related initiatives towards societal change? VERY! Preschool education should very much be allowed to proliferate towards their desired niches to target towards the relevant societal preferences, as long as it retains its fundamental Islamic outlook. (for those who take issue with Fundamentalist Islam, start researching this subject and don’t be swayed by the Internet and Wikipedia too much – start asking the right people) Daerah should have a say in the running of these preschools – preferably post of TPSM should be automatically a Board member of Education institutions to anchor the debates and discussions in realistic societal-centric strategies. And from there, demand for Islamic oriented schools can be cultivated and nurtured and thence a stronger Islamic educational institutional can be anchored to rival the Kuen Chengs of the world. Then, all this nonsense espoused by the goblog Oi Jeff can be effectively challenged.

4.       Pajam

How can it be to develop agriculture in Pajam be the best option 3 weeks ago and suddenly turn into lets sell this to this Datuk at any cost? Unsurprising that the outcome is like this when nobody is coming forward to support Mak and she’s the one wracking her brains to solve her problem of asset management, and she also sees this as doing a favour for her children who she sees as incapable of handling their problems. Admittedly, I am the one who should be doing this, but past experiences are just holding me back. I’m not keen to help my sisters by helping Mak, and she’s not likely to favour me by bypassing my sisters. So the cycle continues.

IMO it’s still a long call to sell – it takes someone either not business-savvy or a bit mad to purchase Pajam at the inflated prices being pushed by the owners (Mak and Zadi being the ones rational on the pricing, leaving the other as the irrational one) – and feasibly Datuk could be one of those. Couple that with his interest to develop this “friendship” and this could be a good call to solve Mak’s perennial problem. Otherwise, I should still keep the option for developing in the backburner.

5.       Family

And here lies the rub. To do all that I’ve said should be done above needs me to exercise my independent outlook on life and I feel my options before have restrained rather than unleashed my options. Although OTOH when I’m left to make my own calls, I’ve been railroaded into making all the wrong decisions anyway.

But, hard choices, decisions, and finally action! Need to put my easel frame into action now!

Assortments

1.       Nightmare / Premonition

The message was stark and clear – I continue with this tomfoolery / monkeying / misbehaviour and all that impacts on iman and taqwa levels, and I am at the very end of the boundary of practicing muslims. The image of joining Friday prayers only for tasyahhud just before salam and just slightly better than the deceiving people at the back who are laughing, joking their way contrasts with the image of the thousands of muslims performing prayers with khusyu’ and devotion to Allah.

Point is to be fully absorbed in all my actions hereafter.

 

2.       4^th consecutive defeat for Liverpool

There are now calls for his head. Ridiculous! But there have been too many ridiculousness in the decision-making these past few years to suggest that it cannot happen. In my own opinion, Rafa should be given the space to work – he has proven he can overcome adversity, errors, poor decision-making and he has not shown tobe big enough not to admit his poor judgment. What better criteria can you place upon people attempting to compete with better-endowed rivals other than those above? Of course, this is also a results business, and if results cannot be sustainably be achieved, he should go. But there needs to be a calmer response to the situation, and perhaps the return of G&T will help to turn this around.

 

On the other hand, what this has shown is how much we have overachieved given the resources available, and it is a credit to Rafa that we are performers in the CL (as compared to Mourinho’s Inter, and Chelsea’s records over the past 5 years with equivalent or better resources, and I would think ManU’s CL win and runnerup in the past 5 years is comparable to Rafa’s record) It is in the league that he has fallen short, and unfortunately when expectations are higher this year following last season’s extremely strong finish, the transitory stage this year has pulled down results. To reiterate, Rafa needs time to turn things around, given Alonso’s departure and injuries to key personnel – and I include Aquilani in this as he IS the replacement for Alonso, given that he was the guy we purchased with the money from Alonso’s sale.

 

Failure to get a result against ManU will be painful – but if the performance resembles Lyon’s and Sunderland’s 2^nd half, it can only accelerate Rafa’s departure. There are pretty irrational people in Anfield these days – including the booing terrace-goers (IMO they are not fans)

 

3.       Insider trading at Galleon and McKinsey partner implicated

Following on from the impatient and amoral people theme, (although I had not included G&H in the Liverpool theme above considering their promises upon their takeover), the Rajaratnam?, Sri Lankan founder of the largest tech hedge fund, Galleon, is implicated in insider trading deals in 2007. Also implicated is an Indian national Anil Kumar, a partner in McKinsey.

 

These are hedge funds, already an amoral speculative financial instrument with too much power for its own good coming from its ability to leverage other people’s money manifold. How can something speculative such as this be allowed to operate given its power to move markets isn’t an inherent strength, but rather, built on greed on profit-making. Hence, their trade is based upon using derivative instruments to manage risks, and the nature of the beast is that they will continue to speculate and bend rules to make money for their funders / investors. The surprise is that it has taken this long to implicate one in an insider trading scandal- and that too using wiretaps. That should leave the financial analysts / stockbrokers / fund managers who’s been doing for too long running scared.

 

If I sound a bit bitter about it, perhaps I am. Engineers, and those in the professional services dealing in the real economy has been getting a raw deal from these market-movers getting a slice out of the billions sloshing around through insanely unregulated ways. It’s about time, although I should add that the law will take its natural course and clear those who are innocent.

 

4.       Work and technology

Speaking of tech, I should limit myself to Ind Biotech from here onwards. Otherwise, it’s just too large an elephant to swallow. But having said that, looking beyond my scope, I also seek to deepen my interest in RE, Education and Agriculture. And all these require a bit more than just passing remarks here and there – there should be real commitment and deep interest to sustain this. Hedghogs will also require that there is an execution emphasis for all these!

 

5.       Leadership stresses and faultlines

Conflicts in my departmental meetings are rare given how monotonously monologue it has been – but it’s interesting when personal attacks are allowed in this meeting. At the same time, I feel that it is a bit shallow to attack people for not meeting, there is probably a bit more than that which meets the eye, and there are probably underlying circumstances which demand that changes will have to be made. I’m an optimist – I expect big changes to happen in the next 6 months. Or maybe, I should make that I’m suddenly depressed about things now!

 

 

Initial thoughts on scenarios

1.       It appears that there is general acceptance of the mediocrity of the Malaysian economic growth story amongst the policymakers, and there is general readiness to embrace the change. Without the chest-thumping of politicians, “omphaloskepsis” or navel-gazing has turned to a somewhat muted and pessimistic outlook.

2.       So where to now? Ideas of a high-growth model to bring us out of the income trap has surfaced, though it is noted perhaps more of the rhetorics of grandeur it generates rather than any solid substantial plans as of this moment. Perhaps it is still early stages, but when government ministers seem to be preoccupied with their personal KPI setting for what they have done before, and rather mundane NKRAs that it’s looking at currently, who’s looking at what to do next? EPU and MOF seems to be focusing on hot to replace ‘loss’ of Bumiputra rights and what to do with a shiringking treasury. Personally, someone mentioned in the KMF recently that Stiglitz and Sen has proposed a different set of measures to look at growth and progress, and it should be one where the general betterment of the populace should be prioritized, and I do agree with this view wholeheartedly.

3.       Back to my own scope – tech and biotech. I’d think that our success in this area, with expectations of this being the focal point of the economic growth story, is important. While personally I think the expectations are rather overblown, mainly from the perspective that there has been limited domestic success models currently, and growth potential is curtailed by our lack of capacity amongst technocrats, scientists, investors, researchers and financiers.

4.       However, looking forward, success is predicated on three dimensions – execution capability, funding capacity and sustainable demand pipeline. We could perhaps draw four discrete scenarios across these soft drivers, (as opposed to predetermined hard drivers of ageing population, oil / gas shocks, etc):

-          Green: successful coevolution of the three critical development factors outlined above

-          Dry wells: progress on a global front, but we’re left further behind as we fail to leverage our execution and funding capacity-building

-          Desert: global pipeline dries up as countries ramp up their domestic focus in the face of sluggish global economic conditions, and while decoupling may not be realised, but effectively demonstrated through raised trading barriers

-          Status quo: we plod along, celebrate the little successes which come our way, overcome the little curveballs that gets thrown into our path ever so regularly by our regulators, partners and businesses

5.       Preparation across all four scenarios entails:

-          Continuous engagement and mobilization of the various entities and stakeholders in this Greening project\

-          Engaging private financiers and incorporating their acceptance of biotech as an asset class early

-          Remodeling and incentivizing local and foreign players to step up into the Malaysian-centric perspective

-          Finalising and creating buyin of LS subsectors that the country would need to participate in

Assortments

Taman Desa, Kuen Cheng and Menara IGB

1.       I’m impressed with the Chinese community’s strengths in business and finance after looking at these three, hardly iconic, but manifestations of their expertise and community teachings.

2.       Taman Desa is a township with heavy Chinese features – where trading and commerce in heavy services and machinery is all too prevalent, presumably began and continued since mid19th century. Kuen Cheng is a private Chinese primary school, whose buildings and layout is more reminiscent of a tertiary level malayish IPTS with some government backed institution, and MEnara IGB sits across TNB headquarters, where over 10 years it has grown to a fantastic self-contained commercial city generating revenue and with a high multi-storey building housing the IGB hq.

3.       The Malays would be hard-pressed to replicate this, but again, the question is, what is the inherent strength of the Chinese? I would hazard that it’s the community’s ability to stand on the shoulders of giants, to cooperate and to consolidate.