QE Hospital KK Demolition - Week 14

Another week; another floor gone. Good progress; December completion within sight.

Amnesty Month - Car Parking Fee Arrears in Kota Kinabalu

Once a year, there is an amnesty month ; where the penalties on the unpaid street parking fees in Kota Kinabalu are mostly waived (95% waiver).


This year, they were collecting the arrears (after waiver) at a booth in Tanjung Aru (one of the collecting locations) yesterday and today. In Kota Kinabalu, street parking fees are payable with 21 days.


It seemed there were "customers". I submitted my vehicle number for checking ...

It seemed that the statement was issued by The Mayor of Kota Kinabalu; who seemed to be managed by a company called Wawasan Iktisas Sdn Bhd!

It seemed that I had parking fees of RM6.95 outstanding up to June 2010 (data-entry chores are A Bitch!!!). The penalties were supposed to be RM80.00. Was it any wonder that no-one bothered to pay the fees after the 21-day grace period?

Anyway, they graciously waived 95% of the penalties (net payable RM4.00); leaving a net payable of RM10.95. As a law-abiding citizen, I paid up.


Noticing my cousin's car parked near our Tanjung Aru Post Office, I phoned him and went for "yam cha".

Do notice that the gate (behind the lady in the center of the photo) had come off the guide-tracks; so everyone can enter the post office compound at ALL hours (the post boxes are on the external wall of the building) to collect their mail! It had been that way for more than a week. Bureaucracy at work!

All The BS from Timothy Geithner

I read this bunch of BS by Timothy Geithner (US Treasury Secretary) on 18 October 2010, on his way to G20 "hot-air" meeting in Korea.

Geithner Vows US Will Not Devalue Dollar

Published: Monday, 18 Oct 2010 | 6:46 PM

"... "It is not going to happen in this country." Geithner told Silicon Valley business leaders of devaluing the dollar. ..."

"... On Friday, the dollar index hit a 10-month low against a basket of major currencies, while the greenback has been plumbing fresh 15-year lows against Japan's yen. ..."

"... Geithner said in Palo Alto that he believes China will continue to lift the value of its yuan currency to aid the rebalancing of its economy away from exports and toward domestic growth.

Asked how much higher China should allow the yuan to rise, Geithner said: "Higher."

"You can't know how far it should go. What you know now is that it's significantly undervalued which I think they acknowledge and it's better for them, and of course very important for us, that it move. And I think it's going to continue to move," Geithner said. ..."

He can really talk BS - If the Yuan is undervalued, and is to appreciate against the US dollar, then the US dollar will drop. How does that make a STRONG US DOLLAR?

So, the US did not devalue, but other countries revalued. So the end result is a lower US Dollar, BUT don't blame him (or the US), they didn't devalue!!

Yesterday's Reuters Report gave even more BS from Timothy Geithner:

"... He reiterated that he wants to see China to accelerate its move toward a market-determined exchange rate.

"China is well into a very promising and very ambitious program of domestic reforms to strengthen domestic growth because China recognized that it cannot afford to rely as it has in the past on such an export-dependent model for growth," Geithner told a news conference. "We want to see that progress continue."

"Of course as a part of that, it's not ready for its exchange rate to rise more rapidly in response to market forces," Geithner added of China. ..."

He said that China was instituting domestic reforms to up growth (domestic consumption) so he said China was NOT ready for its exchange rate to rise rapidly (cannot appreciate fast).

So he wanted a STRONG DOLLAR, but also wanted the Yuan to APPRECIATE (= weak dollar), but also said that the Yuan was not ready to appreciate .

No wonder at the G20 meeting, the German Economy Minister said that the US was the one manipulating the exchange rate!

As expected the meeting ended with the usual meaningless communique:

"... In a final statement after two days of heated negotiation, the G20 said it would “move towards more market-determined exchange rate systems” and that the International Monetary Fund would “deepen” its supervision of exchange rates. ..."

Then:

"... While several member countries of the G20 hailed the summit in South Korea as a success, Japan immediately broke ranks to declare that, contrary to the spirit of the communique, it would continue to devalue the yen if it saw fit. ..."

Ex - Sembulan Stalls Site

On my way out this morning, I passed by the Ex-Sembulan Stalls site. The area in the foreground was previously occupied by some temporary stalls; selling vegetables and fish (seafood). The stalls were demolished on 12 October 2010 by Kota Kinabalu City Hall.

Turning right, you can see the size of the "drain", that led all the way to the sea. The fishing boats (small ones) could bring their catch all the way up-drain ("up-river") to this point each morning and each evening. Thus those stalls were very popular for buying fresh fish (early mornings and late afternoons).

But the boats still landed here.

No more stalls didn't mean no more customers. The loyal customers still came round.

This lady customer must really want it "fresh off the boat"!

QE Hospital KK Demolition - Week 13

Another week; another floor gone. Looked like good progress.

Not that many floors to go.

Household Debt Level - Malaysia

This newspaper article caught my eye. The Malaysian Institute of Economic Research (MIER) was commenting on the 2009 Bank Negara Malaysia (BNM) report on the level of household debt. MIER expressed their concern on the high level;
2008 - 63.9% of Gross Domestic Product (GDP)
2009 - 76.6% of GDP

(BNM Report end-August 2010 - 78.1% of GDP)

MIER suggested lowering the Loan To Value (LTV) ratio (i.e. bigger down-payment) and for the banks to do more business loans than consumer loans.

This prompted me to do some "on-line research" (Google is Your Friend!).

The Malaysia Government's Department of Statistics has an official website. The 2009 GDP for Malaysia (at constant 2000 prices) was RM521 Billion. The 2009 GDP dropped 1.7%.

For 2010; MIER forecasted GDP Growth at 6.5% and the Overnight Policy Rate (OPR - BNM's benchmark interest rate) to remain at 2.75% till end-2010.

MIER's current forecast for 2011 is 5.2% GDP Growth and OPR to rise to 3.25%.

Some points to think about:

• The Household Debt to GDP ratio of 78.1% was very high (highest in Asia - according to BNM for 2009).
  
• But What Does This Mean? The various levels of concern expressed indicated that this is BAD.
• There is Total Debt to GDP, Business Debt to GDP, and Household Debt to GDP.
• One interesting article (The Star Business 2 October 2010) gave some interesting statistics and background.
  
  In 2002, household debts were Car Loans (RM36.7 Billion), Housing Loans (RM71.5 Billion), and Personal Loans (RM1.9 Billion).
  
  In August 2010, Car Loans were RM116.2 Billion, Housing Loans were RM218.9 Billion, and Personal Loans were RM20.9 Billion.
  
  These were BIG Increases. So were we all enjoying the good life with other people's money?
  
  Wait A Minute! The total household debts listed above (end-August 2010) only totalled RM356 Billion when it was reported that TOTAL HOUSEHOLD DEBTS at end-August 2010 was RM561.5 Billion (Business Times 20 October 2010).
  
  What's the other RM205.5 Billion (RM561.5 Billion - RM356 Billion)? Don't tell me it's THE CREDIT CARD DEBTS?
• It's funny that all these articles do not analyse or discuss these car loans or credit card debts (even the BNM one switched quickly to the property loans).
  
• The article in the Star Business (referred to above) explained that as Corporates turned towards bond issuances (PDM), The Banks in Malaysia turned towards CONSUMER LENDING.
• The BIG problem with Consumer Lending (as The USA has found to its cost) is that with easy availability of debt (Banks want more and more business / profit each year), the consumer will quickly reach the point where he can't pay it all back!
  

Business Debts taken up to earn income from exports (productive investment and production) will bring in (to Malaysia) more "money" which can be used to pay the interest on the debts and increments to the workers.

Consumer Debts taken to buy consumer goods (imported) drain out the "money".

Consumer Debts taken to buy consumer goods (manufactured in Malaysia) just pass the "money" from one hand to another. There is no increase in "money" that can used to pay the interest or increments.

It's all pretty complicated, and I don't know if I have explained it fully. You can research more under "Austrian Economics". The good website to start is The Ludwig von Mises Institute.

Anyway, all the concerns mean that "they" know its best to reduce the Household Debts before non-payment start (When that happens, they will say that there was a Household Debt BUBBLE). But stopping the Debt Juggernaut is very difficult! So "small voices" start talking about restricting the number of credit cards, reducing the housing loan LTV, and maybe reducing car loans. The most effective method is to up the interest rate on all household borrowings?

The Business Times article (referred to above) quoted the MIER as saying that they were disappointed The Budget 2011 did not provide measures to address high household debts.

"Executive director Dr Zakaria Abdul Rashid described it as a key disappointment in the Budget, besides the lack of measures such as those to address property speculation ..."
Read more: 'Household debt issue not addressed' http://www.btimes.com.my/Current_News/BTIMES/articles/rup0193/Article/#ixzz12yNSS7MB

UPDATE : Here's a prediction from our Minister of Housing and Local Government, Datuk Chor Chee Hiung:

Bernama (21 October 2010) -

"Chor: No property bubble in sight"

Let's see if he is right. I like this quote "... If you find a house at RM200,000 within the Kuala Lumpur City, this means our economy is in bad shape ..."

Shouldn't it be GREAT for the Rakyat if houses do cost RM200,000 (i.e. more affordable)?

Was his remarks affected by the fact that he gave them when launching a property development?

QE Hospital KK Demolition - Week 12

After the roof structures were removed, the demolition seemed to go much faster.

This was the photo from 3 October for comparison. That next floor down from the roof only took a week.

UPDATE : In the Daily Express (19 October 2010), it was reported the State Health Director, Dr. Mohd Yusuf Ibrahim said the demolition works was supervised by the Department of Occupational Safety & Health (DOSH) and the Department of Public Works (JKR). The JKR denied their involvement in the demolition. Dr. Yusuf said the demolition will be done manually for the 10th floor to the 7th. The "small cranes" (excavators ) were only used to remove the debris. From the 6th floor down, a crusher crane will be used (so demolition should be faster).

Malaysia's Economic Transformation Program (ETP)

I saw this in the Daily Express (also on 7 October 2010). The was no byline nor the issuing body. I presumed it was official. The article can be simplified / summarised as follows:

• The Economic Transformation Program (ETP) has the objective of raising the Gross National Income (GNI) per capita from US$6,700 to US$15,000 (RM23,700 to RM48,000) by 2020. This requires an annual growth rate of 6%. I presume this is "NET" Growth Rate; i.e. after deducting the inflation %.

• It aims to produce 3.3 million new jobs. The Services sector is to grow to 65% of the economy.
  
  
• The ETP says the focus will be on a few key growth engines. There will be 12 National key Economic Areas (NKEAs). The Government aims to be the facilitator with policies and incentives. 92% of the investments will come from the Private sector (including the Government Linked Companies - GLCs)
  
  
• The ETP claims to be action-oriented with 131 Entry Point Projects (EPPs) giving the required "returns" to achieve the desired 6% growth in GNI.
  
  
• Driving the program will be via PEMANDU (Performance Management and Delivery Unit in The Prime Minister's department). PEMANDU will monitor and report on the progress of the ETP.
  
  
• It was claimed that 500 persons (from private sector companies and government departments) formulated the 12 NKEAs.
  
  
• Many "Labs" (workshops) were held to obtain ideas which were then "syndicated" (co-ordinated) amongst the stakeholders.
  
  
• Obviously the past Malaysia Plans and development had brought us to a Middle-Income Level. This ETP is the next step. It is mandatory to have a New Economic Model in a New World.
  
  
• The US$15,000 per capita target is the current definition of "High-Income" by The World Bank.
  
  
• It says that the ETP development will be both "Inclusive" and "Sustainable".
  
  
• The achievement will be not just quantitative; but by balancing consumption, investments, productivity and with a thriving services sector.
  
  
• "Inclusive" means All Malaysians. It emphasised the creation of 3.3 million good jobs (half requiring diplomas). This will grow the income of the lowest 40% of Malaysian households from RM1,440 per month (2009) to RM2,300 per month (by 2015).
  
  
• The ETP wants to achieve the target without depleting the natural resources of Malaysia, and with reduced reliance on the Oil & Gas sector.
  
  
• The Government will not rely on public funding (92% from the private sector).
  
  
• The article said that growth was not up to standard ("loss of momentum") in the past decade! I have never heard this mentioned before in all The Budget Speeches.
  
  
• Slow Productivity Growth was one big factor. The ETP requires the private sector investment to grow 12% over the next 5 years (actual average of 2% p.a. in the past 5 years).
  
  
• Malaysia is no longer competitive in the high-volume low-cost product sectors. The ETP wants to move Malaysia to the high-value product sectors. Obviously the working population will have to change to function in a "high-skilled, knowledge-based, innovation-intensive" environment.
  
  
• Malaysia had fiscal deficits every year since 1998. In fact, the deficit in 2009 was 7% of GDP. The Government is committed to reduce the deficit to 3% of GDP by 2015. The availability of borrowing (even by governments) will be increasingly difficult in the future.
  
  
• The low Foreign Direct Investments (FDIs) in Malaysia in the past decade showed the eroding competitiveness of the country in the region.
  
  
• The Foundations of the ETP are 1Malaysia, Government Transformation Program (GTP), New Economic Model (NEM), and The 10th Malaysia Plan.
  
  
• The ETP is the starting point and will "evolve" over time.
  
  
• The 12 NKEAs are oil, gas and energy; palm oil; financial services; tourism; business services; electronic and electrical; wholesale and retail; education; healthcare; communications content and infrastructure; agriculture; and Greater KL.
  
  
• 60% of the GNI growth is to come from the first 4 NKEAs.
  
  
• By 2020, services sector will be 65% of GDP; domestic consumption will be 59% of GDP; 70% of the population will be urban.
  
  
• Total investment required of RM1.4 trillion; 92% from the private sector (RM120 billion a year - estimated 2010 figure is only RM72 billion); 73% of the private sector investments will be source domestically with the balance 27% from FDIs.
  
  
• The jobs classification will reach Low-paying 43% (57% in 2009); Middle-paying 46% (39% in 2009); and High-paying 11% (4% in 2009).
  
  
• The Government promises to ensure that EPPs are owned by the private sector wherever possible, fast track regulations amendments, revamp MIDA to get more DDIs and FDIs, transparent award of public tenders, seek feedback, report on ETP progress, and maintain the ETP as a priority.
  
  

There you are; you now know something about the ETP. You have learned quite a few acronyms to use in your daily conversations.

UPDATE: (13 October 2010 - Tengku Razaleigh Hamzah (Ku Li) said that the ETP is so big and life changing, a more exhaustive discussion must be held with people-influencing leaders of society to get the full support).

Tests of Predictions (Update 01)

I saw another prediction in The Daily Express (7 October 2010) for the Crude Palm Oil (CPO) price. Current CPO price was around RM2,600 per mt. These "experts" predicted CPO price to reach RM2,950 per mt in 3 months, then RM3,300 per mt in 6 months and finally to RM3,600 in 9 months.

SUMMARY OF PREDICTIONS BEING TRACKED:

1. CPO price to reach RM3,600 per mt within the next 9 months; i.e. by June 2011 (CPO price was RM2,920 today 11 October 2010).
2. KLCI to reach 1480 by 31 December 2010 ( KLCI was 1481 on 8 October 2010)
3. OPR to remain 2.75% for 2010 (OPR was last raised 8 July 2010 to 2.75%).
   

I hope to show that most predictions are not very useful (i.e. mostly failed). As Nassim Taleb commented; we can only say what the future direction looks like from today's viewpoint, but the truth is that we don't know. We definitely cannot quantify the future.

What is ECM Libra going to say now on the predicted year end KLCI; since the index had already exceeded the 1480 predicted? Are they going to simply raise their prediction (citing some factors ...), or will they say that KLCI will be flat for the next 3 months, or will they say that any further increases in the next three months will be lost before the year end?

Nassim Taleb suggested that we do not allow ourselves to be confused by all these "noise". In fact, he suggested that we do not read/watch the business news!

QE Hospital KK Demolition Week 11

Week 11 - All roof structures appeared to have been removed.

There was 1 excavator on the roof ...

... and 1 the next floor down. This all looked somewhat dangerous. Does the Occupational Safety and Health Act (OSHA 1994) apply here? If yes, have the OSHA inspectors been here?

Keningau Visit

I went to Keningau last week (work-related visit on 5 & 6 October). The above was a panorama from the hotel window taken on the morning of 6 October. The room was facing south-west so no view of Mt. Kinabalu (I will request for the correct room on the next trip). Keningau has misty mornings on most days.

A panorama of the nearby buildings (including the Keningau Town Mosque).

A view of my client's Regional Office in Keningau. It was once the office/warehouse for a tobacco company.

As they are in the plantation industry, they have some nicely done-up 4WD vehicles.

The Borneo Orchid Show 2010 - Kota Kinabalu

I visited The Borneo Orchid Show (The Jewels of Borneo) this afternoon. Entry was RM2 per person (very reasonable).

It's being held on 1 - 5 October 2010 at Suria Sabah. The main entrance to the show is on the 6th floor.

I am no orchid enthusiast; neither knowing how to grow them nor what they are really about. It was a good photographic opportunity. The announcement that The Sumazau Slipper Orchid had been nominated as The Official Sabah Orchid intrigued me to find out more (what it looked like especially).

Slipper orchids are called Paphiopedilums (short-form Paph). The "Class" refers to the exhibition categories ( I saw Class 80, so there were at least that many categories exhibited).

This was what the plant looked like.

A close-up view; the 2 wings are like the arms of the sumazau (local kadazan ethnic dance) dancer.

From another angle; it did looked like a slipper.

There were all kinds of orchids (flower size, colour, and shapes).

Pretty white ones ...

... skinny yellow one ...

... bigger yellow ones ...

... spotted ones ...

... spidery ones ...

... yellow with purple fringe ones ...

... dark magenta ones ...

... yellow spotted ones.

This was Best in Section and Best Plant of The Show. The trophies were on the small table. The Biscuit Tin Box was asking for RM2 from those taking photos! Since the lady explained it was for "tambang" (contribution towards the transport and handling for bringing the big plant from Penampang to the show), I was happy to contribute.

On the 5th floor, there were exhibits from some organisations. This was one by Japan (?).

There was a poster advertising The Okinawa International Orchid Show to be held on 5 Feb 2011.

Every official function has 1Malaysia.

The Sabah Agriculture Park's exhibit. The park is in Tenom and holds the sumazau slipper orchid.

The Winning Exhibit was by The Sabah Parks ...

... it had orchids amongst the Rafflesia flower, civet ...

... hawk or eagle ...

... a python ...

... even a waterfall ...

A panorama of The Sabah Parks Exhibit.

I remembered a visit to Orchid De Villa; where the guide said the bigger blooms are commercial orchids (for sale). The wild orchids were generally small. The farm had a jungle trail where you can see the various types of orchids.

If you are able to; a visit to The Borneo Orchid Show is definitely recommended.

Apart from the orchids (much much more than in my photos), there were photos of 100 native species of Borneo Orchids ...

... a Painting Gallery; where you can get your portrait done (even caricatured) ...

... and for those who believe they have the "Green Thumb"; orchids for sale.

UPDATE (4 October 2010) : I read in The Daily Express that Sabah had 1,200 of the estimated 1,600 orchid species in Borneo and Mt Kinabalu alone had 800+ of that.