US QE3 sparks concerns !

Tweet

Possible US QE3 sparks concerns

By Hu Yuanyuan and Chen Ji 

BEIJING - The Federal Reserve said on Wednesday it could ease monetary policy further if the United States failed to see solid growth, which analysts said may add to China's inflation and endanger its $3.2 trillion foreign exchange reserves.

"The possibility remains that the recent economic weakness may prove more persistent than expected and that deflationary risks might re-emerge, implying a need for additional policy support," Ben Bernanke, Fed chairman, told the House of Representatives Financial Services Committee. His remarks were generally interpreted as a signal of a possible QE3 (quantitative easing).

In late 2009, the Fed launched an unprecedented bond-buying drive to boost the economy and make credit more available, spending some $1.7 trillion on mortgage-backed securities and Treasuries before it ended in March 2010. It then initiated a second round of easing, that wrapped up in June, in which $600 billion of bonds were bought.

But the US economy remains weak, prompting the possible launch of a QE3. A Reuters/Ipsos poll released on Wednesday showed that the number of Americans who believe the country is on the wrong economic track rose to 63 percent this month, up from 60 percent in June. The country's jobless rate rose to 9.2 percent in June from 9.1 percent in May.



"If the Fed continues to print more money (as Bernanke hinted), it will drag China into a protracted war to limit liquidity and tame inflation," Lu Zhengwei, chief economist with Industrial Bank Co Ltd, said.

China's consumer inflation already surged to a three-year high of 6.4 percent in June, according to the National Bureau of Statistics. This was partly attributable to quantitative easing measures by the US, which drove global capital into the more lucrative developing markets, including China, analysts agreed.

Moreover, the potential injection of money in the US is likely to raise global commodity prices. Crude-oil futures finished higher on Wednesday boosted by Bernanke's comments. The rising prices may force emerging economies, such as China, Brazil and India, to pay more for imported commodities, further exacerbating their inflationary problems.

"It will be a very bad news for emerging countries," Lu said.

Those countries may have to continually tighten their monetary stance, such as by raising interest rates, further incurring capital inflows, Lu said.

Cao Fengqi, director of the Research Center for Finance and Securities at Peking University, told China Daily that a QE3 would lead to faster appreciation of the yuan against the dollar.

According to Cao, if the easing policy became a reality, the resulting flood of US dollars means a faster depreciation of the greenback, which threatens the security of China's foreign exchange stockpile as it will reduce the real value of the dollar-denominated reserves.

"The primary task for China is to control consumer prices and maintain steady and fast economic growth (to counter any external shocks)," Cao said.

The Foreign Ministry said on Thursday that it hoped the US government would take a responsible attitude to protect investor interests.

Bernanke's hint of a QE3 could also be a strategy to pressure lawmakers to agree on raising the US debt ceiling, analysts said.

US President Barack Obama and the Republicans are bogged down in negotiations to raise the borrowing limit before the Aug 2 deadline.

Bernanke may be "talking up the market" and goading Congress to reach a consensus on the ceiling, Chen Xingdong, chief economist with BNP Paribas Asia Ltd, said.

Moody's Investors Service on Wednesday put its AAA rating on US government bonds on watch for a possible downgrade, citing the "rising possibility that the statutory debt limit will not be raised on a timely basis", which would lead to a default on US Treasury debt obligations.

Meanwhile, Chinese rating agency Dagong Global Ratings Co Ltd on Thursday put US ratings on domestic and foreign currencies on a negative watch list because of the country's rising debt.

Dagong said the current political and economic situation had squeezed out room for tax increases, while it is difficult to curtail military and welfare spending.

In the worst-case scenario, the US public debt will continue to grow to 124 percent of the country's GDP in 2015, and the federal government will have to raise the debt limit by $5.5 trillion, Dagong said.

Dagong downgraded US ratings from AA to A+ on Nov 9, 2010 after the US government announced the second round of quantitative easing.

Wei Tian contributed to this story.

 Newscribe : get free news in real time

Bersih rally awakening the young voters in Malaysian politics; Registration easy & simple

Tweet

Awakening the young voters

ANALYSIS By BARADAN KUPPUSAMY

Pakatan Rakyat is seeking to keep the rally’s momentum going, hoping that it can be sustained until an early general election is held. 

NOW that the Bersih 2.0 rally is over, what’s in store for the divided politics of the nation? It’s a question on the minds of many Malaysians.

The Bersih 2.0 rally was a success by some measure because Pakatan Rakyat supporters braved police restrictions, roadblocks and barbed wire to gather in the city centre calling on the Government to institute electoral reform.

Their eight-point demand included issues that the opposition had been campaigning on for many years, like a clean electoral roll, reforming postal voting and a minimum of 21 days for campaigning.

These are fundamentals of a basic election system in a democratic society and few citizens would find this objectionable.

Saturday’s rally, therefore, had an unprecedented impact on society at large and on the election system, comparable to the March 8 political tsunami.

While Saturday’s rally was smaller in size compared to Bersih’s first rally in November 2007, the effects were the same – the awakening of young people to political action to rally for a basic right in defiance of the police.

In 2007, Bersih had the run of the city with huge numbers converging on the Istana to deliver a memorandum to the King.

Anwar called the 2007 Bersih rally an unqualified success.

Three months later, a general election was called that saw a loose coalition, that later became Pakatan Rakyat, winning five state governments and denying Barisan Nasional a two-thirds majority.

This time, too, Anwar is expecting an early election, probably by the fourth quarter of this year to capitalise on the Bersih 2.0 momentum.

709 pictures of the BERSIH march. Malaysians unite!

https://picasaweb.google.com/104201905154669598873/Bersih2Rally090711?authkey=Gv1sRgCN2Bo8PKqdzNIQ#slideshow/5627287829029822

Voices from Malaysian: 

 Patrick Teoh

Teoh has come a very long way from his days as an announcer on the Rediffusion private radio station before establishing himself as one of the pioneers in mobile discos. In fact, till today people still associate Teoh with his voice though he is also into the arts and theatre.

Watch and listen his Video:


By PR’s reckoning, Bersih 2.0 was a major success and big enough to wipe out the series of by-election losses they suffered in recent months and the spate of defections from PKR to BN.

The internal turmoil caused by PKR’s direct elections that also saw many people disheartened with PKR has also been eclipsed.

PR sought to keep its Bersih 2.0 momentum going by organising a large rally in Penang, a PR state, on Monday that was well-attended.

It is hoping that the momentum would be sustained until an early general election is held.

It needs to step up its criticism of BN, organise more Bersih rallies in other states and perhaps take nationwide action to keep the momentum going.

For this reason alone, it is unlikely that Prime Minister Datuk Seri Najib Tun Razak would call an election this year.

He has to put some distance between the Government and the effects of the Bersih 2.0 rally.

Another reason for Najib to delay the general election is the urban voters whose preference is still with the opposition. He has to come up with imaginative programmes to win over the urban voters whose concerns are very different from the rural electorate.

Najib is also due to meet the Pope next week and hopes to establish a diplomatic relationship with the Vatican. He hopes to consolidate the Christian vote, which accounts for about 9% of the 14 million voters.

On another point, Bersih 2.0 leaders like Datuk Ambiga Sreenevasan tried hard to convince Malaysians that her organisation was an independent body and was acting independently.

It is, however, abundantly clear that Bersih 2.0 was an opposition affair from start to finish.

The police handling of the Bersih 2.0 rally is also under the spotlight. Although they were heavy-handed, there was a relative absence of violence except for one death of a PKR activist that was attributed to a heart condition.

The low level of violence as a whole also limited the electoral backlash against the Government.

Therefore, it is an opportune time to release all those arrested, including the six leaders of Parti Sosialis Malaysia who have been detained under the Emergency Ordinance for allegedly reviving communism.

The Bersih 2.0 rally did not come anywhere near those in Egypt, Tunisia, Yemen and Syria. But it will probably have an impact in the coming general election.

The rally proved its point that a large number of Malaysians can gather, despite police action, and march peacefully.

But Bersih 2.0 is unlikely to be a game changer in the way the first Bersih rally was.

Registration easy & simple

By SHAHANAAZ HABIB and RASHVINJEET S. BEDI sunday@thestar.com.my

PUTRAJAYA: Voter registration numbers have gone up significantly, thanks to efforts by political parties.
But some 40% of the new voters they have registered turned out to be ineligible.

“Some are dead, underage or already registered voters,” said Election Commission (EC) chairman Tan Sri Abdul Aziz Mohd Yusof.

“We verify with the National Registration Department (NRD) those who are genuine and get rid of the names of those who are not. This makes it tiring because we have to keep checking,” he told The Star.

Despite this, he said, political parties still registered the highest number, bringing in more half of the new eligible voters.

“Compared to universities and NGOs, the voters we get from political parties are a lot more,” he said.
For May alone, 52% of new eligible voters were registered by political parties.

Twenty per cent were registered through post offices and 13% by government departments.

The EC, meanwhile, roped in 10% of the new voters through its counters and outreach programme. Universities and NGOs helped to register 3% and 2% new voters respectively.

Abdul Aziz added that the EC had appointed political parties, NGOs and universities as assistant registrars to help register new voters, paying RM1 for every clean and confirmed new voter these organisations bring in.

“If they register 1,000 new voters and only 600 are genuine, we pay them RM600,” he said. Between 2008 and 2009, there were 10 million registered voters in the country and another 4.3 million eligible voters who were not registered.

This year, the total number of registered voters increased to 12 million and eligible unregistered voters dropped to 3.7 million.

“We have made registration easy and simple. You can go to the post office, youth bodies, universities, colleges, government departments, NGOs and political parties to register,” he added.

Abdul Aziz said the Malaysian EC was the only one in the world that appointed political parties to assist in registering new voters.

He pointed out that it made sense to rope in political parties. “We appoint an average of two assistant registrars for each state seat. And because they have an interest, they work very hard to register new voters.

“When we do the voter registration ourselves, the response is not very good. We go to events like TV3's Jom Heboh to register new voters but it is difficult for people to come forward.

“This has to do with attitude. People ask what benefit they get by registering as voters. Some people do not have the spirit. They ask what happens if they don't register and when they find out no action is taken, they leave it as it is. Only those who really love the country and would like to choose their own leaders would voluntarily go and register as voters.”

Abdul Aziz also advised the people to vote in their current place of residence as this was stipulated in the law. This would also resolve the issue of phantom voters, where voters allegedly stay in a different place from where they cast their vote.

He said people should not feel attachment to their hometown and balik kampung to cast their votes.
“If I stay in Shah Alam, I shouldn't go back to Penang or my hometown to vote,” he said.

He estimated that about 30% to 40% of Malaysians voted in a different place or state than where they lived.

“I have no power to force them to vote where they live. I can only explain and persuade them,” he added.

Changes & Reforms - a case of two opposing sides in Malaysia

Tweet

A case of two opposing sides

CERITALAH By KARIM RASLAN

We’ve reached a point where it doesn’t matter who brings the change – BN or PR, conservative or liberal, socialist or right-wing. Malaysians will get behind whoever is the most sincere in taking us out of this mess. 

Voices from Malaysian: 

 Patrick Teoh

Teoh has come a very long way from his days as an announcer on the Rediffusion private radio station before establishing himself as one of the pioneers in mobile discos. In fact, till today people still associate Teoh with his voice though he is also into the arts and theatre.

Watch and listen his Video:

LAST weekend’s thwarted march wasn’t an ordinary incident – it reveals two radically different world views.

While the march was nominally non-political, the chasm between the two forces – the Government and the demonstrators – clearly mirrors the increasingly acrimonious split between Barisan Nasional (BN) and Pakatan Rakyat (PR).

Of course, a deeply divided political terrain is always troubling, however, it is at least proof of a dynamic and thriving public discourse.

Ironically, the opposition, despite being excluded from the mainstream media, is clearly setting the terms of this debate.

It also shows that Malaysia remains a democracy – albeit a flawed one.

Indeed, I’d argue that the intensity of the discourse over the past few weeks highlights quite how much we Malaysians care about the state of our nation.

We can see and feel that the state is becoming more polarised – and in such a situation, we are being forced to choose sides.



Sitting on the fence is no longer a viable option – especially when the fence is been shaken so hard by the two opposing sides. However, there are some positives. Most notably the fact that the divide is not racial despite what some politicians are alleging.

In fact there are Malays, Indians, Chinese, Iban, Kadazan, Muslims, Christians, Buddhists and Hindu on both sides of the debate. Indeed, the struggle has gone way beyond racial and religious lines.

Instead we are tussling over political philosophies and principles.

While the differences are certainly stark, their mere existence indicates a certain maturing of our political system presenting us with the alluring prospect of a two-party system.

I must stress that the racial diversity on both sides represents a steadying force – anchoring us together as a nation.

And yes, you could say, it underlines the fact that we are debating a truly Malaysian set of issues.

So what are these substantive political differences? Well, for a start, they transcend mere personality.

On one hand, we have a strident Umno-led Government demanding the continuation of the status quo.

In this respect, Umno is very definitely a conservative (small “c”) force – defending and promoting the interests of the influence-bearing classes.

It’s arguable that Umno’s small businessmen/contractors have adopted the mindset and behaviour of the many minor aristocrats and noblemen that once surrounded Malaysia’s many istana (or palaces) jockeying for favours and/or contracts.

The current Umno vision is retrogressive – it looks back to the party’s heyday under Tun Abdul Razak and Tun Dr Mahathir Mohamad.

It is not a dynamic, expansive vision – witness the primordial and unavoidable cry for Malay unity interspersed with Malay rights.

As with those enamoured and indeed obsessed by the past there is a paranoia and fear of change. Understandably then, any concession or reform is seen of as an affront to Umno’s domination, dignity and integrity.

On the other, you have what is essentially a socialist front in Pakatan Rakyat.

They claim to represent the interest of the rakyat – the ordinary people, taking a moral high-ground on issues such as corruption, mismanagement and civil liberties.

They know the language of the people – focusing on day-to-day issues from rising food prices to the quality of education.

Obviously my formulation ignores the inconsistencies, but there’s no denying the socio-economic and “class” basis to this struggle.

At the same time the respective leaders play up these associations because politics – let’s face it – is also theatre and understatement doesn’t play to the gallery.

Returning to Pakatan, I must point out that the coalition’s very new-ness means they are much more flexible, less rigid and accepting.

Indeed, Hadi Awang’s courageous stance on Negara Kebajikan is an indication of the extent to which Pakatan is exploring new paradigms.

Of course, PAS carry a certain baggage themselves. For example, will the gentle and considerate PAS of today be replaced by a morally sanctimonious force once in power?

At a time when technology is changing so rapidly, (iPad succeeded by iPad2, just when you’ve begun to understand it), we’ve got to accept political systems have to change as well.

But will the face-off between the two opposing forces benefit us – the rakyat?

Well, I for one am confident that there will be change and that we as a nation desperately need that change.

Indeed, we’ve reached a point where it doesn’t actually matter who brings the change – BN or PR, conservative or liberal, socialist or right-wing.

Malaysians will rally behind whoever is the most sincere in taking us out of this mess, just as Ronnie Reagan and later Obama inspired their respective voters.

Ironically, after all this talk of substantive politics we’re back where we started with character and personality.

So, we have to batten down, wait, watch and judge because at the end of the day we, the people are sovereign and through the ballot box, we can kick out those who’ve let us down.

So carry on ladies and gentlemen of the political world, we’re watching and evaluating your performance.