The title today actually reflects how I think our current government makes their decisions. When they announced that we will stick to the 30cents subsidy for petrol, they were thinking very short term. Now, instead of subsidizing 30 cents, we end up subsidizing the goverment with our hard earn money. Now, why do I say the solution was short term thinking? They only thought of a solution for high fuel price, eg above USD80, but they never thought what will happen when the price of fuel drops.
What if fuel price drop up to the level that our fuel price is only 30cents per litre? Does this mean free petrol for us? Obviously not…. so now, Najib is trying to slow down the loss of income from the low fuel price… get the people to pay the government’s bills…. bring down the fuel price slowly, shouldn’t it be done based on biweekly average of fuel price. We the people don’t mind paying more when the fuel price increases so long as when it drops, they honour the drop and allow us to have cheap oil. Imagine, this is only on crude oil…. what about palm oil price (CPO), etc… when the price of CPO is high, they enforced windfall tax, but when the price of CPO has gone low, do you think they will subsidize the loss?
I’m really interested to see how Malaysia manages this e-crisis. If you observe properly our current share market, I think the government is pumping in money into the KLSE market to dampen people’s fear… when the world’s market crashes badly eg 5%, we only drop by 0.5%, and when the world market goes up by 5%, we drop by a small amount, eg. 0.01%. This just shows that when world market crashes, our government buys in to control the situation and when other stock exchange increases significantly, our government tries to sell what they bought earlier, as people will go buy into the market thinking that KLCI will go up. This can’t go on forever…. so its a matter of time before Malaysian market drops below 700 points… my prediction still stays, 600 points by end of Q1 next year
. Why do I say this, right now in the US, the banks are only seeing lots of bad debts from home owners, individual persons, imagine when the corporate bad debts start to come in next year…. banks will close down.
Oh yea.. and nothing is impossible at this time, I remembered a time when I spoke to a friend, and he said that when CITIGROUP reduces to USD20, he is going to buy in … now its USD3.77.