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Saturday, 12 February 2011

Never overstay, a lesson from Cairo, Voice in Egyptian Democracy !

ON THE BEAT WITH WONG CHUN WAI

A boy watches as his parents hold masks depicting former Egyptian President Hosni Mubarak, during a rally staged by human rights groups as part of a global event to mark the resignation of Mubarak, in Trafalgar Square, London, Saturday, Feb. 12, 2011. (AP / Lefteris Pitarakis)



We have our fair share of politicians who should have called it a day some time ago.

IT’S a disease that affects many ageing politicians. They refuse to let go and cling on to their powers, believing that they are indispensable, possibly even invincible, and that chaos would result if anyone else were to take over their jobs.

But a defiant Egyptian President Hosni Mubarak has finally given up despite his stubborn stand barely 24 hours earlier, when he told the people that he would not allow himself to be forced out of office.

He repeatedly said over state TV that he would “not leave this soil until I am buried underneath it”, and reminded his listeners that “I never sought false power or popularity. I am certain that the majority of people are aware of who Hosni Mubarak is”.

We don’t know what his cronies have been telling him but a majority of the people who gathered at Tahrir Square over the past two weeks certainly knew who Mubarak was.

They wanted him to go. They had already grown tired of his leadership and irrespective of what he has done for Egypt as a war hero, they were not going to miss him.

Getting rid of Mubarak in this arguably short, bloodless revolution is the easy part. No one is clear as to what will happen next, however.

For the time being, the Egyptians are just jubilant that they have managed to get rid of the man they regard as a despot.

Mubarak has passed the baton to his deputy, Omar Suleiman, who is said to be another hugely unpopular figure. He is regarded as being too close to the United States and Israel, and has been accused of being a CIA agent.

But the transition, or Mubarak’s resignation, could not be carried out until the United States had accepted someone they were comfortable with. In this case, it was Suleiman.

In the early days of the uprising, the Obama administration had stood behind Mubarak.

The American media, including CNN, seemingly took their time to cover the unfolding historic event.

US President Barack Obama himself at first suggested that Mubarak should go, and then reversed his stand, saying that the Egyptian president should remain in office until September when elections would be held.
Now, US Secretary of State Hillary Clinton has thrown her weight behind Suleiman.

There are fears across Europe that with Mubarak gone, Islamist groups such as the Muslim Brotherhood will take over the leadership, which would be disastrous for their geo-political interests.

French President Nicolas Sarkozy reportedly expressed his concerns that it might turn into an Iranian style revolution. He was quoted as saying: “I hope with all my heart for Egypt’s nascent democracy that they take time to create the structures and principles that will help them find the path to democracy and not another form of dictatorship, religious dictatorship, as happened in Iran.”

Such fears are not entirely unfounded.
During the Iranian Revolution, the people ousted the Shah of Iran, which then saw the return of Ayatollah Khomeini, who had been in exile in France, to take over the leadership.

Decades later, the people who had celebrated the fall of the Shah must be thinking differently about what they had wished for.

As the saying goes, be careful what you wish for. They had dumped a corrupt monarchy only to trade it for a repressive, theocratic regime. Democracy is now regarded as a Western concept that is unsuitable in the religious structure of their country; and when the name of God is invoked, not many of the faithful would dare to challenge the men in religious cloaks.

Many liberal and talented Iranians, unable to stand the choking religious-political make-up of their country, have left their once moderate homeland for Europe.

As of now, we are still unclear where Egypt is heading. Will the United States and Europe prop up the non-credible Suleiman or will the army generals call the shots until a genuine presidential election is called this autumn?

One thing is for sure, though. No one – whether it’s Suleiman, the army or the Islamists – should ever take the people for granted.

They have gathered by the thousands demanding reforms and, having succeeded, they would do so again if they have to.

They know they can mobilise themselves. As some have correctly said, for the first time a people’s revolution has taken shape and succeeded via SMS, YouTube, Twitter and Facebook.

Times have changed but, unfortunately, Mubarak did not notice the Internet Generation. Perhaps he was arrogant or was simply out of touch.

Mubarak is now on retirement at the seaside resort of Sharm el-Sheikh whereas Tunisia’s ousted president, Zine El Abidine Ben Ali, has run off to Saudi Arabia. Many Arab leaders must be having nightmares now.

Despite their horrendous human rights records, with elections non-existent in their countries, they , the Middle East countries, have escaped world scrutiny because they are oil producers and allies of the United States. So the US media looked the other way, preferring to land their punches instead on China, an economic rival.

Let’s not look far. In Malaysia, we have our fair share of politicians who should have long ago called it a day and left to spend their time doting on their grandchildren.

But they are still around, insisting that their work has not been completed. They are there on both sides of the political divide.

The Egyptian lesson is for all. Never overstay in politics – people will get sick and tired of you.


Protesters Call for Voice in Egyptian Democracy

Associated Press
CAIRO -- On Egypt's first day in nearly 30 years without Hosni Mubarak as president, its new military rulers promised Saturday to abide by the peace treaty with Israel and eventually hand power to an elected government. Protesters, still partying over their victory in pushing Mubarak out, now pressed for a voice in guiding their country's move to democracy.

The protesters' first act was deeply symbolic of their ambition to build a new Egypt and their determination to do it themselves: Thousands began cleaning up Cairo's central Tahrir Square, the epicenter of their movement. The sprawling plaza was battered and trashed by 18 days of street battles and rallies by hundreds of thousands.

Even as thousands flowed in to celebrate, broom brigades fanned out, with smiling young men and women -- some in stylish clothes and earrings -- sweeping up rubble and garbage. Others repaired sidewalks torn apart for concrete chunks to use as ammunition in fighting with pro-regime gangs. Young veiled girls painted the metal railings of fences along the sidewalk. "Sorry for the inconvenience, but we're building Egypt," read placards many wore.

"We are cleaning the square now because it is ours," said Omar Mohammed, a 20-year-old student. "After living here for three weeks, it has become our home ... We're going to leave it better than before."

A coalition of youth groups that organized the protests issued their first cohesive list of demands for handling the transition to democracy. Their focus was on ensuring they -- not just the military or members of Mubarak's regime -- have a seat at the table in deliberations shaping the future.

Among their demands: lifting of emergency law; creation of a presidential council, made up of a military representative and two "trusted personalities"; the dissolving of the ruling party-dominated parliament; and the forming of a broad-based unity government and a committee to either amend or rewrite completely the constitution.

"The revolution is not over. This is just a beginning. We are working on how to move into a second republic," said Shady el-Ghazali Harb, the representative on the coalition from one of the youth organizing groups, the Democratic Front.

Protesters were debating whether to lift their 24-hour-a-day demonstration camp in Tahrir. The coalition called for it to end and be replaced by weekly mass demonstrations every Friday to keep pressure on. But many in the square argued to remain. One man on a megaphone encouraged everyone to stay until all their demands were met, while others chanted "the people want the square to be cleared," referring to public grumbling that the protest camp is disrupting life downtown.

Many in the square were pouring love on the military: Families put babies on the laps of soldiers on tanks for photos, crowds cheered when a line of soldiers jogged by for exercise. But there was also realism that the military's ultimate intention is unclear.

"We don't know what they'll do, they might keep hanging on to power," said Muhammed Ali, a 22-year-old archaeology student who argued for the protests to continue.

With Mubarak gone, Egypt's future will likely be shaped by three powers: the military, the protesters, and the sprawling autocratic infrastructure of Mubarak's regime that remains in place, dominating the bureaucracy, the police, state media and parts of the economy. Right now, the protesters' intentions are the clearest of the bunch.

The Armed Forces Supreme Council is now the official ruler after Mubarak handed it power on Friday, consisting of the commanders of each military branch, the chief of staff and Defense Minister Hussein Tantawy. It has not explicitly canceled the constitution drawn up by Mubarak's regime, but the constitution seems to have effectively been put in a cupboard for the time being until it is decided what to do with it.

The military seized power after pleas from protesters, and it has repeatedly promised to ensure democratic change, making it highly popular with the movement.

But on the face of it, the elderly generals are no reformers, and their move to push out Mubarak may have been more to ensure the survival of a ruling system the military has been intertwined with since a 1952 army coup. The deeply secretive military has substantial economic interests, running industries and businesses that it will likely seek to preserve.

The council of generals has said nothing so far about how the transition will be carried out or addressed the protesters' demands.

While it decides that, it sought on Saturday to reassure Egyptians and Egypt's allies abroad.

A spokesman, Gen. Mohsen el-Fangari, appeared on state TV in front of a row of Egyptian military and national flags and read the council statement, proclaiming the military is "looking forward to a peaceful transition ... to permit an elected civil authority to be in charge of the country to build a democratic free nation."

The military statement also said Egypt will "abide by all regional and international treaties and agreements, and commitments" -- reassurance to its top ally the United States that Egypt's 1979 peace accord with Israel is not in danger.

Israeli Prime Minister Benjamin Netanyahu welcomed the statement, saying the treaty "has greatly contributed to both countries and is the cornerstone for peace and stability in the entire Middle East."

Israel has been deeply concerned that Egypt's turmoil could threaten the peace accord, the first between an Arab nation and Israel. But Egypt's military strongly supports the peace deal, not in small part because it guarantees U.S. aid for the armed forces, currently running at $1.3 billion a year. While anti-Israeli feeling is strong in Egypt, few so far seriously call for the treaty's abrogation.

Also, the Supreme Council asked the current government, installed by Mubarak after protests broke out Jan. 25, and provincial governors to "continue their activities until a new government is formed."

It did not say when that would happen, but it seemed to imply the army would draw one up to replace the current one.

The move to keep the government of Prime Minister Ahmed Shafiq in place appeared to be a stop-gap measure to keep the state and economy functioning at a time when the country is trying to recover from the economic fall out of the upheaval.

For days, many businesses and shops were closed, much of Cairo's population of 18 million stayed home under heavy curfew, and foreign tourists -- one of the top sources of revenues -- fled the country. Earlier this week, even as businesses began to reopen on a wide scale, labor strikes erupted around the country, many at state industries or branches of the bureaucracy.

The Supreme Council state asked the public, particularly the millions in the government sector, to "work to push the economy forward," el-Fangari said, an apparent call for everyone to return to work.

The military relaxed the curfew -- now to run from midnight to 6 a.m. instead of 8 p.m. to 6 a.m. -- and the Stock Market announced plans to reopen on Wednesday after a closure of nearly three weeks.

The other force that has hardly been heard from yet is the remainder of Mubarak's regime, which was accused of widespread corruption and authoritarianism but also has the experience in the nitty gritty of running the country, unlike the military.

Members of Mubarak's National Democratic Party still dominate ministries, parliament, state industries and other bodies. The powerful security forces, accused of widespread use of torture and involvement in past vote rigging, remain empowered by the emergency law that gives them wide authorities of arrest.

The regime remainders are battered. Some of its top personalities were purged in Mubarak's last days. Seeking to placate protester demands, the public prosecutor has launched a corruption investigation into four of the millionaire businessman politicians who came to dominate the NDP under the leadership of Mubarak's son, Gamal -- former ministers Ahmed Maghrabi, Rashid Mohammed Rashid and Zuheir Garana as well as ex-ruling party figure Ahmed Ezz.

On Saturday, the prosecutor general asked European countries to freeze the assets of the four.
He also announced a travel ban on former prime minister Ahmed Nazif, former interior minister Habib el-Adly and information minister Anas el-Fiqqi, who told state TV on Saturday that he has now resigned his post.

But much of the regime is in place -- too entrenched to call "former" -- and parts of it may resist changes that threaten their position. The security forces, in particular, have hardly been heard from since they were pulled off the streets during the crisis following clashes with protesters and replaced by the army.

Regime figures are certain to play a role in the transition. The question is how much of a role the military will give them and to what degree it will let in other voices.

The protest organizers say they so far have no direct talks with the military. "There are no channels of communications between us and the army but some public figures can help us," said Harb. He said "prominent figures" may play a mediating role.

The coalition that called for the Tahrir protest camp to be lifted and replaced by weekly rallies is highly influential in the square. But they do not claim to be its leaders and often say they can't defy the will of the "revolution." It is made up of several youth activist groups, including supporters of reform advocate and Nobel Peace laureate Mohamed ElBaradei as well as youth from the Muslim Brotherhood.

Friday, 11 February 2011

Is it more viable to buy or rent a house?

MY MONEY By TEE LIN SAY linsay@thestar.com.my



IN today's environment of rising home prices, is it more advantageous to buy a house or rent a house?

While most people unanimously agree that owning a home is better, the financial situation of the individual is important in assessing whether he or she can afford the home.

VPC Alliance (KL) Sdn Bhd managing director James Wong says it is always better to own a home. But one's financial ability will play a big part in the choice of a house, he adds.

“Of course, it's better to buy than rent as the loan you pay to the bank is equivalent to the rental you are forking out,” says the boss of the property consultant firm.

James Wong ... ‘It’s better to buy than rent as the loan you pay to the bank is equivalent to the rental you are forking out.’

Young people are advised to look into their finances and ensure their existing debt ratios are not too high before buying a house. They also need to consider the stability of their jobs to ensure they will be able to make the monthly loan instalments, Wong says.

“If a person's debt ratio in relation to his salary is already close to 50%, chances are banks will not qualify the loan. If a person's salary is too low, meaning that the mortgage amount to be paid is more than 50% of a person's salary, the bank may also hesitate and require more documentation to approve the loan.

“These days, with the easy payment packages by banks and the ability to withdraw from one's Employees Provident Fund (EPF) savings, owning a house has become more affordable,” says Wong.

Certainly, potential house buyers can now tap on their EPF account 2 to purchase a property. First-time house buyers can still qualify for loans of up to 90%

During Budget 2011, the Government said it will introduce Skim Rumah Pertamaku through Cagamas Bhd, which will provide a guarantee on the downpayment of 10% for houses below RM220,000.

This scheme is for first-time house buyers with household income of less than RM3,000 per month. In other words, the buyers will obtain a 100% loan without having to pay the 10% downpayment.

First-time house buyers will also be given a stamp duty exemption of 50% on instruments of transfer on house prices not exceeding RM350,000. The Government also proposed that a stamp duty exemption of 50% be given on loan agreement instruments to finance such first-time purchase of houses.

“If you rent a home, especially in today's environment of rising prices, you will never benefit from the increase of the property value. Furthermore, even if the value of the home does not increase over time, the mortgage balance decreases and equity builds,” says another property consultant.

“With the problem of inflation creeping up, the more you delay buying a house, the more expensive it becomes over time. Buying property is one way to fight inflation,” he adds.

In terms of disadvantages in owning a house, there are many variable costs involved, for example the house assessment, service or maintenance fees and fire insurance among others.

“Selling the house may also not be as quick as, say, selling your investments in shares. The whole process of selling, along with documentation by lawyers can take up to a year, depending on the location of the home. If there is already a potential house buyer, the process can be sped up to 3 months,” says the property consultant.

Khong & Jaafar managing director Elvin Fernandez gives a quantitative example between buying and renting a property.

If a typical middle class 2-storey terrace house in Kuala Lumpur is RM400,000 and the rent is RM1,500 a month, the nett yield is RM3.8%.

“This is a reasonable return from such a landed property,” he says.

Assuming that the household income is about RM7,000 a month, this means that the ratio of the household income per annum to the house price is 4.76 times.

“To buy this house based on 90% financing at a fixed interest loan for 30 years, you would have to pay a 5% interest, which means a monthly expense of about RM1,900 a month. At this point of the exercise, it is clearly better to rent than buy,” he elaborates.

Still, he adds: “This analysis is based on what I consider the typical housing unit. Different considerations may apply for different types of housing units in different areas.”

Another powerful motivation in favour of buying rather than renting is the social imperative to own a home.

“Owning a house also allows you to raise credit as and when it is needed, for family expenses and for business purposes, and this is a powerful motivation for ownership,” says Fernandez.

This obsession with debt

WHAT ARE WE TO DO By TAN SRI LIN SEE-YAN



AT Harvard, I really enjoyed graduate macroeconomics taught by Nobel laureate Prof W. Leonfief and Prof Martin Feldstein. In particular, the philosophies underlying different policy approaches by Keynes, Hayek and Friedman. Simply put, Hayek (the Austrian school ascendant in the 19th and early 20th centuries) promoted the idea that private sector should be left free to find its own balance in a downturn.

The markets' resulting purging power served the United States well in the 19th century when the economy emerged stronger after each recession. But, it was later taken too far in the mix of tight money and high taxes that led finally to the Great Depression. That's when the Keynesian idea of fiscal stimulus took root.

In October 1932, Keynes made the case that depressions are caused by a spending deficit which can only be made up by government spending. Because of “a lack of confidence”, there is no assurance excess funds “will find its way into investment in new capital construction by public or private concerns.” With global recession, the consensus made us all Keynesians resorting to heavy government spending to resuscitate the economy was the answer to severe downturns. First cracks appeared with the outbreak of the fiscal crisis in Greece early in 2010. Critics argued government spending brought-in diminishing returns, producing an anaemic (jobless) recovery that benefited mainly special interest groups.

In the United States, Federal Reserve chairman Ben Bernanke stood steadfast and let it be known more stimulus was needed. His monetary activism led to an open-ended commitment to pump as much money into the system as is required to push for maximum employment. He added that he was doing what Friedman would do.
Milton Friedman advocated that the Great Depression was largely the result of a major contraction in money supply.

Milton Friedman (father of monetarism) advocated that the Great Depression was largely the result of a major contraction in money supply. And could have been avoided had the Fed held money supply stable. There is now growing backlash against the Fed's new approach. As I read it, Keynes would not have supported big deficits during boom times, such as those that led eventually to the 2007/'08 crisis. Similarly, Friedman is unlikely to have backed the Fed's monetary activism in engineering economic expansion rather than merely cushioning the pain in downturns. So, systematic perversion of Keynes' and Friedman's thoughts has led to their falling out of favour once again.

Confidence 

The greatest disagreement between Keynes and Hayek was over benefits of government spending financed by deficits. Keynes pointed out that public interest in a recession cannot rely on private economy went so far as to say: “to spend less money than we should like to do is not patriotic.” But Hayek argued: “The existence of public debt on a large-scale imposes frictions and obstacles to re-adjustment very much greater than that imposed by the existence of private debt.” Simply put, no stimulus is needed. Nevertheless, both agreed this lack of confidence is simply destructive to any weakened economy.

For Keynes, confidence will come by bridging this gap in aggregate demand. “Private economy” was the culprit that impeded a return to prosperity by hoarding savings. That is, the potentially pernicious consequences of an increase in demand for money being not met by a corresponding increase in the supply of money. Even Hayek agreed hoarding is deflationary and “no one thinks deflation is in itself desirable.”

For Hayek, the way forward to building confidence in the face of destructive Smoot Hawley Tariff 30 protectionism, is for governments world-wide, led by the United States, to “abolish all those restrictions on trade and the free movement of capital.” Only expanded trade can rebuild confidence to enable the United States to pay off the public debt.

Growth vs debt

With recovery, albeit anaemic, attention is turned to exit (of stimulus) and fiscal consolidation (bringing down deficits and debt). After more than a decade of good times, the world awakens to face the reality of painful cuts and tax increases which are now needed to restore sanity in public finances, battered by a combination of years of overspending and the effects of global crises.

When recession set in in 2007, advanced nations' budget deficit averaged 1.1% of GDP. By end-2010, this had exceeded 9% according to the IMF, as revenues plummeted and banks got bailed out big time. Government gross debt will exceed 110% by 2015, against 73% of national income in 2007. This global rise in mounting debt will require nations to (i) reduce accumulating debt to bring down debt ratios, and (ii) inject fiscal discipline to reduce deficits. This, the International Monetary Fund warns, means “sizeable and sometimes unprecedented efforts as failing to do so would ultimately weaken the world's long-term growth prospects.”

While this is all well and good, there are fundamental differences in policy on opposite sides of the Atlantic. Germany's finance minister puts it this way: “While US policy makers like to focus on short-term corrective measures, we take the longer view and are, therefore, more preoccupied with the implications of excessive deficits and the dangers of high inflation.”

Last week's Franco-German move to end wage indexation, raise retirement age and lock-in debt limits into national constitutions across the euro-zone is bound to be provoking. In a public lecture, the infamous Soros said: “Something has gone fundamentally wrong in Germany's attitude towards the Economic Union.” By not only insisting on strict fiscal discipline for weaker euro-zone countries but also reducing its own fiscal deficit, Germany was in danger of setting in motion “a downward spiral.” This policy stance ignores a lesson from the 1930s Depression and so is “liable to push Europe into a period of prolonged stagnation or worse. That will in turn generate discontent and social unrest.”

Much of this is already today's reality. President Obama's stance is different but clear: secure a sustainable recovery first, while setting the stage for fiscal consolidation over the near medium-term. Growth is critical to success in reducing budget deficits. The US position is unique in that with US dollar at the heart of the global financial system, it can afford to tighten fiscal policy only when expansion is invigorated. While the US fiscal deficit (10.7% of GDP) is larger than the euro-zone, the Greek and Irish crises have prompted a flight to, rather than from, the US dollar and US bonds. Indeed, there is no market pressure to adjust. So, while the United States recognises it has to seriously tackle problems of fiscal deficit and high debt, there is an unwillingness to act politically.

Is debt too high?

Today's deficits which are leading to ever higher debt and servicing burdens are plainly unsustainable. What level of public debt is appropriate? Conventional wisdom says a safe level in a rich economy is 60% of GDP pitched at the limit enshrined in The Maastricht Treaty which governs membership in the euro. That's before the crisis.

As I see it, there is no empirical evidence to support this limit. Of course, the lower the better since it is unlikely to crowd-out private sector initiative. In the past, this limit was often by-passed anyway. Recent studies by Harvard's Rogoff and Reinhart find that public debt burdens of less than 90% have scant impact on growth; but they see significant impact at higher levels. No one-size fits all.

The United States, with the broadest and deepest bond market and dollar as reserve currency, surely will be able to carry a higher debt than any euro-zone members. In the end, the right level of debt depends on the means used to get there, consistent with growth targets. Evidence shows that cuts in spending are more sustainable and friendlier to growth; whereas, tax increases can harm growth. Taxes that do least harm to growth are on consumption and immobile assets (eg. property). Green taxes also make good sense. But politics often point elsewhere, eg. towards making the rich pay to clean the environment. In UK and US, the highest marginal income tax rates are possibly poised to rise. Good for populists but it will not boost growth.

Debts matter but assets also count 

During the Great Depression, Keynes advocated spending “of any kind, private or public, whether on consumption or investment.” The immediate aim was to urgently fill the void in demand. Hayek took exception for it mattered to him the form spending took since “revival of investment was particularly desirable.” Sure, once recovery comes on-stream, it does matter what the spending is on.

Henry Morgenthau, President Roosevelt's Treasury Secretary, advised: “You can do something about the railroads. You can do something about housing. Above all, you must do something to reassure business We want to see private business expand. We believe much of remaining unemployment will disappear as private capital funds are increasingly employed.” History suggests the new respect for market confidence helped in the recovery following a double-dip in 1937-38. A lesson for US Treasury's Geithner those who forget the past condemn us all to repeat it.

Come to think of it, fiscal consolidation is not just about deficits and debt. Depending on how they are incurred, assets are usually created. It is true we should not burden the future with unproductive debt. All societies have infrastructure assets, i.e. transport, energy & water systems. They also have basic education, health, judicial and defence systems. These systems provide a “public good” which are not usually provided by competitive markets.

Surely, it does not make sense slashing infrastructure and utility investments and support for university teaching when borrowing can be had at absurdly low cost. Indeed, never has there been a better time to borrow than now to productively build public assets. Such Keynesianism is worthy of support especially in the face of large unused capacity.

I think it is wrong to insist that solving the problem caused by debt can't be solved by piling more debt. It's wise to look at net debt. Yale Prof Shiller argues there is “an arbitrage opportunity for governments to borrow massively at these low real interest rates, and invest in positive returning projects Unlike private firms, government can count as “economic profits” on their investments with positive externalities (benefits that accrue to everyone). Of course, unsustainable government consumption must be curbed. Borrowing is no sin so long as they create productive assets. Assets created cannot be ignored when looking at debt.

The Keynesian way

I should end on a lighter note. I well recall a fascination with Keynes' lesser known short essay written in 1930: “Economic Possibilities for Our Grandchildren”. While in the thick of the Great Depression, Keynes reminded us that “the long run trend was inexorable growth.” He then went on to predict ... “the standard of life in progressive countries one-hundred years hence will be between four and eight times as high as it is today.” After 80 years, with all the disasters in between, US and Western Europe are already about 5-times richer. And still counting.

In emerging nations, income growth in the past 30 years has been even more impressive. What's of concern is the quality of sort of growth we are after in the end. Keynes acknowledged the insatiable desire of human beings to blindly pursue wealth. Recent events have shown, even with wealth, people still wanted to borrow more than they could repay. In the end, most would adjust, albeit grudgingly, to a life of plenty. It is in this future good life Keynes famously imagined economists could be thought of as “humble, competent people on a level with dentists.” Economists have a way to go yet.

Former banker, Dr Lin is a Harvard-educated economist and a British Chartered Scientist who now spends time writing, teaching and promoting the public interest. Feedback is most welcome; email: starbizweek@thestar.com.my.