My Maiden Song in Commercial Writing!

Yes, it is in print! It is so popular that I could not even get an additional copy for marketing purposes!

I started on the project sometime before Chinese New Year 2009. It was to stretch into the third week of April.

It was a great feeling to get the okay from the client before it went to the printers.

I have accomplished this in such a short time. The period was about 2 months. I had only two meetings with the clients. Much of the work was done using the email.

I thank Almighty God for this first entry into the publishing world!

US Economy's Latest GDP Data

WASHINGTON, Sept 30 — The US economy contracted at slower pace than previously thought in the second quarter, but a further decline in private payrolls in September was another indication that recovery from recession would be patchy.

The Commerce Department said today gross domestic product fell at a 0.7 per cent annual rate instead of the 1.0 per cent decline reported last month. This was better than market expectations for a 1.2 per cent drop.

GDP, which measures total goods and services output within US borders, fell at a 6.4 per cent rate in the January-March period.

A separate survey by the ADP Employer Services showed private employers 254,000 jobs in September more than the 210,000 layoffs the market had been expecting. However it was less than the 277,000 jobs lost in August.

“It’s (GDP) not an earth-shaking revision, but it does show a healthier picture than before because domestic spending is less weak. It’s unlikely to change perceptions about the third-quarter outlook,” said Pierre Ellis, a senior economist at Decision Economics in New York.

US stock futures rose after the GDP report, regaining losses suffered after data on private sector employment showed more job losses than expected in September. Bond prices fell on the news, while the dollar rose against the euro.

The decline in GDP will probably mark the last quarter of contracting output for the US economy, which slipped into recession in December 2007. The economy is believed to have rebounded in the July-September quarter.

With the second-quarter contraction, the country’s real GDP has shrunk for four straight quarters for the first time since government records started in 1947.

The shallow decline in activity in the second quarter reflected more moderate drops in consumer spending and business investment than previously thought, the report showed.

Consumer spending, which normally accounts for over two-thirds of US economic activity, fell at a 0.9 percent rate in the second quarter — smaller than the previously estimated 1.0 per cent decline. Spending rose at a 0.6 per cent rate in the previous quarter.

Business investment fell at a 9.6 per cent rate in the second quarter instead of 10.9 per cent, reflecting slightly better demand for software than previously thought. It tumbled 39.2 per cent in the first quarter.

Weak domestic demand meant businesses continued to reduce their stock of unsold goods. Business inventories plunged by a record US$160.2 billion (RM891 billion) in the second quarter rather than the US$159.2 billion drop estimated by the government last month. Stockpiles of unsold goods fell by US$113.9 billion in the first quarter.

The drop in inventories subtracted 1.42 percentage points from second-quarter GDP, the department said. Excluding inventories, GDP rose 0.7 per cent in the second quarter compared to a 4.1 per cent decline in the first quarter.

Rebuilding of inventories is expected to be one of the main drivers of the economy’s recovery. Economists agree that the recovery, which is also aided by government spending, is already under way.

However there are doubts over its strength and sustainability because of weak consumer spending as the economy continues to bleed jobs.

The department said corporate profits after taxes rose 0.9 per cent, much lower than the 2.9 per cent it estimated last month. It compared to analysts’ forecasts for 3.0 per cent growth.

After tax corporate profits increased 1.3 per cent in the first quarter.

Investment in nonresidential structures fell at a 17.3 per cent rate compared to a 43.6 per cent drop in the January-March quarter. Residential investment, at the heart of the worst US recession in seven decades, dropped at a 23.3 per cent rate in the second quarter. It fell 38.2 per cent in the first quarter.

There was encouraging news on the trade front. Exports fell at a smaller 4.1 per cent rate instead of the 5 per cent drop reported last month, the department said. Exports plunged 29.9 per cent in the first quarter.
Trade with buyers and suppliers from around the world on Alibaba.com!

There were positive contributions from the federal, state and local government during the second quarter.

A National Association of Purchasing Management-New York survey showed business activity in New York City surged to a near three-year high in September, building on recent optimism about local economic conditions.

Separately, the Mortgage Bankers Association said mortgage applications fell last week despite the lowest loan rates in four months, an indication the housing market would likely recover slowly from its three-year plunge. — Reuters

The World is in Debt!

The International Monetary Fund today lowered its estimate for global writedowns for banks and other financial institutions to US$3.4 trillion (RM11.8 trillion) but warned that loan losses were set to rise as unemployment grew.

In April the IMF estimated in its Global Financial Stability Report that global bank losses could reach US$4 trillion but said it cut the figure by US$600 billion to reflect rising securities values and new methodology for calculating writedowns.

“Global financial stability has improved, but risks remain elevated and the risk of reversal remains significant,” the IMF said. It added that the economic downturn was troughing but the recovery in advanced economies would be extremely slow.

The report said that while banks have enough capital to survive, their earnings are not expected to fully offset writedowns expected over the next 18 months.

It said stronger action was needed to bolster bank capital and earnings capacity to ensure banks could support a recovery.

The Fund said while private-sector credit growth has contracted in big economies, overall borrowing needs have not slowed as quickly because of burgeoning government deficits.

“The likely result is constrained credit availability,” it said, adding that continued support by central banks may be required to alleviate this.

Using new methodology to calculate the writedowns, the IMF said bank losses on loans and securities holdings amounted to US$1.3 trillion through the first half of 2009, with new writedowns of about US$1.5 trillion still needed through the end of 2010.

The report said US institutions were about 60 per cent through their needed writedowns, while their euro area and British counterparts had recognized only 40 per cent of losses.

DEAL WITH IT

It said loan losses are expected to account for around two thirds of total writedowns between 2007 and 2010, with housing the hardest hit in the United States and foreign loans the big contributors to loan losses in Britain and the euro area.

The IMF urged authorities to deal with troubled assets still on banks’ books, adding that reassuring stress test results and signs of economic stabilisation have eased pressure to deal with the toxic debt.

“Authorities, banks and investors need to persevere with these programs,” the IMF said, adding that in countries where banks were undercapitalised, such toxic assets should be ringfenced to reassure markets about future losses.

“Only when this source of uncertainty has been substantially reduced can banks fully participate in providing credit for recovery,” the IMF said.
Alibaba.com - Fast & easy sourcing right from your computer

The Fund said financial conditions in emerging markets have improved thanks to strong policies but estimated that companies faced foreign currency debt refinancing needs of US$400 billion over the next two years. — Reuters

US Economy and Home Prices

NEW YORK, Sept 30 — US house prices rose for a third month in July, but consumer confidence fell unexpectedly in September as the worst job market in 26 years fuelled worries about personal finances, private reports showed yesterday.

The data indicates the economic rebound is still in its early days following the worst recession in decades, and it could be a long time before consumers contribute to growth.

Despite improvements elsewhere in the economy and a roaring stock market rally since March, the weakness of the consumer sector bodes ill for the year-end, traditionally a period of heavy shopping and spending.

“Companies haven’t started to hire yet, which is going to weigh on confidence,” said Sean Simko, fixed income portfolio manager at SEI in Oaks, Pennsylvania.

“Offsetting that is the positive move in the equity market. But in the end, as individuals feel under pressure from the labour market, you will have confidence lower than where it needs to be to bolster the economy.”

Consumers’ job prospects might not improve anytime soon, judging by the plans of senior managers. US chief executives are not ready to step up hiring or capital spending, according to a Business Roundtable survey.

It said 40 per cent expect to cut US jobs over the next six months, compared with 13 per cent who expect to add them.

Stocks were lower after turning negative following the weaker-than-expected consumer confidence report. US government bonds, which are investors’ favorite safe haven during weak economic times, pared early losses.

CONFIDENCE GAME

The Conference Board, an industry group, said its index of consumer attitudes fell to 53.1 in September, versus a revised 54.5 in August and expectations of a rise to 57.0.

Reflecting Americans’ worries about employment prospects, the Conference Board’s index measuring jobs “hard to get” rose to 47.0 from 44.3.

At the other end of the scale, the gauge of “jobs plentiful” fell to 3.4 from 4.3. That was the lowest since February 1983 and ties in with Labor Department data showing the US unemployment rate was at a 26-year high of 9.7 per cent in August.

“While not as pessimistic as earlier this year, consumers remain quite apprehensive about the short-term outlook and their incomes,” said Lynn Franco, director of the Conference Board Consumer Research Center.

“With the holiday season quickly approaching, this is not very encouraging news.”

The poor outlook overall led consumers to evaluate their present situation as the worst since March. The present situation gauge fell to 22.7 from 25.4.

In a bit of good news for the Federal Reserve, which has pumped easy money into the financial system in an effort to revive the economy, one-year inflation expectations fell to 5.2 per cent from 5.4 per cent in August.

September’s inflation expectations were the lowest since October 2007. Some investors have worried that the Fed’s recovery efforts will ultimately spark inflation.

IN THE HOUSE

The S&P/Case-Shiller composite index of house prices in 20 metropolitan areas rose 1.6 per cent in July from June, more than triple the estimate of a 0.5 per cent rise found in a Reuters poll. This index rose 1.4 per cent the previous month.

The 10-city index gained 1.7 per cent in July after a 1.4 per cent rise in June.

Housing was at the epicenter of the financial crisis that pushed last year’s mild recession into deep a downturn, and massive foreclosures have heaped pressure on consumers.

“These figures continue to support an indication of stabilization in national real estate values, but we do need to be cautious in coming months to assess whether the housing market will weather the expiration of the Federal First-Time Buyer’s Tax Credit in November, anticipated higher unemployment rates and a possible increase in foreclosures,” David Blitzer, chairman of the index committee at S&P, said in a statement.

A first-time buyer credit of US$8,000 (RM27,962), which ends November 30, has jump-started housing activity this year. But there are concerns about the impact when this incentive disappears.

The monthly price increases helped slow the annual rates of decline but home prices were still down 12.8 per cent in the 10-city index and 13.3 per cent lower in the 20-city index.

Meanwhile, Fannie Mae, the largest provider of funding for US home mortgages, said delinquencies on loans it guarantees accelerated. — Reuters

Fancy Seeing Miyabi in an Indonesian Movie?

So what do you know, megastar Japanese porn star Miyabi is coming by to Indonesia to act in a comedy. The clerics are almost in arms!

Read on, this could be fun!

The Straits Times reported on Sept 29 that filmmakers in Indonesia are adamant on this.

Muslim leaders have blasted plans to bring in erotic film megastar Maria Ozawa, 23, popularly known as Miyabi, to play herself in the upcoming film, Menculik Miyabi (Kidnapping Miyabi).

But Maxima Productions general manager Adi Sudiadi said the firm would stick to plans to include Ozawa in the film, which tells the story of a group of university students who accidentally kidnap the starlet.

“We guarantee that Miyabi won’t be playing in a porn film here. We will bring her here not as a porn star, but purely for a comedy,” Sudiadi said. “Miyabi is well-known to Indonesians. We are expecting her to attract a lot of audience here."

“We are also trying to fix Miyabi’s image by showing she can do more than a porn star,” he said, adding that no final agreement had been reached with Ozawa to act in the film.

Indonesian Council of Ulema chairman Amidhan slammed the choice of Ozawa — who has gained notoriety in Japan’s porn industry, thanks to her Canadian-Japanese looks — as a threat to the moral health of the country’s youth. “Even if the film isn’t pornographic, it is very dangerous for our young people, particularly if they become fans of this porn actress and become curious enough to watch her films,” he said. “We have to be firm and not let rubbish into our country. This is about Indonesia’s reputation as the world’s most populous Muslim country”’

Nearly 90 per cent of Indonesia’s 234 million people are Muslim.

Indonesia’s Parliament earlier this month passed a controversial film law that imposes tighter controls on content, including violence and sex.

Will these tighter legal fetters torpedo Maxima Productions'great Miyabi dreams?

The Brain Drain Continues.....

The Straits Times has this story to tell about the topic of the continuing brain drain from Malaysia.

According to its report today (27 Sept), Harvard-trained Malek Ali,BFM's radio owner has recently lost two staff members of his radio station.He felt the reason of his loss was unnecessary.

One was an Australian radio station engineer and the other was the man's Malaysian wife. The couple returned to Australia after the husband could not renew his work permit.

“These are good people. He was among the best in his field,” Malek said. “He and his wife are now contributing to the Australian economy.”

That was a stark contrast to his own experience — in Singapore.

In 2000, he became a permanent resident there, while working for the Singapore operations of a Malaysian company. Six months later, he was asked if he wanted to apply for citizenship.

He did not. He came back to start the BFM radio station, but without his family. He felt it was better for them to continue living across the Causeway. He commutes every weekend to Singapore.

Malek's stories tell a succinct tale of the double whammy Malaysia is facing in the global grab for talent. Its citizens are being wooed by other countries, while its labyrinthine process of applying for permanent residence or even work permits drives away those who might want to stay.

This is not a new story. But it came to the forefront last week when complaints poured out on Internet forums after the Home Ministry held a high-profile exercise to award citizenships to 92 people.

The 92 were among the 33,000 “stateless” persons in the country. Most of them were born in Malaysia, but did not have legal papers as their births were never registered or the papers lost.

Among them was Leong Chwee Chun, 64. She had waited 36 years after her papers were lost during the Japanese Occupation.

But many of the best-qualified of these “stateless” residents have not stayed. Some left long ago, frustrated with inconclusive outcomes of their applications.

Plain-speaking Gerakan politician Dr Hsu Dar Ren tells of a former classmate who did not have citizenship, even though he was born in pre-independence Malaya, because his mother did not apply for it then.

The classmate was consistently top in his class and was later offered a scholarship to study in Singapore, where he became a citizen after graduating as an engineer. No one could blame him.

“The brain drain is really one of the biggest problems in Malaysia today, and this sort of thing does not help,” said Dr Hsu.

The citizenship ceremony was held with pomp last week to showcase the Home Ministry's pledge to clear the backlog of applications by the year end. It has already processed 70 per cent of the 32,927 outstanding applications for citizenship, 16,812 for permanent residency and 93,360 cases of late registration of births.

Malaysia's difficulty in retaining talent has become more acute as the government tries to lift the economy up and out of the low-cost, low-wages model. It needs to have better brains to operate in this country.

Prime Minister Najib Razak had asked the government's Economic Council for a new economic model to emphasise innovation and creativity. I wonder whether this can be done in a country that is steep in religious conservatism as generally wary of championing new ideas for early adoption. Malaysia has always been a laggard in this department.Even its academia is beginning to look suspect because of the so called fake degree uproar unleashed recently.

But as Malaysians like Malek have noted, the malaysian authorities ought to be more efficient about keeping talent. The Malaysian process is opaque and convoluted and the delays are notoriously legendary.

Many have complained that they are kept in the dark about the criteria — unlike countries such as Australia, which uses a clear points system.

There is widespread belief that much hinges on what Dr Hsu describes as “a numbers game”. In a country where race is linked to power, the racial balance is always part of the consideration. Fear is the key and as such the nation suffers.

It may not be an official policy, but there are scores of stories that hint of unspoken racial considerations.

But as it has been pointed out, even if they number in the thousands, new immigrants will hardly change Malaysia's demography.

“The demographic trend clearly shows that the major ethnic group is going to form a bigger and bigger proportion of the total population as time goes on,” said Dr Hsu.

The pledge to clear the huge backlog — which is part of the Home Ministry's Key Performance Indicators (KPIs) — is welcomed, but it will not go very far as long as the process itself is not reformed.

Management-style KPIs may focus on statistics, but not necessarily the right decisions.

“They can easily say 'no' to everyone and meet the KPI,” said Malek. “But we haven't done what is needed — provide a clear policy, transparency and speed.” —

The Hums at the Factories are Getting Louder

The Singapore Straits Times (Sept 27)did bring some indicative good news today about the state of the manufacturing sector in Malaysia.

Yes, at this time last year,it was bleak time for Malaysia’s manufacturing sector.Since last December, many factories started four-day work weeks which slashed the income of its employees by up to 20 per cent. Rumours were rife then that a three-day work week would be next. Some workers were told to go especially new ones.

Today some relief has slowly returned. Many are of the view that the worst may be over for the global economy.There has been a rebound in orders for most factories. Work schedules have been restored and many have their pay elevated to former levels.The morale in the factories is so much better these days.

The crash and subsequent rebound of the manufacturing industry, particularly in the electronics and electrical (E&E) sector, has resulted in Malaysia’s see-saw unemployment rate.E&E accounts for 40 per cent of Malaysia’s exports.After holding steady at 3.1 per cent for the third and fourth quarters of last year, unemployment shot up to 4 per cent in the first quarter of this year. Some 100,000 jobs were shed in those three months, most of them in manufacturing.

Given that sharp rise, the Malaysian government had forecast unemployment to be 4.5 per cent for this year, based on the assumption that the global downturn would last for a few more months, a government official told The Sunday Times.But then, monthly unemployment figures started falling. The jobless rate dropped steadily from 4.1 per cent in February to 3.6 per cent in May, which are the latest monthly figures available. Hence, the government may now revise the unemployment forecast for the year to below 4 per cent, the official said.

People working in the manufacturing industry, which had borne the brunt of layoffs during the downturn, are now the ones who are getting their jobs back, said Malaysian Trades Union Congress secretary-general G. Rajasekaran.“We haven’t heard much news of people being retrenched in the last two months. Instead, we hear that companies are rehiring,” he said.

Economists say that the return of orders to the E&E industry is one big reason for the rebound in employment. When the global meltdown struck, the sector was one of the worst hit. Like Singapore, Malaysia is an export-driven economy, and its E&E industry exports almost all of its products to key markets like the United States and China.With the global economy grinding to a halt at the end of last year, orders fell dramatically. But the demand for electronic products seemed to have recovered quickly.

Datuk Wong Siew Hai, chairman of the Malaysian American Electronics Industry (MAEI), feels that growth in the sector was driven by strong consumer demand for products like netbooks, mobile phones and smart phones, which continued to sell well in a sluggish economy.“Look at the new iPhone and the netbooks. They’re not too expensive, and everyone wants one,” he said.

MAEI represents 17 US companies, including giants Intel, Dell and AMD. The companies make up almost a third of the total value of Malaysia’s E&E exports, and contributed 11.3 per cent of the value of Malaysia’s total exports.MAEI members’ export sales rose more than 20 per cent in the second quarter of this year, and are expected to increase by at least another 10 per cent in the third quarter, said Wong.Besides E&E, there are other bright spots in the Malaysian economy.

Six days ago, Prime Minister Najib Razak said that the government’s two stimulus packages totalling RM67 billion were having a positive impact on the economy.He singled out the construction sector, one of the biggest beneficiaries.Construction grew by 2.8 per cent in the second quarter, while the services sector grew by 1.6 per cent.

But labour lobbyists like Factory Workers’ Coalition coordinator A.Sivarajan feel that it is too early to cheer.He noted that some retrenched factory workers have still not found jobs.Some became drivers while others ran illegal food stalls.Indeed, while Malaysia’s economy is rebounding, it is far from roaring.This year’s approved manufacturing investments are forecast to be only half of last year’s US$13.3 billion.It may be a while before the country sees quarterly growth rates of more than 7 per cent — the comfortable position it was in merely two years ago.

So, hold yuor horses! It is still too early to chill the beer glasses for a good cheer.