Category Archives: Ringgit

Ringgit

PEGGING THE RINGGIT

  1. Bank Negara knows best about the management of the Ringgit. It should not be pegged. 
  1. However, I am curious about how pegging the Ringgit in 1998 helped in the economic recovery of Malaysia. I say this because even the International Monetary Fund (IMF) and the World Bank agreed that Malaysia did the right thing. 
  1. Admittedly, the financial situation then was worse than now. And our reserves then was not as big as now. Still, we overcame the financial and economic problems caused by the depreciation of the Ringgit through pegging the Ringgit at RM3.80 per USD.
  1. When the Ringgit is pegged would it cause the outflow of foreign investments in Malaysia? From the little that I know about finance, outflows of foreign investment is due to the expectation of further depreciation of the Ringgit or shares. When the Ringgit was pegged there would not be further depreciation against the USD. Assured of the value of their investments, the need to divest was removed. 
  1. Let’s say an investor invested 1 million USD at the time when the Ringgit was stronger – say RM 3.80 per 1USD. Effectively his investment would be worth 3.8 million Ringgit in Malaysia. This value would be sustained when the Ringgit is pegged. 
  1. But if the Ringgit depreciates to 4.5 to 1USD, he would get only 844,000 USD from his 1 million Dollar investment should he divest. Fearing further depreciation he would change the Ringgit into USD and get out with 844,000 USD. He would have lost 156,000 USD. 
  1. A merchant importing in USD would have to change RM4,500,000 to get 1 million USD if the Ringgit depreciates to 4.50 Ringgit to 1 USD. Obviously when the Ringgit depreciates, the cost of I million imports in USD would be RM4,500,000.
  1. On the other hand, if the Ringgit is pegged at 3.80 the cost of import would be only 3.8 million Ringgit per 1 million USD.  A pegged Ringgit would save 700,000 Ringgit in the cost of import. 
  1. When the Ringgit depreciates the cost of production would be lower if there is no pay revision upwards. On the other hand, the cost of imported raw materials and components would increase and negate the gain from lower wages. Logistical cost would also increase, again reducing the gain from production cost. A depreciated Ringgit does not necessarily reduce cost of production. 
  1. Assuming that the Ringgit remains pegged at RM3.80 per USD, the cost in Ringgit would not change. Budget estimates would be sustainable. 
  1. Wherever an importer wishes to buy something in U.S. Dollar, the Central Bank should have enough USD to sell at the pegged rate i.e. RM3.80 per USD.
  1. In 1998 the Central Bank had less reserves. We did not know whether the reserves were held in cash, and if in cash, in what currency. Still, we were able to change Ringgit into USD so as to pay in USD. Now the Central Bank has more reserves in USD, I believe. Earnings in USD should be deposited with the Central Bank, in exchange for Ringgits. There should be no shortage of USD when needed. 
  1. There were problems of course. But we were able to set up subcommittees to deal with them in 1998. This included the recapitalisation of banks and businesses. 
  2. The fact remains that the pegging was successful. As mentioned above the IMF and World Bank admitted that Malaysia did the right thing and helped other countries to overcome the serious devaluation of their currencies also. We were even able to deal with CLOB, the stock market set up by Singapore. 
  1. I am just curious. We have more savings and reserves now compared to 1997- 8. Yet I am told that if we peg, we may go bankrupt? 
  1. And neither have they suggested any possible solutions?
Ringgit

MATA WANG

1. Saya takut memberi pandangan saya terhadap nilai Ringgit kerana saya akan diketawa pakar kewangan. Tetapi walaupun saya akan diketawa orang saya memberanikan diri memberi pendapat saya berkenaan duit Ringgit kita yang naik turun nilainya. Pendapat saya didapati semasa menangani krisis mata wang pada 1997-8. Walaupun tindakan Malaysia dikecam hebat tetapi ia berjaya menghentikan ketidaktentuan nilai Ringgit dan kewangan kita dipulih semula. Akhirnya pihak IMF dan World Bank mengakui bahawa tindakan Malaysia berjaya menghentikan ketidaktentuan nilai Ringgit dan kemiskinan yang berlaku kerananya.

2. Semua orang sedar bahawa bank dibenar memberi pinjam duit yang tidak ada pada mereka. Syaratnya apabila hutang dibayar, jumlah wang itu dijadikan sebahagian dari aset bank. Dan berhaklah bank memberi pinjam duit yang telah menjadi aset hari ini. Benar atau tidak pakar boleh godam saya.

3. Demikian juga dengan peniaga mata wang. Mereka boleh beri pinjam atau jual duit yang tidak ada pada mereka. Pinjaman atau penjualan ini menjadi sah apabila duit ini disampaikan kepada peminjam atau pembeli kemudian.

4. Tetapi penjualan Ringgit oleh mereka menyebabkan pasar kewangan dipenuhi dengan Ringgit. Mengikut teori supply and demand, apabila supply bercambah, permintaan akan berkurangan. Apabila tidak ada demand untuk Ringgit, nilai Ringgit akan jatuh.

5. Apabila nilai Ringgit jatuh permintaan akan meningkat. Peniaga mata wang akan beli Ringgit yang sudah jatuh nilai dan akan deliver kepada pembeli yang telah beli Ringgit pada nilai yang tinggi sebelum jatuh nilainya.

6. Maka beruntunglah peniaga kerana menjual Ringgit di masa nilainya tinggi dan membekal kemudian dengan Ringgit yang dibeli semasa nilainya rendah.

7. Malangnya, apabila nilai Ringgit jatuh, pihak yang pinjam atau peniaga akan rugi. Mereka perlu bayar dengan lebih banyak Ringgit yang sudah jatuh nilai. Katakanlah mereka pinjam RM1,000 diwaktu nilainya tinggi, apabila nilai jatuh 50 peratus, mereka mesti bayar hutang atau harga belian asal dengan RM2,000. Maka rugilah peminjam atau peniaga, sementara peniaga mata wang untung RM1,000 kerana di waktu pinjam RM1000 cukup untuk kos tetapi di waktu nilai Ringgit jatuh 50%, lebih banyak Ringgit diperlukan.

8. Inilah yang berlaku pada 1997-8 diwaktu mana nilai Ringgit jatuh kerana peniaga mata wang menjual banyak Ringgit yang bukan pun dimiliki oleh mereka. Harapan mereka ialah apabila nilai Ringgit jatuh, mereka boleh beli Ringgit murah ini untuk dibekal kepada pembeli asal.

9. Apabila kita tetapkan nilai Ringgit pada RM3.80 satu Dollar U.S., dan kita jamin bekalan U.S. Dollar kepada sesiapa yang sanggup membayar RM3.80 untuk 1 Dollar U.S. maka nilai Ringgit tidak lagi akan turun naik. Dan peniaga mata wang pun tidak dapat turunkan nilai Ringgit dengan menjual Ringgit dengan banyaknya untuk jatuhkan nilainya.

10. Sebaliknya jika peminjam hutang Dollar dan nilai Dollar naik, lebih banyak Ringgit diperlukan untuk membayar hutang satu Dollar. Ini merugikan peminjam dan menguntungkan peniaga mata wang.

11. Sekarang kita lihat nilai Ringgit naik turun kerana nilainya tidak ditetap dan dijamin oleh Kerajaan. Dagangan Malaysia melonjak naik yang mana ini menyumbang kepada ekonomi negara. Tetapi di masa wabak Covid-19 nilai Ringgit tidak stabil. Ada masa ia naik dan ada masa ia menurun.

12. Bagi peniaga yang import bahan dengan Dollar America atau meminjam Dollar America, jatuhnya nilai Ringgit berbanding Dollar America meningkatkan Ringgit kos pengeluaran dan harga pasar produk. Kerana kenaikan ini harga baru jualan perlu ambil kira nilai Ringgit berbanding dengan Dollar Amerika.

13. Tetapi jangan cakap berkenaan fixed exchange rate. Ini taboo, haram. Ya. Pada 1997-8 fixed exchange rate selamatkan kita. Tetapi itu kerana orang politik tidak faham sistem kewangan. Jangan ikut mereka.

1MDB, Ringgit, UMNO

BERSIH

213 Comments

1. Saya hadir dalam tunjuk perasaan anjuran Bersih pada 29-30 Ogos. Ramai yang tertanya-tanya apakah saya sudah jadi penyokong Bersih. Apakah saya sokong parti lawan DAP dan Kit Siang. Ada juga yang bertanya saya sudah
memihak kepada orang Cina.

2. Saya pernah menyatakan demonstrasi jalanan tidak harus diguna untuk tekanan politik kerana ia menjejaskan perniagaan terutama perniagaan kecil dan ekonomi Negara. Apakah sekarang perbuatan saya tidak menunjuk sifat berdolak-dalik dalam politik.

3. Saya tidak setuju dengan tunjuk perasaan kerana ada saluran lain yang boleh digunakan untuk menekan Kerajaan apabila menyalahguna kuasa.

4. Kita boleh buat laporan polis, dengan harapan polis dan Pendakwa Raya akan ambil tindakan, menghadapkan pihak yang dituduh ke mahkamah.

5. Tetapi sekarang Najib sudah bubar dan musnahkan institusi-institusi Kerajaan yang ditugas untuk melindungi hak rakyat.

6. Apabila dituduh telah lesapkan duit Kerajaan melalui 1MDB, Najib serah siasatan kepada Ketua Audit Negara dan Jawatankuasa Kira-kira Wang Negara (PAC – Public Accounts Committee) Dewan Rakyat. Rakyat disuruh tunggu sehingga siasatan oleh badan-badan ini selesai.

7. Apabila wang sebanyak RM2.6 bilion terdapat dalam akaun peribadi Najib, dan dia tak dapat menafi duit ini ada dalam akaunnya, dan ramai bertanya daripada mana duit ini datang, dan penjelasan yang munasabah tidak dapat diberi oleh Najib, maka satu pasukan bertugas (task force) dibentuk untuk secara rasmi menyelidik wang ini.

8. Pasukan ini terdiri daripada Pendakwa Raya, Ketua Polis Negara, Ketua Badan Pencegah Rasuah dan Gabenor Bank.

9. Rakyat menunggu hasil siasatan ini. Tiba-tiba Pendakwa Raya disingkir oleh Najib, Ketua Badan Pencegah Rasuah diarah bercuti, dan Gabenor Bank diugut kononnya kerana Bank Negara bocor maklumat. Dan terhentilah siasatan oleh badan ini.

10. Di masa yang sama Pengerusi PAC dan tiga lagi ahli diberi jawatan dalam Kerajaan dan siasatan berkenaan wang 1MDB oleh PAC pun dihentikan.

11. Beberapa pegawai polis dan lain-lain pegawai dipindah ke jawatan lain supaya tidak lagi dapat meneruskan siasatan.

12. Yang ditinggal dan yang baru dilantik adalah orang yang tidak tunjuk minat untuk membuat siasatan, bahkan sengaja menghalang apa-apa siasatan terhadap 1MDB dan duit RM2.6 bilion dalam akaun Najib.

13. Semua saluran untuk menyiasat 1MDB dan RM2.6 bilion dalam akaun Najib sudah tidak lagi ada.

14. Sebaliknya Najib dan konco-konconya sering mendakwa duit RM2.6 bilion adalah derma. Tidak pula diperkenalkan penderma, punca kekayaannya, bentuk wang yang diberi, bank yang terlibat dan lain-lain butiran. Sebenarnya dakwaan ini tidak boleh diterima akal.

15. Kepada pemimpin UMNO Najib mendakwa bahawa RM2.6 bilion ini adalah untuk pilihanraya ke-14. Jika untuk parti belanja membeli nasi lemak atau minuman atau sewa kereta seperti dahulu, jumlah ini beratus kali ganda wang yang diperlukan.

16. Tetapi untuk sogok pemimpin dan ahli Dewan Rakyat dengan berjuta tiap seorang, untuk sogok pegawai supaya menipu, besar kemungkinan wang sebanyak RM2.6 bilion diperlukan.

17. Jika Najib menang kerana sogok wang, dia akan perlu lebih banyak wang lagi untuk mengekalkan dirinya sebagai PM dan untuk PRU 15. Dari mana akan datang berbilion lagi jika tidak secara haram. Malaysia akan diperintah oleh seorang Perdana Menteri yang bergantung kepada rasuah. Najib sendiri berkata “Cash is King” “Wang Tunai adalah Raja”. Raja inilah yang disembah oleh Najib.

18. Najib akan nafi tetapi keadaan Negara sekarang amat buruk. Hubungan kaum tegang. Nilai Ringgit dan saham jatuh dengan teruknya jauh lebih teruk dari Thailand, Singapura dan lain-lain Negara. Kos sara hidup melambung naik kerana GST dan lain-lain. Hutang Negara bertimbun dan lain-lain.

19. Inilah masa depan Malaysia jika Najib kekal. Segala cara menukar Perdana Menteri yang mengikut undang-undang dan Perlembagaan Negara sudah ditutup oleh Najib. Hanya dengan suara keramat rakyat dibantu dengan undi tidak percaya Dewan Rakyat sahaja yang boleh menjatuhkan Najib dan menyelamatkan Negara daripada perasuah.

20. Oleh itu saya terpaksa menyertai demonstrasi jalanan anjuran Bersih yang bertema singkirkan Najib kerana rasuah, dan saya rayu kepada ahli Dewan Rakyat UMNO dan BN supaya menyokong undi tidak percaya kepada Najib. BN tidak akan jatuh setelah Najib disingkir. BN masih parti majoriti.

21. Selagi Najib berkuasa semala itulah ekonomi merosot, nilai Ringgit jatuh, saham jatuh, kos sara hidup meningkat kerana GST, hutang Negara bertimbun dan tidak dapat dibayar, pengangguran bertambah, berbilion duit rakyat disalahgunakan.

22. Inilah nasib yang menunggu Malaysia kerana Najib.

ENG VERSION
1. I attended the demonstration organized by the Bersih on 29 to 30 August. Many have wondered whether I have become a supporter of Bersih. Do I support the opposition party DAP and Kit Siang. There are also some that asked whether I now favour the Chinese.

2. I did say that street protests should not be used for political pressure as it affects business, especially small businesses and the national economy. Is it not now my action reflects the flip-flop nature of politics.

3. I do not agree with demonstrations as there are other avenues that can be used to pressure the Government when there is abuse of power.

4. We can make a police report, hoping the police and the public prosecutor will take action, bringing the accused to court.

5. But now Najib had dismantled and destroyed the institutions of government that are tasked with protecting the rights of citizens.

6. When the accused had made Government money disappeared through 1MDB, Najib handed over the investigation to the Auditor General and the Parliamentary Public Accounts Committee. People were told to wait until the investigations by these agencies are completed.

7. When the sum of RM2.6 billion appeared in Najib’s personal account, and he cannot deny this money in his account, and many had asked where the money came from, and no reasonable explanation can be given by Najib, then a task force was formally formed to investigate this money.

8. The task force is comprised of the Public Prosecutor, Inspector-General of Police, Head of Anti-Corruption Agency and Central Bank Governor.

9. People wer waiting for the results of this investigation. Suddenly, the Public Prosecutor was dismissed by Najib, Head of Anti-Corruption Agency was ordered to go on vacation, and Central Bank Governor threatened because it seemed Bank Negara leaked information. Thus ceased the investigation by this body.

10. At the same time the Chairman of the PAC and the three other members were given positions in the Government and the investigation by PAC on 1MDB money was stopped.

11. Several police officers and other officials were moved to other positions so that they were no longer able to continue the investigation.

12. What is left and the newly appointed are people who do not show any interest in making investigations, even wilfully obstructing any investigation into 1MDB money and RM2.6 billion in Najib’s account.

13. All channels to investigate 1MDB and RM2.6 billion in Najib’s account are no longer available.

14. Instead Najib and his henchmen often times claimed the RM2.6 billion money is a donation. No necessity to identify the donor, the source of his wealth, in what form the money was given, the banks involved and other details. In fact, this claim does not make any sense.

15. To leaders of UMNO Najib claimed the RM2.6 billion is for the 14th General Elections. If this is for the party to buy ‘nasi lemak’ or drinks or rent cars as in the past, this is hundreds of times more than the amount of money required.

16. But in order to bribe leaders and members of the House of Representatives by millions for each person, to bribe officials in order to deceive, it is highly probable that a sum of RM2.6 billion is required.

17. If Najib wins by bribing, he will need more money to retain himself as the PM and for PRU 15. From where will come the billions if not illegally. Malaysia will be governed by a Prime Minister who relies on corruption. He himself said, “Cash is King”. This is the King that is worshipped by Najib.

18. Najib will deny, but the situation in the country is now very bad. Tense race relations. The value of Ringgit and shares fell very badly, much worse than Thailand, Singapore and other countries. The cost of living skyrocketed because of GST and others. National debt piled up and others.

19. This is the future of Malaysia if Najib remains. All avenues to change the Prime Minister according to the law and the National Constitution have been closed by Najib. Only the sacred voice of the people assisted by a vote of no confidence in the House of Representatives can bring down Najib and save the country from the corrupt.

20. Therefore, I had to join street demonstrations organized by Bersih themed ‘get rid of Najib because of corruption’, and I appeal to UMNO and BN members of Parliament to support the vote of no confidence on Najib. BN will not fall after Najib is dismissed. BN is still the majority party.

21. As long as Najib remains in authority that will be for how long there is going to be economic slump, fall in ringgit, fall in stocks, the rise in cost of living because of GST, national debt will piled up and cannot be paid, increased unemployment, billions of public fund misused.

22. This is the fate that awaits Malaysia because of Najib.

Ringgit

Ringgit is weakening badly

79 Comments

ringgitI would like to share an email sent to me by Andrew Tang [email protected] expressing concern on the riggit. Do you agree with his view?

Dear Tun,

I am truly amaze by your past achievements in bringing high growth to Malaysia a PM.Of late I am worry to see our RM weakening by so much while othe SEA has remain stable versus US dollar…is the government spending too much with not much revenue due to slower growth and foreign investing? I plead with you Tun to lead BN again and reinstate back Malaysia to its glory days…A weak RM couple with rising petrol price and subsidy cut back is not the solution…we should create more growth, spend wisely (the govnment) and bring up the standard our education so that all the hard work and benefits to the nation from our fathers and grand fathers can be pass on to futher generation..please do something..Malaysia PASTI boleh bukan saja boleh..proud to be a Malaysian..Salam hormat and Selamat Malam..29/1/2014