The Meaning Of Zero Rated

I’m still snowed under with work commitments, so the blog will be on temporary hiatus until I can get a handle on my new job responsibilities.

Nevertheless, I can’t resist commenting on this (excerpt, emphasis added):

Putrajaya confusing Malaysians about GST, says NGO

Second Finance Minister Datuk Seri Ahmad Husni Mohamad Hanadzlah’s recent explanation of the goods and services tax (GST) is illogical and only confuses the Malaysians, a civil society group said.

The Oppressed People's Network (Jerit) refuted Husni’s remarks that those earning RM2,000 a month would only pay RM15.06 of tax because of the GST.

“The finance minister appears to try to confuse the people with his statement,” Jerit Coordinator E. Parames said in a statement yesterday....

4Q2013 Construction and Distributive Trade

The prevailing narrative I see in the media these days – both mainstream and online – is that the economy is in trouble, and we’re doomed unless the government does something (alternatively: we’re doomed unless we change the government).

I don’t know; the numbers are painting an entirely different picture. The angst is partly a function of price increases, which have squeezed wallets across the country. It’s also I suppose a function of which sector you’re working in and whether labour is sharing in the money coming in.

December 2013 Industrial Production

Yesterday’s IPI report confirms the acceleration in economic growth at the end of last year (log annual and monthly changes; seasonally adjusted):

December 2013 External Trade

Things are seriously picking up (log annual and monthly changes; seasonally adjusted):

In log terms, seasonally adjusted exports are up 13.9%, while imports rose 13.5%. The monthly growth figures aren’t quite so positive, but the fact that December would be the sixth straight month of expansion says something.

Aiming For High Wages

There are going to be some scheduling and other changes to my blog posts from now on, as I’m inordinately busy and won’t have as much time to post as I used to. Things will be slow for the next few weeks/months until I get a handle on new responsibilities.

In the meantime, via IMoney.my is some info on the highest paying jobs in Malaysia at different levels of the economy. Hint: doing medicine pays off, but you might be surprised at what really pays at the senior level.

BNM Watch: Like Waiting For Paint To Dry

Surprise, surprise…not (excerpt):

Monetary Policy Statement

At the Monetary Policy Committee (MPC) meeting today, Bank Negara Malaysia decided to maintain the Overnight Policy Rate (OPR) at 3.00 percent….

…In recent weeks, shifts in global liquidity have resulted in increased volatility and uncertainties in the international financial markets….global economic and financial conditions remain vulnerable to shifts in sentiments and heightened volatility in the international financial markets.

Inflation At Different Income Levels: Why Can’t We Do This?

Kenya does it; India does it; Singapore does it (warning: pdf link):

SINGAPORE CONSUMER PRICE INDEX FOR HOUSEHOLDS IN DIFFERENT INCOME GROUPS

Consumer Price Index, July – December 2013

During the second half of 2013, the consumer price index (CPI) for general households rose by 1.9 per cent over the same period in 2012. This increase was lower than the 2.8 per cent recorded in the first half of 2013. A similar trend was observed for CPI excluding imputed rentals on owner-occupied accommodation (OOA), which rose by 1.5 per cent, down from the 2.2 per cent in the first half of 2013.

In terms of the different income groups, the CPI excluding imputed rentals on OOA for the lowest 20% income group rose by 1.1 per cent. This was lower than the increases of 1.4 per cent and 1.8 per cent experienced by the middle 60% and highest 20% income groups respectively.

Emerging Markets: No, It Isn’t 1997 Again

It seems to be my day to get beaten to the gun. I was going to write a post on this issue, but Lars got there first (excerpt):

Please don’t fight it – the risk of EM policy mistakes

Emerging Markets are once again back in the headlines in the global financial media – from Turkey to Argentina market volatility has spiked from the beginning of the year….

…Lets take the case of Turkey and lets assume Turkey is operating a pegged exchange rate regime – for example against the US dollar. And lets at the same time note that Turkey presently has a current account deficit of around 7% of GDP. This current account deficit is nearly fully funded by portfolio inflows from abroad – for example foreign investors buying Turkish bonds and equities.

The “Bloated” Malaysian Civil Service

I’ve been meaning to write a post on this subject for a couple of years now, but somehow never got around to it. Now DS Idris Jala has beaten me to the punch (excerpt):

Transforming public service delivery

It’s not bloated and we are looking at ways to improve.

Before I start talking about how we can and are doing things differently in the civil service, let me clear up this common misconception that the civil service is bloated.

Many comparisons have been made with other countries by simply taking the number of people who are termed public servants and comparing them as a proportion of the population. However, the problem is that no account is taken of who are considered to be civil servants.

Jesse Colombo Smackdown Part II

Mr Bubble is at it again, but this time, I’ll leave it to someone more qualified to issue the rebuttal:

Is Singapore Headed to an Iceland Style Meltdown: Part I

The piece by Jesse Colombo asking whether Singapore is headed to an Icelandic style meltdown received a lot of attention but not a lot of analysis. I think it is important to examine not only the factual basis for the arguments put forth but also the bigger picture philosophical framework for predicting financial crises. Today in the first part, I will place the arguments in a type of philosophical framework and the biases we have with regards to economic and financial analysis….

You can read part II here.

For what it’s worth, I’d agree that Singapore’s property markets are frothy, credit is expanding way too fast, and external exposure uncomfortably high. But I’d also agree with Prof Balding – it’s a stretch to say this will presage a meltdown.

I’d be far more concerned about structural issues in Singapore’s economy – the ageing society; the lack of productivity growth that has had to be papered over by immigration; the low provision of public goods; the high inequality of wealth and income. All these are probably more important – and immediate – concerns, than a putative bubble about to burst.

Working For The Few

Oxfam released a new report in conjunction with the World Economic Forum in Davos:

Working for the Few: Political capture and economic inequality

Almost half of the world’s wealth is now owned by just one percent of the population, and seven out of ten people live in countries where economic inequality has increased in the last 30 years. The World Economic Forum has identified economic inequality as a major risk to human progress, impacting social stability within countries and threatening security on a global scale.

December 2013 Consumer Prices

Consumer prices rose 3.2% in log terms in December (log annual and monthly changes; 2000=100):