Okay this one will just be a simple post about a conversion I had with few friends of mine about some hypothetical series of events where they maybe better or worse for the investors.
As I have written in my last post, Khazanah has initiated a proposal of buying out the remaining 30% of MAS stock to make the revamping process easier. So they offered 27ct for every single unit of MAS share currently being publicly traded. Now the share price hovers around 25.5ct to 26ct, where some people are still buying at 26ct, making a very slight margin of 1ct(3.8% not too bad actually) once Khazanah bought over the share.
But that's the thing. The thing have not been finalised yet. A a matter of fact,no official letter or anything has been sent out to the shareholders. So, until an offer letter has been sent out, there are still possibilities that this could go bad or go for the better. Bear in mind that this process may take months.
How it may go bad? Obviously, govt make a revision of the offer price, Citizens not happy with govt keep bailing MA out to help certain individuals, Tun Mahathir keeps bashing the current govt for bailing out MAS and many other reasons. All these could result into reduced offer priced or the bail out not to happen at all. In the case offer price being revised to less than 27ct, the guys that bought at 26ct are pretty much screwed, and if there is no bail out, all of the shareholders are screwed. However the likelihood for this to happen is very low since Khazanah(govt) did announce their decision and that would be a very blatant way of manipulating your people. They always screw their people from every angle they could, but this would be too subtle.
How it may go better? most of the shareholders, or there are a few big-time investors in that 30% rejected Khazanah's 27ct proposal. In this case Khazanah would have to revise and increase their offer.The likelyhood of this to happen is pretty darn low too because you know why right? MAS is pretty deep in the shit and 27ct is already a pretty good deal for most investors.
Even though it is almost sure that Khazanah would proceed with the 27ct buy out, anything may happen and may screw it all up.Also, since the takeover process gonna take months with no estimated date at this moment, would you rather wait or sell them at slightly lower price (25.5-26ct) and vet the money to something else,with chances to get more return within the same period. The answer would depend your personality and what kind of investor you are
Thursday, 21 August 2014
Saturday, 9 August 2014
The Malaysia Airlines Saga : In the midst of chaos, there is also opportunity - Sun Tzu
I think every single one of us is already very familiar with the problems faced by this company. The company has been in the red for so many years, and recently hit by 2 high profile aircraft disasters which will most definitely get Malaysia name into a few National Geographic episodes or series. Additionally for Malaysians we already know how terrible the state of this company with every single politician seems to have a piece of their pie in the company and has been sucking Khazanah fund since forever. So this company is definitely what should be classified as very high risk.
6months ago, MAS stocks was traded at 315ct and MH370 dissappearance really hit the market hard where the stock went to its all-time low to 155ct. I don't know why I didn't buy it at that time, but probably because it was too shitty, and with all the news and all I just got distracted. It was only when it reach 20ct I realised that "This is pretty damn low for a national carrier isn't it??" So I went in when it was 20ct.
Few reasons why I decided to go into MAS and why I think it has a potential to give big return:
1. All my other portfolios are what I consider medium risk. I wanted to diversify where I want a small portion of my portfolio vested in a "chance to strike gold" kind of stuff.
2. This company has history being saved by the govt, not once but twice. No reason why there can't be the third time.
3. People will argue bailing out MAS for the third time will be too much. But let's look back at why the first and second govt bail-out happened? As I mentioned above, so many politicians have their personal interest in churning fund out of this company. They will want that to continue
4. I was expecting 3 scenarios that will be in my favor. First is that Khazanah will inject extra fund, the second is like what is happening where Khazanah buy out the remaining 30% of the publicly traded share and make it 100% khazanah, privatizing it (It is actually nationalised since Khazanah is govt owned firm). The third scenario will be a third party investor came in and became a major shareholder. The third one is highly unlikely because MAS is a national flag carrier, so the govt wouldn't want a third party investor as the major shareholder. Likewise, a third party investor does not wanna be a major shareholder for a national carrier because they will be tied with a lot of political and nationalism bullshit. That is not good for business.
So I bought some at 20ct, and the price went up and down a few time, just like a normal stock. I was just waiting for "good news" from the govt to come in and saves the day. Although they were few bad days where the performance was too bad that I had to tell myself to stop looking to my Bloomberg apps price update every couple minutes. Freaking technology that gives you price update every second. Then MH17 happened.....
It was not an easy experience holding the stock when such crisis happened. The night when MH17 news came out all over my FB wall, while other people were saddened, worried and sad about the victims, I was up all night running analysis and thinking about what may happen with MAS stocks and its future post MH17 crisis, and decided to keep holding them. Like I wrote above, even though I went in with the mentality to write-off the money, embracing the fact that I could never get my money back, money is still money and nobody likes losing money. The only time you are at peace with writing off money is when you make a donation. Even then, you would still expect some reward in the afterlife. Some friends know that I bought MAS share, and they texted me and told me to drop and let go while I can, simply short of telling me that I am an idiot to keep holding it. That surely didn't help.
But I kept holding my share for a few reasons ;
1. MH17 was different from MH370. It wasn't a disappearance but the plane was shot down. You may argue as want but the bottomline is that in that case, MAS was a victim and Malaysians moved from anger to sympathy towards MAS. This would make it easier for the govt to justify bailing MAS out.
2. MAS is a national carrier, to a certain extend carry national pride. No Prime Minister want to leave MAS gone bankrupt when one of its carrier got shot down unjustly. Leaving it bankrupt would also mean that Malaysians are accepting the fact that MAS is incompetent and deserved to be left unsaved. I wouldn't say it was the right way to use people's money but politically the right thing to do.
3. But most of all even most Malaysians don't want the airlines to go down where a rebel group(or Ukrainian whatever) was the one to put the last nail to the coffin. It is just not right.
4. I went in buying a high-risk investment, this is the exact thing that I should expect. I have to stick to my gameplan. If I got spooked with such news, I am being emotional and pretty much beat the purpose of the whole thing.
So I held my share and I gotta say I am lucky that things worked out perfectly as I wanted it to be. A reminder to myself and my friends that it could have easily gone the other way around. This was basically my first high risk investment, I have learned a lot from it and in many way marks a big milestones in my investing journey.
Few advises for myself and friends for investing in high-risk stock;
1. Keep your emotion in check.
2. Stop looking at the price update every few seconds. The fluctuation may also goes proportionate to your blood pressure. Not good for your health. Doesn't help with my receding hairline problem either.
3. Only tell about your investment to a very close circle friends or friends that actually know and analyze the market properly. I am not saying you shouldn't listen to other people's opinion. I do have few friends who actually analyze data and information differently from I do. They could easily reasoned out how everything I mentioned above could go the way around, basically telling you the negative implications of the events. You NEED to listen to those people to keep your check and balance. What you don't want is a cocky guy telling how idiot you are by presenting a fact word by word from whatever he reads in the internet or hears from his cousins. Those people will just disrupt your emotions. Not good.
4. As a Malaysian, take advantage of the fact that you know the political background, and how it will affect the market. Many of my foreigner friends think it is a bad idea to invest in MAS because they were only looking at the cashflow, business performance and company's fundamental. They don't know and can't possibly understand the political connection and the history between MAS, the govt and the people. Capitalize that.
Well I guess that was all I got to write. Though I do feel that I have some more to say, but the idea just doesn't come up when I am writing them down. It's always easier to speak them up rather than writing them down. Probably it is tied to my mediocre writing skill. But I guess if you want more details about it you gotta buy me a coffee or lunch so that we can have a longer conversation about it. I always find it easier to discuss about stuff when I am full, and with a nice cigar in my hand. Cheers.
6months ago, MAS stocks was traded at 315ct and MH370 dissappearance really hit the market hard where the stock went to its all-time low to 155ct. I don't know why I didn't buy it at that time, but probably because it was too shitty, and with all the news and all I just got distracted. It was only when it reach 20ct I realised that "This is pretty damn low for a national carrier isn't it??" So I went in when it was 20ct.
Few reasons why I decided to go into MAS and why I think it has a potential to give big return:
1. All my other portfolios are what I consider medium risk. I wanted to diversify where I want a small portion of my portfolio vested in a "chance to strike gold" kind of stuff.
2. This company has history being saved by the govt, not once but twice. No reason why there can't be the third time.
3. People will argue bailing out MAS for the third time will be too much. But let's look back at why the first and second govt bail-out happened? As I mentioned above, so many politicians have their personal interest in churning fund out of this company. They will want that to continue
4. I was expecting 3 scenarios that will be in my favor. First is that Khazanah will inject extra fund, the second is like what is happening where Khazanah buy out the remaining 30% of the publicly traded share and make it 100% khazanah, privatizing it (It is actually nationalised since Khazanah is govt owned firm). The third scenario will be a third party investor came in and became a major shareholder. The third one is highly unlikely because MAS is a national flag carrier, so the govt wouldn't want a third party investor as the major shareholder. Likewise, a third party investor does not wanna be a major shareholder for a national carrier because they will be tied with a lot of political and nationalism bullshit. That is not good for business.
So I bought some at 20ct, and the price went up and down a few time, just like a normal stock. I was just waiting for "good news" from the govt to come in and saves the day. Although they were few bad days where the performance was too bad that I had to tell myself to stop looking to my Bloomberg apps price update every couple minutes. Freaking technology that gives you price update every second. Then MH17 happened.....
It was not an easy experience holding the stock when such crisis happened. The night when MH17 news came out all over my FB wall, while other people were saddened, worried and sad about the victims, I was up all night running analysis and thinking about what may happen with MAS stocks and its future post MH17 crisis, and decided to keep holding them. Like I wrote above, even though I went in with the mentality to write-off the money, embracing the fact that I could never get my money back, money is still money and nobody likes losing money. The only time you are at peace with writing off money is when you make a donation. Even then, you would still expect some reward in the afterlife. Some friends know that I bought MAS share, and they texted me and told me to drop and let go while I can, simply short of telling me that I am an idiot to keep holding it. That surely didn't help.
But I kept holding my share for a few reasons ;
1. MH17 was different from MH370. It wasn't a disappearance but the plane was shot down. You may argue as want but the bottomline is that in that case, MAS was a victim and Malaysians moved from anger to sympathy towards MAS. This would make it easier for the govt to justify bailing MAS out.
2. MAS is a national carrier, to a certain extend carry national pride. No Prime Minister want to leave MAS gone bankrupt when one of its carrier got shot down unjustly. Leaving it bankrupt would also mean that Malaysians are accepting the fact that MAS is incompetent and deserved to be left unsaved. I wouldn't say it was the right way to use people's money but politically the right thing to do.
3. But most of all even most Malaysians don't want the airlines to go down where a rebel group(or Ukrainian whatever) was the one to put the last nail to the coffin. It is just not right.
4. I went in buying a high-risk investment, this is the exact thing that I should expect. I have to stick to my gameplan. If I got spooked with such news, I am being emotional and pretty much beat the purpose of the whole thing.
So I held my share and I gotta say I am lucky that things worked out perfectly as I wanted it to be. A reminder to myself and my friends that it could have easily gone the other way around. This was basically my first high risk investment, I have learned a lot from it and in many way marks a big milestones in my investing journey.
Few advises for myself and friends for investing in high-risk stock;
1. Keep your emotion in check.
2. Stop looking at the price update every few seconds. The fluctuation may also goes proportionate to your blood pressure. Not good for your health. Doesn't help with my receding hairline problem either.
3. Only tell about your investment to a very close circle friends or friends that actually know and analyze the market properly. I am not saying you shouldn't listen to other people's opinion. I do have few friends who actually analyze data and information differently from I do. They could easily reasoned out how everything I mentioned above could go the way around, basically telling you the negative implications of the events. You NEED to listen to those people to keep your check and balance. What you don't want is a cocky guy telling how idiot you are by presenting a fact word by word from whatever he reads in the internet or hears from his cousins. Those people will just disrupt your emotions. Not good.
4. As a Malaysian, take advantage of the fact that you know the political background, and how it will affect the market. Many of my foreigner friends think it is a bad idea to invest in MAS because they were only looking at the cashflow, business performance and company's fundamental. They don't know and can't possibly understand the political connection and the history between MAS, the govt and the people. Capitalize that.
Well I guess that was all I got to write. Though I do feel that I have some more to say, but the idea just doesn't come up when I am writing them down. It's always easier to speak them up rather than writing them down. Probably it is tied to my mediocre writing skill. But I guess if you want more details about it you gotta buy me a coffee or lunch so that we can have a longer conversation about it. I always find it easier to discuss about stuff when I am full, and with a nice cigar in my hand. Cheers.
Monday, 9 June 2014
Case Study : Negative interest rate.
Last week the Chairman of ECB, Mr Draghi has announced a negative interest rate(-0.1% annum to be exact) for banks that hold EUR account with them. This is definitely one of the weirdest policies that has been implemented in the banking world. Imagine you hold and account with a bank and say they give you like a shitty interest rate a year, 1.50% annum. Shitty rate, yeah but at the end of the year you will get 1.50% of your savings right? With negative interest rate, you are the one that have to pay money to the bank for the privilege of saving money with them. In this case, the banks that hold account with ECB will have to pay 0.1% (annum rate) for overnight. So you don't to worry much about this because this is only between ECB and the banks that have account with them, and most importantly because I am sure many of you don't have a EUR account. But that doesn't mean you don't have to know about it. Knowledge is power and the same thing could have happened to Malaysia one day. you'll never know.
Some of you maybe be a bit unclear about what ECB is and what their function is. Well ECB is the federal reserve, the central bank of EUR currency. Similar to BNM(Bank Negara Malaysia), to process every single settlement in RM (EUR for ECB). To make explanation easy, refer the pic below
Imagine situation where I have to transfer RM100 to your account but I hold an account with a different bank from you. What happens when I told my bank (Bank C) to remit RM100 to your account in Bank M is that Bank C will tell BNM to debit RM100 to their account and credit RM100 to Bank M account. At the same time Bank C will tell Bank M that the RM100 is for you. And only then, you will see RM100 in your account. This settlement or remittance can only happen if :
1. Both banks hold RM account with BNM
2. Let's say one of them, Bank C doesn't have RM account with BNM, they must hold an RM account with another Bank that have RM account with BNM. Basically it is just another level of message where that other bank will transfer their money to Bank M.
Although that pic above is actually Settlement 101, I myself never knew about it till I joined banking. The reason I explained above is so that you can have a better picture of the ramification of this negative interest rate. If BNM(substitute of ECB) were to implement negative interest rate, that would means, every single day Bank C and Bank M will have to pay BNM if they cannot zerorize (flatten or whatever mumbo jumbo words those accountants use) their account. But worry not, Bank C or Bank M will not implement the negative interest rate on you or me because we already have gajillion reasons not to park money in a bank, negative interest rate is pretty much a deal breaker. currently most banks in Europe are offering 0% or near zero interest rate on the saving account. Damn I guess zero is still better than negative.
So the message that ECB really wanna tell to the banks that hold EUR account with them through this new policy is, "I want you to get all the EUR you have out there, to the corporations, to the people, make them spend with it and generate economy." Pretty loud and clear. Of course with this negative rates, the lending rates also went down, to encourage people to borrow money from the bank. Pretty fancy move from the ECB, the first time in the history of modern banking to introduce a negative interest rate. US Federal reserve brought down the rate"near-zero" but never really went all the way to the negative zone.
It is kinda the recent 'in' thing with the Central Banks all over the world where they keep trying new fancy policy. The day Draghi announced about this new policy of his, few big media that I read mentioned that Draghi still have this one super power hidden weapon to beat deflation. The most potent weapon of all that he still keeps under his sleeve. Quantitative Easing. Fancy name right? I notice financial world likes to use fancy name for a stupidly easy stuff. I think it is one of a trick to sound more intelligent and make people easily amazed using fancy words. Quantitative Easing basically is printing money. See?? I wouldn't sound too intelligent if I simply say printing money. See?? I wouldn't sound too intelligent if I simply say printing money. Anyway, few years ago when Ben Bernanke of the US Federal Reserve announced QE, He didn't have many fans, and now medias describing QE as a "potent weapon".
Though undeniably QE did help in many ways generating the US economy (not so much in Japan because corporations there are stingy as a retired old man). It's just that the World is super worry on how this policy is gonna fuck us up in the ass one day. We don't know how it's gonna fuck us up, we don't know when and how bad it will be, but knowing how economy works, it will fuck us up one day.
Some of you maybe be a bit unclear about what ECB is and what their function is. Well ECB is the federal reserve, the central bank of EUR currency. Similar to BNM(Bank Negara Malaysia), to process every single settlement in RM (EUR for ECB). To make explanation easy, refer the pic below
1. Both banks hold RM account with BNM
2. Let's say one of them, Bank C doesn't have RM account with BNM, they must hold an RM account with another Bank that have RM account with BNM. Basically it is just another level of message where that other bank will transfer their money to Bank M.
Although that pic above is actually Settlement 101, I myself never knew about it till I joined banking. The reason I explained above is so that you can have a better picture of the ramification of this negative interest rate. If BNM(substitute of ECB) were to implement negative interest rate, that would means, every single day Bank C and Bank M will have to pay BNM if they cannot zerorize (flatten or whatever mumbo jumbo words those accountants use) their account. But worry not, Bank C or Bank M will not implement the negative interest rate on you or me because we already have gajillion reasons not to park money in a bank, negative interest rate is pretty much a deal breaker. currently most banks in Europe are offering 0% or near zero interest rate on the saving account. Damn I guess zero is still better than negative.
So the message that ECB really wanna tell to the banks that hold EUR account with them through this new policy is, "I want you to get all the EUR you have out there, to the corporations, to the people, make them spend with it and generate economy." Pretty loud and clear. Of course with this negative rates, the lending rates also went down, to encourage people to borrow money from the bank. Pretty fancy move from the ECB, the first time in the history of modern banking to introduce a negative interest rate. US Federal reserve brought down the rate"near-zero" but never really went all the way to the negative zone.
It is kinda the recent 'in' thing with the Central Banks all over the world where they keep trying new fancy policy. The day Draghi announced about this new policy of his, few big media that I read mentioned that Draghi still have this one super power hidden weapon to beat deflation. The most potent weapon of all that he still keeps under his sleeve. Quantitative Easing. Fancy name right? I notice financial world likes to use fancy name for a stupidly easy stuff. I think it is one of a trick to sound more intelligent and make people easily amazed using fancy words. Quantitative Easing basically is printing money. See?? I wouldn't sound too intelligent if I simply say printing money. See?? I wouldn't sound too intelligent if I simply say printing money. Anyway, few years ago when Ben Bernanke of the US Federal Reserve announced QE, He didn't have many fans, and now medias describing QE as a "potent weapon".
Though undeniably QE did help in many ways generating the US economy (not so much in Japan because corporations there are stingy as a retired old man). It's just that the World is super worry on how this policy is gonna fuck us up in the ass one day. We don't know how it's gonna fuck us up, we don't know when and how bad it will be, but knowing how economy works, it will fuck us up one day.
Saturday, 31 May 2014
Warisan Merdeka Tower - The downfall of Malaysia economy. Or maybe the whole Asia?
I think a couple months ago I shared in my Facebook an article prepared by Barclay's analyst about skyscraper index. And few days ago I was reading about Malaysia government about their mega project Menara Warisan Merdeka Tower which is estimated to finish by 2018. Let's just be very clear that I would steer this entry away from political. There will be no government bashing, but writing based on my observations what are the possible consequences it may bring to our economy.
This index was initially introduced by a property analyst name Andrew Lawrence. Basically what this index says is that, around the completion time (+/- 1year) of a skyscraper, or a mega building project, there will be an economy downturn. the logic is actually very simple, and quite acceptable to a simple minded me at least. I'm sure that even if you guys don't know jack about economy, you still would know that economy have its cycle right? There will be good time, and bad time. Basically, what happens in the skyscraper index is that, the commencement or the decision to start building a mega building project is when the economy is at its peak.
It makes sense. When the economy is at peak, that would be the time people start thinking, "Hey, let's start spending all the money we don't have and on top of that we borrow all the money the banks don't have. Anyway the lending rate is almost 0% annum right?????". The other would reply, "Hell yeah let's do that. Show our neighbours our small dick syndrome by building a massive building that looks like a penis" That's how easy a decision to build a mega multi-billion dollar building is. As mentioned above that economy usually is a cyclical thing, by the time the building finished, it would be just the sweet spot time for the economy to make a crash landing.
That is just the nature of market. When the market is bullish*, everyone is in this euphoric state like they in some mythical drugs. If someone came to them and tried to sell a slummy apartment somewhere not so close to Kuala Lumpur city with developer notoriously known for being terrible at property maintenance for RM500,000.00, they would still say, "Man, the price is quite expensive, but who cares right???? in 1 month it is going to like RM2million. Haha stupid other people who told me not to buy". But when the economy is bearish*, someone could tried to sell you a nice bungalow at RM10,000.00 and you'd still "Hmmmmmm quite a cheap price, but I don't think I am gonna buy this when by next week the value is just gonna be half of this. furthermore I now cannot make bank loan anymore because they are charging at 20% annum now".
(Bullish and Bearish is the words financialists use to describe uptrend and downtrend. Bullish is for uptrend and Bearish is for downtrend. No idea why bull and bear but some suggest it is due to the way they charge. A bull will charge with its head going upward whereas bear will charge down and tear you apart.)
Anyway, Malaysia had quite a good economy in recent years. I would not say a good economy with strong foundation but still, the citizens have been spending a lot of money they don't have, supporting the nation's economy leveraging their own household debt amount. So in 2010, the decision to build this mega project was announced and estimated to consume RM5Bn. Like I explained, the bullish market made it so easy to justify this RM5Bn investment. I am not saying it will not be a good investment at all, but it probably has to survive on a rough bearish economy period, which is tough and the outcome really depend on how resilient Malaysians and their government.
The skyscraper index report by Barclay gave multiple examples with most of the buildings being in the US because we know that generally if the US themselves is in recession, the whole will get it or at least feels a piece of it. They were few building names that I could remember, Empire state building, World Trade Center tower, Chrysler Building, Dubai's Burj Khalifa, Taipei 101, and one that hit home, Our nation pride The Petronas Twin Towers. The completion of the Twin Towers was the signal for Asian Economy Crisis 1998. Malaysia and most Asian countries were saved and skipped the 2008 crisis for reasons I am not writing in this entry. And then comes this new project by Malaysia, the Warisan Merdeka Tower, estimated to be finished by 2018. Ever heard of the 10 years cycle for economy? 1998, 2008, 2018? Personally I am not really a fan of that 10year cycle theory. I believe that the period may vary, and don't have to be 10 years. But seems to be going that way.
And when that happens again, will Our leader be coming up with some weird conspiracy theory about how Jews and their underground groups were the one responsible killing our economy again? I hope when that time comes, we would have a ballsy leader that will accept what he had done wrong. lol yeah I am being a bit dreamy.
This index was initially introduced by a property analyst name Andrew Lawrence. Basically what this index says is that, around the completion time (+/- 1year) of a skyscraper, or a mega building project, there will be an economy downturn. the logic is actually very simple, and quite acceptable to a simple minded me at least. I'm sure that even if you guys don't know jack about economy, you still would know that economy have its cycle right? There will be good time, and bad time. Basically, what happens in the skyscraper index is that, the commencement or the decision to start building a mega building project is when the economy is at its peak.
It makes sense. When the economy is at peak, that would be the time people start thinking, "Hey, let's start spending all the money we don't have and on top of that we borrow all the money the banks don't have. Anyway the lending rate is almost 0% annum right?????". The other would reply, "Hell yeah let's do that. Show our neighbours our small dick syndrome by building a massive building that looks like a penis" That's how easy a decision to build a mega multi-billion dollar building is. As mentioned above that economy usually is a cyclical thing, by the time the building finished, it would be just the sweet spot time for the economy to make a crash landing.
That is just the nature of market. When the market is bullish*, everyone is in this euphoric state like they in some mythical drugs. If someone came to them and tried to sell a slummy apartment somewhere not so close to Kuala Lumpur city with developer notoriously known for being terrible at property maintenance for RM500,000.00, they would still say, "Man, the price is quite expensive, but who cares right???? in 1 month it is going to like RM2million. Haha stupid other people who told me not to buy". But when the economy is bearish*, someone could tried to sell you a nice bungalow at RM10,000.00 and you'd still "Hmmmmmm quite a cheap price, but I don't think I am gonna buy this when by next week the value is just gonna be half of this. furthermore I now cannot make bank loan anymore because they are charging at 20% annum now".
(Bullish and Bearish is the words financialists use to describe uptrend and downtrend. Bullish is for uptrend and Bearish is for downtrend. No idea why bull and bear but some suggest it is due to the way they charge. A bull will charge with its head going upward whereas bear will charge down and tear you apart.)
Anyway, Malaysia had quite a good economy in recent years. I would not say a good economy with strong foundation but still, the citizens have been spending a lot of money they don't have, supporting the nation's economy leveraging their own household debt amount. So in 2010, the decision to build this mega project was announced and estimated to consume RM5Bn. Like I explained, the bullish market made it so easy to justify this RM5Bn investment. I am not saying it will not be a good investment at all, but it probably has to survive on a rough bearish economy period, which is tough and the outcome really depend on how resilient Malaysians and their government.
The skyscraper index report by Barclay gave multiple examples with most of the buildings being in the US because we know that generally if the US themselves is in recession, the whole will get it or at least feels a piece of it. They were few building names that I could remember, Empire state building, World Trade Center tower, Chrysler Building, Dubai's Burj Khalifa, Taipei 101, and one that hit home, Our nation pride The Petronas Twin Towers. The completion of the Twin Towers was the signal for Asian Economy Crisis 1998. Malaysia and most Asian countries were saved and skipped the 2008 crisis for reasons I am not writing in this entry. And then comes this new project by Malaysia, the Warisan Merdeka Tower, estimated to be finished by 2018. Ever heard of the 10 years cycle for economy? 1998, 2008, 2018? Personally I am not really a fan of that 10year cycle theory. I believe that the period may vary, and don't have to be 10 years. But seems to be going that way.
And when that happens again, will Our leader be coming up with some weird conspiracy theory about how Jews and their underground groups were the one responsible killing our economy again? I hope when that time comes, we would have a ballsy leader that will accept what he had done wrong. lol yeah I am being a bit dreamy.
Saturday, 24 May 2014
Singapore green Corridor run (trail track) - breaking the 10km barrier
Last Week I did 10km run. the Singapore Green Corridor Run. The run just started last year I think, so this is only the second time it is being held in Singapore. I feel like writing about this because that was the first ever running event that I ever entered. I do run every once in a while, but I never really push myself all the way to 10km. I probably do like 30mins running session which probably like 3-4km. And this is a trail track, unlike the usual paved road or on the threadmill that we do.
So anyway, just wanna share some experience of running in this event. The event started fairly early at 9:20am. Anything that starts before 11am on a Sunday is early for me. So I had to wake up like 730am that day. When I was about to go out of my place, the rain suddenly pouring down. Like really pouring down, like this is the last rain and there will be no more rain after this. The first thought that I had was "Quite a shitty day to run trail". Trail running is already wet, stinky and shitty without the rain, so the rain would just multiply that by 10 times.
Against my better judgement and the excuses I created in my mind (because I really didn't feel like running 10km 920am on Sunday morning when the other option is sleeping. Very tempting), I still went to the event starting point which is the old Tanjong Pagar KTM station. I convinced myself that by the time the race going to start, the rain would stop, and it did stop when I started.
So the organiser have an arrangement where they will keep my stuff and I can collect them at the finishing point. Kinda neat, I have always wondered how do the runners keep their personal belongings, handphones or money during the race. The race started at 920am and even though the rain has stopped, the evidence of it still lingered around. The trail was basically a trail of mud and puddles. Below is a picture of proof
In the first kilometer I have already felt the difference in running trail, which I never get during running on a paved road. There was just this awkward feeling about running on soft and uneven surface, where it was kinda hard for me to anticipate on how to embrace my foot with the impact when it hits the ground. I know I have heard many people told me that running trail is different than paved road bla bla bla but you would never really get how different it is until you run one. On top of that, the trail was practically an inclining track all the way from the 5th kilometer. My knee took it quite hard from my lack of experience in running on uneven surface and inclining track practically just killed me. I was fading quite fast after the fifth kilometer. I also have to remind you that I have never been a physically fit nor an athletic person. Different people might just shrug off these things and say that I am just making it bigger than it actually is.
Oh yeah, did I tell you that only after a couple of kilometers it started to rain cats and dogs again? Yeap. Already in the race and too late to stop, although the temptation to stop was always there because there were a few exits set up by the organizers for those who just had enough with that thing. I actually joined the race together with few of my colleagues, and my managers too. My Vice President, who is my direct manager, my Director, who is my manager's manager, and my Executive Director, who is my manager's manager's manager. So yeah, quitter is the last image that I want them to have when they think of my name.
As I am writing this, I also realized that the timing that we recorded apparently went accordingly to our corporate title and age, being that the guy with most seniority (and also the oldest) finished fastest and the young little analyst me finished last. The bloody old man (My Exec Director) is 55 year old and he finished the race in 59minutes. Although he does rund on a daily basis and the shorter runs during his daily run is 10km and the longer ones would be around 30km. So this run is really just another day for him. I remember there was a day some couple months ago when he went to Korea for a business trip, and he managed to join and run a marathon (yes the full 42.195km) during his trip. This old guy is a beast, really. I on the hand, run like every once in a blue moon, and be really happy if I could finish a 5km.
My timing was relatively bad in my book, at 84minutes. I was targetting somewhere around 70minutes range but that would be in the ideal world. I can think of few reasons why I could not achieve my target. Like I wrote above, my inexperience in running trail, and the pouring rain definitely did not help and there were many points during the run where people were actually bottlenecked because many slowed down to tread the muddy trail. It was tough, really where my I can't really control a steady pace. And most of all I think it was the 2 sticks of cigars that I had the night prior to the race. Those 2 sticks definitely did not help me during the race. But those are just excuses. What I'm really looking forward to is to improve my timing and do a longer distance. Perhaps I should do a half marathon next time, and also revisit this place next year and get a better timing. All being said and done, I may still not be the fastest runner there is, but when I start something, I finish it.
So anyway, just wanna share some experience of running in this event. The event started fairly early at 9:20am. Anything that starts before 11am on a Sunday is early for me. So I had to wake up like 730am that day. When I was about to go out of my place, the rain suddenly pouring down. Like really pouring down, like this is the last rain and there will be no more rain after this. The first thought that I had was "Quite a shitty day to run trail". Trail running is already wet, stinky and shitty without the rain, so the rain would just multiply that by 10 times.
Against my better judgement and the excuses I created in my mind (because I really didn't feel like running 10km 920am on Sunday morning when the other option is sleeping. Very tempting), I still went to the event starting point which is the old Tanjong Pagar KTM station. I convinced myself that by the time the race going to start, the rain would stop, and it did stop when I started.
So the organiser have an arrangement where they will keep my stuff and I can collect them at the finishing point. Kinda neat, I have always wondered how do the runners keep their personal belongings, handphones or money during the race. The race started at 920am and even though the rain has stopped, the evidence of it still lingered around. The trail was basically a trail of mud and puddles. Below is a picture of proof
In the first kilometer I have already felt the difference in running trail, which I never get during running on a paved road. There was just this awkward feeling about running on soft and uneven surface, where it was kinda hard for me to anticipate on how to embrace my foot with the impact when it hits the ground. I know I have heard many people told me that running trail is different than paved road bla bla bla but you would never really get how different it is until you run one. On top of that, the trail was practically an inclining track all the way from the 5th kilometer. My knee took it quite hard from my lack of experience in running on uneven surface and inclining track practically just killed me. I was fading quite fast after the fifth kilometer. I also have to remind you that I have never been a physically fit nor an athletic person. Different people might just shrug off these things and say that I am just making it bigger than it actually is.
Oh yeah, did I tell you that only after a couple of kilometers it started to rain cats and dogs again? Yeap. Already in the race and too late to stop, although the temptation to stop was always there because there were a few exits set up by the organizers for those who just had enough with that thing. I actually joined the race together with few of my colleagues, and my managers too. My Vice President, who is my direct manager, my Director, who is my manager's manager, and my Executive Director, who is my manager's manager's manager. So yeah, quitter is the last image that I want them to have when they think of my name.
As I am writing this, I also realized that the timing that we recorded apparently went accordingly to our corporate title and age, being that the guy with most seniority (and also the oldest) finished fastest and the young little analyst me finished last. The bloody old man (My Exec Director) is 55 year old and he finished the race in 59minutes. Although he does rund on a daily basis and the shorter runs during his daily run is 10km and the longer ones would be around 30km. So this run is really just another day for him. I remember there was a day some couple months ago when he went to Korea for a business trip, and he managed to join and run a marathon (yes the full 42.195km) during his trip. This old guy is a beast, really. I on the hand, run like every once in a blue moon, and be really happy if I could finish a 5km.
My timing was relatively bad in my book, at 84minutes. I was targetting somewhere around 70minutes range but that would be in the ideal world. I can think of few reasons why I could not achieve my target. Like I wrote above, my inexperience in running trail, and the pouring rain definitely did not help and there were many points during the run where people were actually bottlenecked because many slowed down to tread the muddy trail. It was tough, really where my I can't really control a steady pace. And most of all I think it was the 2 sticks of cigars that I had the night prior to the race. Those 2 sticks definitely did not help me during the race. But those are just excuses. What I'm really looking forward to is to improve my timing and do a longer distance. Perhaps I should do a half marathon next time, and also revisit this place next year and get a better timing. All being said and done, I may still not be the fastest runner there is, but when I start something, I finish it.
Friday, 16 May 2014
Inflation. What does it means?
Inflation. A word that we commonly hear in the news, read in the newspaper but never really grasp the idea of what it really is. Many Malaysians of my age, we probably heard it first when we were around 11 year old, standard 5. that year was 1998, when Malaysia was hit hard by the Asian Economic Crisis. Our former Prime Minister Mahathir implemented Zero Inflation measure, which was believed to be the ideal economic measure at that time (Which of course modern economist now would disagree with this method).
If we were asked whether we know what inflation is, we probably will say that we know of it. Of course, we hear about it all the time now right?? But then again we can't really describe what it actually is, how it happens and how it really affects us in a bigger picture. Yeap, we are that ignorant, even though this percentage affects us in so many ways in our life. Why bother when we can just blame it all on the economists and the politicians right?
In the not so modern world, but not really ancient, somewhere in the 18th century, economists said that inflation is the decrease in the value of a currency. In Layman term, If in year 1800 you can buy a pair of shoes for $1, in the year 1801 the same pair of shoes gonna cost you $1.50. That means your currency value diluted and you needed more of the currency to buy the same stuff. This is mainly caused by the supply of currency is bigger than the demand in the market. Too much currency(or fiat money in our case now) is being injected into the monetary system.
However in the modern world nowadays, especially when the world has gone through the industrialization era, economists realized that inflation does not just got affected by the supply of currency itself, but also the supply of the goods or commodities in the market. Example, if the supply of shoes suddenly quadrupled in the year 1801, the same pair of shoes probably gonna cost less than $1 compared to the previous year. It would probably be $0.50. In this case, your currency value has increased because the same $1 can buy you 2 pair of shoes in a year gap. So the supply of goods and the supply of currency, they both play their roles to determine the value of your currency.
Some people came to me and said that inflation would not happened if we stopped using fiat money and use gold or silver as currency. WRONG! 2 examples. When Europe was in their expansion and colonization era, Spain had a serious inflation issue when their conquistadors from the South America started bringing home all the gold from the Aztecs civilization that they plundered. The sudden influx of gold has eroded gold's value, because everyone suddenly had so many gold to spend. The other example was, even gold coins in the old days used to be circulated in a way where they would be collected, melted, and then mixed with other metals such as silver or iron etc. 300 gold coins came in, 1000 "not 100% gold" coins came out. 300 gold coins went back to the people, 700 would be used by kings and governments to fund their wars. Pretty good war funding machine this inflation thing was, and still is.
That is why there are these terms "nominal" and "real" when financial people talk about investments or loans. Nominal is the percentage, gain or loss without factoring in the inflation rate, whereas real is the percentage when you factor in inflation rate. Example, if your salary increment last year was 3%, and the Malaysia average annual inflation rate is 3%, your nominal increment is 3%, but your real increment is actually 0%. Because your new salary actually has exactly the same purchase power of your old salary. If your increment is actually lower than the inflation rate, well, you're kinda got screwed. At the same time, Corporations and employers have been using inflation as a tool to cut your "real" salary without you even realizing it. They get to sell their goods at higher price due to inflation, but giving you sub inflation increment gives them bigger margin on their profit. Sneaky yeah?
Deflation
Now you pretty much understand that excess supply of money can cause inflation right? And you would have this idea in mind "Why don't the government stop printing money like mad and curb this inflation issue" US government probably has been quite infamous recently with their currency printing stimulus program, at the same time diluting their USD currency value. Let me introduce you to the other side of inflation, the dark side of inflation. Deflation. It is when inflation has negative value. So it works the other around. But it may sounds good at first, because unlike inflation, the value of your currency increases over time. Your purchasing power increases. But not good in a bigger picture.
Japan is an example of a country that has been battling deflation for decades. In the 80s when their economy was booming, productivity increased like mad in Japan, a lot of goods and products need to be moved and sold, but the currency supply did not increased at the same pace with their productivity. Add in the baby booming factor into the equation, you imagine a country with the same amount of money in circulation, but the population grew exponentially, and the goods and products also increased at the same time. Day by day, people realized that the currency they hold is increasing in value due to lack of supply, whereas the value of goods are decreasing because of oversupply. This will discourage people to spend or invest their money. This situation is called liquidity trap where money is being trapped, hoarded, and not circulated, which further worsen the situation of the lack supply of money.
Corporations will make less profit in this case, since income has been reduced due to lack of sales and lowered price because of oversupply. They can't use the cut "real" salary method, because there is no inflation in this case. The value of money is stronger over time. So even if they give you 0% increment, the nominal increment is 0% but you are getting a "real" increment, because the value of money increases. So there is no other method but to cut manpower or stop hiring, or just cut your salary period. Unemployment rate will rise, the cycle will continue. Deflation is considered a vicious cycle because it is very tough to get out of it. Go ask Abe, he is still struggling to bring Japan out of it and his over-hyped Abenomics doesn't do jack. He tried using US formula, introducing money stimulus, printing out Japanese Yen. Japanese corporations have been making billions of yen out of the program, but the corporations still refused to flow down the wealth down to the people. Theoretically, the corporations that benefited from this program should then give out more salary increment to their employees so that the money will move, generate the economy, and bring out all the hoarded money. But the corporations themselves are still afraid to spend and hoarding the money for themselves. Stingy bunch if you ask me.
Hyper-inflation
There is another version of inflation. Hyper-inflation. I think many of you probably have heard a story about how inflation gone on total rampage like nobody business. Zimbabwe. If you read in google, somewhere in 2008, the inflation rate of Zimbabwe was estimated to be 6.5sextillion percent. Haha did you read that, sextillion!! I didn't even know that word exist before I read about that article. If I were to write the number down, I probably had to spend like a few minutes to write the number down, and recount whether I had the right number of zeros. Basically the causes can be simplified to no regulations, printing money to fund war, and corruption. No need to write in further details.
Needless to say, this situation is very bad since the money you hold pretty much worth nothing. $10 Zimbabwe dollar would worth nothing if the biggest note that they printed out was $100billion. You would think that this kind of thing would only happened to 3rd world country like Zimbabwe, but Germany themselves have had some series of hyperinflation drama with their Mark. Go google for more details.
The conclusion, inflation is an economic tool which has to be used very diligently. It is hard to pinpoint what is the ideal inflation rate, because every country has a different situation economic background, but many economists nowadays agree that 2% range is the ideal number to promote economic growth without eroding too much purchasing power from the people. Really need some extraordinary minds and leadership to dictate a country's economic move. May Malaysia be blessed with those people.
I myself am still learning about these things and may have different or wrong understanding about this whole thing. After all, I'm just a Chemical Engineering student, never have touched any economic textbooks my whole student life. If there are any wrongs in my writing, or anything that I misunderstood, please let me know or drop a comment. Or if you would like to have a cuppa to discuss about these kind of things, I am more than pleased to do so. I always have time to learn about these subjects that I missed when I was in school.
Farouk
If we were asked whether we know what inflation is, we probably will say that we know of it. Of course, we hear about it all the time now right?? But then again we can't really describe what it actually is, how it happens and how it really affects us in a bigger picture. Yeap, we are that ignorant, even though this percentage affects us in so many ways in our life. Why bother when we can just blame it all on the economists and the politicians right?
In the not so modern world, but not really ancient, somewhere in the 18th century, economists said that inflation is the decrease in the value of a currency. In Layman term, If in year 1800 you can buy a pair of shoes for $1, in the year 1801 the same pair of shoes gonna cost you $1.50. That means your currency value diluted and you needed more of the currency to buy the same stuff. This is mainly caused by the supply of currency is bigger than the demand in the market. Too much currency(or fiat money in our case now) is being injected into the monetary system.
However in the modern world nowadays, especially when the world has gone through the industrialization era, economists realized that inflation does not just got affected by the supply of currency itself, but also the supply of the goods or commodities in the market. Example, if the supply of shoes suddenly quadrupled in the year 1801, the same pair of shoes probably gonna cost less than $1 compared to the previous year. It would probably be $0.50. In this case, your currency value has increased because the same $1 can buy you 2 pair of shoes in a year gap. So the supply of goods and the supply of currency, they both play their roles to determine the value of your currency.
Some people came to me and said that inflation would not happened if we stopped using fiat money and use gold or silver as currency. WRONG! 2 examples. When Europe was in their expansion and colonization era, Spain had a serious inflation issue when their conquistadors from the South America started bringing home all the gold from the Aztecs civilization that they plundered. The sudden influx of gold has eroded gold's value, because everyone suddenly had so many gold to spend. The other example was, even gold coins in the old days used to be circulated in a way where they would be collected, melted, and then mixed with other metals such as silver or iron etc. 300 gold coins came in, 1000 "not 100% gold" coins came out. 300 gold coins went back to the people, 700 would be used by kings and governments to fund their wars. Pretty good war funding machine this inflation thing was, and still is.
That is why there are these terms "nominal" and "real" when financial people talk about investments or loans. Nominal is the percentage, gain or loss without factoring in the inflation rate, whereas real is the percentage when you factor in inflation rate. Example, if your salary increment last year was 3%, and the Malaysia average annual inflation rate is 3%, your nominal increment is 3%, but your real increment is actually 0%. Because your new salary actually has exactly the same purchase power of your old salary. If your increment is actually lower than the inflation rate, well, you're kinda got screwed. At the same time, Corporations and employers have been using inflation as a tool to cut your "real" salary without you even realizing it. They get to sell their goods at higher price due to inflation, but giving you sub inflation increment gives them bigger margin on their profit. Sneaky yeah?
Deflation
Now you pretty much understand that excess supply of money can cause inflation right? And you would have this idea in mind "Why don't the government stop printing money like mad and curb this inflation issue" US government probably has been quite infamous recently with their currency printing stimulus program, at the same time diluting their USD currency value. Let me introduce you to the other side of inflation, the dark side of inflation. Deflation. It is when inflation has negative value. So it works the other around. But it may sounds good at first, because unlike inflation, the value of your currency increases over time. Your purchasing power increases. But not good in a bigger picture.
Japan is an example of a country that has been battling deflation for decades. In the 80s when their economy was booming, productivity increased like mad in Japan, a lot of goods and products need to be moved and sold, but the currency supply did not increased at the same pace with their productivity. Add in the baby booming factor into the equation, you imagine a country with the same amount of money in circulation, but the population grew exponentially, and the goods and products also increased at the same time. Day by day, people realized that the currency they hold is increasing in value due to lack of supply, whereas the value of goods are decreasing because of oversupply. This will discourage people to spend or invest their money. This situation is called liquidity trap where money is being trapped, hoarded, and not circulated, which further worsen the situation of the lack supply of money.
Corporations will make less profit in this case, since income has been reduced due to lack of sales and lowered price because of oversupply. They can't use the cut "real" salary method, because there is no inflation in this case. The value of money is stronger over time. So even if they give you 0% increment, the nominal increment is 0% but you are getting a "real" increment, because the value of money increases. So there is no other method but to cut manpower or stop hiring, or just cut your salary period. Unemployment rate will rise, the cycle will continue. Deflation is considered a vicious cycle because it is very tough to get out of it. Go ask Abe, he is still struggling to bring Japan out of it and his over-hyped Abenomics doesn't do jack. He tried using US formula, introducing money stimulus, printing out Japanese Yen. Japanese corporations have been making billions of yen out of the program, but the corporations still refused to flow down the wealth down to the people. Theoretically, the corporations that benefited from this program should then give out more salary increment to their employees so that the money will move, generate the economy, and bring out all the hoarded money. But the corporations themselves are still afraid to spend and hoarding the money for themselves. Stingy bunch if you ask me.
Hyper-inflation
There is another version of inflation. Hyper-inflation. I think many of you probably have heard a story about how inflation gone on total rampage like nobody business. Zimbabwe. If you read in google, somewhere in 2008, the inflation rate of Zimbabwe was estimated to be 6.5sextillion percent. Haha did you read that, sextillion!! I didn't even know that word exist before I read about that article. If I were to write the number down, I probably had to spend like a few minutes to write the number down, and recount whether I had the right number of zeros. Basically the causes can be simplified to no regulations, printing money to fund war, and corruption. No need to write in further details.
Needless to say, this situation is very bad since the money you hold pretty much worth nothing. $10 Zimbabwe dollar would worth nothing if the biggest note that they printed out was $100billion. You would think that this kind of thing would only happened to 3rd world country like Zimbabwe, but Germany themselves have had some series of hyperinflation drama with their Mark. Go google for more details.
The conclusion, inflation is an economic tool which has to be used very diligently. It is hard to pinpoint what is the ideal inflation rate, because every country has a different situation economic background, but many economists nowadays agree that 2% range is the ideal number to promote economic growth without eroding too much purchasing power from the people. Really need some extraordinary minds and leadership to dictate a country's economic move. May Malaysia be blessed with those people.
I myself am still learning about these things and may have different or wrong understanding about this whole thing. After all, I'm just a Chemical Engineering student, never have touched any economic textbooks my whole student life. If there are any wrongs in my writing, or anything that I misunderstood, please let me know or drop a comment. Or if you would like to have a cuppa to discuss about these kind of things, I am more than pleased to do so. I always have time to learn about these subjects that I missed when I was in school.
Farouk
Saturday, 3 May 2014
We are getting old
When I write "We" in the title, I don't really mean for all the readers of this blog, but more to people to my age. And I do not mean old as in the number that starts ticking the year that we were born, but the way we think, the ideas that we have in mind and our opinions on the newer generations.
A while back, I read a facebook status of a friend of mine. A young mom, with a kid probably around 1-2year old. She was writing about how she religously believed that parents exposing their kids to young age (2-3yo) is such a bad thing. Of course in that same post she was saying how an examplary mom she was in raising her kids. Probably you guys with no kids like me have seen a few statement of these young parents indirectly inflating themselves claiming they're like the best mom/dad of the world and sharing about how good they are raising their kid(s). Don't wanna go too deep into that cos I'll probably do the same thing if I ever had any kids one day. That being said, at that time I kinda agreed with her, kids nowadays are getting too too much exposure of these things.
But then I was in an MRT(the train here) last week, taking a ride back from home. While I was standing in there I saw a child in his stroller. The kid was playing some kind of puzzle game, I don't know what game was that, but he looked like he was enjoying himself, and he seemed to be doing quite good at it. I was impressed, not just by the fact that he knows how to operate that thing, but also that he was solving puzzles with that game. Again, the kid was only like 2 or 3 year old. That kinda got me thinking that this kind of exposure was not too bad at all. I think it does generate a certain kind of interaction albeit not with human. Nevertheless, it still helps with the kids mind growing with many kinds of puzzles and problem solving applications.
When I was a kid, I played a lot of video games, and people of my parents generations also religiously believed that playing video games are bad for us kids. But I for one did not think so, and I know many would agree with me. Video games gave me a lot exposure to English language. You think I would pick up English by reading grammar books and the boring lame textbooks? hell no. And then there were (and still exist) computers and internet. Did you remember how during that day spending an hour in the internet would warrant a lecture from your parents? Nowadays it is so common we are carrying a gadget if not two with internet access. Our life will be incomplete and paralyzed if we don't have internet access in a day. Even some of our parents now have a facebook account and probably been posting more stuff than us nowadays. Probably even have more social networks accounts than we do. How time has changed yeah?
When I was in my video gaming days my dad would tell me all sort of stuff he used to do when he was a kid and those are the things that I have missed and did not get the chance to do. I still had the opportunities to play some of the traditional games, but apparently according to him that was like the milder and unoriginal version of them, and the golden age of traditional games were during his days. Okay dad... And now I see people of my generation whining about how the kids nowadays never play any traditional games and resented it. What I am trying to say is that if our ancestors thousand years before Us used to run for days to stalk and hunt cheetah for sport when they were teenagers, do you expect your kids to do the same thing?
The World and technologies are moving so fast nowadays,I think that there is a part of Our brain, our subconscious mind is actually being defensive about these changes. Fear or scared would be too strong of a word, but I am trying to be a bit vanilla by saying defensive. We keep telling ourselves that the good old way is the best. Hey, we turned out just fine anyway right? No reason why it wouldn't work out the same with our kids. I think that by doing so, we are actually teaching our future generation of the World that was, and making them ignorant about the World that is, and the World that will be. We are imposing an old system and Ideas that have worked on Us, but not necessarily going to work on them.
Why would We wanna severe their exposure and access to the progress of this world? Shouldn't our task be preparing and nurturing them so that they will be up to date to this harsh and ever evolving world? I am not suggesting leaving the kids with unlimited and unmonitored usage of those technologies, but I do think severing the connection wholly is unwise. Again, I am being vanilla by using the word unwise. I have another stronger words in mind. The key is in moderation. Everything has to be in moderation, even moderation itself.
Ignorant. That will be another thing that I think we develop as we grow. We develop the attitude that We have been through enough and We know enough crap that the opinions of people younger than us means shit. This is Us in our mid to late 20s. Wait till we get to 50s, we are gonna think people should bow and obey to our every word just because we're old. By that time, We are going to consider the voice of younger generations are just like insects buzz and we will spank their asses for their opinions because they dare to talk back to us. What a great culture and society We are living in.
Probably by this time, people with kids are already cursing me by writing this, saying that I know nothing because I don't have kids yet. But hey, they are right. I don't have kids yet, that's why I write this opinion of mine. Probably one day when I had one, my opinions would change, I would see things in their perspective. But that would actually just proved my points here. That day, when I started thinking like an old, outdated man, living in an old World inside my own head. By that time, you will see my Facebook status championing myself as the best dad in the World, uncontested and disregarding billions other Dads in the World. If it comes to that, please forgive me in advance.
A while back, I read a facebook status of a friend of mine. A young mom, with a kid probably around 1-2year old. She was writing about how she religously believed that parents exposing their kids to young age (2-3yo) is such a bad thing. Of course in that same post she was saying how an examplary mom she was in raising her kids. Probably you guys with no kids like me have seen a few statement of these young parents indirectly inflating themselves claiming they're like the best mom/dad of the world and sharing about how good they are raising their kid(s). Don't wanna go too deep into that cos I'll probably do the same thing if I ever had any kids one day. That being said, at that time I kinda agreed with her, kids nowadays are getting too too much exposure of these things.
But then I was in an MRT(the train here) last week, taking a ride back from home. While I was standing in there I saw a child in his stroller. The kid was playing some kind of puzzle game, I don't know what game was that, but he looked like he was enjoying himself, and he seemed to be doing quite good at it. I was impressed, not just by the fact that he knows how to operate that thing, but also that he was solving puzzles with that game. Again, the kid was only like 2 or 3 year old. That kinda got me thinking that this kind of exposure was not too bad at all. I think it does generate a certain kind of interaction albeit not with human. Nevertheless, it still helps with the kids mind growing with many kinds of puzzles and problem solving applications.
When I was a kid, I played a lot of video games, and people of my parents generations also religiously believed that playing video games are bad for us kids. But I for one did not think so, and I know many would agree with me. Video games gave me a lot exposure to English language. You think I would pick up English by reading grammar books and the boring lame textbooks? hell no. And then there were (and still exist) computers and internet. Did you remember how during that day spending an hour in the internet would warrant a lecture from your parents? Nowadays it is so common we are carrying a gadget if not two with internet access. Our life will be incomplete and paralyzed if we don't have internet access in a day. Even some of our parents now have a facebook account and probably been posting more stuff than us nowadays. Probably even have more social networks accounts than we do. How time has changed yeah?
When I was in my video gaming days my dad would tell me all sort of stuff he used to do when he was a kid and those are the things that I have missed and did not get the chance to do. I still had the opportunities to play some of the traditional games, but apparently according to him that was like the milder and unoriginal version of them, and the golden age of traditional games were during his days. Okay dad... And now I see people of my generation whining about how the kids nowadays never play any traditional games and resented it. What I am trying to say is that if our ancestors thousand years before Us used to run for days to stalk and hunt cheetah for sport when they were teenagers, do you expect your kids to do the same thing?
The World and technologies are moving so fast nowadays,I think that there is a part of Our brain, our subconscious mind is actually being defensive about these changes. Fear or scared would be too strong of a word, but I am trying to be a bit vanilla by saying defensive. We keep telling ourselves that the good old way is the best. Hey, we turned out just fine anyway right? No reason why it wouldn't work out the same with our kids. I think that by doing so, we are actually teaching our future generation of the World that was, and making them ignorant about the World that is, and the World that will be. We are imposing an old system and Ideas that have worked on Us, but not necessarily going to work on them.
Why would We wanna severe their exposure and access to the progress of this world? Shouldn't our task be preparing and nurturing them so that they will be up to date to this harsh and ever evolving world? I am not suggesting leaving the kids with unlimited and unmonitored usage of those technologies, but I do think severing the connection wholly is unwise. Again, I am being vanilla by using the word unwise. I have another stronger words in mind. The key is in moderation. Everything has to be in moderation, even moderation itself.
Ignorant. That will be another thing that I think we develop as we grow. We develop the attitude that We have been through enough and We know enough crap that the opinions of people younger than us means shit. This is Us in our mid to late 20s. Wait till we get to 50s, we are gonna think people should bow and obey to our every word just because we're old. By that time, We are going to consider the voice of younger generations are just like insects buzz and we will spank their asses for their opinions because they dare to talk back to us. What a great culture and society We are living in.
Probably by this time, people with kids are already cursing me by writing this, saying that I know nothing because I don't have kids yet. But hey, they are right. I don't have kids yet, that's why I write this opinion of mine. Probably one day when I had one, my opinions would change, I would see things in their perspective. But that would actually just proved my points here. That day, when I started thinking like an old, outdated man, living in an old World inside my own head. By that time, you will see my Facebook status championing myself as the best dad in the World, uncontested and disregarding billions other Dads in the World. If it comes to that, please forgive me in advance.
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