Economic turmoil

My job requires me to constantly read and source for written articles on the property market as well as the economy (being that the performance of the property market is always directly linked to a nation's economy).

And I stumbled upon this brilliantly-written article by none other than our very own TDM.

I may not be a good economist, and I may not be able to ask the right questions to determine if what TDM writes is merely an old datuk's paranoia. But I do know that what he wrote made sense to me. And I suddenly felt this fear. I hope that TDM's analysis is very wrong and our current leaders (morons as they have proved to be) are very right. I hope hard.

So that you can feel ice running down your spine, here are some snippets from TDM's eye-opening article :

1. This ability to isolate Malaysia and Malaysian banks from the effect of the bankruptcies of all the biggest banks in the world must be regarded as a miracle.
2. The United States and Europe are among the biggest of our trading partners. Roughly 40 per cent of our total trade is with them. I may be wrong but I believe that if our buyers cannot pay for what they import from us, we would not make the profit we had expected.
3. It is believed that unpaid credit card loans is in excess of RM20 billion.
4. We are told that six billion Ringgit in Foreign Direct Investment would flow into the country. But what about the RM30 billion outflow as foreign investors pulled out of the stock market?
5. I pray that I am wrong. I pray that the Government is right in declaring that the whole world may collapse but we would be the only country which won't. We will sail calmly through the seas of shattered economies.
6. Instead of doing business in goods and services they now do business in money, in fictitious money.
7. If you ask yourself where do the US700 billion Dollars come from when you know the United States' Government has to borrow US1.5 billion every day, you will find no answer.

It is scary because everyday the newspapers report our various Ministers proclaiming that our economy is strong, our reserves are huge, etc etc. The recent immediate flip-flop on the "bank guarantee policy" is enough to show that our Oxford-educated Finance Minister does not really know what he's doing.

I hope the government is merely releasing such encouraging statements only because they want us to remain calm, and that behind the curtains, the government is actually taking severe measures to safeguard our country. I hope the government is smarter than they make themselves out to be. I hope this will not be the 50-year Great Depression as the chain mails are making it out to be.

UPDATE 15:41 - Najib has announced today that the government will borrow RM5 billion from EPF to fund government investment agency Valuecap Sdn Bhd which primarily invests in undervalued blue-chip stocks in KLSE.

Why, oh why, are my alarm bells ringing? All our hard-earned money used to play shares in the share market during a period of free-falling markets? Pls, can anyone explain to the economic bozo in me why this RM5 billion will help "boost the economy and protect Malaysia from the effects of global financial turmoil" instead of putting us on a speed-train straight towards it?

And on another note, but still on our favourite protagonist (or is it antagonist?), when asked on whether the government's cost-cutting includes the controversial Eurocopters, he says : "All projects will be reviewed but defence projects are to be assessed differently. We are looking at all projects, not just defence projects. Security projects cannot be measured on the economic yardstick."

The question of WHY begs to be asked. But, we already know the answers don't we. Whose pockets are brimming?