No threats

Malaysiakini reports in the piece entitled, Amirsham: Our economy not under threat that the Minister in the Prime Minister's Department, Amirsham Abdul Aziz, today rejected claims that the country's economy was under threat in the wake of a global economic crisis, saying Malaysia was well-equipped to weather the storm.

Being the ex-banker that he is, the Minister did NOT answer the question posed. Raime Unggi (BN-Tenom) had quite sensibly asked whether the government had any alternative plans to manage the country's unstable economy, including fluctuating fuel prices and inflation.

The Minister's answer was narrowly on the financial sector. He completely overlooked, side-stepped, ignored or, avoided (take your pick) the question from the MP from Tenom. The question was on the general economy. He was NOT asking about the banking sector. Duh?

The rest of the economy
Take the Malaysian capital market. The KLCI, as a broad indicator is now below 1,000 points despite having started the year with ambitions of achieving 1,500 points. What has been the impact of this loss of wealth on the wider economy?

Exports
Take the export sector which is driven by oil, manufactured goods and oil palm. Oil prices per barrel touched USD144 per barrel and has eased to USD78 per barrel. CPO prices crossed RM4,000 per metric tonne and has eased down to RM1,800 per metric tonne.

Automotive sector
Despite announcements by car manufacturers to the contrary, it is certain that automotive sales are down. Proton needs a new suitor again. What is the rate of projected sales for 2009 for this sector?

White goods
Exports of white goods such as TV, radios, camcorders, air-conditioning units, washing machines, and so on are on the decline. What is the extent of the decline? What is the projected value of exports for 2009?

Retail
Retail sales are going down. How far down has retail sales gone since January 1, 2008? What is the projected scenario for 2009?

The list goes on.

Economic data needed
Will the government be able to release economic data for the type of information raised above? The Malaysian economic players and the general public needs to know all this in order to forward plan.

Knowledge elsewhere
Malaysians are not unaware that countries like the U.S. are projected to enter into recession mode. Ironically, there is more economic data available on other countries than there are on Malaysia.

We know, for example, that Nouriel Roubini, the professor who predicted the financial crisis in 2006, has said that the U.S. will suffer its worst recession in 40 years, causing the recent rally in the stock market to sputter.

Roubini has warned that there are significant downside risks still to the U.S. market and economy and, that, the expected recession will last 18 to 24 months, driving unemployment to 9 percent, and already depressed home prices will fall another 15 percent.

Roubini reckons that the U.S. government will need to double its purchase of bank stakes and force lenders to eliminate dividends to save them from bankruptcy. The U.S. government has just committed USD250 million to purchase bank stakes.

More ominously, Roubini also reckons that this will only be the first round of recapitalization of the banks. He is also quoted as saying that the stock market is going to stop rallying soon enough when they see the U.S. economy is really tanking right now.

From available data, we know that the U.S. unemployment rate stands at a five-year high of 6.1 percent last month. From the available data, we also know that home prices in 20 U.S. metropolitan areas fell 16 percent in July from a year earlier.

Knowledge in Malaysia

It is not as if Malaysian economists and analysts are stupid. But one senses a lingering fear of speaking out freely between and amongst economists and analysts whose livelihood may be threatened by powers that be for offering contrarian views to the bland and dull and vague pronouncements by Ministers and their departments. In some cases the dreaded three-letters, I.S.A., have been uttered; you know, threats to economic security and all that.

So, with the proverbial Sword of Damocles hanging over their heads, intelligent and articulate Malaysian economists and analysts are stymied.

What does it say about Malaysia's economic management and general socio-political environment when we know more about the U.S. economy and, even the economy of China, compared to what we know about the Malaysian economy?