Malaysian Atheist

An avowed atheist living in Malaysia.

Sunday, March 04, 2007

Happy Chinese New Year!

Hello folks. Sorry for the hiatus. I miss blogging, I really do. I hope to write as much as possible here. Let me first say Happy Chinese New Year! Gong Xi Fa Cai! It's a bit late, but today is Chap Goh Mei, the 15th and last day of the Chinese New Year (CNY) celebration.

Let's see, what happened recently? Well, just last week, the KL Composite Index (KLCI) fell 5 days in a row and lost over a hundred points, wiping out over RM 100 billion in market cap. This was caused by the drop in China's stock market, triggering a worldwide contagion effect. People are saying the market crashed, it's the 10 year jinx - the 1987 crash, the 1997 crash and now the 2007 crash. Well, I don't know. I don't like to speculate but I don't think this is a crash, it's merely a correction. The stock market has been inching up since December last year and an 8% drop like this one is just a correction that is bound to happen. Plus, this time around, the bull run is backed by generally healthy corporate earnings.

The funniest thing for me though, is that just before the drop, our Prime Minister, Mr. Badawi told the Malaysian public to invest in the stock market and help push it past it's all time high. I do sympathize with those who listened to Mr. Badawi's call, but my question is this: What business does a Prime Minister have in asking the people to buy stocks? As far as I know, no other leader from any other country tells its people to buy into the local stock exchange. To the uninformed public, it is like asking them to gamble away their savings. Imagine your country's leader asking you all to hit the casino so that you can make an extra few bucks!

Mr. Badawi should know the power of free markets. If the country is run properly, the currency and the economy well-managed, then we will see healthy economic growth. When there is healthy growth, people will have confidence in the economy. When people are more confident, they will invest in the economy. There is absolutely no need for the PM to tell people what to do with their money. He should just concentrate on doing his job.

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