tag:blogger.com,1999:blog-9719974958094052722024-02-07T10:25:27.349+08:00Sport and StockSport, Stock, Federal Reserve, Malaysia, Anwar, Bernanke, Paulson, Movie......ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.comBlogger200125tag:blogger.com,1999:blog-971997495809405272.post-41029671350222162312012-06-14T10:18:00.001+08:002012-06-14T10:18:43.314+08:00StupidityYes, I am stupid, and I am sorry to say, we are all stupid. Warren Buffett is stupid, Bill gates is stupid, Barack Obama (obviously) is stupid, late Steve Job is stupid, all of us are stupid. We are probably as stupid as animals.<br />
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Yes I know at this point 99 percent of the reader will close this page and start wondering just how stupid the author of this article is claiming these great figures are stupid.<br />
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So for the 1 percent that keep reading, allow me to explain. Theories of microeconomic and general equilibrium mention that market failure occur on various sources such as externalities, imperfect information, existence of free riders etc. That means human is deemed rational and only make irrational decision when influenced by negative (or positive) external forces, disrupting the market forces from working its magic of creating point of equilibrium. Even the school of Keynesian agrees that government is needed on the basic of imperfect information. Suppose if information is perfect, with the existence of rational expectation, everyone should be able to make wise and correct decision every time currently and in the future.<br />
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However, is that true? Are we capable of obtaining perfect information? Are we interested in getting perfect information? More importantly, if we have perfect information, are we able (and want) to make correct decision?<br />
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I do not think so. That's the reason I claim all of us are stupid. For me, people that do not want to get perfect information or cannot make correct decision even with perfect information or know the correct decision yet still want to choose another option are called stupid person.<br />
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Now how many of us can claim that we try our best to obtain perfect information in the process of decision making? How many of us can claim that we can make correct decision if we are presented with perfect information? How many of us can claim that we always able to choose the correct option if we know its the correct decision?<br />
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The answer: very few.<br />
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Let me give you a few examples: in the decision of choosing toothpaste, have you read the label on the toothpaste box? Have you googled the ingredients of the toothpaste? Do you know the differences between various toothpaste besides the packaging? What is the special ingredients in certain toothpaste suitable for sensitive gum?<br />
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If most of your answers are NO, then you are stupid.<br />
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Another example: All of us know that eating healthily is good for us. We know by eating healthily, we will be able to enjoy our daily life better, we will have more energy in daily activities, we will have better mental strength, thus make us better in most situation in work etc. However, how many of us really maintain healthy eating diet?<br />
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Wait!!!!!!! You may say I ignore the concept of utility. Utility of eating delicious (and unhealthy) food may overwhelm the healthy life. I agree but how many of us really quantify the options and determine that? Often when we wanna have unhealthy food, we do not consider the option. We do not make wise decision as we consider eating junk food is the only option. We are not making decision, instead we are blindly selecting the option based on our random instinct.<br />
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That still is considered stupid.<br />
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Finally, fresh milk. We know almost everything about fresh milk. We know where it comes from, we know the ingredients of fresh milk, we know the taste and colour (lol.). So are we able to make correct decision based on these information? Are we using these information to select the best fresh milk? Or are we simple stick to the brand we always consume? Where are the correlation and causality between the availability of these information and our ability of decision making? How many of us use these information in improving our decision making?<br />
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That is stupidity.<br />
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For very few of us that try our best in obtaining perfect information legally, use the available information'<br />
to help our decision making scientifically and select the best option with these information, well done, you are rational. You are not stupid.ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com25tag:blogger.com,1999:blog-971997495809405272.post-19928990795254368912012-06-07T09:12:00.003+08:002012-06-07T09:12:54.646+08:00Malaysia Firms AnalysisJust finished my task in analyzing several Malaysia firms in conjunction with my university and ministry of trade. The project aims at identifying the strengths and weaknesses among Malaysia firms from a different perspectives, from the perspective of an economist. <br />
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In short, besides all the irrational determination of costs and lack of skilled labours, I found 2 major problems exist in Malaysia firms. <br />
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1. Although the concept of fordism has long been regarded as outdated and not suitable with the dynamic competition of today, I found that this is still being practised in most firms that I observed. Fordism assembly line production causes 1 major problem: difficulty in identifying problem. Since all the works are routinely done, problems are ignored. This cause major disruption in the process of economic value added and more importantly, have spill over effect that will lead to several problems. When such condition arise, the root of these problems is hard to identify, thus making the problem solving process irrelevant. Although most firms are good in problem solving, they are not at all good in identifying problems. <br />
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2. This is a major problem for Malaysia not only for firms but government as well. The problem is the problem of cost and benefit projection. Most firms do not scientifically estimate the costs (including opportunity cost) and benefit of a project, making any project irrelevant and insignificant. Of course they may still end up with positive net benefit but the unsystematic risk involved should not be borne and can easily be eliminated. Furthermore, the importance of opportunity cost is often ignored, making the projection of costs and benefit irrelevant. The clearest example of this second problem is marketing project. One of the firms I observed was planning to have a marketing plan to increase their revenue. They planned to have their labours involve in local community service (similar to project "anak angkat"). They wished to have their labours becoming foster children of local elders, gaining their confidence in the firms and increase the value of their brand. However, no proper estimation was done before the project. After 2 months of implementation, the project ended with insignificant increase in revenue. However, the management of this firm concluded that although the project did not produce significant increase in revenue, but the costs involved is minimal and they were satisfied with the project.<br />
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I don't think I have to justify what is wrong with this firm and their project. It may sound foolish and we may think we will never do such thing but in reality, most firms and even government do this all the time. Presumption is so routinely practised we are used to it. Presumption such as "if I spend more time study I will earn better grade", "If I invest more in marketing I will get greater revenue" and "1+1=2 so I don't have to know why it works that way" etc. <br />
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Problem of identification of problems and problem of scientific projection of costs and benefit are all around firms in Malaysia. They do not think these are problems and they do not take proper action to solve them. They deserve to fail.ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com3tag:blogger.com,1999:blog-971997495809405272.post-16835318336005725922012-05-21T09:00:00.001+08:002012-05-21T09:00:41.566+08:00International Museum Day, Not...May the 18th of every year is the International Museum Day ever since 1977. It is an appropriate day (unlike most other "days" created just to capture commercial expenditure value from consumers) to appreciate the historical value of various items left for us from the past. To celebrate this day, all local museums at Melaka offer free entrance to all visitors on that day.<br />
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I love visiting museum. Museum is probably my most visited leisure places. So I spent almost my whole day there, visiting 1 museum after another. What surprise me was the fact that very few visitors around. After some investigation, I found that most people do not know about the International Museum Day. Those who know do not visit as it was a working day. Even if it was a weekend, they still wouldn't visit as they simply have no interest in doing so. </div>
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For me that is a sad situation. Most people prefer other forms of entertainment that a museum visit. Most people I know never visited museum before. Most people prefer using an Iphone than looking at a 800-years-old coin. </div>
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I was at the Custom museum and they have a log book that is used to record all personal information from visitors. I was surprise that all visitors on the International Museum day are from foreign nations except from 2 Sarawak visitors and myself. </div>
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I enjoy my day at those museums and will do so again when I have spare time. I will encourage all the people I know to do so. In the mean time, happy International Museum Day. (although I am 3 days late)</div>ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com3tag:blogger.com,1999:blog-971997495809405272.post-10335991049544550442012-05-21T08:32:00.001+08:002012-05-21T08:32:56.879+08:00Fresh Graduates = Liabilities?<a href="http://thestar.com.my/news/story.asp?file=/2012/5/16/nation/11296180&sec=nation">Employers: Fresh graduates not suitable and are ‘liabilities’</a><br />
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The above link from The Star highlights the opinion of the marketing director of Singapore and Malaysia Kelly Services Sdn. Bhd., a recruitment agency. According to her, fresh graduates need to be retrained before able to contribute to the firm, beside having high demand for the first job and poor communication skills. Thus, hiring fresh graduates is costly for firms and they are considered as liabilities to firms. <br />
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I agree with her on the point of unrealistic demand and poor communication skills among fresh graduates. Some fresh graduates overestimate themselves, demanding ridiculous rate of wages, and hope to immediately "cash in" their effort in university study without objective comparison with their skills and value to the firms. Furthermore, some fresh graduates are relatively weak in their communication skills, particularly their English. This thus distort their ability of performing on certain jobs including marketing related works. <br />
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However, I strongly disagree with 2 of her points. First, fresh graduates are not liabilities and will never be liabilities to firm. Fresh graduates from reputable universities will certainly be able to offer certain skills unavailable elsewhere. Contribution of fresh graduates can be in the form of hard skills or soft skills. By calling them liabilities basically highlight the failure of top management to harness their strengths.<br />
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Secondly, according to her, "companies would rather hire experienced and skilled professionals who can bring instant returns". I highly doubt the validity of this statement. The biggest strength of fresh graduates is their creativity, innovation and ability to transform the dynamics of business world. By going through the process of formal undergraduate (and postgraduate) studies, they are equipped with theories and application skills. The combination of such skills will enable them to change the dynamics of the economy in general.<br />
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That's probably is the biggest difference between formal university study and workplace experience. In other words, formal knowledge is the root of a plant while experience is the leaves of the plant. Experience can only help in ways that occurred before and not in unforeseeable circumstances. However, the world of economy is dynamic and constantly changing. New problems will be in the "world of infinity" for experienced person. Since formal tertiary education highlights theoretical knowledge and application, they are trained to handle dynamically new problems. <br />
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Certain firms that emphasize on long term prospect will require these fresh graduate to lift them to new levels. <br />
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Sadly however, some firms don't. They do not recruit fresh graduates for their strength, rather wish to have them "continue the trend" and takeover the same tasks as the previous labours. They want their "hands" rather than their "brain". They expect fresh graduate to instantly understand the operation of a firm and start generating revenue for a firm. <br />
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Recruiting labours is similar to investing in financial assets. We should not aim for immediate positive return and doing so will only expose us to greater risks and may backfire. Labours should be treated as assets for the future and should not be require to instantly generate revenue for firms. Since growth in productivity outpace growth in wage rate, firms are in great position to profit from recruitment, thus ensuring a steady stream of long term income, providing that they can hold the "asset" long enough.ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com1tag:blogger.com,1999:blog-971997495809405272.post-61349041500994733272012-05-07T10:05:00.003+08:002012-05-07T10:05:40.520+08:00My Analysis on the Minimum Wage Policy in Malaysia Part 2The second part of my analysis on the minimum wage policy of Malaysia will only focus on three issues: inflation, unemployment and productivity. Many think minimum wage will cause relative rise in the rate of inflation and unemployment in Malaysia in the coming months / years. Many argue that Malaysia labour simply do not have the productivity required for such wage (RM 900 for peninsula Malaysia and RM 800 for East Malaysia), thus discriminating firms operating in Malaysia especially small and medium enterprises (SME). Some even suggest that the policy will distort Malaysia competitiveness in the international trading. Not many people (that I know of) objectively praise the latest labour policy of Malaysia government.<br />
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First of all, as mentioned in my previous analysis (PTPTN issue part 1), GDP of Malaysia is RM 766 billion and GNI of Malaysia is RM 740 billion. With a population of 28.25 million, annual per capita GDP and GNI is at RM 27,115.04 and RM 26,194.69 respectively. That's RM 2259.58 and RM 2182.89 monthly per capita GDP and GNI. That's well above the minimum wage set by government. As we all know, setting minimum wage below equilibrium wage will not cause significant unemployment, but only eliminate imperfect information in labour market. However, this may not be the case for Malaysia and we shall investigate.<br />
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RM 900 set is just 25 percent above the poverty line of Malaysia (RM 720). Although 25 percent is a significant number, 25 percent above the poverty line is not significantly overpriced. In any part of Malaysia, RM 900 is barely enough for daily expenses, even for the most remote places in peninsula Malaysia.<br />
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However, according to a report from Human Resource Ministry of Malaysia, around 34 percent of labours in Malaysia earned less than RM 700 per month, lower than the RM 720 poverty line. The wage rate has only grown 2.6 percent over the past 10 years. That's around 43 percent lower than the average annual GDP growth for the same period (4.5683 percent). The main cause of the problem is the change in labour structure of Malaysia which foreign labour is considered as perfect substitution for unskilled labour in Malaysia. Hence, most firms do not demand unskilled labour if their wage is above the wage rate of foreign labour.<br />
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So, for our first issue: will minimum wage policy cause hike in inflation rate: yes, in short run. However, the hike will not be significant as the minimum wage is well below our average income. Slight increase in labour wage rate will not significantly increase the general price level of Malaysia. In the long run, inflation rate will not move at all by the minimum wage policy as expectation of labours adjusted to the level of minimum wage.<br />
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Second issue: unemployment. Yes, I agree with most people. Minimum wage policy alone will cause significant number of unemployment in the short run. Since 34 percent of labours are below significantly below the level of minimum wage, a 28.5 percent increase in wage rate (from RM 700 to RM 900) significantly increase the production costs of firms that employ these unskilled labours especially SMEs. 28.5 percent increase in labour costs means that total costs of SMEs could rise as much as 20 percent, well enough for them to change adjust their labour cost structure. Firms will either resort to more cheap foreign labours or simply lay off labours and force the remaining labours to work for longer hours. If firms were to maintain the same level of total costs, it means that as much as 9.69 percent of labours could be substituted with cheap foreign labours. 9.69 percent rise in unemployment rate is disastrous for Malaysia economy.<br />
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For that, Malaysia government need to accompany the minimum wage policy with other labour market policy especially foreign labour policy. Adjustment to the structure of Malaysia labour market is needed in order to effectively increase the wealth distribution of Malaysia.<br />
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Third issue: productivity. As mentioned before, many argue that the rate of productivity of labours in Malaysia may not increase to the level of minimum wage. However, this is not true. For the past 10 years, rate of increase in productivity outperform rate of increase in wage level by around 40 percent. In other words, labours should earn more. So productivity is not an issue. After all, RM 900 merely means around RM 5 per hour.<br />
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So from this relatively simple analysis, minimum wage policy will not cause significant increase in inflation rate and will not have issue on insufficient rate of increment in productivity. The real issue faced by Malaysia under such policy is the structure of labour market. The minimum policy alone might cause relatively severe hike in unemployment rate without the interference of government in handling the foreign labour issue, at least in the short run. In the long run however, this may not be a problem as Malaysia transiting to developed economy.<br />
<br />ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com4tag:blogger.com,1999:blog-971997495809405272.post-45047995896159448502012-05-02T10:20:00.003+08:002012-05-02T10:20:26.354+08:00My Analysis on the Minimum Wage Policy in MalaysiaCouple of days ago Human Resource Ministry of Malaysia announced the rate of minimum wage in Malaysia. It is officially RM 900 per month minimum wage for every local labour in Malaysia with exception of labours in house care sector.<br />
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The announcement was followed with moderate dissatisfaction from most Malaysia labours as they claimed RM 900 is insignificant compared to the living cost of Malaysia. A moderate level of demonstration was held on labour day yesterday for such purpose.<br />
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To be fair, they are right. The minimum wage is insignificant for most Malaysian as RM 900 is almost impossible for anybody that stay in major cities in Malaysia to survive with. However, they should also know that this is the minimum wage, not the recommended wage. Minimum wage should be, well, minimum. Besides, unreasonably high minimum wage could distort the labour market.<br />
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So here is my analysis on such matter.<br />
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Personally, I think this is a good policy by government. Minimum wage is there to ensure no (or minimum) discrimination on labours especially unskilled labours. This is the policy to protect these unskilled labours in the process of wage bargaining between them and firms. Commonly, unskilled labours are significantly discriminated with unreasonably rate of wage and unable to bargain correctly due to weak communication skills. <br />
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For skilled labours, the wage bargaining process should not be distorted. This process will automatically set the equilibrium wage for Malaysia labours. Distorting such process would affect the equilibrium wage, resulting in failure in labour market. <br />
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So, on this point, government of Malaysia is doing fine by setting the minimum wage rate just enough to protect the unskilled labours. <br />
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Using the simple New Keynesian analysis of price setting-wage setting analysis, setting high rate of minimum wage could result in leftward shift of wage setting curve, resulting in higher rate of involuntary unemployment. It means that setting high rate of minimum wage would not at all help most labours to earn higher wage but probably resulting in many unskilled labours to be unemployed. <br />
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Since labour market in Malaysia (and most of the world) is imperfect in information and mobility, setting a minimum wage below the equilibrium wage in labour market could still be efficient. With this, unskilled labours have more information on the rate of wage they should get, thus, eliminating certain level of micro level failures of labour market. <br />
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Statistical analysis backs my point. I will compare Malaysia minimum wage policy with several economies in the world. I will use petrol (or gasoline) price as my point of reference as it is the most important variable for any economy and likely to affect the rate of inflation in general. <br />
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The economies I will use are Hong Kong, Indonesia, Thailand, US, UK and Japan. Certain economies (such as Singapore) cannot be analyzed as no minimum wage policy is set. Besides, Ron 95 or unleaded grade of petrol will be used as proxy for petrol price.<br />
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For Hong Kong, the minimum wage rate is HK$ 28 per hour and petrol price is HK$ 17.15 per litre. Thus, per hour litre of petrol (litre of petrol one hour of wage can buy) is at 1.6327. <br />
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For Indonesia, the minimum wage rate is averagely at 5,000 rupiah per hour with petrol price at 10,300 rupiah per litre. This means 0.4854 per hour litre of petrol.<br />
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For US, the minimum wage is $7.25 per hour with petrol price at $1.03 per litre. This means 7.0388 per hour litre of petrol.<br />
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For UK, minimum wage rate is 5.93 GBP per hour with petrol price at 1.41 GBP per litre. 4.2057 per hour litre of petrol.<br />
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For Thailand, minimum wage rate is averagely at 21.94 Baht per hour with petrol price of 55.39 Baht per litre. 0.3961 per hour litre of petrol.<br />
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For Japan, minimum wage rate is averagely at 678.5 Yen with petrol price at 152.7 Yen per litre. 4.4434 per hour litre of petrol.<br />
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For the case of Malaysia, since we have monthly minimum wage, 2 assumptions have to be made. First, assume that there is no bonus. Next, total working hours are set in 2 groups. First group: 5 working days week with 8 hours per day, which means 40 working hours per week. Second group: 5 working days per week with 9 hours per day, or 5.5 working days with 8 hours per day, which means around 45 working hours per week. <br />
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For the first group (40 working hours per week), per hour wage rate is RM 5.19 and for the second group (45 working hour per week), per hour wage rate is RM 4.62. Since petrol price in Malaysia is RM 1.90, per hour litre of petrol are 2.7328 and 2.4292 respectively for these groups.<br />
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Looking at these data, our per hour litre of petrol is relatively lower than UK, US and Japan but higher than HK, Thailand and Indonesia. Since developed economies generally have proportionally higher rate of wages, it is unsurprised that UK, US and Japan per hour litre of petrol are higher than Malaysia. However, Malaysia per hour litre of petrol is higher than HK, effectively meaning that Malaysia minimum wage rate is much more generous than HK minimum wage rate.<br />
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So there is it. The minimum wage is properly scaled compared to other economies and it is properly designed to protect the unskilled labours from discrimination.<br />
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Although the policy is good, there is an area that can be improved. Monthly minimum wage rate is not the perfect way of minimum wage settings. Several other variables, such as working days per week, working hours per day etc. could affect the effectiveness of the policy. Thus, minimum wage policy should be set in hourly form to eliminate all the unknown variables.<br />
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<br />ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com3tag:blogger.com,1999:blog-971997495809405272.post-62563274835269564722012-04-26T10:33:00.002+08:002012-04-26T10:33:25.298+08:00Analysis of PTPTN Issue Part 2Thanks to a comment by a reader who suggeted the difference between full PTPTN loan and fees of study, I will extend my analysis on the validity and possibility of free undergraduate study for all public universities students.<br />
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The simple arithmetic mean of full PTPTN loan for all courses taken by the undegraduates in public universities is slightly above RM 25,000 which is RM 8333.33 annually if we assume undergraduate study takes 3 years to complete. <br />
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Using the same data as in the previous post (8,000 new enrollment every year), it will cost government and public around RM 666 million to finance 1 batch of students annually or RM 2 billion to finance all undergraduate students in public universities annually. This amounted to RM 70 per capita annually and its more than 3 times compared to the previous analysis.<br />
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Using the same rate of opportunity cost (5 percent annually), RM 100 million should be added into the cost structure. So the total cost to fully finance undergraduate studies with full PTPTN loan is RM 2.1 billion or RM 74 per capita annually. How's that compare to the benefit?<br />
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As mentioned before, the increase productivity of labours amounted to RM 38 billion to RM 96 billion annually. So, macroeconomic-wise, it is still beneficial for Malaysia to implement such proposition. However, in the short run, the problems (as mentioned in the previous post) faced by Malaysia may prevent such implementation.<br />
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Here I want to justify another point: many comments I've seen recently mention about the effect of free higher education to future generation. They claim that free education may jeopardize future generation's opportunity of financing their undergraduate study.<br />
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Yes, boost of aggregate demand alone will resulted in short term increase in output but in the long run, the output will not increase and only resulted in inflationary pressure. That is true but investment in higher education will also increase in aggregate supply as labour productivity increases. Increament in aggregare demand and aggregate supply offset each other and general price will not increase significantly (assume that increase in aggregate demand and aggregate supply do not differ significantly). However increase in both will generate growth in output, boosting the long term potential output of Malaysia. <br />
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The real question is the burden faced by government and public (through tax) vs growth in output. If output growth outweight tax burden, then this proposition may not only benefit current generation but future generations as well. Since we already established that benefit outweight cost, the proposition could be beneficial to the future generations as well.ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com3tag:blogger.com,1999:blog-971997495809405272.post-62767927766474895752012-04-23T14:09:00.002+08:002012-04-23T14:37:01.760+08:00My Analysis on the Recent PTPTN Issue in MalaysiaAfter around 6 months absent due to extreme busyness, I finally have time to rant a little and I select the PTPTN issue as the topic of discussion. <br />
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For those who don't know, recently the opposition party of Malaysia (Pakatan Rakyat) suggested the possibility of free tertiary education in Malaysia. The issue has been snowballing ever since with various comments from various parties arised. Most government officials denied such possibility, claiming that this will lead to bankruptcy. Most current tertiary education "undergraduates" welcome the suggestion and even orchestrate an "event" at Dataran Merdeka to show their support towards this suggestion. Besides, many so-called analysts offer their comments on such issue, mostly oppose to this suggestion; and of course we have the public opinion. Public have been somewhat mixed in such issue but from my observation, most oppose the suggestion.<br />
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However, almost all analyses (or comments) so far have little credibility as they offer very little evidence or data. The level of objectivity is not up to par, leading to biases in their comment. Undergraduates, due to the concept of "self interest" will undoubtedly support the suggestion while government officials will (for whatever reason) oppose to the suggestion of opposition party. This time they claimed Malaysia will not benefit from this, to and extent that bankruptcy is a possibility if tertiary education is made free.<br />
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THE FOLLOWING IS THE ANALYSIS FROM THE AUTHOR AND AUTHOR ALONE. THE ANALYSIS IS BASED ON DATA OBTAINED FROM VARIOUS RELIABLE SOURCES AND ANALYSED USING OBJECTIVE ANALYTICAL TOOLS TO ELIMINATE ALL BIASES INVOLVED. VIEWERS DISCRETION IS ADVICED.<br />
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Bear in mind that I only channel the concept of free tertiary education towards the local students in our public universities and college universities. Private colleges and universities are profit oriented, thus impossible for the state to fully subsidise all fees involved. <br />
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Lets start with some important statistics. According to official statistics from Ministry of Higher Education (MOHE), we have 82,296 new enrolment into all public universities and college universities (U/CU) undergraduate programme. Averagely, we have almost 80,000 new enrolment every year to our public U/CU undergraduate programme. Mean study fees for each student every year (2 semesters) is RM 2,500. <br />
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If such information is considered, it costs Malaysia around RM 200,000,000 (two hundred million) to finance each batch of students. Since most undergraduate courses take about 3 years to finish, roughly estimation for Malaysia to fully finance all public undergraduates is RM 600,000,000 annually (six hundred million).<br />
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Six hundred million sounds very high considering we are a developing economy relying on domestic demand to boost our aggregate demand. However, if we reconsider our information so far, six hundred million for 240,000 students (8,000 x 3 years) every year merely means around RM 208 per month. If the benefits (increase in productivity) we obtain from such proposition exceed RM 208 per month, Malaysia should do this.<br />
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However, there are three visible problems: first, opportunity cost involve for the six hundred million is significant for the economy with only RM 766 billion annual gross domestic product and almost RM 740 billion gross national income. Investment in infrastructure could yield higher return in the long run for the economy, and even if it doesn't, it will still add significant weight to the RM 208 we talked about earlier.<br />
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Second, the capital needed to finance such a proposition required significant commitment from all agents of economy. With a population of 28.25 million, we need around RM 21 per capita to achieve such proposition. Tax is imminent under such event. Additional increament of six hundred million Ringgit into our money supply will result in enormous inflationary pressure to the economy.<br />
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Third, the characteristics of public goods, namely nonexcludability and nonrivalrous in consumption for public goods can't be satisfied. Tertiary education in U/CU is both rivaled and excludable services. With that, public can't enjoy this services at free will and utility may not be maximised. Furthermore, requiring public finance for a service that is both rivaled and excludable may not be welcomed by everyone, especially those with less possibility of enjoying it.<br />
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Nonetheless, numerically, using a moderate 5 percent opportunity cost rate, RM 30 million should be added into the total costs of this proposition, or RM 125 per capita. This equates RM 333 per capita every month. With such number, per capita "contribution" for every Malaysian would be merely RM 1 higher at around RM 22.<br />
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Next, we need to determine the increase in productivity of undergraduate compared to their primary and secondary eduation counterparts. This is not an easy task especially for the case of Malaysia as not much labour market researches focus on such aspect. However, from most researches that I can gather, with some slight ammendments to fit the case of Malaysia, productivity of higher education graduates are around 10-25 percent higher than primary and secondary graduates. Furthermore, the gap is proportionally higher, indicating that the difference in productivity between the 2 groups will grow bigger, supporting this proposition. Free tertiary education might increase the number of graduates in higher education, thus increasing the productivity of labours in general at increasing margin. <br />
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10 to 25 percent increase in labour productivity will generate an increament to our gross domestic product by RM 38 billion to RM 96 billion, way above our RM 630 million annual expenditure required to finance such proposition. <br />
<br />So, free tetiary education can really be possible and beneficial to the economy in general. Although such proposition requires significant investment and may result in higher tax rate or public debt level, with such significant growth potential to our economy, it may be a extremely good suggestion.<br />
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However, growth in output level, deficit budget and public debt are still main problems of Malaysia economy, increasing the difficulty of such proposition to be implemented. In the short run, the time lag involved may cause ineffectiveness of such implementation.<br />
In the long run, free tertiary education could be one of the catalysts that lift Malaysia towards a high income economy.ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com3tag:blogger.com,1999:blog-971997495809405272.post-49060096819850635752011-12-09T20:15:00.001+08:002011-12-09T21:41:37.197+08:00Italian Job for Manchester Duo?As we all know, the City of Manchester Duo: Manchester City and United are out of the Champions League and England are left with Arsenal and Chelsea to carry their pride. We can feel the pain of it especially in England with English press exaggerate the misery of English football in Europe this year and also in Malaysia where most football fans here can't name more than 10 players playing outside England. <br />
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However, you may wonder why such miserable feeling exist? I mean they still have 2 teams to carry their pride. Spain, Germany and France, they all have 2 teams in the knockout stage as well (Real and Barca for Spain, Leverkusen and bayern for Germany, Lyon and Marseille for France). Only Italy have more team in the knockout stage than England (3 teams). So it perfectly ok to say England are on par with teams from other prestigious leagues in Europe<br />
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Nahhh. For English football fans, they are better than everyone in Europe and should have more representatives than any league in the knockout stage of the highest level European football tournament. Such pride and ego started in the 1970' with clubs such as Liverpool, Nottingham Forest and Aston Villa that dominated European Cup in 7 of 8 seasons from 1976/77 to 1983/84 season. After that, Heysel incident stopped English football momentum and they did not recover until 1998/99 with the amazing win of United over Bayern. During that period, Italian football were king of Europe and world. From 1988/89 to 1997/98 (10 seasons), Italian club only missed 1 European Cup final (1990/91). All the world's biggest football stars were playing at Serie A and it was deemed the "mini world cup"<br />
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The success of Italian clubs in Europe and fierce competition of Serie A killed Italian football (in my opinion). Serie A clubs did not take European competition seriously and often sent their second team to play in Europe while their best were reserved for domestic competition. Clubs such as Milan, Inter, Juve, Fiorentina, Roma, Parma and Lazio made Serie A the absolute best of Europe and the world. As a result, after the 1997/98 season ended, their performance sunk. Their ignorance toward European competition coped with their ego to become bigger caused them to financially failed. Domestic competition alone couldn't generate enough revenue to offset their huge wage expenses needed to attract the best football players. By the time they realized this, it was too late.<br />
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Similar case may be developed in the case of England. Before this, lets face it, English Premier League were not competitive. ( I am sure most English football fans are either very mad now or straight away leave the page lol but let me explain.) English Premier League had less league winner in the past 15 seasons than any prestigious league in Europe including La Liga, Serie A, League 1 and Bundesliga. Only 3 clubs managed to snatch the EPL trophy in the past 15 seasons. Even Spain with the dominance of Barca and Real produced 4 league champions during the period.<br />
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The relatively less competitive domestic league enabled English clubs to focus all their firepower towards European competition and as a result, they managed to play some of the best football in Europe for the last 10 seasons. However, even with such conditions, they still didn't manage to dominate Europe. (1 more time EPL fans will probably be very angry). Yes, I know, English clubs had good performance in the knockout stage of Champions' League but they did not dominate the UCL finals like Italy did 10 years prior. In the last 10 seasons, they managed to be featured in 6 finals (less than 9 for Italian clubs) and of that 6 finals (although 2007/08 they had 2 clubs in the final: Chelsea and Man United, it is counted as 1 as it was in the same year), they only managed to win it twice. Clubs from Spain (4 wins) and Italy (3 wins) are more successful than English clubs.<br />
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So here we are, 2011/12 season, the strong rise of Manchester City and Tottenham Hotspur make the English Premier League more competitive than ever (in my opinion still not as competitive as Italian Serie A in the 1990's) and immediately we can see the effect. Top 2 teams are out of European top football competition and had to play in Europa League. It shouldn't surprise us as even with ideal conditions for the last 10 seasons (less competitive domestic league, financially successful, 100% focus in European competition, right mentality, fans support etc.), the English clubs couldn't dominate Europe. It's no surprise why their play so mediocre in Europe this season. Unless Chelsea or Arsenal sacrifice their domestic competition, I don't think Chelsea and Arsenal can go very far. (well Arsenal may do so since they are 12 points behind Man City). <br />
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Only 2 clubs in the world can dominate a competitive domestic competition and Europe: Barcelona and Real Madrid. Many football fans claimed that Spanish La Liga isn't competitive. Well when you have Barcelona and Real Madrid in the same league, any league will have similar scenario. Put these 2 teams in English Premier League and you will have Barca and Real dominate EPL as well. Fact is Spain are more competitive than EPL. Look at where are Villareal this season (4th last season, currently at 15). How bout Levante (14th last season, currently at 4th). That's the sign of competitive football: all teams have equal opportunity of finishing in any position (with the exception of Barca and Real of course as they are by far the 2 best clubs in the world).<br />
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So will English football follow the footstep of Italian football 10-15 years ago and left behind in European competition caused by fierce competition in domestic league? only time will tell. In the mean time, it's time to wake up for all English fans and media. Put aside your ego and pride. Watch other football leagues and discover their beauty. You are not a true football fans if you know nothing about football club competition except for English Premier League. To prove my point, here's a question for all the English football fans: Manchester City were eliminated by Bayern and Napoli and both of them are big clubs in their country. Can you name 5 players currently from Bayern and Napoli? If you can't? What? Football Fans? LOL<br />
<br />ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com6tag:blogger.com,1999:blog-971997495809405272.post-15729301654469440182011-12-08T12:10:00.001+08:002011-12-08T13:50:04.069+08:00Ministry of Tourism Malaysia (Kementerian Pelancongan Malaysia)Currently terribly busy with my work and study. Wrote so much articles (all at half way) but do not have time to finish them. Anyway I have a great story to share with all of you as I think it's a joke to our beloved nation, Malaysia.<br />
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Was dealing with my eductional matter at Malaysia Ministry of Higher Education (MOHE), Putrajaya and found out that Ministry of Tourism of Malaysia is just beside MOHE so went there for some tourism brochures and materials for my next holiday.<br />
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Went to the main entrance of the Ministry of Tourism, asked the security guard for direction, greeted by a surprised looking guard that direct me to the customer services counter directly in front of the main entrance.<br />
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So went to the counter and greeted by few Malays that speak very poor English. Asked for tourism maps and brochures. Again these receptionists showed surprised expression and did not answer anything at first. Then after few minutes of clarification in Bahasa Melayu, finally they understood and told me to go to first storey. However before I could go, I had to get a visitor pass by putting my driving license there (what if someone doesn't have one?).<br />
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Went to first storey and found out that it was the wrong floor. There was nothing there except for few counters dealing with licensing matters.<br />
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Went down again to the main entrence counter and re-asked those receptionists and they told me to go to second story this time. <br />
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So went to second storey. Came out of the lift and there were 2 doors: the one on the right (door A, I think) was locked and the one on the left was wide opened. Seriously, take a guess: which door is the correct one?<br />
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Wrong! The door on the left was the entrance to the library of Tourism Ministry. Went to the librarian. Again greeted with surprised expression. Asked by the librarian to scan my visitor pass on a scanning machine on the side of the locked door (door A).<br />
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Once scanned, the door unlocked and there was another person there, responsible for all the tourism brochures and maps. So took some and went out of this miserable place.<br />
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So let's make everything clear: to get tourism brochures and maps at Ministry of Tourism of Malaysia, I need to walk into the building, hand over my driving license (wonder what happen if I don't have 1), deal with few receptionists who don't know much, go to the second floor of the building, scan my visitor pass on a machine next to a locked door with no instruction at all from those receptionists, then finally ask for them at a counter. I wouldn't call it user friendly.<br />
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How bout just put those brochures and maps beside the main entrance? Why make it so difficult for tourists to get tourism informations at the Ministry of Tourism? Does it make sense that people will go to Ministry of Tourism of a nation to get some tourism information? Or are they intend to purposely create a fun maze for tourists to enjoy?<br />
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Nevertheless, do you all (Malaysian) have similar story? if so, why not share......ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com2tag:blogger.com,1999:blog-971997495809405272.post-71890152734976966832011-09-22T14:06:00.004+08:002011-09-22T15:01:45.417+08:00Economic Crisis???Recently I am superbly busy with my works and my PhD thesis. Just finished couple of researches and a seminar as speaker. Finally have some time to rant about some of my thoughts and understanding especially on the subject of economic crisis.<br /><br /><br /><p>3-4 years ago, we all know what happened. Burst of subprime market cause the economy to went south and we experienced then greatest economic crisis since Great Depression. </p>After that, everybody started talking about recovery and stimulus as well as quantitative easing. Everybody was optimistic about the future including all those central banks, investment bankers and investors / speculators. Asset prices started increasing and profit was running wild in derivative markets, commodity markets, stock markets and other tradable financial markets. Majority stock markets rallied more than 100% compared to their September 2008 low. Some even managed to rally more than 200% (Latin America SE).<br /><br />Now, with just 10 - 20% retracement in the those tradable financial markets, we are all doom!!!!! There is no tomorrow!!!!! US will be recession!!!!! Economy is going south!!!!! Sell sell sell!!!!!<br /><br /><br /><p align="center"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjDRcPskrtWu5Wg-0w9OaUMGrnm5w4xqzVbNxbj5ufiYEiuWMPULG6WfkDcoth7m4jDtRXs8QHVRzY2oBcNLrNU6RKBWlup9eaA3wO4HsTEL8YVo6py7HOkOQdRz09lFcpjX5ygmfA6H55R/s1600/1.png"><img style="MARGIN: 0px 10px 10px 0px; WIDTH: 268px; FLOAT: left; HEIGHT: 246px; CURSOR: hand" id="BLOGGER_PHOTO_ID_5655064689579763058" border="0" alt="" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjDRcPskrtWu5Wg-0w9OaUMGrnm5w4xqzVbNxbj5ufiYEiuWMPULG6WfkDcoth7m4jDtRXs8QHVRzY2oBcNLrNU6RKBWlup9eaA3wO4HsTEL8YVo6py7HOkOQdRz09lFcpjX5ygmfA6H55R/s400/1.png" /></a></p>Look at the chart of Hang Seng Index from 2008-2011 available from Stockcharts.com. It drops more than 20% compared to early August. However compared to September 2008 low, it is still almost 70% higher. It's not even at the first level of fibonacci retracement (61.8%) which should be at around 17274.<br /><br /><br />Furthermore, did economy recover compared to 2008?<br /><br />Unemployment is worst (in most developed economies) now compared than 2008, output did not increase much compared to 2008 due to high level of umployment (deflationary gap). monetary expansion does not yield any quantitative and/or qualitative improvement other than inflation. Productivity did not improve as well. The only change that we have is the liquidity in tradable financial markets due to the significant aggresive monetary expansion from central banks and fiscal expansion that cause governments around the world to have budget deficit problems. So I wont be surprise if stock markets visit their september 2008 low.<br /><br />WAIT?<br /><br />Most investors / specualtors / trades do not like to listen to economics stuff. What they want is that how to gain profit in such economy condition (at least that's what my asset management client ask all the time).<br /><br />Well, if you listen to what I said in 2008 (invest in commodity market), I am sure you have gain at least 200%. Furthermore, investment is always long term. It's much better to buy a good firm at fair price than fair firm at good price. If you own shares of good and profitable firms, keep it. Warren Buffett will not be the (second) richest man in the world today had him sold Coca cola or Gillete during the US recession of 1993.<br /><br />Another question that I often get from my client is that how do I earn profit during bearish market sentiment? Well, how bout put option, put warrant, Bear contact, short derivative etc. Investing in safe instrument such as money market and bond market can also maximise the return. Furthermore cash is king now. Lower loss = higher gain.<br /><br />Unless economy improves (ie lower unemployment and more stable positive economic growth), do not rush into the market. This is probably the best time for us to find a good firm with fair price. (KO maybe lol.)ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com6tag:blogger.com,1999:blog-971997495809405272.post-88921105975080043932011-08-02T11:46:00.002+08:002011-08-02T12:13:55.268+08:00Well Done US CongressPredictably, US Congress have approved a new debt ceiling, more than $ 2.1 trillion over the initial debt ceiling and hooray, US can start spending again.<br /><br />Wait, according the the deal, tax won't be increased but spending will be cut starting from defense spending. Wow, what a superb plan, at least on paper. US is not defaulting their T-bill / note / bond, spending will be cut, tax won't be raised, finally US could be doing the right thing...... or is it?<br /><br />Well, not really......<br /><br />Spending cut won't be implemented at least until 2013 which mean from now until the next presidential election in 2012, Obama, Geithner and other government official and still spend like hell. That's probably the reason the deal said more than $ 2.1 trillion. BTW, how much is more than $ 2.1 trillion? $ 100 trillion? Well, it all depends on how much US government want to spend.<br /><br />Furthermore, although the deal seems like there is government spending cut (by more than $ 2.4 trillion over god knows how many years), in reality, US government is not cutting spending nominally, but in percentage of growth. In other words, US government spending will still increase by a smaller margin in the coming years.<br /><br />Politicians are politician. Some are wise and know economics but most aren't. Some oppose with cut in defense spending and others oppose any cut in US government spending at all claiming the action is going to take money out of the economy.<br /><br />Well, there is a term in economy called crowding out effect. Cutting government spending actually does not harm economy at all as resources used in the public sectors will shift to private sector. As long as there is demand, supply, whether from public or private sector, will be there. Ricardo Equivalence explains the same concept as if government spending increases, sooner or later, tax would increase as well (according to bloomberg, US tax rate will be increased after 2012). In other words, consumers, one way or the other, have to finance government spending. Since government is never a efficient and effective economic agent, government spending should be eliminated and all public spending will be shifted to private sectors.<br /><br />So, as usual, US government and Treasury department manage to fool everyone just like what they did previously (2001-2003 and 2008-now rapid monetary expansion fueled by enormous spending from government). Well done US congress!ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com10tag:blogger.com,1999:blog-971997495809405272.post-64881697237334391612011-07-30T13:30:00.002+08:002011-07-30T14:22:15.378+08:00$14,300,000,000,000$14.3 trillion debt ceiling. What a magical number. Who would thought that $14.3 trillion will be reached?<br /><br />US gross domestic products of 2010 was $14.7 trillion in nominal term and who knows the percentage of phony output growth stimulated by rapid monetary expansion especially in the finance and banking sectors.<br /><br />$14.3 trillion debt ceiling or almost 100% of US gdp of 2010 has been reached in May of 2011 and technically, that means US is unofficially bankrupt. To Repay the debt, they have to sacrifice 1 year of national output. That would be ok provided US has high international reserves to finance their spending. According to treasury department, as of 29/7/2011, the official US international reserves is around $145 billion or less than 1% of gdp. In other word, US can only finance their import for just around 14 days (2010 data). Compared to international standard of 8 months, US is not as wealthy as we think.<br /><br />Furthermore, US government is terrible in managing their budget. Around 40% of government spending is financed by debt. Most debt are foreign debt sold to country like China, Japan, Russia, middle east countries etc. In other words, US debtor now own 40% of US economy and US resources (since debt / gdp = 100%). How about if US GDP figure did not include the phony banking and financial sectors junk loan and fake transaction, we could be looking at around 50% of US economy is foreign own.<br /><br />Combined with terrible data in labour market (unemployment rate of almost 10%) and fake general price level (low inflation according to treasury and feds), US economy is at the worst level ever (even worst than ww2 and Great Depression era).<br /><br />To make things worse, Fed funds rate is kept at 0-0.25% which encourage more borrowing and leverage. Since money is free in US, debt financing activities will keep going. In the short run there are no visible way US could improve on their deficit and overspending problems.<br /><br />To make things worse, nobody seems to understand the problems and US congress is it the process of adjusting debt ceiling to a higher level. At the moment, no agreement is reached yet but I guarantee at the end, everything will be sorted out and debt ceiling will be lifted.<br /><br />Using simple logic, if our income is much lower than our spending and every month, 40% of our spending is financed by debt (credit card). There are only 2 solutions: increase income or decrease spending right?<br /><br />Wrong!<br /><br />US government can't increase their revenue (ie taxes) as tax rate is already at such a high level and Obama would risk public support if he choose to increase tax rate. So the best way should be decrease US government spending. Start with military spending which cost US trillions of dollar every year.<br /><br />Wrong again!<br /><br />US try to use the third way: negotiating term with banks to increase the credit card limit so that they can borrow even more money and pile on the debt that got them into trouble in the first place. Remember, US was in subprime crisis because of too much debt, and their solution to deficit spending is...... more debt?<br /><br />So, to all American, you still think your country is the biggest economy in the world? You still think America is the wealthiest country in the world?ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com3tag:blogger.com,1999:blog-971997495809405272.post-53360281414232426492011-07-29T01:21:00.004+08:002011-07-30T06:38:27.465+08:00Harry Potter and Deathly Hollows Part 2 Review<a onblur="try {parent.deselectBloggerImageGracefully();} catch(e) {}" href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiCpoiGFrTRXptWYY0Q0ZFQKAfalt2z_z4Tjbqy2vwguMM69pSz1oCmH_xgUB3JGqbOiOM7MCg3DigbY_GVfVYL1XRxxmdQuFlokfoRm9B05d_Lz2rr7zxVYW19Yks6VuU1s9T2jeNO5w6_/s1600/harry-potter-and-the-deathly-hallows-part-2-movie-poster.jpg"><img style="float: left; margin: 0pt 10px 10px 0pt; cursor: pointer; width: 269px; height: 400px;" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiCpoiGFrTRXptWYY0Q0ZFQKAfalt2z_z4Tjbqy2vwguMM69pSz1oCmH_xgUB3JGqbOiOM7MCg3DigbY_GVfVYL1XRxxmdQuFlokfoRm9B05d_Lz2rr7zxVYW19Yks6VuU1s9T2jeNO5w6_/s400/harry-potter-and-the-deathly-hallows-part-2-movie-poster.jpg" alt="" id="BLOGGER_PHOTO_ID_5634455441274666994" border="0" /></a><br /><br /><br /><br /><br /><br /><br /><br /><br /><br /><br /><br /><br /><br /><br /><br /><br /><br /><br /><br /><br /><br /><br /><br /><br />WOW!!!<br /><br />This is my first feeling when I walked out of the cinema. Definitely one of the best movie in 2011 and together with part 1, I would say one of the best movie ever.<br /><br />Movie always starts with story regardless of the genre and part 2 has one of the best story i've seen. Of course we should give all the credit to Ms Rowling but either you have read the book or not, you will like the story of this movie nonetheless.<br /><br />Then the directing. Many felt that the movie is too action oriented and pace is too fast. However this is part 2 of a 5 hours movie and combined with part 1, I think David Yates did a fantastic job in setting the pace and set up one of the greatest climax in recent movie history.<br /><br />Acting is not perfect but very good nonetheless. Daniel Radcliffe, Emma Watson and Rupert Grint have matured so much since the first movie and it's a very nice feeling seeing them grow not only as the characters they portraying but their acting as well. Supporting casts play a fabulous role too. Neville Longbottom rocks!!!<br /><br />The action scenes is well done especially the Hogwarts battle scene as it managed to avoid the common problem of crappy action movies such as 2012, clash of the titan or transformers (all 3) which is too much actions. Action scene in an action movie, similar to horror scene in a horror movie, should not be overused. Otherwise the suspense elements will be lost. Deathly Hollows part 2 incorporate great transition period within action scenes to maintain the suspense.<br /><br />The duel between Harry Potter and Voldemort was great. After 7 movies and 10 long years, it is superb too see the epic "good vs evil" and I guarantee if you've watched all 7 movies prior to this one, you will have goosebumps running all over your body.<br /><br />Other elements such as dialogue and editing were done superbly too. Of course they are not as good as the first Deathly Hollows but great nonetheless.<br /><br />Small problem such as too little characters development and stupid epilogue aside, Harry Potter and the Deathly Hollows part 2 is a fantastic movie and definitely one of the greatest movie of 2011. Either you are a action movie lover, a movie lover or movie hater, you should not miss this movie. Together with Deathly Hollows part 1, this is one of the greatest 5 hours in cinema history and to me, on par with other great movies such as Indiana Jones series, Back to the Future Series, Lord of the Rings series, Citizen Kane, Gone with the Wind....... and more recently, The Dark Knight and Inception.<br /><br />9.5/10ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com2tag:blogger.com,1999:blog-971997495809405272.post-85845797398936315722011-07-25T13:23:00.002+08:002011-07-25T13:35:55.917+08:00Teoh Beng Hock RCI Report AnalysisFound an article on Malaysiakini analyses the RCI report into the death of Teoh Beng Hock.<br /><br />The article is very nicely written and cover all important facts about the case. Analysis part is well done and thorough. Check it out <a href="http://www.freemalaysiakini.com/modules.php?name=News&file=article&sid=16827">HERE</a>.ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com1tag:blogger.com,1999:blog-971997495809405272.post-59700837376359277272011-07-22T14:14:00.000+08:002011-07-22T14:14:49.834+08:00WTF TBH LOLLet me get this straight:<br /><br />1) He suicides because he can bear the pressure of being interrogated for the alleges of somebody else?<br /><br />2) He suicides although he did not bear any alleges?<br /><br />3) Although physical difficulty, his keen desire to suicide help him squeeze through the tight window?<br /><br />4) He suddenly forgot about his wife and coming child?<br /><br />5) He was declared suicide despite the world renown forensic pathology, Pornthip Rojanasunand, mentioned about he was more likely murdered than suicide?<br /><br />6) He suicide despite having no sign or history of depression or mental illness?<br /><br />Wow, what a story. It's better than any literature by JK Rowling or JRR Tolkien. Where can I buy this story book?ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com2tag:blogger.com,1999:blog-971997495809405272.post-74749032252342076482011-07-17T17:58:00.000+08:002011-07-17T17:58:02.907+08:00Economics JokeA man receives 4 letters. He opens the first letter and it's from the firm he is working at. His superior has terminated his service and he becomes an unemployed.<br /><br />He then opens the second letter. It's from his wife and it's a divorce letter.<br /><br />Next, the third letter. It's from his doctor and it's a confirmation that he is diagnosed with stage 4 cancer and he will die in a week.<br /><br />Finally, the man opens the last letter and it's from a lottery firm confirming that he won the first prize of the jackpot.<br /><br />After all the letter, he jumps in joy and happiness. He loudly says assume that everything else being constant, ceteris paribus, I am happy I won the lottery jackpot. Hurray!ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com4tag:blogger.com,1999:blog-971997495809405272.post-44175040879339823602011-07-02T13:05:00.002+08:002011-07-02T13:17:39.355+08:00IGN Top 100 Modern Games1 Mass Effect 2<br />2 Bioshock<br />3 Red Dead Redemption<br />4 Super Mario Galaxy 2<br />5 Portal 2<br />6 Fallout 3<br />7 Uncharted 2<br />8 Assassin Creed 2<br />9 Batman Arkham Asylum<br />10 Super Smash Brothers Brawl<br />11 GTA 4<br />12 Half Life 2 Ep. 2<br />13 Pac Man Champs. Ed. DX<br />14 Halo Reach<br />15 New Super Mario Bros.<br />16 Heavy Rain<br />17 Left For Dead 2<br />18 Elders Scrolls 4<br />19 COD 4 Modern Warfare<br />20 Dead Space<br /><br />The rest of the list can be seen <a href="http://www.ign.com/top/modern-games">here</a>.<br /><br />Well, some very bad choices such as why Gamespot's game of the year 2010, Demon Souls, is at last place (100th), why Dragon Age Origins is at 91th and where is Metal Gears Solid 4?<br /><br />Well for the last question, I think IGN only allows 1 game per Franchise. Since MGS 3 already in the list, well MGS 4 will not. This is a great move to avoid Mario from dominate the list too much lol.<br /><br />However, from my point of view, top ten games absolutely deserve their spot there in their respective orders. Mass Effect 2, Bioshock and Red Dead Redemption should be the top 3 modern games. Great job IGN!ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com3tag:blogger.com,1999:blog-971997495809405272.post-86662395655869510712011-06-30T17:35:00.002+08:002011-06-30T18:00:30.728+08:00Critics Review vs Anonymous ReviewHot topic: Critics Review vs Anonymous review. Which one is the better evaluation for movie?<br /><br />Recent release of Transformers Dark of the Moon has spurred many disputes. Most anonymous or so called "amateur" reviews favor the movie (at the moment, 6.1/10 on metacritic, A- on yahoo movies and 6.9 on IMDB.). However most Critics do not like this movie (42/100 on metacritic, C on yahoo movie and 36% on rotten tomatoes).<br /><br />So, which one is more accurate?<br /><br />Well, it depends on what you want and know about movie in general. If you think movie is just one of the many forms of entertainment similar to music, video games etc. and you prefer action more than anything else, then you will find this movie interesting.<br /><br />However if you think movie is different compared to all other forms of entertainment, and you want a total package in a movie (ie. action + acting + characters + directing + plot + story + pace + audio + dialog etc.), you will not like this movie.<br /><br />This is the reason why most people think that critics are wrong every time. Critics look at multiple dimensions and give a complete evaluation while most anonymous reviewers look at single dimension and focus at it (from what I see so far, most people praised the movie for the action scenes).<br /><br />That's why many bad movies reviewed by critics are considered good by anonymous reviewers. Most notably the Transformers series.<br /><br />Personally, I prefer critics review as the more I watch movie, the more I want from it. I do not want movie to just entertain me. I want movie that can entertain me with multiple aspects that make movie different than other forms of entertainment. If I want mindless action with explosion, I will watch "Mythbusters". If I want the trill of moving very fast, I will either drive very fast or go for a roller coaster ride. If I want robots fighting each other, I will watch cartoon or play video games.<br /><br />Of course everything should be based on moral judgement. However if you think Transformers 3 is the best movie of the year, I will say, you do not know movie.ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com1tag:blogger.com,1999:blog-971997495809405272.post-17924077908799946202011-06-29T22:06:00.002+08:002011-06-29T22:25:15.300+08:00Laddaland ReviewWent to watch Laddaland last week at my home town of Melaka and have to say: it's better than I thought.<br /><br />First of all, it's not a good horror movie. The director seems to have problem deciding the direction of the film whether it should be like traditional Asian horror movies involving "ghosts", or like western horror movie involving "psycho maniac killer, or even like M Night Shyamalan's "the Village". As a result, this movie has them all, but poor version of them (well maybe not as bad as the Village lol.)<br /><br />However, as the movie progresses, it starting to become good in non-horror department of the film. The problems faced by characters in this movie, mixed with very good writing and excellent acting, we have a really good and engaging drama that truly like a reflection of most typical family's problems.<br /><br />The director knows that and as the movie progresses, it leans more and more away from horror into drama and even end with it. From time to time, we have some good shocks and very little horror but that may not be a bad thing after all.<br /><br />Story wise, this is no Inception. It has many lovable characters and interesting plot but quite poor main story. However the implementation and pace of the whole movie is nonetheless good.<br /><br />Overall, this movie is terrible if you want something similar to Insidious. However, why should we limit ourselves to horror for a horror movie. This movie shows us that a horror movie can have so much more than just plain horror it excels at that. No wonder it achieves such a success in Thai's box office. A good movie.<br /><br />8/10 for me.<br /><br />p/s: based on the reviews from metacritic and rotten tomatoes, Transformers 3 is no Inception either but who cares, it will still top the box office anyway. Wonder why people like to kill their brain cell by enduring 150 minutes of mindless action lol.ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com2tag:blogger.com,1999:blog-971997495809405272.post-13054976385200046782011-06-23T09:20:00.003+08:002011-06-23T09:53:08.387+08:00Can CAPM and APT used for forecasting?Capital asset pricing model and arbitrage pricing theory are probably the greatest and most popular asset pricing theories of 20<span id="SPELLING_ERROR_0" class="blsp-spelling-error"><span id="SPELLING_ERROR_0" class="blsp-spelling-error">th</span></span> century. They have gone through numerous changes and modifications in the past 50 years since their <span id="SPELLING_ERROR_1" class="blsp-spelling-corrected">existence</span> in the 50's. Can they be used to determine asset prices correctly and accurately?<br /><br />Recently a research has been done and published based on such questions on stock markets of <span id="SPELLING_ERROR_2" class="blsp-spelling-error">Hong</span> Kong, Japan, Malaysia, Singapore and US. The results shows that <span id="SPELLING_ERROR_3" class="blsp-spelling-error">CAPM</span> does not even exist in all markets except for Japan as the linear relationship between market beta and asset return can't be accepted statistically. Similar result for APT as well for these markets.<br /><br />Although <span id="SPELLING_ERROR_4" class="blsp-spelling-error">CAPM</span> and APT do exist in Japan, their forecasting ability using constant beta and time varying beta are terrible especially during economic crisis of 2007/2008.<br /><br />So the question is why do we need to study these asset pricing theories? Why <span id="SPELLING_ERROR_5" class="blsp-spelling-error">CAPM</span> and APT are so popular and basically learned by all finance / business / economic / accounting students? Can we even call them as theories as they are numerous research on similar topics disprove the availability of <span id="SPELLING_ERROR_6" class="blsp-spelling-error">CAPM</span> and APT in the past.<br /><br />Using simple economic theory, prices are determined endogenously (provided no government intervention) by market forces of buyers and sellers. The same concept can be applied in financial assets as well. Stocks, bonds, currencies, commodity futures share the same characteristics. Higher the demand, higher the market price, ceteris paribus.<br /><br />CAPM and APT are not effective tools in predicting and forecating the tradable financial assets (mostly stocks) as they are not used by stock market investors (especially retail investor). Since nobody use CAPM and APT in the decision making process for stock buying, they cannot spur demand and thus, ineffective in such uses.<br /><br />Most investors (retail or institutional) use technical analysis tools (RSI, Bollinger bands, Stochastic, Macd etc.) and financial analysis tools (PE, ROA, ROE, Profit margin etc.) in determine the buying and selling opportunity in tradable financial assets thus making them much more effective tools in forecasting than CAPM and APT.<br /><br />So, why don't we introduce technical analysis in tertiary education instead of CAPM and APT? (as far as I know, no university include technical analysis tools in their syllabus, correct me if I'm wrong)?<br /><br />Or how bout random walk? can asset price be predicted correctly and accurately everytime using certain indicators?<br /><br />Well, Economists have been discussing this for centuries and answer is yet to be found. Econometricians try to use modelling techniques to form unbelievably complex models and in the end, we still do not have a standardised model in determining asset price. Probably Austrian economists are correct: human being are unpredictable and cannot be estimated using econometric modelling.ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com2tag:blogger.com,1999:blog-971997495809405272.post-64824170497805998592011-06-20T15:19:00.002+08:002011-06-20T15:23:02.689+08:00Some Jokes on Economy and Economist<div align="justify">Found some jokes about the economics and economist. All of it are hillarious and some of it is actually correct. Enjoy!<br /><br /><br />A mathematician, an accountant and an economist apply for the same job.<br />The interviewer calls in the mathematician and asks “What do two plus two equal?” The mathematician replies “Four.” The interviewer asks “Four, exactly?” The mathematician looks at the interviewer incredulously and says “Yes, four, exactly.”<br />Then the interviewer calls in the accountant and asks the same question “What do two plus two equal?” The accountant says “On average, four – give or take ten percent, but on average, four.”<br />Then the interviewer calls in the economist and poses the same question “What do two plus two equal?” The economist gets up, locks the door, closes the shade, sits down next to the interviewer and says “What do you want it to equal?”<br /><br />An economist is a trained professional paid to guess wrong about the economy. An econometrician is a trained professional paid to use computers to guess wrong about the economy.<br /><br />Bentley’s second Law of Economics: The only thing more dangerous than an economist is an amateur economist!<br />Berta’s Fundamental Law of Economic Rents: The only thing more dangerous than an amateur economist is a professional economist.<br /><br />Three econometricians went out hunting, and came across a large deer. The first econometrician fired, but missed, by a meter to the left. The second econometrician fired, but also missed, by a meter to the right. The third econometrician didn’t fire, but shouted in triumph, “We got it! We got it!”<br /><br />Economics is the painful elaboration of the obvious.<br /><br />An economist is someone who doesn’t know what he’s talking about – and make you feel it’s your fault.<br /><br />A woman hears from her doctor that she has only half a year to live. The doctor advises her to marry an economist and to live in South Dakota. The woman asks: will this cure my illness? Answer of the doctor: No, but the half year will seem pretty long.<br /><br />I asked an economist for her phone number and she gave me an estimate.<br /><br />Economists have forecasted 9 out of the last 5 recessions.<br /><br />An economist is someone who gets rich explaining others why they are poor.<br /><br />“I’m thinking of leaving my husband,” complained the economist’s wife. “All he ever does is stand at the end of the bed and tell me how good things are going to be.”<br /><br />There are two things you are better off not watching in the making: sausages and econometric estimates.<br />— Edward Leamer<br /><br />On the first day God created the sun – so the Devil countered and created sunburn. On the second day God created sex. In response the Devil created marriage. On the third day God created an economist. This was a tough one for the Devil, but in the end and after a lot of thought he created a second economist!<br /><br />Economics is extremely useful as a form of employment for economists.<br /><br />The First Law of Economists: For every economist, there exists an equal and opposite economist.<br />The Second Law of Economists: They’re both wrong.<br /><br />We have 2 classes of forecasters: Those who don’t know and those who don’t know they don’t know.<br />— John Kenneth Galbraith<br /><br />An economist is an expert who will know tomorrow why the things he predicted yesterday didn’t happen today.<br />— Laurence J. Peter<br /><br />How can you tell when an economist is lying?<br />His lips are moving.<br /><br />They say that Christopher Columbus was the first economist. When he left to discover America, he didn’t know where he was going. When he got there he didn’t know where he was. And it was all done on a government grant.<br /><br />Economics is the only field in which two people can share a Nobel Prize for saying opposing things.<br /></div>ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com1tag:blogger.com,1999:blog-971997495809405272.post-18167137126847709702011-06-15T13:46:00.003+08:002011-06-15T14:10:51.834+08:00X Men First Class & Super 8 Should (& Hopefully Will) Kick Transformers 3's ButtRecently watched X-Men first class and Super 8. No they are not perfect but yes, they are way better than many of the action movies of this generation. Although they are not on the level of The Dark Knight or Inception, They are good action movies nonetheless.<br /><br />We all know no matter how bad Transformers 3 Dark of the Moon is, it will still top the box office chart but it's like breeze of fresh air to have some good action summer blockbusters.<br /><br />Both of these movies done exceptionally job of acting, directing and pace. It managed to make us feel involved with the overall story, sub-plots and characters. This is exceptionally true for Super 8 which done a remarkable job in characters development and sub-plots that truly link us to the glorious day of ET and Close Encounters of the Third Kind<span style="font-style: italic;">.<br /><br /></span>I<span style="font-style: italic;"><span style="font-style: italic;"> </span></span>admit I love X Men<span style="font-style: italic;"> </span>but I don't lik<span style="font-style: italic;">e</span> the first 3 movies as they suffered the same problems of most action / superhero movies: weak story, no character development, bad directing and overused of action scenes. X-Men origins: Wolverine was better but still have some problems faced by its predecessors. X-Men first class shows a vast improvement of all categories such as directing, acting, dialogue, character development, action scenes, jokes, story, pace...... It's not perfect by any means but it's great.<br /><br />For me, both movies are somewhat too long and something sub-plots dominates the main story. 90-100 minutes would be better for these movies.<br /><br />Well, based on past experiences, Transformers Dark of the Moon will be a bad movie. I am certain I will not contribute to its box office success but who cares, it will still win the summer blockbusters list.<br /><br />IMO, action movie is similar to horror movie. In a horror movie, the more you see the "ghost / demon", the less scary it becomes and hence the worse the movie it becomes. Similarly, the more actions you see in an action movies, the worse it becomes as it lose all the suspense.<br /><br />Movies industry is dying not because of poorly-made movies or piracy, it's because "people who watch movies no longer know what a good movie is"ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com1tag:blogger.com,1999:blog-971997495809405272.post-15698964300715647832011-06-06T09:10:00.007+08:002011-06-06T14:20:02.425+08:00QE3<p align="justify">QE3 or quantitative easing 3 is the latest hot topic that everyone is talking about especially after the gloomy outlook in the labour market in US as only 54,000 jobs were created last month compared to the projected number of 150,000. As a result, fear of recession come back and they (as usual) look at government to provide "free lunch".<br /></p><br /><div align="justify">So, til today, we have TARP or troubled assets Relief Program which worth US$ 700 billion and QE2 which worth 600 billion. These however do not include the trillions and trillions of US dollar "printed" by FEDS and created by commercial banks.</div><br /><div align="justify"></div><br /><div align="justify"></div><br /><div align="justify">Federal Funds rate on the other hand has been keep at record low of 0-0.25% since December 2008. So, technically, money is free in US as the price and cost of money (interest rate) is zero. This situation is dangerously similar to Japan in the 1980's after the burst of real estate bubble. As a result, Japan has been in a liquidity trap for over 2 decades and still recovering.</div><br /><div align="justify"></div><br /><div align="justify"><br /></div><br /><div align="justify">US is dangerously close to either have hyperinflation, liquidity trap, or worse, both, depend on the sentiment of consumers. Another round of QE will almost guarantee liquidity trap as consumers and investors will not be stimulated by the easing of monetary policy. Zero interest rate policy implemented by the Feds certainly does not make the situation any better.</div><br /><div align="justify"><br /></div><br /><div align="justify"></div><br /><div align="justify">On the other hand, although consumer do not invest as illustrate by liquidity trap, they may spend more as more easy money come in. Unexpected increase in consumption may lead to inflation or even hyperinflation.</div><br /><div align="justify"></div><br /><div align="justify"><br /><br /></div><br /><div align="justify">Either way US economy is looking gloomy now and QE3 will only end with a massive failure. It's crazy to expect different results with same method. So if TARP and QE2 did not work, how can QE3 work? </div>ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com0tag:blogger.com,1999:blog-971997495809405272.post-63305751601035793022011-05-22T15:04:00.002+08:002011-05-22T15:42:02.615+08:00The Death of Motion Picture Part 2: 3DNowadays, almost 50% of the motion pictures are in 3D. Everybody seems to dig this 3D magic especially after the infamous Avatar which (almost) perfected the technology that started around 60 years ago. Now we even have 3D handheld gaming device called Nintendo 3DS where glasses are history.<br /><br />However I think 3D will kill motion pictures.<br /><br />First of all, the glasses. It is unbelievable that after 60 years, we still cannot watch a 3D movie without the stupid 3D glasses that are ridiculously pricey. A good pair of it will cost us more than US$150. Sure we can rent one for 2 hours in the cinema but it is unbelievably uncomfortable. Why can't they design the shape of 3D glasses according to human skull?!<br /><br />Next, the existence of 3D increase the significance of visual effect and graphical quality in making and watching movie. The viewers demand more on the graphic and the movie makers try to fulfill it. However that's the problem: they concentrate so much on graphic and (usually) ignore the other (more important) aspect of a movie: directing, plot, story, acting, dialogue, audio, character etc.<br /><br />Furthermore, many viewers can't distinguish between 3D and CG. Take Clash of the Titans for instance. The 3D effect in that movie is superbly crappy and few and far in between. Most action scene in that film is computer-generated graphic and not 3D. However, many people including some movie-reviewing media wrongly considered CG as 3D.<br /><br />It's actually very easy to distinguish 3D from CG (and i know most of you know). Take off the glasses and if you still can see clearly, it's CG.<br /><br />With that small amount of 3D effect in most films, the price of ticket increase significantly from their 2D counterpart. Without improvement in other aspects of film mentioned above, slight improvement in graphic department can't offset the increase in ticket price and eventually viewers will lose interest.<br /><br />Nowadays almost everything is in 3D. Animated movies and action movies in particular. Do we need toy story, Shrekor How to Train a Dragon in 3D? How bout action movie? Clash of the Titan, The Last Airbender, or Piranha 3D. The 3D effect in these movies is added in post production and it's very crappy. Worse, these movies completely ignore other aspect of motion picture making them unbelievably bad.<br /><br />How bout the amazingly overpriced 3DTV? Few thousand bucks and all we get is a TV with few crappy glasses and few movies? Is this a scam? Nintendo can make a glasses free handheld devices so why we still do not have a glasses free TV?<br /><br />Yes, it's cool to have 3D movie and Avatar really let us know 3D can be good for movies but until they improve the overall quality of motion picture, 3D will kill the motion picture we love.ru40342http://www.blogger.com/profile/00079369969322644918noreply@blogger.com1