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Monday, October 31, 2005

Competitiveness of civil servant in Malaysia

In 1987, one day before Black Monday (21 October 1987) and police is going to mass arrests of politician under Operation Lalang.

When the whole Malaysia is in tension. Some one shooting with M-16 in Chow Kit Road in Kuala Lumpur occur. I remember I watch on the TV that the then Inspector-General of Police ( IGP )appear on the crime scene himself alone to observe the situation himself. He really brave and willing to risk his life. He can delegate this to his subordinate in such dangerous situation but he didn't.

One week ago. The ex-IGP write an article on The Star. It demonstrated what call competitive. I feel all civil servant should have read such article.

Ex-IGP is a former British train civil servant. However, after so many years of independent. Our civil service has deteriorated.

If you read Tun Hanif Omar article, it is difficult to imagine how Malaysia crime rate has come to this level if police force is lead by such highly competitive person. However, after Tun Hanif Omar retired. There is at least two more person heading the police force. Who should be responsible to the deterioration?

Today is second anniversary of Abdullah become our Prime Minister. When Abdullah become Prime Minister, he make a surprise visit to government department. Everybody hope he would bring reform to civil services.

Then, a victory in general election show support of people to him. Unfortunately, a large number of his team has lost in UMNO election, which slow down the reform process. Present IGP's son arrest by Anti-Corruption agency also affect the spirit of Abdullah's team. Clearly, reform is not an easy task. Hope the present IGP would continue what suppose to be do.

On the 2nd anniversary of Abdullah become Prime Minister. It is a real test of Abdullah on how to reshuffle the cabinet and move on.

Related link: Lim Kit siang


Characteristics of Successful Traders (Advertorial 4)

Many investors take actions that aren’t in their best self-interest. They make irrational trades; they trade based on emotion, rather than logic; they hold on to a losing position due to their unwillingness to admit they made a bad trade; they trade based on greed or panic… the list is endless.

Successful traders, on the other hand, all have a few things in common. Developing these characteristics and habits will help make you a successful trader.

Successful Traders Set Goals

Successful traders tend to be incredibly goal-oriented. Why? Most people perform at their best when they’re reaching for a clear goal. And there are three basic qualities that make up a clear goal:

1)The goal must be realistic. If your goal is to double your money every day, it sounds great – but it’s not realistic.

2)The goal must be attainable. Just like with a realistic goal, an attainable goal must be within your current capabilities. The best goals are short-term goals; make your first goal a small one, and then continue to increase your goals as you experience success. World-class sprinters don’t start by thinking of winning the Olympics.

3)The goal must be measurable. Goals that aren’t precise, and can’t be quantified or measured, aren’t really goals at all. If your goal is to be wealthy, that’s great… but what does “wealthy” mean? Our guess is that your definition of “wealth” will change as your net worth increases. If you can’t define your goal, and measure your progress towards it, then you have no way of assessing your progress or of making changes to your techniques and strategies that allow you to reach your goal.

Successful traders set goals, and they also are confident they can reach their goals. Confidence is a key to staying rational, logical, and disciplined. Starting with small, realistic goals will help build your confidence in yourself and your abilities.

Success Can Come at Any Level

Whether you’re a beginning trader, a trader with some experience, or someone who makes his or her living strictly from trading, you can be successful. Many people think they have to have significant capital, or years of experience, to trade successfully. That’s not true. (It’s also true that if you don’t stay disciplined, focused, and rational, you’ll end up as a losing trader, regardless of your level of "expertise.") All successful traders started as small investors; they didn’t trade more than they could safely risk, they learned from their mistakes, and they developed systems that worked for them and that fit their personal styles. We have not defined different strategies for different "levels" of traders in this e-course because the principles are the same: logical, focused, disciplined trading creates success.

Successful Traders Specialize

It’s simply not possible to understand and stay in touch with everything that occurs in all the types of investment vehicles and markets across the world. While some traders have developed systems that allow them to trade in multiple venues (for instance, in different stock markets around the world), most traders specialize in a particular type of investment, and in a particular market. You may enjoy trading in commodities futures; that enjoyment will help you focus and stay in touch with market events. If you aren’t interested in currency trading, for example, don’t trade in it – your lack of knowledge and motivation will cause you to lose focus and make mistakes.

Successful traders tend to specialize; they pick an area to gain in-depth knowledge of, and they follow it closely, learning from past trends and patterns, and from their own trades. If you’re a beginning trader, we recommend focusing narrowly on a particular investment vehicle and market; learn all you can, about the market and about yourself, before you move into other investment types.

Successful Traders Take Losses in Stride

No one likes to lose. But losing is a fact of life for traders; they key is to limit your losses and maximize your successes.

A losing trade is not a failure. It isn’t a reflection of you or of your overall judgment. (If it was possible to be right every time, we’d all be rich.) The only way a losing trade is truly a failure is if you aren’t willing to take the loss, without hesitation, and move on to find winning trades. By accepting that they’ve made a losing trade, and getting out of the position, successful traders focus on making money – not on being right all the time.

Many traders feel they don’t want to “lose” money on any trade, and they stay in losing positions in the hopes that it will recover to at least the break-even point. There are three problems with this approach:

1. The position may never recover to the break-even point.
2. Holding on to a losing position ties up capital that could be placed into winning trades.
3. Holding on to a losing position is an example of unfocused trading and a lack of discipline.

Successful traders are willing to take small losses. If you aren’t willing to take small losses, or don’t have the discipline to take small losses, don’t trade.

Successful Traders Stay Focused During Rapid Swings

Most of us were raised to think that it takes years of hard work to acquire wealth. That viewpoint doesn’t apply to trading in the markets; you can make thousands of dollars in minutes under the right circumstances. Successful traders understand that money can be made or lost extremely quickly, and they stay calm and rational.

Why is that attitude important? Let’s say you’ve made several thousand dollars over the course of an hour trading futures contracts. You’re thrilled and excited, and you may lose your composure and start making irrational trades. You may stay in the position longer than you should, for one of two reasons:

1)You think the market will keep going up, and you don’t want to limit your gains.
2)The market falls, and you don’t want to give up all the gains you’ve made, so you hold on in hopes your position will rally.

If you accept and understand that huge amounts of money can be made in a short period of time, you are less likely to become undisciplined in your trading. Successful traders take their gains in stride, no matter how large. They quickly move to protect their positions by setting stops, or covering a percentage of a short position. Successful traders stay rational and disciplined in the face of rapid gains or losses because they understand the nature of trading.

Successful Traders Stay Flexible

Staying flexible requires that you stay detached and unemotional about your trades. No matter how strongly you feel about your analysis of a position or a trade, you have to be willing to change that opinion and act quickly if necessary.

Successful traders realize that bad trades reduce the gains made from past trades and potential gains from future trades. Successful traders change their minds quickly and easily, and are not concerned about whether they were "right" or "wrong." They’re concerned with maximizing their gains and minimizing their losses – and to minimize losses, they have to be willing to quickly change their minds.

Remember: the more flexible you are, the more successful you will be.

Successful Traders Don’t Leap Before They Look

One of the most common mistakes inexperienced traders make is to trade when they see an opportunity they think might be too good to miss. Jumping into a position based on a hunch, or on the belief that you may be missing an opportunity, is no different than gambling. Almost every investor at one time or another has felt a rush of greed or enthusiasm for a trade – based solely on the desire not to miss out on a great opportunity that might be available.

Successful traders practice self-discipline, and apply skill and logic to their trading. They learn every day, and they use what they know to make intelligent decisions on every trade. Successful traders don’t worry about missing out – they focus on making intelligent decisions.

Successful Traders Don’t Passively Follow "Expert" Advice

Blindly following the investment advice of a broker or analyst is foolish and self-destructive. Oftentimes, the broker’s self-interest is completely different from yours, because the broker gets paid when you make a trade, whether it’s a good trade or not. He or she wants you to trade. Analysts may have inside knowledge or years worth of experience, but in the end their opinions on the markets are just that – opinions.

Successful traders take responsibility for their trades and therefore their money. They learn, they stay focused and disciplined, and they make their own judgments about their trades.

Successful Traders Aren’t Affected by Mood Swings

Many traders get excited when their positions are making money, and they increase their stake in the position. Then, when the price goes down, they panic and sell. Emotional traders are affected by the highs and lows of gains and losses, and fail to stick to their plans and their strategies.

Successful traders understand how the markets work, what to expect, and how to capitalize on trends and events. They aren’t affected by the excitement or the disappointment that can come from good or bad trades.

"What Takes Some Successful Traders A Lifetime To Achieve Could Take You Just A Few Days... Or Less!"

Get these reports for free

Advertorial 1 - Introduction
Advertorial 2 - The Basics of Analusis and Rational Trading
Advertorial 3 - Basic Principles
Advertorial 4 - Characteristics of Successful Traders
Advertorial 5 - Playing to Your Strenghts, Overcoming Your Weaknesses
Advertorial 6 - Winning Psychology
Advertorial 7 - Avoiding Common Pitfalls
Advertorial 8 - Sound Money Management
Advertorial 9 - Trading Systems
Advertorial 10 - Final Words


Friday, October 28, 2005

National Automotive Policy legitimate Naza

Ex-Prime Minister Tun Dr Mahathir has stated that a Minister has deceived him and cabinet to approve Naza Kia to have national car status.

Naza, being unlisted company has been silent on this. Maybe it work behind the scene .

National Automotive Policy ( NAP ) announced last week which make local assembly enjoy similar incentive enjoy by national car like R&D grant on a case by case basis.

This effectively make national car status a non issue as they able to enjoy similar incentive. This has legitimate Naza indirectly.

Apparently Naza is not involve in deceiving ex-Prime Minister or if involved, government has pardon him base on his contribution to our country automotive industry.


" The Apprentice "Vs Local reality show " The Music Executive "

I rarely watch TV. Last Friday, I accidentally found out a local TV reality show model on " The Apprentice " call " The Music Executive " has air on 8TV.

The winner will be employed by...... EMI if not mistaken.

I really enjoy watching " The Apprentice " hosted by Donald Trump. Business skill and competitiveness of Tana and Kendra show on the show.

It is glad that we have our own business TV reality show.

However, I feel that our show is too brief. I cannot see the performance of each contestant.

The most attractive part on " The Apprentice " is board room. Where the loser team leader has to hand pick his team mate that responsible who he think should get fire.

However, on our " The Music Executive " There is no such procedure where contestant have to defend themselves why he or she should not be fire or who should be fire.

Last week, I do not understand why such contestant is fire. No proposal from team mate. No defense. Actually, on the show, I see the losing team which remain 3 person, out of the 3, 2 dislike each other and they accuse each other respectively on TV. The 3rd is being diplomatic by mentioning that the other 2 team mate is good.

When the team lose out. The host want to change the rule that they do not want to follow the previous rule to let the whole team to vote out one of their team mate. Instead, the judges like to select and decide themselves and ........ they choose the diplomatic one!!!!!!

Reason. Unable to fit inside to the whole team!!!! I though the other two dislike each other?

I think there is still much to be improve on our local reality show.

Remember to watch " The Music Executive " tonight 9.30pm on 8TV


Thursday, October 27, 2005

Mahathir economic theory

I take a long time to study my accounting qualifiation. When I study Economy. Initially I study traditional economic theory like Adam Smith's "Invisible Hand" theory, David Ricardo's "comparative advantage" theory, which is the basis of free trade and globalisation today and keynesian theory.

The world and technology has change so fast that. Later, I have to study Reaganism and Thatcherism theory.

What is Reaganism and Thatherism? It is the economic theory implement by the then US president Donald Reagan and British Prime Minister Margaret Thatcher. Both theory are similar to each other call Supply Side Economy.

What is Supply Side Economic theory. Actually, it is implemented by our ex-Finance Minister Tun Daim Zainuddin. Part of it is Privatisation.

Privatisation in Malaysia, initially has successfully reduce our Income tax rate from 40% to now 28%. However, tax rate remain unchange at 28% for many years whereas privatised company like PLUS keep on increasing it toll rate. TNB increase it tariff and even Post Malaysia Bhd also inrease it postage but no reduction in income tax then.

Indah Water also fail to redue local government rates and assessment.

Thus, we can say that privatisation in Malaysia successs initially but fail eventually.

Ex-Prime Minister Tun Dr Mahathir used currency peg to help Malaysia to come out from Asia financial crisis, unlike it neighbour Thailand and Indonesia and even South Korea, Malaysia reover from Asia finanial crisis without the help from International Monetary Fund ( IMF ).

The recent de-peg of Ringgit and USD fail to lifted Malaysia stock market. Thus, it prove that currency peg is not the main cause of weak performance of our stock market. Further, Hong Kong currency peg has longer history than Malaysia and until today after China and Malaysia has de-peg it currency. Hong Kong urreny is still remain peg with US currency. But Hong Kong status does not affected by the peg and it still remain a financial centre like Singapore and is yet to be challange by Shanghai. However, nobody critise Hong Kong policies!

In history, we do not lack of Doctor turn Economist, like William Petty 1623-1687 etc.

However, the basis of Mahathir theory like:

1) Opposed traditional economic theory especially Anti-Free Trade.

2) Different country in different development stage should have different economy policy. The centre of this theory is that we should protect certain industries via prtectionist policies.

The above theory sound familier, always stress by our ex-Prime Minister Tun Dr Mahathir. However, the above theory is theory from German Economist Friedrich List 1789-1846.

Thus, like Ronald Reagan and Margaret Thather is the implementor of Supply Side Eonomy. Mahathir is Implementor of Friedrih List economic theory.


Tuesday, October 25, 2005

Alan Greenspan successor nominated

Alan Greenspan, second most influence person in the world after US President George W. Bush is due for retirement. Everybody in the financial world is guessing who would be his successor.

The guessing game ended yesterday when US President George W. Bush nominated his top economic advisor Dr Ben Bernanke as chairman of Federal Reserve Board to succeed Alan Greenspan.

The appointment is subject to Senate confirmation.

Dr. Bernanke was born on December 13, 1953, in Augusta, Georgia. He received a B.A. in economics in 1975 from Harvard University (summa cum laude) and a Ph.D. in economics in 1979 from the Massachusetts Institute of Technology.

Updated: Dr Bernanke is a co-author of a book " Inflation Targeting: Lessons from the International Experience "


Sunday, October 23, 2005

Japan rise again

At the beginning of October 2005, Asia Wall Street Journal (AWSJ)reported that Japan's investment fund invested aggressively in India. AWSJ, however, view that Japan might be joinning the game when the music is going to stop.

On 14 October 2005, Oriental Daily reported that Japan economy is booming again after 15 years of recession. After Japan Prime Minister win in his recent Parliament election. Japan stock market has increase more than 2,000 point in less than 2 months.

Japan Toyota bring back Lexus brand to it home country after successfully market in North America. Toyota sold 4,600 units of it GS model in less than a month,3.8 times over it target.

Isetan cosmetic counter able to make a lot of sale on male cosmetic. Which is not a necessity for male.

Foreign capital rushing to Japan stock market after recent Prime Minister victory in election. The rise in stock market has increase wealth on people on the street. On 30 September 2005 issue of The Economist magazine. It published an article : The sun eventually rise.

Japan corporate world have wait for government help or bail out after recession. However, after a long period of waiting. They recognized that government ability to give them a helping hand is very slim. Thus, they have to restructure and stand up on their own feet. However, the process take 15 years, that is the period for Japanese to take.

How long Malaysia GLC and bumiputra entrepreneur especially contractor would take?

On 18 October 2005. Oriental daily again reported that Japan consumer have start to spend money. Which create a demand on economic. Japanese confidence is back as they more willing to spend money and not save everything they earn.

Last week, a Singapore base economist published an analysis on The Edge regarding beneficiaries of Japan revive economy and Japan intention to shift it sole reliance on China economy.He view that Singapore is the most beneficiaries country.

Second beneficiaries is Indonesia as a large portion of FDI would flow from Japan to Indonesia as Japan want to shift it focus of FDI from China.

The third is India. Japan investment in India is more on capital market while Indonesia is more on production economy.

If his prediction is correct. Malaysia,being neighbor of the above country, would benefit too.

Japan investment in Indonesia also make a shift from BRIC to IRIC come true.

In Malaysia, the direct beneficiary of revive Japan economy is timber industry.


Friday, October 21, 2005

Downgraded of Malaysia stock market

Malaysian Business reported that after one week of investment mission lead by Prime Minister to UK and US on 12 September 2005. Merrill Lynch downgraded Malaysia's stock market to 'underweight' while upgrading that of South Korea.

"Merrill's regional strategy report dated Sept 20 was essentially a plug for the Korean exchange. But in overweighting Korea, the Malaysian bourse got downgraded to underweight, owing to a relatively limited upside."Write A Kadir Jasin on Malaysian Business..

On Sept 30 - the day that the Prime Minister presented the 2006 Budget. Credit Swisse First Boston, another US-based international investment bank,revised the Malaysian equities downward.

This was followed on October 3 by the Hong Kong brokerage unit of UBN Amro Holding NV, which downgraded the Kuala Lumpur bourse from overweight to neutral.

Those associated with the London-New York investment mission own us, Malaysian investor an explanation.


Tuesday, October 18, 2005

GST and Income Tax

What is the difference between GST and Income Tax?The main different is Income tax is a tax impose on your income whereas GST is tax when you spend.


Income Tax
Government will send you Form B for you to report your income to the government. Base on what you report, government will tax you on your income. How much you pay tax is generally determine by how much income you received in a particular period. Regardsless of whether you spend it or not. Often, it is better you spend it and if you able to prove that your spending is wholly and exclusively generating your income, you might able to deduct against your income.

On the other hand, GST would not tax you on your income. You would not be tax when you received your income. As long as you never spend it. You would be tax when you decide to buy something ...... Like, you want to buy cigarette, you would pay "sin" tax to government indirectly. If you decide to buy a car, you might have to pay 200% tax to government on amount you spend, indirectly, included in the purchase price.

Thus, GST is call indirect tax as you pay tax indirectly included in the purchase price. Income tax is call Direct Tax as you pay directly to the government.

Which one is fair?

As you can see above, income tax is a tax base on your income. How much tax you pay depend on how much your income is regardsless of how much you spend.

Under GST system, you would not pay government tax no matter how high your income is if you never spend it. You would be tax if you try to buy something.

Now, which one is fair? Especially to poor people.

They is no definite answer. In UK, some services like healthcare does not impose GST or they call VAT, thus, poor people can enjoy such service without paying tax. In Malaysia, if you buy luxury car, you have to pay as high as 200% on amount you spend. Thus ,is depend on execution.

Are we ready?
In order for us to start implement GST from year 2007. Everybody have to get use to it now. Government has reduce the 10% Service tax to RM150,000 per year few years ago. Divide by 12 month. Thus, a coffee shop with monthly sales RM12,500 is subject to Sales Tax. Thus, unlike previously, only you go to high class restaurant only you pay plus 10% Service tax (or fast food). Under current legislation. Even if you go to coffee shop is subject to Service tax.
If every coffee shop register to custom and obtain a Service tax license now. By 2007, majority of the coffee shop has register to custom and they might have a system to collect the service tax and pay the tax to custom.
However, now, majority of the coffee shop owner is yet to implement this system. With current inflation cause by high oil price. Government also face difficulty in control inflation if they want to force those coffee shop owner to register.
It look like by 2007, custom and tax department would have difficulties in implement it. Custom and tax department would unable to process large volume of registration and license application. Small business owner also do not have a system to monitor the money collected on behalf and summit to government every two months.
We see how Finance Minister solve this problem then?

Technorati Tag:

Sunday, October 16, 2005

Perwaja Steel strategic alliance

Kinsteel Bhd announced it has form a strategic alliance with Maju Holdings Berhad by acquiring 51% equity interest in Perwaja and Gurun Assets. Maju would retain 49% equity interest in Perwaja and Gurun and acquired a substantial stake in Kinsteel Bhd.

Kinsteel Bhd and Datuk Pheng Yin Huah

Kinsteel Bhd managing director is not stranger to chinese community as he is a social activists. He is Federation of Pahang Chinese Associations (FPCA) President.With that position, he is deem a central committee of Federation of Malaysia Chinese Associations. Few years ago, he contest for the post of President of Federation of Malaysia Chinese Association but fail. Few months ago, he agree not to contest the post again this year and remain as a central committee. He must be in negotiation on strategic alliance at that point of time and shift his focus to his own business rather than social activity. If he become President of Federation of Malaysia Chinese Association. He would represent chinese community in Malaysia. Thus, sometime might have to oppose government policy on behalf of chinese community. This might contradict role in business which view as a partnership between bumiputra and non-bumiputra.

Maju executive chairman Tan Sri Abu Sahid Mohamed said Perwaja and Kinsteel had been business partners for a long time, and that Kinsteel managing director Datuk Pheng Yin Huah was also a close friend.

The deal also view as a partnership between bumiputra and non-bumiputra malaysia to protect Malaysia's steel industry being take over by foreigner. As report stated that India most richest man Mittal Group eyeing Perwaja Steel in Malaysia.

Steel Industry in Malaysia after this

After this strategic alliance. Steel industry in Malaysia is control by 3 focus core group.

First is Lion Group. Lion Group is no stranger to every body. The group started from steel industry and has diversified to other industry like Parkson. It diversified geographically as well as they have a lot of investment in China.

Second is Ann Joo and Malayawata Group. Ann Joo Group is a veteran in steel business. They have interest in furniture making and in property business. They own a shopping mall in Kepong in private. They have taken over Malayawata from Pernas. This make them a significant group in steel industry. Ann Joo make a General Offer to acquired all the shares in Malayawata that they did not own recently.

The third is Kinsteel-Perwaja if the deal go through.

Other is not a focus group in steel industry. Like diversified Hong Leong own Southern Steel and Melewar's Group Melewar Steel. Althogh the company is large and significant, they are not focus in steel industry nor they are veteran in steel industry. Then there is numerous small player.


Saturday, October 15, 2005

Diminish of East Malaysia bumiputra interest

On 12 October 2005, MP Datuk Wilfred Madius Tangau (BN 's Tuaran) asked about the equity ownership involving Sabah and Sarawak bumiputra ownership.

One of the most successful East malaysia bumiputra entrepreneur is Datuk Effendi Norwawi. One of his firm Enfiniti Productions has support one of his wife Tiara Jacquelina in producing a film call "Puteri Gunung Ledang". However, his TV station NTV7 is in the process of being taken over by Media Prima, which is running TV3 & 8TVstation.

Media Prima, is a company run by UMNO(according to a reply by Tun Dr Mahathir to allegation from Anwar Ibrahim) , representing a west Malaysia bumiputra interest.

The take over also resulting in "temporary" cease operationn of Wah! FM yesterday (15 October 2005). A Chinese radio station despite protest by chinese community.

The take over of NTV7 by TV3 view as East Malaysia bumiputra interest shifted to west Malaysia bumiputra.

Datuk Effendi still control Encorp Bhd

Earlier, RHB bank, a bank control by Sarawak government application to re-appointment of Datuk Seri Sulaiman Abdul Rahman Taib as executive Chairman did not receive Bank Negara's approval.

This has cause the diminish of East Malaysia Bumiputra influence in corporate Malaysia.

Other influential East Malaysia bumiputra control company is timber company Ta Ann.

When India community demand quota system on equity participation. One columnist has stated his comment on a mainstream chinese newspaper that soon, East Malaysia community would demand their quota....Quota for Kadazan Dusun Dayak each .


Education Ministry try to save cost!

While we try to improve our country competitiveness via improving our human capital. The producer of our human capital....teacher has been a victim of cost cutting.

Education Ministry has issue a letter to terminated services of temporary teacher in order to save their salary cost for the month of November and December. This happen on a yearly basis.

Education Ministry fail to solve the problem of shortage of teacher. Thus, some school have to rely the services of temporary teacher. If temporary teacher have been deny of their salary for two months (Nov & Dec) every year. Who want to become temporary teacher again.

Strangely, treasury in Finance Ministry do not aware of such termination and they do paid out such salary in November and December every year.

The question is...Where does the money has gone? Perhaps ACA should step in as well.


Thursday, October 13, 2005

“benchmarking” or “multilateral method” proposal at WTO

While US and EC still refuse to liberalisation it textile industry, and continue to give subsidy to it agriculture industry. They have try to force developing country to liberalisation their service industry.

On 13 September 2005, European Union, Japan, Switzerland, Australia and Korea presented six papers calling for additional ways to accelerate the pace of services liberalisation before the WTO Ministerial conference in Hong Kong in December 2005. The US and Canada also supported the proposals.

Earlier, EC has however has limit China's textile import to EC at 12.5% growth rate. Whereas China negotiation with the US is still on going.

The services sector includes banks, insurance companies and other financial institutions, wholesale and retail trade, utilities (such as electricity, energy, water and telecommunications), transportation, postal services, education and professional services (including lawyers, doctors, architects).

Two years ago. When the world steel price drop to a very low level. US government impose anti-dumping import duty on steel export from China and some other country.

US, EU and Japan has continuously provided subsidy to its agriculture industry. American economists, Paul Zane Pilzer, has stated in his book "The Wellness Revolution" that such subsidy has resulted in over supply in food & agriculture product and major cause of unhealthier diet among American citizen.

While developing country still protecting their primary industry ( Agriculture industry ) and Secondary industry ( Manufacturing like textile and Steel ). It is ridiculous and unfair for developing country to liberalize their service industry.


Sunday, October 09, 2005

Indian software outsourcing Vs China internet industry

India software outsourcing competitiveness is not new to everybody. Same as China competitiveness in manufacturing industry.

Little people know or focus on is China internet industry.

NASDAQ listed online game and entertainment company Shanda paid USD230million to acquired 19.5% shares in In August, another Chinese search engine company Baidu listed on NASDAQ. It first day closing price above 354% of its IPO price, with market capitalization of USD3.98billion. Baidu is a company started 5 and half years ago.

China largest eCommerce company have a strategic alliance with Yahoo. Alibaba acquired all Yahoo assets and business in China. Yahoo will invest 1 billion in and get 40% shares eventually. Alibaba strength is in eCommerce while Yahoo strength is in search engine.The strategic alliance would create a largest search engine company in China.

The robust of China internet industry is cause by it growing number of internet user. It has the second largest internet user in the world after United States. it has 20million people that has make online purchase until June 2005. According a research report from CNNIC.

According a report from CNNIC. New internet user who choose Baidu comprise 51.5%. Google 32.9%. Both Baidu and Yahoo control more than 84.4% while the third Sohu control 4.6% market shares only.

Yahoo market shares is 3.7% only. After Baidu, Google,Sohu, Sina (4%). This make Yahoo try to strategic alliance with Alibaba to growth it market shares.

With all the netprenuer in China keep appearing on Forbes list. You are wrong if you think China only have strength in hardware or manufacturing industry only.

Based on a report on Oriental Daily

Tag Computers and internet


Thursday, October 06, 2005

GST rate should be 5%

THE implementation of the impending goods and services tax (GST) in 2007 is on track, like the change in tax rates (towards a standardised percentage) so that there is one rate applicable to all goods and services,” executive director and head of indirect tax solutions and private client services of Ernst & Young , Bhupinder Singh, told a press conference before the company's annual budget seminar in Subang yesterday .

However, an overwhelming 88% felt that the GST rate should be 5% or lower, and Ernst & Young directors concurred that it would likely be set at 5% in the beginning.

All the above have confirmed my comment on Budget 2006.


Monday, October 03, 2005

Datuk M. Kayveas attack local government

PeopleÂ’s Progressive Party president Datuk M. Kayveas attack Local governments when speaking at the party's 52nd general assembly at the Putra World Trade Centre. The assembly was opened by Prime Minister Datuk Seri Abdullah Ahmad Badawi.

Calling for a revamp of local governments, Kavyeas said: "They have failed to function as a third government and front-liner to the Federal and State governments. They merely serve as an agency to collect taxes."

Kavyeas, a Deputy Minister in the Prime Minister's Department and former Deputy Housing and Local Government Minister. Later, at a Press conference, said none of the 146 local governments in the country was of "world-class standard".

Earlier, when Deputy Prime Minister bought out the issue of Malaysia decline in world competitive ranking caused by decline in efficiency in civil services. A few columnist in chinese newspaper claim that government has too manyservantservent per population compare to other country.

However, last Friday, on Budget 2006, government announced that all local government one stop centre would added 334 position to expedite licensing, permit approval, collection of rates and assessment and fine and penalty process.

Update: Politic 101 Malaysia
New Strait Times
Lim Kit Siang


Sunday, October 02, 2005

Comment on Budget 2006-3

Budget 2006 also try to improve cash flow of the company by :

1) Allowing a Group Relief : 50% of a company's current year losses can be offset against profits of companies in the same group with minimum 70% ownnership.

2) Allowing pioneer period losses and unabsorbed capital allowances to be carried forward.

3) Income from investment activities of listed investment holding companies treated as business income to offset opearating expenses like salary.

All the above would reduce Income Tax payable to the government and business has more income to channel to our economic, as a lot of cash flow has been tight up on petroleum and increase cost of living.

4) Allowing current year tax estimate at minimum 85% of preceding year estimate. If last year your tax payable is RM1,200,000. Previously, you have to pay tax installment of RM100,000 per month to come up with RM1,200,000 per year. Now, you only need to pay 85% amounting to RM1,020,000 per year. Per month amounting to RM85,000 . This company have extra RM15,000 spend. Thus, company cash flow increase.

Goods & Services Tax (GST)

Everybody is upset by the silent on GST in Budget 2006. In fact, government has shifted Sales Tax for cigarettes and liquor to Excise Duty. Government have increase Excise Duty for both cigarettes and liquor but reduces Sales Tax from 25% and 20 % to standard 5%. This standardisation of 25% and 20% of Sales Tax to 5% might pave the way if government want to procedd to implement GST in 2007 .


Beneficiaries of Budget 2006-2

After Property Sector, which sector would benefit from Budget 2006?

Merchant Banker, Boutique Finance Outfit and Universal Broker

Merchant banker, like CIMB, Boutique Finance Outfit like ECM Libra and Universal Broker like OSK would benefit from Merger and Acquisation (M&A), corporate finance and corporate advisory work. Corporate Lawyer's business would also increase. Public listed company might start recruiting Corporate Finance or Corporate Planning Executive. Why?

1) Stamp Duty and Real Property Gain Tax exempted on M&A of listed company from Oct 1,2005 to Dec 31,2007

2) Abolish section 132G of Companies Act 1965. ( Would minority lose out again is yet to be seen. This would spur M&A activities)

SEG which specialize in Accountancy course and Stamford, which specialize in Legal course benefit from broadening of RM5,000 relief to the above two course. However, both SEG and Stamford are still in the red at the moment.


Beneficiaries of Budget 2006-1

Jeff Ooi claim that he is unable to benefit from Budget 2006. Politics 101 Malaysia commented that this is a NEP Budget! Rational Thinking complaint that there is too few comment on Budget 2006 among Malaysian bloggers.

Everybody want to know which is the beneficiaries sectors before tomorrow stock market open?

Property Sector:
1) Setting up Yayasan Amanah Hartanah Bumiputra to buy prime commercial properties for bumiputra. This create demand for commercial properties.

2) One life time Real Property Gain Tax (RPGT) exemption is now given separately to husband and wife. Jeff Ooi's wife can now buy a property and can sell it next year with profit (This is highly likely given the high oil price that push inflation rate higher, property usually is a good hedge against inflation, unlike bank saving, your fixed deposit today might not able to buy the same amount of petroleum next year.) Such profit is not subject to RPGT ( Which can up to 40% of your profit)

3) The process of issuing strata title will be simplified based on the issuance of certificate of fitness.

4) Estimated losses on low cost houses can be used to offset estimated profits of other real property development projects for tax purpose.

5) All local government one stop centre would added 334 position to expedite licensing, permit approval, collection of rates and assessment and fine and penalty process. This is method of improve competitiveness of civil service is debatable as people want reduction of government staff to improve competitiveness, however, such move benefit property sector as they deal a lot with local government.

6) Abolish section 132G of Companies Act

7) Stamp duty and RPGT exemplted on Merger & Acquisition (M&A) of listed companies from Oct 1, 2005 to Dec 31,2007

8) All MSC-status company can buy a property in cyberjaya and entitle for 50% claim of Industrial Bulding Allowance(IBA) for 10 years. Thus, if Jeff Ooi's business is MSC-status company. Again, his company can buy a property in cyberjaya and entitled for 50% claim of IBA for 10 Years.

Wow! Jeff Ooi alone can buy two property to benefit from Budget 2006. What do you think the potential on property sector?

Other than property sector, legal profession-conveyance Lawyer also would benefit as they perform property transaction.


Saturday, October 01, 2005

Basics Principles of trading (Advertorial 3)

To operate effectively in any trading environment, you need rules and boundaries to guide your behavior. It’s a simple fact of any trading, no matter what "system" you’ve developed, that the potential exists to do financial damage to ourselves — damage that can be greater than we think is possible. There are many types of trades in which the risk of loss is unlimited. To prevent the possibility of exposing ourselves to damage, we need to create an internal structure in the form of specialized mental discipline and a perspective that guides our behavior so that we always act in our own best interests. This structure has to exist within each of us because the market doesn't provide it for us.

The markets provide structure in the form of behavior patterns that indicate when an opportunity to buy or sell exists. But that's where the structure ends — with a simple indication. Otherwise, from each individual's perspective, there are no formalized rules to guide behavior. There aren't even any beginnings, middles, or endings as there are in virtually every other activity we participate in.

This is an extremely important distinction with profound psychological implications. The market is like a stream that is in constant motion. It doesn't start, stop, or wait. Even when the markets are closed, prices are still in motion. There is no rule that the opening price on any day must be the same as the closing price the day before. Nothing we do in society properly prepares us to function effectively in an environment with no real boundaries.

Even gambling games have built-in structures that make them much different from trading – and a lot less dangerous. For example, if we decide to play blackjack, the first thing we have to do is decide how much we are going to wager or risk. This is a choice we are forced to make by the rules of the game. If we don't make the choice, we don't get to play.

In trading, no one (except yourself) is going to force you to decide in advance what your risk is. In fact, what we have is a limitless environment, where virtually anything can happen at any moment and only the consistent winners define their risk in advance of making on a trade. For everyone else, defining the risk in advance would force you to confront the reality that each trade has a probable outcome, meaning that it could be a loser. Consistent losers do almost anything to avoid accepting the reality that, no matter how good a trade looks, it could lose. Without the presence of an external structure forcing the typical trader to think otherwise, he is susceptible to any number of justifications, rationalizations, and the kind of distorted logic that will allow him to get into a trade believing that it can't lose… which makes determining the risk in advance irrelevant.

All gambling games have specified beginnings, middles, and endings, based on a sequence of events that determine the outcome of the game. Once you decide you’re going to participate, you can't change your mind — you're in for the duration.

That's not true of trading. With trading, prices are in constant motion, nothing begins until you decide it should, it lasts as long as you want, and it doesn't end until you want it to be over. Regardless of what you may have planned or wanted to do, any number of psychological factors can come into play ― causing you to be distracted, change your mind, or get scared or overconfident. In other words, you can behave in ways that are erratic and unintended.

Because gambling games have a formal ending, they force a participant to be an active loser. If you're on a losing streak, you can't keep on losing without making a conscious decision keep playing (and losing.) The end of each game causes the beginning of a new game, and you have to actively put more of your assets at risk by reaching into your wallet or pushing some chips to the center of the table.

Trading has no formal ending. The market will not take you out of a trade. Unless you have the appropriate mental approach to end a trade in a way that is always in your best interest, you can become a passive loser. Once you're in a losing trade, you don't have to do anything to keep on losing. You don't even have to watch. You can just ignore the situation, and the market can take everything you own.

One of the many contradictions of trading is that it offers a gift and a curse at the same time. The gift is that, perhaps for the first time in our lives, we're in complete control of everything we do. The curse is that there are no external rules or boundaries to guide or structure our behavior. The unlimited characteristics of the trading environment require that we act with some degree of restraint and self-control, at least if we want to create consistent success. The structure we need to guide our behavior has to originate in your mind, as a conscious decision that will guide your actions.

You Need Rules

Almost everyone who is interested in trading resists the idea of creating a set of rules. The resistance may be subtle, but it’s still there. People may agree that rules make sense, but most have no intention of consistently following logical rules. Why?

Most of the guidelines we live by was given to us as a result of our upbringing and is based on choices made by other people, like our parents, relatives, teachers, or friends. Our guidelines were instilled in our minds but did not originate in our minds. This is a very important distinction. In the process of instilling structure, many of our natural impulses to move, express, and learn about the nature of our existence through our own direct experience were denied. Many of these denied impulses were never reconciled and still exist inside of us as frustration, anger, disappointment, or guilt. The accumulation of these negative feelings causes may people to resist anything that keeps us from doing whatever we want, whenever we want to.

It may seem odd, but the very reason we’re attracted to trading, (the unlimited freedom of choice and decision-making inherent in trading), is the same reason we feel a natural resistance to creating the kinds of rules and boundaries that can appropriately guide our behavior.

The need for rules may make perfect sense, but it can be difficult to generate the motivation to create these rules when we've been trying to break free of them most of our lives. It usually takes a great deal of effort to break down the source of our resistance to establishing and abiding by a trading regime that is organized, consistent, and reflects prudent money-management guidelines.

You Have To Take Responsibility

Trading can be characterized as a personal choice with an immediate outcome. Remember, nothing happens until we decide to start; it lasts as long as we want; and it doesn't end until we decide to stop. All of these beginnings, middles, and endings are the result of our interpretation of the information available and how we choose to act on our interpretation. Now, we may want the freedom to make choices, but that doesn't mean we are ready and willing to accept the responsibility for the outcomes. Traders who are not ready to accept responsibility for the outcomes of their interpretations and actions will find themselves in a dilemma: How do you participate in an activity that allows complete freedom of choice, and at the same time avoid taking responsibility if the outcomes of your choices are poor?

The reality of trading is that, if you want to create consistency, you have to start from the premise that no matter what the outcome, you are completely responsible. Not the market, not the economy, not world events – you.

The way to avoid responsibility is to adopt a trading style that is, to all intents and purposes, random. Random trading can be defined as poorly-planned trades, or trades that are not planned at all. Random trading is an unorganized approach that doesn’t allow you to find out what works on a consistent basis and what doesn’t.

Randomness is unstructured freedom without responsibility. When we trade without well-defined plans and with an unlimited set of variables, it's very easy to take credit for the trades that turn out to our liking, because in our minds we used some kind of method, however poorly defined. At the same time, it's very easy to avoid taking responsibility for the trades that didn't turn out the way we wanted, because there's always some variable we didn't know about and therefore couldn't take into consideration beforehand.

If the market's behavior were truly random, then it would be difficult if not impossible to create consistency. If it's impossible to be consistent, then we really don't have to take responsibility. The problem with this logic is that our direct experience of the markets tells us something different. The same behavior patterns present themselves over and over again. Even though the outcome of each individual pattern is random, the outcome of a series of patterns is consistent and statistically reliable. That may seem like a paradox, but it’s a paradox that can be overcome with a disciplined, organized, and consistent approach.

Many traders spend hours doing market analysis and planning trades for the next day. Then, instead of making the trades they planned, they do something else. The trades they make are usually ideas from friends or tips from brokers. By making unstructured, random trades, they are able to avoid responsibility.

Why? When you act on your own ideas, you put our abilities on the line and get instant feedback on how well your ideas worked. It's difficult to rationalize away any unsatisfactory results, since they’re the direct results of your effort, logic, and ideas. On the other hand, when you enter an unplanned, random trade, it's much easier to shift the responsibility by blaming your friend or broker for their bad ideas.

The nature of trading itself also makes it easy to escape the responsibility that comes with creating structure in favor of trading randomly. Any trade has the potential to be a winner, whether you’re a great analyst or a poor one, and whether you do or don't take responsibility. It takes a lot of effort to create and follow a disciplined approach that will make you a consistent winner. It's very easy to avoid the mental work required to follow a disciplined, logical approach… and that’s why most people do.

You Have To Be In Control

Most of us are brought up so we'll function well in society, so we've acquired thinking strategies for fulfilling our needs and desires that are geared toward social interaction and acceptance. We don't just take what we want – we take other people into consideration, too. Not only have we learned to depend on each other to fulfill our needs and desires, but in the process we've acquired many socially-based techniques for assuring that other people behave in a manner that is consistent with what we want.

The markets may seem like a social endeavor because there are so many people involved, but they're not. While we may have learned to depend on each other to fulfill basic needs, the market environment is different: it’s every person for themselves.

Not only can you not depend on the market to do anything for you, but it’s extremely difficult to manipulate or control anything that the market does. If we've become effective in our personal lives at fulfilling our needs and desires by learning how to control and manipulate our environment, but as traders are in an environment that does not know, care, or respond to anything that is important to us, what does that mean? It means we’re in control.

One of the principal reasons so many successful people have failed at trading is that their success is partly attributable to their superior ability to manipulate and control their social environment. To some degree, all of us have learned or developed techniques to make the external environment conform to our needs and desires. The problem is that none of those techniques work with the markets. The markets don’t respond to control and manipulation, unless you're a very large trader.

However, we can control our perception and interpretation of market information, as well as our own behavior. Instead of controlling our surroundings so they conform to our idea of the way things should be, we can learn to control ourselves. Then we can perceive information from the most objective perspective possible, and structure our mental environment so that we always behave in a manner that is in our own best interest.

"What Takes Some Successful Traders A Lifetime To Achieve Could Take You Just A Few Days... Or Less!"

Get these reports for free

Advertorial 1 - Introduction
Advertorial 2 - The Basics of Analusis and Rational Trading
Advertorial 3 - Basic Principles
Advertorial 4 - Characteristics of Successful Traders
Advertorial 5 - Playing to Your Strenghts, Overcoming Your Weaknesses
Advertorial 6 - Winning Psychology
Advertorial 7 - Avoiding Common Pitfalls
Advertorial 8 - Sound Money Management
Advertorial 9 - Trading Systems
Advertorial 10 - Final Words


PLC that advertise on Adsense 1

I have discover the following Infrastructure and contruction company that are advertised on Google Adsense:

1) Integrax BHD - a port operator operate Lumut Port in Perak. Integrax has a 100 per cent stake in Pelabuhan Lumut Sdn Bhd and a 50 per cent minus one share stake in Lumut Maritime Terminal Sdn Bhd

2) Gopeng BHD - Gopeng Bhd own some shares in cement manufacturer Perak Hanjong together with YTL Group. Sunway Group which purchase a substantial share in Gopeng Bhd before Asia financial crisis at higher price, belief to be still holding the shares at the moment.

3) Ekovest BHD - Ekovest Bhd hold a second board company Pembinaan Limbongan Setia Bhd (PLSB) which manage Danga Bay Waterfront project in Johor.

4) Pati SDN BHD - The company is a wholly own subsidiary of UEM Builders Bhd. Previously, 50% of Pati SDN BHD hold by Road Builder Holdings Bhd together with UEM to bid for highways project from Renong Group. Road Builder Holdings Bhd initially like to list the company under second board of KLSE. Like Propel Bhd, which is also under Dato Chua, founder of Road Builder Holdings Bhd. However, when KLSE increase the minimun requirement on listing on second board. The company has to put such plan on hold. When the company under to get further project from UEM group. They dispose off its stake to UEM eventually.