Mullings of a lunatic

So, the other day I was speaking to Jai about the current economic crisis and he asked me, "How long do you think this crisis will persist." Now as a person who has thoroughly believed that America was on the way to recession way back when 'leading' American financial eggheads *who may have been pressured externally* where proudly proclaiming that the subprime mortgage and the credit crunch wasn't a problem and will just go away if they were to close their eyes and wish it away... Right..

The thing is that, although America is the source of this economic crisis, the rest of the world has been feeling the brunt of this crisis. Just look at the exchange rates and the way the stock markets world wide have been progressing, the Nikkei is at a 26 year low, the british pound is at its weakest since the 1997 asian economic crisis and Malaysia, although already rife with a degree of political instability that would've escalated to civil war but hasn't because of the civility and maturity expressed by the bigwigs and regular rakyat.

Which brings me to the topic of home, Malaysia's cash cow is its high grade crude oil, so naturally one would assume that with the drastic increase in oil price which we saw last year that the rakyat would reap the benefits no? Contrary to what you would expect, the rakyat in general saw nothing of the record profits which Petronas posted last year, *with the small exception of the handout that it gave to the government*. Infact what the government did was to throw Malaysia's shielded economy into disarray. Remove the oil subsidies they say, it'll be alright they say...... I mean sure, it could've been worse, but for a country where baseline pay for uneducated labour is anything from 600 ringgit to 1100 ringgit depending on the job, it was badly handled.

I'm not saying that the reduction of fuel subsidies was bad, the idea was good, infact I applaude the move to remove the subsidies, Malaysia has been shielded from real world economics for too long and its about damned time that the rakyat know that there is a world outside Malaysia and that there are speculators and doom mongers there are out there to profiteer off fear and distrust. No, the thing I didn't like was how it was handled, how the government made a statement in May on how the subsidies would be lowered in August, only to remove it a couple of days later.

Some say this was a good move, that it prevented the greedy uncouthe profiteers from stockpiling petrol, and that it's better to make a snap decision because it'll soften the blow of inflation. Whatever the reasoning behind it, it's probable that it was sound and logicly thought off but the lack of transparency was the main reason for alot of the noise which was made by the rakyat and the opposition.

Its a sad fact that politics and economics go hand in hand and that the results of the elections in march is causing the incumbent bigwigs to panic and start acting in a questionable manner by incarcerating opposition figures under the ISA. This only exasterbated the situation which translated to economic wobbliness.

--==to be continued==--