Wednesday, 8 October 2008

And you think everything is still hunky dory

I have said earlier that all those big investment banks should just be left to die but some tend to disagree. Did you know that the former CEO of Lehmann Brothers, the world’s oldest investment bank, pocketed US$480m before the company filed for bankruptcy? And this includes some US$20m+ in bonus just months before the collapse. Was it done on purpose?

Do a quick google around and you will see that people working in Lehmann Brothers are paid on an average of US$300,000 per annum. Tell me, why should the govt (though not our govt) bail all these people? Should the world save the rich just to keep the economy going?

This is why in the
latest banking bail out talk in London, the UK govt has made it clear that “chief executives will not be paid huge bonuses”. Oh yes… looks like Europe has just joined the world financial crisis bandwagon as talks about banking industry bail out sparked in London today.

Are we staring at the worst economic downturn the world has ever seen? Nah… rilek-lah… we are not Singaporeans who are kiasu and kiasi… we are Malaysians… we Malaysia boleh… just look around and you will see people still going ‘yum char’ at Coffee Bean and people hanging around in Pavilion swiping credit cards like nobody’s business.

And while we are at it, what are our leaders doing?

The top guy announced that he will step down in March next year and I wonder whether our current finance minister will be using his brain power to sustain the economy or whether he will concentrate all his might to secure the top post. What say you?

Isn’t our people and country wonderful…

28 comments:

Klaw said...

If by wonderful, you mean f-ed up, then yeah, you're absolutely right.

All those hunky dory messages that Malaysia is doing fine, and a US recession won't affect us much, is, IMHO, bullshit. Even an economics dummy like me would know that if one of your largest trading partners stops importing your stuff, you'll be severely affected for sure.

sÞ¡ηηєє said...
This comment has been removed by the author.
sÞ¡ηηєє said...

i work in a bank and what lehman ceo did was common practice in industry: the top ppl will quickly get compensated and step down. most of them will say "retire" or "personal reasons". in fact, they just screwed up the business big time, so they just have to leave. but the bank still have to give them lots of money even they screwed it up! so it pays to be at the top of a sound bank. =\

aye, it's also good to have this financial crisis so that they will now have to woo investors again from the start. Now I see shittybank ad on TV, which is such a rare sight.

and to think many ppl never expected the big boys will collapse... and seriously, it's such a historical moment... ahahahah

ps: no he dun enjoy it. those who enjoy going back for reservist are usually 'zobo' in camp i.e. eat/sleep/slack in camp. diff camp, diff treatment. it pays to be a 'white horse' too. ;)

pavlova said...

to be honest, i'm a lil concerned that msians haven't quite got what this economic disaster means.

a lot of the multinationals ( namely american firms) are invested in msia. soon, they won't have as much money invested as they did, say, 10 yrs ago.

this is gonna have a HUGE impact on malaysia, esp Penang who relies heavily on the manufacturing industry.

yet at the moment, we are still bickering about our own politics. not that it shouldn't be addressed, but malaysians have better get their focus and priorities together.
everywhere else already has huge interest rate cuts ( including Switzerland (!!!) and Iceland)....

i wonder if malaysians truly understand what's going on....

PS: haih, by the looks of it, the sooner u go to grassyland the better lah... dont mean to sound unpatriotic....

pavlova said...

to be honest, i'm a lil concerned that msians haven't quite got what this economic disaster means.

a lot of the multinationals ( namely american firms) are invested in msia. soon, they won't have as much money invested as they did, say, 10 yrs ago.

this is gonna have a HUGE impact on malaysia, esp Penang who relies heavily on the manufacturing industry.

yet at the moment, we are still bickering about our own politics. not that it shouldn't be addressed, but malaysians have better get their focus and priorities together.
everywhere else already has huge interest rate cuts ( including Switzerland (!!!) and Iceland)....

i wonder if malaysians truly understand what's going on....

PS: haih, by the looks of it, the sooner u go to grassyland the better lah... dont mean to sound unpatriotic....

myop101 said...

the reality is, failure is not an option for giant companies. we know they deserve it for running the company to the ground but having said that...

what is wrong if an employee works hard and make huge profits for the company during good times? aren't all the shareholders happy enough to remunerate these people?

also, who's fault is it to excessively lend to an organisation known for over-leveraging? those lenders made money too...

and when their well remunerated employees spend in the economy, creating jobs for others, should they ask the poor to pay up because they out of their goodwill specifically spend on those services?

shouldn't the govt also thank these people during good times for paying loads of taxes?

sigh... we can pick and choose la what to argue but for me, if those CEOs actually created value for their stakeholders in the good times with no real job security and therefore remunerated as agreed, why are we making noise?

the only diff is, these companies use money to make money. what about manufacturing, minerals extraction and such? they too get to make huge profits when price soared and millions of consumers paid for it. when they go under creating a sudden shortage, shouldn't the govt also consider a bailout?

as for me... since i am not getting a piece of those big pies, i will just sulk behind my computer about the late nights i have to slog... hahahaha

Kok Jin said...

zewt, remember our discussion yesterday? i still dont understand why malaysians are still BAU - business as usual. everytime i come into office, i see stock markets plunging, currency market in jitters, and central banks scrambling to calm economies. its just a matter of time before u see starbux and pavi in KL goes haunted with souls (no humans and consumers).

missironic said...

how should I say ler..hmm.."DA BEST!" hahaha...

pablopabla said...

Now is time to pool and start looking for good investment opportunities ;)

pinknpurplelizard said...

This is affecting the whole world. A recession is on the way and many more will fall victim to it. This is just the beginning. Am expecting this to go on for a some years.

Tough times are ahead. But for those who can afford it. It is time for bargain hunting and patience.

atreyu strange said...

And I heard that Iceland is close to declare "national bankruptcy". Pakistan too, eh?

It scares why our Malaysians is not being extra careful like the rest of the world now. Maybe because the world financial turbulence is overshadowed by our local political games.

erm said...

malaysian is dealing bisnes on brick and mortar

we are different with singapore...we have resources....our bisnes is legit

we have less manipulative...like someone here describe...money over money

of course it affect our market...but not severe enough.....factory dont stop/small shop still sell

what ever cost will be forwarded to customer...rugi ka?

hehehehehe

leyaw said...

Cannot blame the Malaysian at large. Most are not affected yet by the crisis. Most business is still going as usual. Leaders always giving assurance that we are not affected, we can depend on China and India.

For the average Malaysian, there is no reason to believe its otherwise

KittyCat said...

I think it's because Malaysians still believe most of what they read in the local papers?

I was fascinated by a friend who'd just arrived in China here - she didn't know that Nestle milk failed the melamine test in Hong Kong although AP or one of the big media reported it...

She was OK because our Malaysian papers said it's all OK :)

Never underestimate the power of the media!

Or we're now cushioned against the US big sneeze now? Most importantly, we do not borrow from the IMF...

Huei said...

absolutely wonderful..wan tai fu la!

coffee bean? i've long forgotten how it taste like...i wan starbuckssss >.<

yes very low pay >.< thats y go hatyai for cheap clothes =P and also drive instead of taking plane
drive = divide by six
air = count by head
=P

zewt said...

klaw - well, u know what i really meant there :) yes, this one is going to hit us so bad... that i think many will not come out of it.

sÞ¡ηηєє - yes, amd i guess the UK govt is aware of this and trip to plug this hole. like i said... this one is going to make history.

pavlova - yes, we all live in our own fantasy world. what to do, malaysians have too long live lives where we think we are super rich. we think we are so superior to others, thanks to our wonderful media. this one is going to his us to bad, we will not know what hit us.

myop101 - economists around the world all agree that the bail out is not right but is essention to keep the economy going. but then again, i always say... why should the economy keep going? i still prefer it to come down and we start from mid level again. things should be cheaper, good for ppl like us.

kok jin - i doubt it... malaysians still think we are superior and everything is still "ok" thanks to our media. when the effect is finally here, it will be too late. and honestly, many will deserve it.

missironic - absolutely.

zewt said...

pablopabla - come, let's do it together hehehe...

pinknpurplelizard - prefer to hold on to cash... cash is king.

atreyu strange - hey there, welcome to AZAIG. yes, that is correct. the top 3 banks in iceland are now in great debts and the country now only have about USD4m i heard. very bad. i wont be surprise if our country heads that way too.

erm - very optimistic eh... true malaysia boleh fashion.

leyaw - you think so? well, let's hope you are not wrong.

KittyCat - i am really interested in the milk story. i am really skeptical about the level of efficiency of our health ministry, know what i mean?

huei - yeah woh... now i know why you drive, made sense. but then... sit until your ass open flower lor.

myop101 said...

if we are buying shares then it will good since there are lots of undervalued companies out there even as we speak...

but for properties, unless there are mass bankruptcies, layoffs, people committing suicides and banks raising NPLs here in M'sia, I doubt prices will moderate significantly.

it sucks for people like us isn't it?

Kok Jin said...

brother....the reality had sink in. today equity markets all opened lower. kudos to those that think we are still alright, suckers!

pinknpurplelizard said...

like wat Myop101 said. There are undervalued companies which u can pick up. This will allow you to at least double your monies.

Cash may be king but u hold liquidity but it grows slower or not at all. Take a chance and you may come out of this recession to be richer and wiser. ;)

Kok Jin said...

finally, i need to say kudos to those who are still looking to buy stocks. look at the business news tomolo, and see where all the global bourses have closed.

Kok Jin said...

THAI STOCK INDEX <.SETI> DOWN 10 PCT AFTER TRADE RESUMES
BUDAPEST BOURSE FALLS 13 PCT BY 0801 GMT -REUTERS DATA
Thai stocks down 9.95 pct after trade resumes

Who is having the last laugh? Indonesia stock market closed for the 3rd straight trading day (guess why?).

zewt said...

myop101 - well, just wait, i am sure properties will come down soon. after all, property market is always badly hit during recession.

kok jin - i get what you mean. by the way, referring to our earlier conversation... i was informed that the foreign funds already cabut in march. so our market will be quite stable... in a bad way.

pinknpurplelizard - nah, the market has not seen the bottom yet.

pamina said...

aiyooo scared shitless la...more scared that abdullah is in charge in this time of distress...

sharlydia said...

this is not the first day u stay in this "wonderful" country right?

zewt said...

pamina - well, he is stepping down... but the race to the top will supersede all other things... which is worse.

sharlydia - indeed... hehe... it's wonderful mah.

see said...

Don't think we should be resisting bail out of these fat cats 'coz of the mess they created it will bounce back on genuine businesses. Just for interest sake go ask around treasury depts if they having trouble getting financing. Its already happening in US even to mighty companies like GE....no funding means less business means cutbacks means retrenchment? These b%&&ds are holding everybody else for ransom ie bail us out or else....

zewt said...

see - i know... but i am one of those who has been living moderately... i would like to have a recession because then prices will come down and my money will worth much more again.