junior's toks

Inflation Inflation Inflation - Again...

Zeti: Inflation rate to remain low
The inflation rate, which had risen from earlier low levels, is expected to remain relatively low in 2005 despite the US dollar depreciation and the higher international oil prices, says Bank Negara.

To be honest, I am very *tulan* with our Bank Negara and the current administration (our PM lor). I started toking about ‘Inflation Inflation Inflation’ last year (September 2004 Archieve) when I doubted the official inflation rate and their basket of goods (we also discussed whether ‘basket’ is a noun or adjective, remember?) . How can our inflation be only 2.5%?

Petrol prices have gone up, electricity and water rates to go up soon, even stamp also has gone up, toll has gone up, bus fare, fish and chicken prices have gone up….Dr. Zeti, you still want to tell me inflation will be low…… I might as well give you my chastity. Nah…take it….*shy*shy*..

I came back to KL 10 days ago and went to eat ‘Chap Fan’ (mix rice) + Chinese Tea. Do you know how much it costs? RM 5.40!!!! I nearly fell off my chair. I used to pay RM 1.70 you know…..(but to be fair, that was about 10 years ago in serdang la…). You bet that I ate that plate of rice with tears in my heart…

Cost of living is not cheap at all in Malaysia…..

You know that I did not believe that Malaysia will re-peg its currency. I am actually neutral on this (er...er..because i really do not know much about currency). But I feel that this currency pegged or rather 'undervalued' currency is begining to haunt us.

The economy recovery has caused inflation. There is no doubt about that. Yet, we are not able to raise interest rate because it will attractive even more hot money because our currency is fixed or rather pegged. There is a very clear arbitrage opportunity for foregin investors especially Singaporean. Imagine this, if you were singaporean, you would want to buy the properties in Malaysia NOW because (a) currency is cheap and ULTIMATELY Ringgit will appreciate (b) Malaysia property prices will surely increase due to inflation. Same logic goes for stocks. The inflow of foreign money including those tourism money will not benefit everyone in Malaysia.

If you are a working class in Malaysia say teacher or bank officer, I bet you curse at least 5 times a day. BTW, if you really have to curse, pls just say 'Tiu'. Dun be too uncivilised like some who says 'Kan Ni Nia' in my tag board on the top right corner....:D

Junior

posted by Junior @ 4:50 PM