The Perils of Obama ...

My uncle used to say that when he was a kid in the 1950s, there was this wonderful serial film from Republic Pictures called the Perils of Nyoka. It was such a good serial (in fact, one of the best serials to come out from Republic Pictures) that he saw time and time again until it was withdrawn from the village cinema to be sent to another village cinema. Unlike all previous serials where the heroes were all men, this time however the hero was a woman. Strange, my uncle forgets who the hero was. Was it Kay Aldridge ? (a name he just remembered) who plays Nyoka. But apparently my uncle never forgets Clayton Moore who plays opposite her ! You know, the guy who later was to appear on TV wearing a mask and shouting Hiyo Silver, Away ! And Kemo Sabey

The film was apparently set in a desert with horse-riding Arabs as the villains trying to get hold of some emblem which was a power symbol to influence other peaceful Arabs and Nyoka, together with Larry, was determined to get the emblem on behalf of America, what else. At the end of each chapter (there were 15 chapters in all), either Nyoka or Larry or both of them would be in a dangerous situation from which they cannot extricate, holding the audience in suspension , only to be saved by one or the other or by some fortunate events at the start of the next chapter, to the relief of the audience. Like all good Hollywood movies, Nyoka and Larry won the day and saved the world. THE END.

So it seems with Barack Obama. Being black, his early set of perils was probably in fighting against white bigotry to become a senator, and more and more bigotry to be nominated as a presidential candidate for the Democrat party. There were dangers and obstacles from the likes of senators like Hillary Clinton and Edwards who were all Democrat presidential nominees in their own right. Chapter after chapter, we were treated to suspense actions on who would emerge as the ultimate candidate. Hillary Clinton, like the evil Vultura in Perils of Nyoka , put up her best fight only to lose to Barack Obama in the end after a lot of suspense. For a moment, the audience was held breathless. 

Having gone through to chapter 13, we saw chapter 14 in which the cunning McCain, like the villainous Cassib, pulled Sarah Palin out of a hat, hoping to win the sentiments of women voters and the libido of lecherous old men like Billy Clinton. Obama managed to come out unscathed in this chapter 14. We are now towards the end of Chapter 15. Can Obama survive the perils that are about to descend on him in a matter of 5 days. 

Update: 05/11/2008: At last, Chapter 15 ends with Barack Obama triumphant. He has defeated everyone.

[P.S. It is interesting to note that Barack Obama seldom uses his middle name which is H for Hussain - definitely an Arab or a muslim name. Its similar to president Harry S Truman where, some say, the S stands for Sergei - a common Russian name.

[Using Google, the who's who of Perils of Nyoka are Kay Aldridge as Nyoka Gordon, Clayton Moore as Dr. Larry Grayson, Lorna Gray as Vultura and Charless Middleton ("wan gali") as Cassib. The emblem mentioned above was The Tablets of Hippocrates.

A good thing, this recession ...

For me, there's nothing refreshing than being hit by a recession. The more vicious and the more widespread the recession, the better it is for the world. At least, the recession reminds us that we have been living on borrowed money and borrowed times. 

Look at what is happening. We see the prices of commodities such as crude oil going down to USD 65/= from its dizzying height of USD 147/= per barrel. It is still going down despite the cut-back in production by OPEC by about 1.5 million barrels per day. We see in the US of prices of houses going down or houses left idle with no buyers. We see here in Malaysia of palm oil being sold in the international market for RM 1,450/= per tonne from a high of RM 4,500/= per tonne not a few months ago. We see banks and big corporation in the US and Europe getting into trouble. 

We will see an increase in unemployment in the West and Asian regions in the next few months. We will see prices of imported products going down and down and we will see prices of property going down with no takers and we will see no longer developers taking for granted their houses and apartments sold at bloated prices. We will see them scratching their heads to make ends meet. We will see them disposing off their properties at realistic prices rather than at take-it-or-leave-it prices. We will see that, at last, the consumers are getting their money's worth of goods and assets.

We will see less spending among the population. We will see people becoming more prudent with their money, spending on necessities and foregoing luxuries. We will see the fall in credit card spending. We will see more people saving part of their income instead of buying a second car or a second house or for some, a second spouse. We will see less money being spent on entertainment, on drinks, and smokes. 

We will see a lot less in the months or in the years to come. A recession drives a lot of sense into people. Don't anybody think that it's a good thing for us and the whole world.

To me, recession removes the luxuries and re-introduces the necessities. A depression is when the recession has become unmanageable; and this a bad thing. In a depression, most people are out of work, most factories  are shutdown, food is hard to come by, except to those who have the means to acquire food. Like in the stock exchange, Recession or even a Depression is the world economy's way of correcting itself to the overheated  situation when the world lived on credit. The last time the fire of Depression occurred was in the 1930s starting in the US first before the rest of the world got caught in its conflagration. Those people now living who had gone  through the depression years will truly appreciate what Depression means. To us in the twenties and thirties, we only know that Depression is just another word like inflation, recession, bears and bulls and so on. We are not old enough to appreciate what our grandfathers went through.

My uncle used to relate to me about a recession in Malaysia in 1985/1986 when the Malaysian economy went through the floor. Business was bad, people were losing jobs, inventories were mounting, prices were reducing, traders were not paying, debts were mounting and litigation was the rule of the day. During those years, my uncle was among the lucky ones who managed to stay employed. A lot of the unemployeds survived by selling coconut water along parts of the Federal highway especially at the Batu Tiga area. The recession then was deeper than the one he experienced 10 years later when the Malaysian ringgit took a dive to nearly RM 5/= to the US dollar in what was popularly termed as the Asian Financial Crisis. Still, Malaysia survived and nobody died of starvation.

Update 15 November 2008: Although not quite MacMillan's "we've never had it so good" of Britain's economy in the 1960s, Zeti, the Governor of Bank Negara, finally emerged from her cocoon to say that, for the Malaysian economy, "we're good for now" and "we are not in recession and we don't expect to be in one" when recession in half the world is threatening to become a full - blown depression. She said that Malaysia's forex reserve was high, being 3 to 4 times of a comfortable reserve of  a USD 30 to 40 billion, despite the plunge from a peak of USD 125 billion a few months ago to the current level of about USD 100 billion [versus Singapore's of USD 330 billion, a comparison that I cannot resist to mention].  

Like her, I believe, Malaysia will not suffer as much as her Western counterparts. Malaysia's economy will contract to, some say, 3.5 percent growth in GDP. So what ! Our economy has never been good either. The global credit crunch during a recession simply means that the Malaysian consumer would only spend on absolute necessities. He won't buy, for example, a second abode in the KLCC area nor buy a 3rd Mercedez  for his family.

The credit crisis, a simple solution ...

World news is full of stories of the financial crisis. In the past month, there is not a  day that passes without us having to listen to or reading the news on the crisis in the Americas, Europe, and Asia. They talk about recession, and even a depression or a slump on a scale of the 1930s. In some countries, fear of recession has made the word an unmentionable thing.

The root cause of the financial crisis is that someone, somewhere, simply do not pay the money he has borrowed. The someone can be an individual, a corporation, an institution or even a country that does not have the money to pay back. In other words, the world operates a credit system - someone buys or acquire things now and paying for it later - a month, a year, or over a period of time. Someone is borrowing from somebody who is lending. The system is fine if everyone keeps to his word on borrowing i.e. he has to pay the amount plus a little bit more from whoever he has borrowed. The lender however in turn borrows from a third party who also in turn borrows from a fourth and so on in a chained transaction made complicated by a criss-crossed network of borrowing and lending. And, if the someone in the chained network refuses to repay or is unable to repay the money that is due, then the system collapses, since everyone is inter-depending on everyone else for credit.

Shakespeare who once said that "neither a borrower nor a lender be", might not know the financial system of the modern world, perhaps even in the world of his time. But he was acute in his observation. He was absolutely right in believing the problematic outcome to those who borrowed and those who lent.

What if the world declared that from 1st January 2009, the credit system was abolished ! And that, its against the law to borrow or to lend and no transaction shall be carried out unless its in cash or by an exchange of goods. What will happen ? To be sure, the present financial system breaks down. Definitely, business slows down - but only to those business that depends on the credit system, not those business that runs on cash or barter. Will people starve to death ? How does the new system affect people individually ?

An example lets take the case of a wage earner who wants to acquire a bit of luxury in life. He has been eyeing the red 400 hp, 0-100 kmh-in 3.7 seconds Ferrari ever since he was been recently made a CEO of the company he has been working for the past 36 years. With his new income, he can afford to pay a down payment of RM 50,000 from savings and the monthly RM 10,000 from salary for several years to retirement age. All of a sudden, his hope is dashed when hire purchase becomes illegal. Now, if he still wants the Ferrari, he has to come out with RM 1,000,000 - an amount that is three times the amount that he has saved for the past 36 years. He therefore foregoes his desire and instead plans to buy a Proton Wira for RM 50,000 cash. With a bit of persuasion on money being hard to come by these days, the car dealer finally relents to sell the Proton Wira for RM 42,000. The CEO, instead of spending extra, in fact saves RM 8,000 instantly, and has no worry about bank interests, debt collectors, rude reminders for the rest of his life. Now, what happens to the Ferrari dealer. No longer can he sell the million-ringgit Ferrari, no matter how much and for how long he tries to lobby among those people whom he thinks are capable of coming out with a million in cash. He has to sell the car at cost or even at a loss or face legal action from those he has borrowed to import the car. Finally, the dealer sells the car for RM 300,000.

Now take a second example of a senior clerk who wants to buy the RM 50,000 Proton Wira. During those days, he could easily acquire one, what with little or no down payment and installment stretched to 9 years. With hire purchase no longer available, he faces the same dilemma as the CEO. With 5 children still schooling and house mortgage still on, and with savings only for a rainy day, he gives up and plans to buy a motorbike or a scooter, and if necessary, commute to work by bus. As for the Proton Wira dealer, although the car sells slowly, he has no problem in getting the sales when he has to drop prices to RM 30,000 to make a little profit to continue. He has managed to run his dealership with less staff and with no salesmen.

The end result in the case of the scenarios for the 2 consumers, they have saved a considerable amount of money that can be used later for absolute necessities and without having the headaches if they had borrowed money. They have foregone luxuries and comfort but are not actually starving.

The Economist says that "deprive a person of oxygen, he will turn blue, collapse and eventually die. Deprive economies of credit, a similar process kicks in". This paper is confused with what is a life support substance with what is not an absolute necessity. Certainly a person dies for a lack of oxygen but not for a dearth in credit. A person or an economy can still survive with little cash or cash equivalent. After all cash - in other words money - is an artificial means of exchange to facilitate trade. By the same token, credit is also an artificial means to make trade easier, except that credit  implies trading by means of a future income. In my books, credit can be manipulated, stretched, used and re-used, rolled, circulated and in the process, can be adjusted up with artificial interests and "derivatives' for what should have been a simple cash transaction in the first place.

to be amended and continued ....

Centre-spread for Sarah ? ....

If Hollywood is now interested in Sarah Palin, then it wont be long before Playboy or Penthouse start announcing a photoshoot  for her to display her attributes in a centerspread. It might even boost McCain's chances in the presidential election, come November 2008. At this age, Sarah Palin still looks stunning like an "MILF" in a group performance on online TV. 

Being an ex-beauty queen, she certainly has the qualities of a model with less droops and less lines than if compared with Hillary Clinton. Of course, she's no Paris Hilton nor Pamela Anderson nor the younger ones such as Lindsay Lohan or Britney Spears. But since she's good enough for old man McCain, (who by the way, has always an eye for a pretty face), she's good enough for a Penthouse photo session.

What if McCain manages to become US president and dies (he is too old to be president) in office, Sarah becomes the first head of a country with a naked past? Even Osama Laden would plaster her fold-outs on the wall of his tent.