Economic Impact Of H1N1 Should It Worsens

There is some genuine concern now over the H1N1 virus. Fact, this is nowhere as deadly as the H5N1 which ravaged HK and most of Asian economies. H5N1 has a mortality rate of 58%, while the newer strain is not as deadly. There is sufficient antiviral for the new strain unlike the scramble for H5N1. Experts predict that during a pandemic up to 30% of the global workforce could either be off work due to sickness or stay away due to fear. Absence levels at the expected rates would cause severe problems. The economic impact of H1N1 is more global tha H5N1. If conditions worsen, the impact will initially appear in two primary aspects of business. The first will be the availability of the workforce, the second and more unique impact will be in the market place.

Left unchecked, real estate values would be slashed, bankruptcies would soar and the insurance industry would be decimated. Naturally airlines would be one of the most directly impacted, followed by the tourism sector, in particular economies that are heavily dependent on tourism such as Australia, Thailand and HK.

Business are better prepared nowadays, especially in Asia. Many have planned for workers to work remotely from home where possible. More indoor time will naturally slow the flow of money and the service industry will be affected as well.

How the businesses will be affected will depend on how long the impact will last. If the fear conditions persists, we could see about 20%-50% of revenue for most companies being affected if high-alert persists for at least 6 months. During such an extended high-alert period, its best to stay cashed up, pay down all bills and reduce your leverage. Not a time to buy a property.

Hence property developers will be back to where they were 9 months ago if the high-alert conditions were to worsen further. The trade for livestock will again take on a highly protective shield.

What businesses can do is to have contingency plans: do you already have surgical masks at work for staff who may be coughing or seems to be slightly sick; do you have plans to get staff to work remotely from home to sustain the on-going critical services; do you have plans when only 50% of your staff is available; what about 30%; etc.

While the current strain is not as devastating, the entire issue could snowball into extreme fear and crushes confidence - not good for any economies at this juncture of recovery. We are not there yet, but one should know what precautions to take, and how to cash out properly and swiftly when things take a turn for the worse.

p/s photos: Kim Ah Joong

China's Growth Sustainable???

China has led the way by asking its banks to loosen the lending taps, and that has been reflected in the broader economy. China is an important export market for most of the smaller Asian countries. China's stimulus plan is a huge kicker, and the country has begun to stockpile a lot of soft and hard commodities. The black spot is that the easy credit has seen outstanding balances on credit cards more than doubled in the most recent quarter. Can China continue on its merry ways to lead the way to stimulate the rest of the world out of the recession?

• China's economy seems to have re-accelerated from the lows of Q4 2008 and Q1 2009 helped by significant government investment and credit extension. While exports continue to deteriorate, reducing the trade surplus, government investment has surged and consumption influenced by government investment is holding up, suggesting that that the Chinese economy may grow at a faster pace in Q2 and Q3 2009 than the 6% rate at the beginning of the year. However in the absence of new external demand and limitations on domestic demand, there is a risk of developing over capacities.
• In April 2009, many private sector analysts began scaling up 2009 estimates to the 7-8+% range from 6-7% range following the investment and lending surge and suggestions that the Chinese economy might be bottoming out. Now forecasters like the world bank are also doing so, if more cautiously.
• World Bank: very expansionary fiscal and monetary policies have kept the economy growing respectably with the country likely to experience a 7.2% growth rate for all of 2009. But China may not grow in the high double digits until the global economy recovers. Market based investment will lag, and despite resiliency, consumption will slow, meaning that the boost to growth may not carry through to 2010.
• In Q1, China's real GDP growth slowed to 6.1% y/y, the slowest in more than a decade and the seventh consecutive quarter of deceleration. Growth slowed to 6.8% in Q4 2008 from 9% for 2008. Several indicators (investment, stabilizing Manufacturing sector, robust consumption) began to show improvement by March 2009, indicating that the growth may accelerate in Q2-Q4 09 from the very weak pace and near stall of end 2008/early 2009.
• In Q1, Government stimulus boosted investment and consumption holding up despite a fall in real incomes. final consumption, investment and net exports contributed 4.3, 2.0, and -0.2 percentage points to GDP respectively.
• Goldman: More aggressive policy stimulus and stronger domestic demand response than previously expected suggests a growth will be 8.3% (previous estimate 6%) in 2009 and 10.9% in 2010 (9%) policymakers will eventually normalize and shift away from aggressive policy loosening, when they are more assured of a stabilization in domestic unemployment and external demand, giving additional insurance to the growth trajectory.
• The recent flood of credit-fuelled (and government-led) investment has staved off an economic collapse that might have sent unemployment surging and damaged the confidence in China's growth trajectory that is so important to its development prospects. However, it is a huge leap to go from this short-term success to declaring China to be out of trouble and back on the road to double-digit growth.
  
• Morgan Stanley: On a seasonally adjusted basis, the economy experienced a 5% rebound in Q109, after the first qoq contraction (-0.5%) in almost eight years. The aggressive policy stimulus should bring about further recovery in H209, making China among the first to emerge from the global downturn. The recovery should be relatively ‘job-rich’ but ‘profit-deficient’, especially in H109, with those exposed to government-supported capex programs likely benefiting most.
• BNP: In Q1, GDP rebounded as a result of the fiscal stimulus and the most expansionary monetary stance since 1997. Household demand for property and autos is rebounding while the credit surge is boosting fixed asset investment meaning China will achieve GDP growth of 7.7% in 2009.
• Citi: After seasonal adjustment GDP growth actually rebounded to 5.3% annualized in Q1, compared to 0.9% growth in Q408. The aggressive expansion in credit and investment seem to bank on a substantial rebound in final demand, or run the risk of greatly increasing overcapacity.
• HS: Given the prevailing external environment, it would still be a severe challenge for mainland China to achieve its 8% growth target this year and officials need to have exit strategies to prevent credit and money supply from expanding too rapidly to jeopardise future macro-economic stability.
• Even with the stimulus, China’s overall economic growth is likely to decline to around 5% in 2009. Although the country could potentially sustain higher growth, the poor outlook for exports over the next two years severely limits any quick recovery.
  
• ADB: Little evidence that China is rebalancing away from investment-led growth, but it is shifting investment sectors. Risk of entrenched inflation and overheating in some sectors

p/s photos: Zhang Xin Yu

Jim Rogers Views Summarised

I don't have a terribly high opinion of Jim Rogers. Big picture guys can take a terribly long time before they are proven right - my adage, if you are bearish or bullish long enough, you will eventually be right. The following is an updated piece on Jim Rogers' views by Market Folly:

Rogers has opinions on a vast array of topics so we'll just dive right in and try to present the updates as orderly as possible. Firstly, we want to start with the topic of the crisis in general. Obviously, Rogers thinks the United States and the U.K. are in bad shape and will be for some time. He likens the current situation to that of the 1930s. He says,

In the 1930s, we had a huge stock market bubble which popped. And then politicians started making many mistakes. They became protectionist. They made solvent banks take over insolvent banks and then both banks failed in the end. They are making many of the same mistakes now. What's different this time is that we are printing huge amounts of money which they did not print at that time. So, we are going to have inflation this time.

While the current crisis is unique in its own right, it does have shades of the 1930s written all over it. As such, Rogers focuses on inflation a lot and we'll get to that below.

Agriculture

Rogers still likes agriculture and thinks it will be one of the best investments in our lifetime. He says so under the premise that the world is growing and so are the number of mouths to feed. The economic emergence of countries that previously did not enjoy protein heavy diets have also spurred this trend on. Add into the equation the fact that supply is not necessarily growing to match demand, and you could have a real imbalance in the future. As such, Rogers likes agriculture and specifically farmland.

In the past, we've covered the farmland investments he has made and have elaborated on his thoughts. His main active investments are in Agcapita Farmland Investment Partnerships (in Canada) and Agrifirma Brazil. His bullishness on agriculture comes down to a simple supply and demand equation imbalance. Food inventories are at multi-decade lows and this is without a ton of major droughts or weather problems. Not to mention, there is a shortage of actual farmers (and not to mention farmland) and Rogers says this can be attributed to the fact that it has been a horrible business for the past 30 years. To see more of his thoughts on this topic, see our post about Rogers' extreme bullishness on agriculture.

Currencies, Commodities, and Bonds (Inflation Theme)

On the topic of currencies, Rogers has varying opinions as each currency is its own equation. Recently, he has been out saying that he owns the Chinese renminbi and he likes to add to his position every chance he gets (as he cites the difficulty to buy and sell the currency due to it being blocked). While he still has some US dollars due to being a citizen, he has sold nearly all of his holdings in the currency and sees serious problems developing. Overall though, he sees a currency crisis looming due to the amount of money governments around the world are printing. He sees the U.S. dollar as a flawed currency and thinks it could be the source of the currency crisis. He explains saying, "I would suspect that somewhere along the line, someone's going to say, 'I'm going to start selling mine (dollars) before everybody else does.' That's when you have a currency crisis."

While he has focused largely on the U.S. dollar, he has often remarked that the British Pound could have major issues as well. We found it intriguing that Rogers has repeatedly focused on the possible currency crisis scenario in his appearances. He has gone as far as to say that sovereign defaults are not out of the question. And, he would not be alone in that regard. Kyle Bass, manager of hedge fund Hayman Capital agrees and predicts sovereign defaults will be the next crisis. Bass is well known for predicting the housing crisis and profiting handsomely (along with John Paulson as well). To back up claims for possible sovereign defaults, Rogers highlights the U.K. in 1918 as it transformed from world power to a nation wrought with default in 1970. Additionally, he talks about how Iceland has already defaulted too. He thinks we could possibly see more defaults between now and 2011.

Commenting on the government's actions, Rogers says

It's a mistake what they are doing. It's giving short-term pleasure, but there's long-term pain as we are going to have much higher inflation, much higher interest rates and a worse economy down the road.

Clearly, Rogers likens the current scenario to placing a bandaid on a gunshot wound victim and calling everything 'good.' Short-term solutions do not solve long-term issues. He cites this with evidence of the bond market already beginning to taper off and he thinks this will continue as the government sells a ridiculously large amount of bonds. This can be boiled down to one simplistic notion: when governments print a lot of money, you get serious inflation. At least, that's how Rogers sees it.

As such, Rogers does have one recommendation to benefit from this possible impending phenomenon: Buy commodities. As fiat money depreciates in value and inflation rises, assets (and namely commodities) appreciate in value. He thinks that commodities could lead the global economy out of this mess and even if that doesn't happen, they will still appreciate due to inflation. In terms of specific commodities, Rogers likes cotton, sugar, as well as silver.

Gold and Silver

While we could technically lump his gold and silver commentary in the commodity section, we felt it deserved its own section due to his views on the precious metals. Overall, Rogers likes gold and has no plans to sell his. In fact, he could be adding to his position should the right circumstances pop up. He says,

The fact is that the IMF is trying to get permission from everybody to sell gold. I don't know if it will succeed or not. But if and when the IMF sells its gold, gold prices may go to a bottom. Who knows? It may go down to $700. The IMF has a lot of gold to sell. If it does, I hope I'm brave enough and smart enough to buy more.

So, he likes gold. However, he likes silver even more right now due to it being cheaper on a historical basis since everyone has been piling into gold and driving up the price. Reverting to the topic of currencies quickly, we know that Rogers also thinks the debate on a new international reserve currency is a legitimate one. He thinks change is coming in this regard and he is not alone in those thoughts. Noted trader Dennis Gartman sees gold becoming the next reserve currency.

Short Positions

Rogers says it is rare for him not to have many short positions and so this definitely classifies as a 'rare' time for him. Derived from his stance on currencies, he hardly has any short positions at the moment due to the amount of paper money governments are throwing at the crisis. He thinks that a currency crisis is imminent and that investors should avoid shorting the market. Rogers says, "I'm afraid they're printing so much money that stocks could go to 20,000 or 30,000. Of course it would be in worthless money, but it could happen and you could lose a lot of money being short." As such, Rogers is not fighting the current trend and will pick his battles.

(Do note that Rogers tends to exaggerate things to make a point and we highly doubt he realistically sees the market hitting those numbers). He thinks the extended rally is nothing more than a bear market rally which could be further fueled in the near-term due to a weakening dollar and the Fed utilizing the 'printing presses' and printing more money.

China, India & Sri Lanka

While Rogers is bullish on agriculture and commodities in general, he is also bullish on select sectors in emerging markets too. Specifically, he has focused on water treatment. He notes China and India's water problems and he has bought water companies in China. He did not cite specific names, but we do know that Heckmann (HEK) has had a large presence regarding water in China, even if it is not right along the lines of what Rogers is referring to. He says that the Chinese are aware of their problem and are spending "hundreds of billions" to solve their agricultural problem. So, his bets on water treatment and agriculture are tied together.

When pitting the emerging market nations against one another, Rogers favors China over India. He does so because of the reforms and change that India requires to fully compete. While he likes the commitments coming out of India lately, he needs to see action rather than just pledges for it to become the next real big investment opportunity. Specifically regarding India though, he did say that he likes the prospects of tourism in that nation. While Rogers likes China, he has not added to that position since picking up shares back in October and November of last year. Instead, he is directing money toward commodities.

Turning specifically to Sri Lanka, we find out that Rogers really likes this nation as an investment because it looks as if the 30-year war is coming to a close. He cites numerous other examples of war-torn countries that have emerged successful after troubled times. Rogers highlights that there is significant opportunity at hand, and all it takes is hard work. He likes Sri Lanka as an investment more so than India, Pakistan, or Bangladesh.

Conclusion

As you can see, Rogers is very opinionated on a large set of topics and likes to think in macro themes. After all, this is where his successful background comes into play. He made a fortune running the Quantum Fund with George Soros using similar strategies. While the fund is now defunct, both are still active investors and are good to track for their macro methodology. Make sure you check out our past update on Rogers' portfolio to get a better idea as to what other positions he holds.

To conclude, Rogers thinks that the stock market will eventually hit new lows this year or next year after the bear market eventually subsides. He thinks that our problems remain largely unsolved and we have a whole lot of work to do in order to emerge from this mess. He thinks that the UK is potentially worse off than the US (because the US has agriculture to fall back on), but that the overall picture is still bleak either way. He thinks that moving to London in 1807 was brilliant, that moving to New York in 1907 was brilliant, and that moving to Asia in 2007 would be the next brilliant move. He clearly sees a shift of power to the east as the emerging markets (and particularly China) start to bloom. He sees Mandarin as the most important language in the world going forward and has already begun teaching his daughters.

Speaking on the global economy's future, Rogers draws from the past by saying,

Throughout history, the center of the world has shifted to where the capital is, where the assets are. You don't see any period in history where things are shifting to the debtors, and America's the largest debtor nation in the history of the world. Unless something's different this time, unless the world's changed very very dramatically, the center of the influence, the center of the power, the center of the earth, the center of the globe, is going to be shifting towards Asia, because that's where all the money is. Have you ever heard of anybody saying, 'Let's go to where all of the debtors are'? It just doesn't happen that way.

If you want to follow Rogers, then bet on inflation, agriculture, commodities, China, and bet against the US and the UK. For more on what he deems to be the best investment opportunities out there, check out Rogers' two books: Hot Commodities and then A Bull In China. We'll leave everyone with one last bit of advice from Rogers: become a farmer.

p/s photos: Li Rui Xi

Have Commodity Prices Run Ahead of Fundamentals?

Have commodity prices run ahead of fundamentals? Or is it that China has begun stock piling aggressively? Commodity prices have rallied since February on the belief that putative 'green shoots' around the world validated a V-shaped economic recovery in 2009. However, these 'green shoots' merely signal the stabilization of economic activity at low levels, rather than a return to trend growth. Even if GDP growth around the world has bottomed, growth will continue to be negative or sluggish until 2011. As such, commodity price gains are a false sign of economic recovery - like the recent spate of bear market rallies in stock markets. The strong uptrend in commodity prices has been propelled more by technicals (investment demand - arbitrage, opportunistic stockpiling at low prices) than fundamentals (real growth in physical demand and production). Commodity prices will likely snap back to reality before resuming a more moderate uptrend in line with a U-shaped global growth path:

• 2 factors to mitigate global slowdown impact on commodities: 1) Growth to continue to be strongest in EM economies whose consumption is most commodity-intensive and 2) Investment to raise production capacity takes time - investment cuts and delays due to lower prices may lead to supply crunch in the future
• Sectoral performance: Traditional sectors such as metals and energy remain fundamentally cyclical as they are more closely tied to industrial production than agriculturals. Agricultural commodities may outperform metals and energy due to less elastic demand and the increasing rarity of very good harvests

Review


• Mar 19 2009: Commodities surged the most this year, led by precious metals and energy, on speculation that the Fed's steps to revive the U.S. economy will spur demand for raw materials as a hedge against inflation. Silver jumped 13%, the most since 1979. Gold had the biggest increase since September, and crude oil topped $52 a barrel. Every commodity in the Reuters/Jefferies CRB Index of 19 prices climbed
• Worst annual performance: Reuters/Jefferies CRB Index of 19 raw materials fell 36% in 2008, the most since the gauge debuted in 1956, to 229.54. It rose to a record 473.97 on July 3, then dropped to the lowest since August 2002 on Dec 5
  
• Biggest 1-day drop since 1956: Sep 29 2008, Reuters/Jefferies CRB Index fell 21.35 points or 5.8% to 343.2 after the House voted against US bailout plan
• Steepest monthly drop since 1980: In July 2008, CRB Index fell 12%

Outlook


• Despite current correction, the secular trend remains upward due to tight supply/demand fundamentals. In the medium term though, focus will be on global slowdown, easing inflationary pressures, dollar recovery, and credit tightening - all bearish for commodities
• There is a risk that some commodity markets have decoupled from fundamentals. The fundamental outlook represented by e.g. stocks for aluminium, nickel and lead has not changed significantly in the last month. Demand for oil in the US is also still pretty weak. It seems that the commodity market has run a bit ahead of the fundamental picture. Both base metals and oil are quite vulnerable if we get a set-back in risk sentiment.
• Supply has been a big support for industrial metals. Demand destruction has led to a correction in energy prices. Agricultural prices have corrected significantly based on improved crop conditions and concerns regarding increased regulation of commodities markets in the US. Prospects for higher inflation has been muted by the correction in energy and has depressed the gold price
• There is only so much demand to accommodate price increases amid tightening in credit markets, falling asset prices and slowing nominal incomes. Maintaining the bull run in commodities in the face of sharply slowing US demand will require that decoupling theories hold

p/s photos: Fan Bing Bing

Tracking & Learning About VIX

VIX is an often quoted indicator, especially over the past 9 months, to say something about the volatility in the market place. A higher trending VIX implies a trend towards risk aversion, or higher fear ratings on all assets. Plenty of players are now looking at VIX as the most immediate indicator for sensing 'fear' in the market place. Those trying to get a forward reading will go as far as tracking the trades in VIX options. Last week's selloff in developed markets coincided with a sharp jump in VIX and a rapid run up in VIX call options, somehow that has dropped down again, as noted by Bespoke. As a rule of thumb, anytime the VIX appears to be headed north of 40, its time to exit all stocks, ... still just a rule of thumb.

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After settling nicely below the 30 level for about a week, the S&P 500 Volatility Index (VIX) jumped back above 30 earlier this week. Today, however, the VIX has dropped significantly below 30 once again down to 28.36. Earlier in the day it was down even more, but even as the market has moved back to flat, the VIX is still down quite a bit. As long as the VIX continues its downtrend, fears in the market are subsiding.

10 Things You Should Know About VIX by Bill Luby

Q: What is the VIX?
A: In brief, the VIX is the ticker symbol for the volatility index that the Chicago Board Options Exchange uses to calculate the implied volatility of options on the S&P 500 index (SPX) for the next 30 days.

Q: How is the VIX calculated?
A: The CBOE utilizes a wide variety of strike prices for SPX puts and calls to calculate the VIX. In order to arrive at a 30 day implied volatility value, the calculation blends options expiring on two different dates, with the result being an interpolated implied volatility number. For the record, the CBOE does not use the Black-Scholes option pricing model. Details of the VIX calculations are available from the CBOE in their VIX white paper.

Q: Why should I care about the VIX?
A: There are several reasons to pay attention to the VIX. Most investors who monitor the VIX do so because it provides important information about investor sentiment that can be helpful in evaluating potential market turning points. A smaller group of investors use VIX options and VIX futures to hedge their portfolios; and an even smaller bunch use those same options and futures to speculate on the future direction of the market.

Q: What is the history of the VIX?
A: The VIX was originally launched in 1993, with a slightly different calculation than the one that is currently employed. The ‘original VIX’ (which is still tracked under the ticker VXO) differs from the current VIX in two main respects: it is based on the S&P 100 (OEX) instead of the S&P 500; and it targets at the money options instead of the broad range of strikes utilized by the VIX. The current VIX was reformulated on September 22, 2003, at which time the original VIX was assigned the VXO ticker. VIX futures began trading on March 26, 2004 and VIX options followed on February 24, 2006.

Q: Why is the VIX sometimes called the “fear index”?
A: The CBOE has actively encouraged the use of the VIX as a tool for measuring investor fear in their marketing of the VIX and VIX-related products. As the CBOE puts it, “since volatility often signifies financial turmoil, [the] VIX is often referred to as the ‘investor fear gauge’”. The media has been quick to latch onto the headline value of the VIX as a fear indicator and has helped to reinforce the relationship between the VIX and investor fear.

Q: How does the VIX differ from other measures of volatility?
A: The VIX is the most widely known of a number of volatility indices. The CBOE alone recognizes nine volatility indices, the most popular of which are the VIX, the VXO, the VXN (for the NASDAQ-100 index), and the RVX (for the Russell 2000 small cap index). In addition to volatility indices for US equities, there are volatility indices for foreign equities (VDAX, VSTOXX, VSMI, VX1, MVX, VAEX, VBEL, VCAC) as well as lesser known volatility indices for other asset classes such as currencies.

Q: What are normal, high and low readings for the VIX?
A: This question is more complicated than it sounds, because some people focus on absolute VIX numbers and some people focus on relative VIX numbers. On an absolute basis, looking at a VIX as reformulated in 2003, but using data reverse engineered going back to 1990, the mean is a little bit over 19, the high is just below 90 and the low is just below 10. Just for fun, using the VXO (original VIX formulation), it is possible to calculate that the VXO peaked at about on Black Monday, October 19, 1987.

Q: Can I trade the VIX?
A: At this time it is not possible to trade the cash or spot VIX directly. The only way to take a position on the VIX is through the use of VIX options and futures. On 1/30/09, Barclays Capital launched two new VIX ETNs that are based on VIX futures: VXX, which targets VIX futures with 1 month to maturity; and VXZ, which targets 5 months to maturity.

Q: How can the VIX be used as a hedge?
A: The VIX is appropriate as a hedging tool because it has a strong negative correlation to the SPX – and is generally about four times more volatile. For this reason, portfolio managers often find that buying of out of the money calls on the VIX to be a relatively inexpensive way to hedge long portfolio positions. Similar hedges can be constructed using VIX futures.

Q: How do investors use the VIX to time the market?
A: This is a subject for a much larger space, but in general, the VIX tends to trend in the very short-term, mean-revert over the short to intermediate term, and move in cycles over a long-term time frame. The devil, of course, is in the details.


p/s photo: Cristine Reyes

Important View On Maids Issue

me said...

i take it mr salvatore doesn't have a maid, or at d very most, is living off d help of parent's maid. Is that a generalization? Perhaps in d same way that u r generalizing. by not letting them roam d streets on weekends, where they r susceptible 2 all imaginable n unimaginable temptations, we r not treating them as family? we r putting them in inhumane work environment? how fast n how easy we humans conclude. forget that we buy things 4 them when we go holiday, ignore d fact that we constantly worry abt whether they hv enuf 2 eat, nevermind all other good things that happen in each household, that we let them hv mth long holidays n laden them wth all sorts of gifts n gold when they go. Scratch that you schedule in some rest time 4 them n worry about over-working them even when u don’t. cancel out everything, simply becos of 1 thing; they don’t get 2 go out on weekends. apparently if you don't let them go out, they r worth less than a human being n it negates all other gd things you do 4 them n d ways you care 4 them? not being able to go out on weekend n suddenly they r being treated so worthless? is this too extreme a generalisation? 1 point agst 100 others. human relations r based on more than 1 factor. but we only see what we want 2 see, don’t we?

it is only a practical solution in d view of the current situation we r faced with, with no protection to employers. perhaps u have not faced with maids sneaking out in d middle of d night 2 hv affairs even when they r not suppose 2 go out? perhaps you hv not had things go missing, even when you hv left them in yr own living room, in broad day light. maybe maids sticking themselves with coathangers in toilet in toilet to abort themselves n then bleed uncontrollably. how abt maids having friendship network so extensive n friends/ ppl trying 2 get all types of info fr them, latching on 2 any n every male worker that enters d house in a most pathetic manner, EVEN when they r not suppose to go out. i could go on and on, but perhaps it's tiresome n u get the idea. the problems exist even with our pathetic supposedly-practical solution at d moment, can u imagine d mayhem if they r allowed 2 mix n roam d streets? they already do not show maturity in d way they handle themselves, r we suppose 2 give them more freedom? if it was your child behaving so irresponsibly, wld u let them do as they please n stay out? How then, are we not being equal? and don't forget, even if you treat them like family, they r not your flesh and blood and do not have to listen 2 your teachings, no matter how u stamp yr feet/nag.

talk about human equality all you want when it doesn't burn too close too home, but it makes u a hypocrite. there are maids out there that may plan 2 rob u when influenced, those that bring men over in yr bed when u r not home, those that wear yr clothes n hook up with any man. exaggerating? i only wish.

When they run off, agents n govt don't care. they hv contagious disease, despite medical check that they r supposed 2 hv undergone, they get pregnant, ntry to abort themselves, leaving themselves half dead n u hv 2 send them 2 hospital, they catch aids fr their roamings, they steal yr things, sell them, d agents n gvt don't care. we r seen as d evil party simply because this is our only choice of protection. When d law doesn’t protect us, don’t strip us further of our protection.

If it’s so tedious, don’t get a maid? Speak when you walk a mile in other’s shoe. Judge only when you have actually lived it.

2:04 PM

Salvatore_Dali said...

Mr. Me,

Thank you for yr posting from the other side. I think yr points are very valid, and if I had implied that "not giving the maid the day off" as being cruel or inhumane, I was wrong, I apologise.

I have had 3 maids before. So, not a hypocrite.

I guess I need to tweak my posting somewhat, but yr points are very valid, I must say. Thanks for sharing.

2:10 PM

p/s photo: Michelle Yip Shuen

Maids Issue

The maids issue has made the headlines again. Do we have to go through the same issues each time? Its always the same issues on both sides. Let's look at the areas we can agree on:

1) Bad employers are few, relative to the majority.
2) Bad maids are few, relative to the majority.
3) Some employers mistreat the maids - physical and mental abuse, over working them, putting them to do dangerous tasks, wtf are those employers who ask their maids to clean the outside of the windows when they are staying in condos???
4) Some maids do behave irrationally or may steal or "hurt" the kids / old people when left alone in the house.

While we all may be surprised that the majority of employers are against giving the maids the day off per week, it is understandable. Many fear that the maids may get involved with new boyfriends, and/or be made use by unscrupulous people to loot the employers' homes, or bring their boyfriends back to the house when the owners are out.

Its a reflection on reality triumphing over morals and human decency issues.

Its always so much easier to "put up stickers that you want world peace", but its so hard not to be pissed off with your neighbour's antics.

I believe all households that want to employ maids should ask themselves these questions honestly:
a) Who is the maid to you and your household? A helper, a worker, or someone who is a lesser human being.
b) How will you treat the maid? As part of your family, or purely a worker.
c) What kind of lessons in life are you imparting to your children by the way you treat the maid? Are your children learning that all people should be treated with respect, or that some people can be treated differently or with disdain? Are you teaching them that its ok to discriminate, or that some people are less "valuable" as a human being? Do you reprimand necessarily to the extent that your kids think that its ok to do likewise?

Maids are just people like you and me who are brought up in a less fortunate environment. How we treat our fellow human beings tells us a lot about the kind of person you are? All maids are someone's wife, mother and child... just like you and I. Sure, some may be not as smart, but thats not reason enough to treat them any less than a human being.

We should treat people how we want ourselves to be treated. Some might say that even after their best efforts, the maid can still be difficult. At least we should still set the right example - whether it results in a better relationship is secondary. We should not second guess our behaviour, if we treat people with respect and its not reciprocated, we at least did our part. Maids are not machines, they are just fallible like all of us. Do what you should do, the way your parents and religion brought you up. When people are nice and helpful, its easy to love them. When they are not, it means we should try harder.... if it gets really difficult, don't get a maid anymore.

We can ask for things to be in a certain way to protect our families, but we should also be mindful of what we are asking for to achieve that. There are basic human decency rules in our hearts and minds, there are worker's rights as well. Its very very difficult to leave your family and friends and maybe children behind for a few years to live and work in a foreign place. If one of your brothers or sisters is in that predicament, how would you want their employers to treat him/her. Its a very tough life, the more we embrace them and live as an extended family member, the better the conditions for all. You do not want to make life even more difficult, oppressive and deplorable by putting them in an "inhumane work environment".

If you honestly fail to answer these questions in the "right way", and you yourself know the "right answers"... you shouldn't really be having a maid.

Having said that, the rules are inadequate both ways currently. The employer does not get sufficient protection after paying hefty fees should the maid absconds or get pregnant, there needs to be better laws to allow for maids to be changed if things are not working out, without penalty. The maids also need better protection, there must be a unit to monitor or for abusive conditions to be reported so that they can be checked, investigated and rectified immediately.

The really superior human being is the one who knows in his/her hearts that everyone is truly equal.


p/s photos: the evergreen Cherie Chung Chor Hung is back in a recent commercial shoot

When Great Singers Sing Great Songs

The following video is from the 28th HK Film Awards Presentation where they did a tribute to great songs from Chinese movies over the years. Couldn't have picked a better pair to sing those songs in Jacky Cheung and Sandy Lam. Enjoy...

28th Hong Kong Film Awards Presentation 百年金曲 張學友 林憶蓮 【Full Version】 @ Yahoo! Video

Outlook For Ringgit For The Rest Of 2009

• Malaysia Ringgit (MYR) has appreciated 6% after hitting a low in early March taking the ytd losses to 1% as of May-end 2009
• March 3, 2009: MYR fell to the lowest level (3.725-3.735/USD) in 3 years due to weakening exports and foreign investment
• February 2009: To promote bilateral trade and investment for economic development, Malaysia's central bank and Chinese central bank established RMB40billion currency swap arrangement for 3 years
  
  Risks for ringgit in 2009:
• External balances: electronic and commodity exports are contracting at a sharp pace and the trend is likely to continue through 2010 with a sluggish recovery in 2010. Presently greater contraction in imports relative to exports is sustaining the trade and current account surpluses and forex reserves
• Easing capital flows: keeping interest rate on hold in April and May 2009 has helped reverse some of the past capital outflows. Rising bond issues at higher yields and sharia bond issues are a plus. But ratings downgrade due to increasing fiscal deficit can weigh on debt inflows. Impact on lower corporate earnings ad revival of risk aversion can weigh on stock market. A recession in 2009 and rising bond issues in U.S. (safer-haven) can be a negative. FDI is expected to fall over 50% y/y in 2009 due to decline in export manufacturing related capex
  
• Central Bank policy: In 2008, central bank was intervening in the FX market selling USD reserves to contain currency depreciation but in 2009 the central bank has been defending the exchange rate to support exports especially as reserves have also been declining. foreign exchange reserve stood at US$88bn as on 15 May, 2009 which is sufficient to finance 8.3 months and 3.8 times the short-term debt. Large forex reserves and external surpluses are a plus to deal with export contraction and any revival of capital outflows. Trend in USD and SGD will also be improtant determinants of movement in ringgit
  
• Since the central bank decided to keep key rate at 2%, USD/MYR is expected to be higher by the end of Q2 2009. But USD/MYR will be lower in H2 2009 as the economic situation is improving. But further stabilization in domestic and global economy is still necessary to guide USD/MYR around 3.45 by the end of 2009
• MYR continues to track the SGD and is expected to weaken against USD in mid-2009 due to anticipated resurgence in USD strength
  
• Declining forex reserves and depreciating SGD would put further pressure on ringgit
  
• Confidence of ringgit would be dampened due to increasing deficit on overall balance of payments, declining exports, outflow foreign capital, and expectation of further rate cut by central bank
• In 2009, ringgit would be weak against USD as the process of de-leveraging by international investors will continue to boost demand for USD
  

p/s photos: Hanako Takigawa

We Have A New Superstar In Zee Avi

Got introduced to Zee Avi, a Malaysian by the way ... I thought Joanna Wang was good, Norah Jones was flaming in the beginning but petered out just as quickly (maybe there was only 2 good albums in her) ... Well, Zee Avi blows both ladies out of the water. Zee Avi's haunting melodies, heavily textured and brooding vocals make for a stunningly reflective time just being mesmerised by her. Its like hearing her baring her souls, her insecurities, her nuanced yet effortless vocalisation ... in a class of her own.

Her debut album was out on Brushfire Records on May 19 2009... so you probably heard it here first.

Her song, Is This The End, should be #1 if she was born and raised in the US, somehow I think she will get there too. The song is soooo good....

Zee Avi - Is This The End @ Yahoo! Video

Some may categorise her as a folk singer much in the mould of Sarah McLachlan, but she is much more than that. Even when she is light and whimsical, she can attract you and charm you with her sincerity and nonchalance. A bit of trivia, her song "Monte" was featured in the second season finale of Private Practice.

Bitter Heart @ Yahoo! Video

You can also catch an exclusive performance of 4 songs from the album at www.youtube.com /zeeavi

Below was her interview with CNN on how she became a sensation via youtube:

LOS ANGELES, California (CNN) -- The famed Roxy Theatre in West Hollywood, California, is filled to capacity on a Wednesday night, and it's only 8:30 p.m. What kind of star could bring out this kind of crowd -- and at such an L.A. early hour?

Zee Avi posted her songs on YouTube and attracted the interest of a record label.

How about a Malaysian Internet sensation with a debut album that was released one day earlier?

Such is the buzz around Zee Avi, a 21st-century chanteuse in the most literal sense. Her spot-on Billie Holiday phrasing and honey-sweet voice would have had her entertaining in a café in the 1930s. In this era, she was discovered on YouTube by an indie rocker -- Patrick Keeler of the Raconteurs -- and is on Jack Johnson's record label, Brushfire, which has partnered with Monotone Records to produce her.

Avi's set of engaging acoustic offerings included an enthralling cover of Interpol's "Slow Hands," and was delivered with self-assurance and poise. In an interview two days earlier, she credited her parents and grandfather for inspiring her love of music -- sometimes through karaoke. "Got to love that," she says.

Avi, 23, also acknowledges the influence of her native Malaysia, which kept her open to new ways of thinking.

"It's a big melting pot of different cultures. We get a good mix of East and West," she says.

Her love of music -- and of the Malay melting pot -- is reflected in her debut album, "Zee Avi" (Brushfire Records). The album, which was released mid-May, fuses early 20th century American standards with modern sounds on songs such as "Kantoi" and "Just You and Me."

CNN spoke to the singer-songwriter just before the album's release. The following is an edited version of the interview.

CNN: You can hear influences on your album from a wide range of artists and eras, from Billie Holiday to Cat Power. How did all of that find its way to you?

Zee Avi: Music is universal. With the media and the Internet you can gain access to everything. By listening to many different types of music it gives me many ways to fuse it with my own [ideas] and then I play whatever comes naturally to me.

CNN: How did you develop a love for music and develop your particular style?

Avi: I think if it's in your blood, it's in your blood. If you love golf, then you would find which wood is good for this and which putter is good for that. It's a passion altogether. Same with music.

CNN: What made you want to put those songs on YouTube?

Avi: One of my friends missed my first gig. I played my first [original] song "Poppy." He's a poet and a writer and I wanted his feedback because I respect his work. So he said to send the song over to him.

I didn't know [how to send it], but I did have this webcam on my dad's laptop and one of those call center headsets. So I ended up putting it on YouTube and he watched and I said, "OK, I'm going to delete it now." He said, "No, let it nest there and see what happens."

I remember I got one comment and I was so happy (laughs). Then I put my second video up and got three comments. It just went on from there.

CNN: And you got a call from Monotone Records.

Avi: One of the guys who worked there messaged me on YouTube. He said, "Hey, we represent White Stripes, M.I.A., the Shins" ... and I went "gasp-gasp-gasp." He said they were interested in talking to me. Next thing I knew we had a rough draft of the recordings.

CNN: What would you be doing right now if there was no Internet?

Avi: What would ["Leave Britney alone!" YouTuber] Chris Crocker be doing right now? (huge laughs)

Before the music thing happened, I wanted to study creative writing and philosophy. When I put these songs on YouTube I certainly never meant it to be a marketing tool. I had no expectations of [what it became].

CNN: Musically, the album is almost wistful, but darkness permeates the lyrics.

Avi: Everybody has that side of their personality that they don't show anybody. Music is my outlet for that.

I also have a positive side -- let's not be a wet blanket. It's not my intention for a song to be [overly] emotive or anything like that. Velvet Underground's "Who Loves the Sun" plays a very important part in how I write songs. That song is very ironic. If you're singing along to that song, you're singing this happy melody but you're actually singing about someone with a broken heart. It's sarcasm too, in a way. It's made such an impact on me, like the fact that you can do that [with songwriting].

CNN: Where does the darkness come from?

Avi: Most of my songs are about relationships, and as anyone knows relationships aren't always sunshine and rainbows. Even when it's good sometimes it's bad. I try to capture the reality of it. It can be a fairy tale, but it doesn't always end up happily ever after. Fine -- prince marries princess and they live happily ever after. But what's "after"?

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Zee Avi's Background:

Zee Avi (born Izyan Alirahman, also known as KokoKaina). Zee Avi is just 23 but she’s an old soul. A huge talent in a petite frame bringing a universal message from the unlikely birthplace of Borneo, an ancient island east of Malaysia which remains an untouched, natural paradise, an apt description of her songs.

How Avi came to record her debut album in L.A., the first joint release from Ian Montone’s Monotone Label and Jack Johnson’s Brushfire Records, is a true 21st century tale of the way the Internet has transformed the music business and shrunk the globe in the process.

Born in the tiny town of Miri in Sarawak on the island of Borneo, Zee grew up near the South China Sea in a liberal, encouraging household where her father owned an energy consultancy. “I was bred to be a lawyer,” she says, but music was in her blood. Her father’s father sang and played double-bass, accordion, violin and guitar in bands.

At age 12, Zee moved from Borneo to Kuala Lumpur where she has been based since. At 17, Zee started locking herself in a room for hours on end to learn to play guitar. Guitar took a back seat for 4 years while she was studying fashion design in London. When she returned to Kuala Lumpur, she picked the instrument back up and began writing songs and performing with a band.

Zee began recording her songs on a webcam and posting them on YouTube for a friend to hear. “I remember getting so excited when there was one new comment from some random person I didn’t know… One read ‘I’m lost for words - I shall favorite it and ponder if that’s OK,’ ” which was written by Kris Rowley, a U.K. singer-songwriter with a YouTube following under the name Zzzzzzzzap. He began posting her videos on his site, which began a viral snowball effect.

The day before her 22nd birthday, Zee posted what she intended to be “my last video,” a holiday song, “No Christmas for Me.” By the time she checked her e-mail Avi had almost 3,000 messages including a slew of label offers. One email came from Ian Montone, who had been shown the YouTube clip by Raconteurs’ drummer, Patrick Keeler, prompting Montone to get in touch and offer to release her music on the Monotone Label.

Before she knew it Zee was on a plane to L.A. to record her debut with producer Robert Carranza at Brushfire’s Solar Powered Plastic Plant. “No Christmas for Me” was then featured on the holiday charity album, This Warm December, A Brushfire Holiday, Vol. 1.

With an eclectic pool of influences that range from such eccentrics as Cat Power, Regina Spektor, Leonard Cohen, Tom Waits, Jolie Holland, Daniel Johnston and Chris Garneau, to jazz greats Billie Holiday and Ella Fitzgerald, to classics like Velvet Underground and Led Zeppelin, this self-described “rock lover at heart” captures the dark, bittersweet qualities of romance with a crack left open for hope and optimism.

From the sensuous scat singing on “Honey Bee” to the sultry break-up song, “Is This the End,” recalling the existential longing of Peggy Lee’s “Is That All There Is,” Zee is hopeful of finding love, but equally aware of lurking heartache.

The songs on Zee Avi’s debut are about an outsider’s desire to belong and the tentative hope of moving on, filled with regret and loss, but boasting an impish, worldly wise sensibility.
“I tend to be a loner,” she nods. ” ‘Honey Bee’ is about a romance between two nonconformists who are different from the rest of the hive, and are trying to avoid the pressure to be like everybody else.”

“Just You and Me,” the first song she wrote on ukulele, has a ‘20s New Orleans swing jazz vibe.

“I get my melodic feel from the simplicity of classic jazz, people singing what they felt with straightforward lyrics and not too many harmonies,” Zee says. “Just a lot of honesty. I’m a girl of simple pleasures.

The elemental acoustic guitar of “Story of…” is enhanced with an Eno-like ambience that add to its shimmering quality, while “Poppy” is autobiographical “with a little bit of poetic license” that looks back at the demise of a two-year relationship.

“My stuff is pretty dark,” Zee admits. “Most of my songs are about the reality side of romance, outlets to vent my emotions.”

While her live experience amounts to playing gigs in Kuala Lumpur, Zee appeared this January on From the Basement, the U.K. TV webcast/broadcast that has featured Radiohead’s Thom Yorke, Damien Rice, the White Stripes and the Shins. From the Basement will also air on the U.S.‘s IFC Channel.

From Malaysia to Los Angeles, Zee Avi is enjoying the ride and ready to take on passengers. “I’m still pinching myself” she gushes. “My parents always told me it’s important to keep yourself grounded. I’m thankful, but at the same time, I just want to jump through the roof. It’s been a pretty amazing journey, getting to work with some really wonderful people, a blessing, really.”

Zee Avi’s Monotone/Brushfire Records debut returns that blessing…and then some.

Monotone Records is owned by Ian Montone, whose Monotone, Inc. manages the White Stripes, M.I.A., The Shins, Vampire Weekend, the Raconteurs, Against Me!, Cold War Kids, Crookers, among others.

Brushfire Records is owned by Jack Johnson and his manager Emmett Malloy and is home to artists like Rogue Wave, Matt Costa, Neil Halstead, Money Mark, G. Love, Mason Jennings, ALO and Zach Gill.

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My parting shot: actually she has been performing in many places in Malaysia ... but u know Malaysians la... until you get recognised by international quarters, you are still nothing when you are singing English songs in Malaysia. At least Zee's experience would now give a lot more confidence to Malaysian artistes singing in English ... and maybe international record labels will consider Malaysia as the "new Seattle" to discover new talent??!!

Fitch Downgrade Malaysia's Debt - Consequences & Rationale

On June 10, 2009 Fitch downgraded Malaysia's long term local currency credit rating from A+ to A. However for Malaysia's outlook, it has upgraded it from negative to stable.

• Rating agencies have voiced concerns about Malaysia's increasing fiscal deficit and impact on long-term yields. But bond issues have received a good response so far and policy rate cuts coming to an end is also a positive. Risks might be limited for investors as yields have improved and Malaysia has a sound external balance and forex reserve position
• Fitch (June 10): Malaysia’s long-term local currency credit rating downgraded from 'A+' to 'A' and its outlook revised from negative to stable. This was led by high govt expenditures including two fiscal stimulus packages, falling govt revenues, slow tax reforms and rise in fiscal and primary deficits. But long-term foreign currency rating was maintained at 'A-' with a stable outlook
• The downgrade is consistent with rating deterioration in some "AAA" countries like Japan and the UK. But it has little implication for Malaysia's fiscal deficit financing in the international market since debt can be financed domestically due to ample liquidity
• S&P: Stimulus package would not affect Malaysia's A-minus foreign currency rating. Stable outlook as it has the capacity to pursue counter-cyclical fiscal policies. Malaysia will be able to fund large fiscal deficit entirely from domestic sources as they had done in the past due to its deep and liquid domestic capital markets
  
• Moody's: 'A3' on high govt debt; S&P foreign-currency rating at 'A-' with a 'stable' outlook on strong external position and high savings rates

Rising Bond Issues:


• Combined two stimulus plans so far would widen budget deficit to 7.6% of GDP in 2009 (the biggest since 1987) or even close to 10% of GDP. Govt. debt might increase to 46% of GDP in 2009 from 41% in 2008 (govt debt: 92.7% as domestic debt and 7.3% as foreign debt). While the first stimulus would be financed from the savings derived from cuts in the fuel subsidies, with the second stimulus and risk of rising deficit, the govt has decided to issue bonds starting January 2009 including foreign bond issues. The government raised RM60 billion from domestic debt sales in 2008 versus RM53 billion in 2007
• From January to May 2009, total sales of government bond have surged by 79% y/y to RM 35billion. Central bank plans to hold 27 govt bond sales in 2009 incl. notes maturing in 3, 5, 10 and 20 years, and sell 5 billion ringgit in Islamic savings bonds
• May 14, 2009 : Malaysia sold US$ 1.3billion (RM 4.5billion) of April 2014 notes at an average yield of 3.879%, which was higher than 3.735% at previous auction in March 2009 and 2.634% in January 2009
• March 12, 2009 : Malaysia held the biggest debt auction in 5 yrs selling RM4.5bn ($1.21bn) of securities maturing in April 2014
• Impact on yields curve: yield Demanded by investors has increased due to record government debt supply. Improved liquidity conditions and recent rate cuts to low levels and bond issues to finance the budget deficit have steepened the yield curve. However, rate cuts may have come to an end while bond issues will continue to flood the market ahead
• Because of the sharp increase in bond supply in 2009 due to fiscal deficit, the MGS curve has gained in convexity. The curve is now extremely steep at the front end (3Y-5Y segment) and extremely flat at the long end (5Y-10Y segment). With the rate cut cycle having come to an end and given signs that economic activity may have bottomed, the outlook for MGS has become more bearish
  
• Liquidity conditions remain supportive of the MGS while scope for a flattening of the curve is limited by upside risk to fiscal spending. Negative swap spreads (IRS-MGS) at the front end narrowed further in the past month on receding hopes of further rate cuts but near-term supply concerns could see the market anomaly persisting for longer
  
• Malaysian government bonds are not attractive due to high debt supply and low possibility of further interest rate by central bank
  

p/s photos: Fiona Xie