Sunday, March 14, 2010

The Khairy Chronicles: Chapter 1 Cabinet to Save Malaysia

In the year 2020, which is only about 10 years away, we will be facing one of the most challenging episodes in not only our local economy but in the global economy as well. The decisions made over the last couple of years, that saw an explosion in the debt of most OECD countries would definitely have had a significant impact in the value of the US Dollar and the movement of global trade.

Against this backdrop, Malaysia is finding itself in an extremely tough situation. After suffering through 5 years of Opposition rule, Barisan Nasional led by its youngest President, took back the mantle of the Government from Pakatan Rakyat and found itself in the unenviable position of trying to rescue a country that is on the verge of meltdown. The Government's public sector debt had shot past the RM 1 trillion mark, and the ringgit is trading at RM 4.60 to the US Dollar, and RM 5.50 to the Singapore dollar and RM 0.36 to the Thai Bhat. The regional economies of Thailand and Indonesia has spurred ahead with the Thai Bhat trading at 13 Thai Bhat to the US Dollar and the Rp 3,500 to the US dollar as well.

China is dominating the Asian economy and Taiwan had reunified with China a couple of years back. The US is in an economic depression as currency has been debased against most regional currencies, with 1 Euro buying USD 2.20 and 1 USD only buying 50 Yen.

Malaysia which had failed to institute proper policies under the rule of Pakatan Rakyat suffered a massive capital flight and attempted to institute capital controls once again in 2017. However, the export industry had been on the wane for the last 10 years, and could not find new markets for their products and services. The prized new convention centre for MITI laid bare as investors shunned the nation. Food and oil was in shortage and the Pakatan Rakyat Government was frequently bickering and did not manage to do a single good thing. 

In 2019, a General Election was called. Now 43 years old, a young Dato Seri Khairy Jamaluddin led Barisan Nasional to one of its greatest election victories to date promising a solution to the rot that had set in. They won all the states and commanded 90% of the seats in the parliament.

After taking the oath of office in National Palace, Dato Seri Khairy proceeded to assemble his Cabinet to Save Malaysia. I was called out of semi retirement, and asked to head the all powerful Ministry of Finance with supervisory capabilities across many of the other Ministries.

This my recollection of what had transpired during those days

I was shocked. 

I had been following the economy regularly for the past 10 years but was shocked to learn of the extent of the damage left by the DAP and their PAS acolytes. We had just been 1 month into our administration when he had to redeem approximately RM 160 billion worth of bonds which had been entered into by the previous Government on a short maturity basis. Globally the financial markets were horrible, and to refund this debt we could not rely on the domestic banks (dominated by the Pakatan folk) and had to go to the international market.

My first job as Finance Minister was to fly to Beijing to try and sell our debt. It was a tense affair and I had goosebumps in my stomach. I was so angry that our beloved country had to come down to this level. We had to secure $USD 34 billion in financing immediately or print more money and tank the ringgit. The financial markets domestically was still in flux with the short term MGB Government bond rate yielding 8%. The Long Term curve however was only 7% I knew the markets were telling me something - "It looks like shite right now, but the markets were factoring a recovery under Dato Seri Khairy." I told my aid, Salim Rajagopal.

But to borrow at 8% on a short term basis was out of the question. We would have to pay approximately an additional USD $3 billion in Interest this year alone.

I travlled on RMAF  2, arrived in Beijing and as per my instruction went straight to the hotel to freshen up with my first meeting with the Chinese Premier scheduled at 7.00 pm that same day. During that time, we talked about a lot of things, and I could sense that the Chinese wanted to reassure us that they will help whichever way they could. The DAP Chauvinists had misjudged the Chinese during their time in Government. They thought that the Chinese Government would be behind them, however their Finance Minister Tony Pua was just rebuffed time and time again.

Well I have to make a confession. Half of the senior Chinese politburo were my friends in Stanford, they saw through the DAP and had nothing to do with them.

But there had been a change in Government in China as well. Some of my old contacts were not there anymore.

But when I met the Chinese Premier, I did not talk business. Our discussion was centred really about KJ. The Chinese were quite eager to find out more about the Prime Minister. I told them what they needed to hear.
The meeting adjourned to dinner, and I hit the sack at about 11:00 pm.

The next day was the deal day. I had assembled some of my ranking Lieutenants who had served me in my private market days and now were in a position to pay back those favours. I entered the Hall of Presidence and Tranquility on the 101st Floor of the Beijing Imperial Tower, instructed the meeting room to be void of anybody whom I had not known and proceeded to deliver the following statement.

"KJ Expects That You Will Do Your Duty."

It was the shortest investment pitch ever in the history of the financial markets

In the 5 hours,  we managed to secure all manner of financing deals, most of them intelligently crafted to include options like repayment in ringgit, calls, puts, derivatives and all manners of fixed income deals to get the 34 billion required.

Our average interest rate: 6% for 3 years. I had just saved the KJ Government between 5-7 billion US Dollars.

Mission accomplished, I took the limousine and went straight to the airport. I had briefed the Prime Minister after the deal was secured and he expected back at work the next morning.

Somehting was a foot and he needed me at the Crisis Room 8.00 am the next day


Repoman said...

Apa punya cerita bodoh ni? Nak tebus bon kena pi cina? Bodoh lah hang. Kao tak tau camana the Government bond market works. Its an auction lah bodoh. Its not on an offmarket deal. kalau buat deal macam tu hancur yield curve bagi MGS. Dah bodoh jangan lagak pandai ok. Kao nak pi Cina, go to China. Ni tanah melayu dah tak tahan lagi dengan karenah menantu hantu yg kao dok siang hari puji hingga ke langit

jbmali said...

again ? another wet dream ?

oh boy.. better stop watching those gay porno. it gets into your head. you know which head.. rite ?

Anonymous said...


You get goosebumps on your arms and not in your stomach.

You get butterflies in your stomach.

Dah confused lah kamu?


zacharias said...

huh. one thing you will never realise is that, despite the bad economic situation, you umno guys can never leave out the limo or the hotel. Still have to live a luxurious life..


show some character la, by using the public transport.

tok pawi said...

Hello bros. Ini cerita komedi la. Tapi tu la... tak kelakar. Kena pasang prompter suruh penonton gelak.

Cabinet to save Malaysia konon... hahaha...