Wednesday 13 June 2018

About the RM1 trillion bullshit and borrowing from Japan

This story today doesn't make our Finance Minister Lim Guan Eng looks very good.

Moody's maintains Malaysia debt 

burden at 50.8% of GDP

That's because.

Guan Eng confirms national debt 

more than RM1 trillion

which is about 65 % of GDP.

i know, he did some spins about the figure after that but that's just sounded lame to me.

That's why the former finance minister,

Najib congratulates Guan Eng for

 'spooking market' with RM1 trillion debt claim


Najib, who was previously also Finance Minister, said he was glad that Finance Minister Guan Eng chose to come clean on the official federal government debt by stating that the official federal government debt remains at RM686.8 billion or 50.8 per cent of the Gross Domestic Product (GDP).
"(And) not 65 per cent of GDP or RM1 trillion as previously claimed.
“The level of 50.8 per cent is much lower than the 103.4 per cent reached during the first reign of Tun Dr Mahathir Mohamad," said Najib.
Najib said his administration had always complied with international public debt reporting guidelines as defined by the IMF and World Bank.
“Therefore, the figure of 50.8 per cent is a universally accepted measurement,” he added.
He said contingent obligations, such as guarantees, have never been included in the official measurement of government debt, not even during Dr Mahathir's previous reign

So, based on the report today, Moody's has confirmed that Najib was right and Guan Eng was wrong about the national debt.

It's not RM1 trillion as claimed but a reasonable RM686.8 billion or 50.8 per cent of GDP.

Let's compare that to my favourite foreign country Japan.

National debt of Japan


The Japanese public debt exceeded one quadrillion yen or about US$10.46 trillion in 2013, more than twice the country's annual gross domestic product.[1][2] By 2015, the figure rose to US$11.06 trillion. As the country adopted key economic initiatives, this figure start to dip so that by the end of December 2017, the debt stood at US$9.94 trillion.[3]
In August 2011, Moody's rating cuts Japan's long-term sovereign debt rating by one notch to Aa3 from Aa2 in line with the size of the country's deficit and borrowing level. The large budget deficits and government debt since the 2008-09 global recession and followed by earthquake and tsunami in March 2011 contributed to the ratings downgrade. In 2012 theOrganization for Economic Cooperation and Development (OECD) Yearbook editorial stated that Japan's debt "debt rose above 200% of GDP partly as a consequence of the tragic earthquake and the related reconstruction efforts."[4] Due to the ballooning debt, former Prime Minister Naoto Kan called the situation "urgent."[5] Indeed, by 2014, Japan had the world's highest debt per GDP.[6][7]

Well, compared to Japan's, I think Malaysia's debt is not so bad.

Maybe this is not such a good idea

Mahathir requests yen credit from Japan

That's because the Japanese public debt is up to 200% of their GDP while ours is only at 50.8 per cent of our GDP.

Maybe the economists among readers of this blog may want to


  1. Aiyaa Annie,

    I think this is quite easy to explain.

    First of all GDP is the size of our economy. It is not Malaysia revenue.

    As a comparison. Our GDP is about 1 trillion while south Korea is about 5 time. This a measure of the size of our economy.

    Our GDP is almost simuilar to Singapore. Our small island neighbour.

    So our economy is not that big.

    Bottom line is GDP is a measure of the size of the economy.

    GDP is not revenue. Our revenue is about RM230 billion, give or take.

    We pay interest last year about RM31 billion. Just interest, not including the principal.

    So the question about 50.8% of GDP.

    The fact is that the debt of 50.8% of GDP "do not include" the 1MDB debt.

    Do we need to pay 1MDB debt? Is 1MDB debt small or big.?

    Ok. That is the first part.

    Now, about japan public debt 200% of their GDP.

    Let me give you an example.

    1 company selling goreng pisang. Their revenue is RM5000 a month.

    Let say, their debt is 50% of revenue.

    Their debt is RM2500 a month. So their net income is RM2500.

    RM2500, is it a lot.?

    2nd company selling motocar. Their income is RM10 million.

    50% of debt is RM 5million. So their net income is RM5 million.

    So can compare RM5 million to RM2,500. Which one is higher.

    So, ok Annie. Simple answer.

    Now for the record, japan service about 1 quarter of their budget for their debt payment.

    But their budget is US860 billion which is RM3.2 trillion.

    Compared to our budget about RM230 billion.

    So bottom line is, you want to compare Malaysia economy with Japan is like comparing Goreng Pisang salesman with Motocar salesman.

    Japan is one of the biggest economy in the world.


    What is your take on BN Sarawak saying farewell? Its the elephant in the room right?

  2. Guan Eng is not really in good book right now among the civil servants. He just yanked 500 ang pow promised to them. Preparation for Hari Raya somewhat hit some glitch to some of them. A lot of them were smouldering inside. They said they would prefer Azmin as finance minister than Guan Eng.

    Should Azmin is MOF minister, those 500 is already closed deal. They probably get more. When it comes to bonus raya, no minister can match Azmin. His track record ad Selangor MB prove it.

    1. I thought Azmin said Selangor's reserves and Malaysia's reserves are bagai langit and bumi.

      As Selangor MB, Azmin has much money to spend.
      If he holds MOF, he has the opposite.. sooo much debt to pay. You think he can afford to pay duit raya as lavishly as he would as Selangor MB?

      haiyyaaa.... budak UPSR pun can understand laa...

  3. Lim Guan Eng is just like a kid in a candy store.

    He was so excited of becoming a federal minister... Finance minister some more.
    When he discovered something that is not right done by the previous govt, he couldn't wait to stop and think before coming out with a statement.


  4. Apa pasat manyk bohong ?, tak tau lea aa ,sikalang siapa kasi bohong siapa maa aa .

    Itu telor itik sama telor ayam apa atak beza lor rr ,lua-lua telor juga maa aa ,makan lasa telor juga maa aa .

    1. You think Moody already got the latest data and figures from all the Red Files that MOF officers just stumbled upon?

      Waah... Moody terrer laa since even MOF officers are still investigating the data they just found from all the Red files.

  5. LOL!

    1. I take any ratings agency ratings with a BIG pinch of salt, especially after what happened in 2008 :)

    2. That said, Moodys may have their own benchmark or standards of rating a government's debt. They are at of the day, nothing more then a bond rating agency; they will not be the ones running your country for the next 5 years.

    3. Japan's huge debt to GDP ratio does not mean it is a good example to follow. If you read enough international news, there are folks warning that Japan is the next big debt bomb that could go off in the new few years.

    4. Even then, most of Japan's national debt is held by its nationals, and the interest paid by the government on each bond is low. Basically, the Japanese are lending money to their own government, and their government can essentially roll over their debt "almost" forever.

    5. A good portion of Malaysia's national debt is to other countries and institutions, and denominated in other currencies, which is always a dangerous position to be in (especially if you still remember 1997). The interest amount is also high, the terms stupid, and the reasons for the debt even stupider (buying handbags, watches and other shopping essentials, and financing a whole bunch of UMNO / BN politicians and their entourage).

    6. The Japanese have a high debt because they borrow those monies to do infrastructure development and lay social safety nets for their citizens. The Singaporeans have a high debt because they borrow their money to make investments for the country overseas. The Greeks have a high debt because they were a corrupted, thieving, lying bunch. The Malaysians have a high debt because they were like the Greeks.

    7. Do you know how the Chinese are funding their growing military budget? From the interest paid by the Americans, the Japanese and the Europeans on their bonds. Hell yeah, their military gets financed by their rivals, how ironic! This is the difference between being a debtor country and being a creditor country ;) That's also why the future superpower of this world is Tiong San :D

    8. You don't have to be so jealous of Guan Eng lar, Annie. Admittedly, he is smarter than everyone in the top UMNO / BN lineup, and better looking than most too. He brought Penang out of the doldrums, he will do the same for Malaysia. The nation is in good hands :)

    As Guan Eng said... if you caused your country to become heavily indebted because you used the borrowed money to do good things... like building housing for the poor or funding social services, even with the fiscal indiscipline, your intentions were noble and good-spirited. But if you caused your country to be heavily indebted because you used the borrowed money in a corrupted manner, in order to enrich yourselves and your cronies, then it is an unforgivable action, tantamount to treason to the country and the people. Do you want to support such kind of people, Annie, or do you want to see your country emerge as a developed, rich, prosperous, clean and moral example to the rest of the world. If you are part of the latter, then you should join the DAP immediately and apply for the position of LGE's political secretary; I heard he has a vacancy since his last political sec has become an MP ;) And of course, because Tajudin Abdul Rahman might actually become an UMNO Vice President, ROTFLMAO!!!!

  6. Annie,

    First of all huge congratulations for quoting Jibby as a source of authority, we all know he has never lied, especially about 1MDB : )

    The short answer is that both Tokong and the Bugis Pirate are partly right, and partly wrong.

    Tokong is wrong because rating agencies have a standard way of calculating debt in a technical sense. Under their criteria, RM686.8 billion would be correct. So to say “1 trillion” is too loose.

    The Bugis pirate is also wrong because a lot of what the Bugis regime did - in cases that are now beng exposed to the harsh light of day - is a massive amount of “off-balance sheet” accounting that was actually just a way of the government either hiding liabilities or guaranteeing “money” that actually never existed. The RM42 billion owed by 1MDB is a “theft cost” - 1MDB has done nothing for Malaysia, it’s a bubble designed to steal cash. But the debt we have to repay is real!

    If you calculate government guarantees for entities unable to service their debts, that’s already amounting to RM199.1 billion, a sum that includes RM42 billion owed by 1MDB. This would take the total federal government debt to RM885.9 billion, or 65.4 per cent of the economy. But these are actually “mirages”, like the infamous saga of Jibby, Arul and the “units” that never existed.

    As at end-2016, debt with direct government guarantees stood at RM187.23 billion, of which RM5 billion was from 1MDB (30-year bond) and RM699 million from TRX City Sdn Bhd (formerly 1MDB Real Estate Sdn Bhd). There was also RM4 billion from its former subsidiary SRC International Sdn Bhd that was transferred to the MoF in 2012.

    None of this was real or added value to the economy. It was a con job, pure and simple.

    All the doings with pipelines and solar panels etc that are now emerging are further examples of “creative accounting”.

    Our debt actually skyrocketed under the Bugis pirate, and debt service charges have risen from RM6.4 billion in 1997 (9.8% of revenue) to RM12.9 billion in 2007 (9.2% of revenue) and RM28.87 billion in 2017 (12.8% of revenue). Gali lobang, tutup lobang.

    Now, guess when Malaysia last had a budget surplus?

    More than two decades ago in 1997, when we spent RM8.2 billion less than we earned.

    Look up who was PM and who was FM in 1997….

  7. Cik Annie aritu si Moody ni juga predicted DS Najib akan menang PRU14. So sikarang apa macam??

  8. Hi Annie,
    Reason why Japanese debt are not alarming because most of the debts, government bond holders are owned mostly by japanese internal institutional bodies like bank of japan itself and other Japanese institutions (same la like those our KWSP, Khazanah etc). Foreign holder less. So, you think their own KWSP will chase the government debt or force their own government to pay if worst to come? So the most drastic, they can do is no need to pay and the government debt can be forgiven, and they just need to clear and compensate foreign bond holders only. Japan has enough cash to do that, means to pay foreign debt bond holders.
    Another, why foreigners confident with Japanese economy even their so call "debt" so high because, Japan always having current account surplus in trading, this mean, they Export more then they Import, thus have positive account balance, means they can "save" a lot of monies. All the Japanese corporations are rich in cash and assets all over the world. You see Toyotas, Sony, Mitsui etc are all big rich international companies. They have financial assets and the nation won't ever go bankrupt if the worst to happen, the government can easily call national patriotic services from these companies to do their duties to save the country economy.
    This is the reason why Japan national debt is a non issue.
    America National debt, is different, their bonds are hold by the Chinese, Japanese, and others more. Although America have also rich corporations like Apple, Texas Instrument, their bond holders China, is holding 1 Trillion American bond....Japanese is holding 1 Trillion as 2 Trillions already OWED to foreign more pressure to the American to manage their economy in case they cannot repay the debt or China come chasing them for payment.

    1. Lol. Malaysia debt also 97% in Ringgit and own by epf kwal etc. whats the difference?

  9. TS Rafidah Aziz did mention it based on how you you define your debt. If u think the govt liability is not debt, yes ours at 50.8%.

    Tun M make a statement saying this new soft loan is to cancel the previous loan which look crazy such as loan from goldman sach. U have to 10% commision + interest rate of 7%.

    Did Annie even bother to read all the hanky panky things did by the bugis warrior?
    Go find story of how 1mdb (read najib) brilliantly borrowing money up to 42 BILLION ringgit with their capital of just 1 million ringgit.

  10. RM 1T to Japan is ciput.Because of good relation, Japan can offer good rate to Malaysia with maybe no commission charged to Malaysia.Just imagine Goldman Sachs can charged almost 10% for the 1MDB loan arrangement n together with interest rate , our financing cost can easily exceed 10%.Currently, our financing cost already exceed RM30B yearly.Just imagine the huge amount of saving if we can refinance our loan through Japan soft loan. Immediately, other projects that are postponed such as HSR n MRT3 can restarted almost immediately with a simple request of soft loan from Japan.Smart tak Tun?

    Of course, the Japanese also expect some favor from Malaysia in exchange of the soft loan. Part of the negotiation, HSR can be awarded to Japan with extension upto the North as envisaged by Tun.So it will be a win win value proposition;The Rakyat, Government of Malaysia n Japan will all be benefited. Strategically, with Japan come on board, we will be less dependence to China.This is important for our future as China tend to develop n operate any mega projects on their own with little or no value added by the locals.

  11. Actually it was Tun who confirm first that our debt is 1 trillion and confirm by MOF. Anyway like Daim says .. don’t pay too much attention to ratings agencies..just take care of the people’s needs..Moody’s also said Najib will win the elections.. Rating agencies are like leeches.. once they smell money they will suck you dry..see how much GS earn from our country from the 1MDB loan.

    Our country will be doing great once all the snakes and leeches are destroyed. Everyday there are exposes of the previous govt corrupt practices. If all rent seekers,cronies ,Indian oil salesmen etc are eradicated all govt agencies won’t have to pay exorbitant prices for their purchases and unnecessary spendings. There will be lots of money left .. it just need the patience of the people for this to be achieved .

    1. Don’t be so cocky about rating agencies. If they downgrade Malaysia’s credit rating, we will certainly have to pay a higher interest rate to refinance our debt as the entire financial market follows their rating decisions.

  12. Point 1: The RM 1t figure serves a political agenda as Moody's will be in the best position to actually comment on public debt on a comparative basis among different countries. But the RM 1t figure is not too wrong because effectively that is what causing the country to have such a high recurring expenses. Financial analysts do sometimes capitalise leases as debt for analysis purposes, not accounting purposes.

    Point 2: On borrowing from Japan, it makes sense if Malaysia assumes obligation of the 1MDB bonds with coupon rates of 5%+. Interest rates for Malaysia on a G to G basis maybe as low 1.5%. Using the funds, GoM could make a tender for the bonds and save money.

    Point 3:
    For this blogger to lambast Lim Guan Eng on account of the RM 1t debt figure but at the same time keep a blind eye on the billions lost by BN to cronies is the key point. There is a financial analysis perspective to consider capital leases as debt, there is only a unbridled racial thinking to allow theft to be defended in the nama of ABATA, and that is the point.

    1. Why gov nk borrowing from epf? I rathe pay epf than japanese? Epd still can gove 4 percent interest. They also dont know where tk park so much mone.

  13. HI, Annie LGE included contingent liabilities and guarantees not just direct govt spending. For example, the Govt has paid 6bn of 1MDB debts so far, so the entire liabilities of 1MDB would have been included by LGE, Moody's would have excluded that.

    Moody's has a specific criteria, LGE used another criteria. This is not 2 sets of facts just 2 different sets of classification.

    I would tend to go with LGE's classification because in essence contingent liabilites and govt guaranteees (considered off balance sheet financing and used by mnost govt's worldwide) are not included in a govt's debt calculations because these entities should be self financing? i.e. the guarantees are there to be drawn upon upon extreme failure. Based on what I have read there are about 8 entities the govt is paying for now, that have in failed and are unable to service their debts, so it would make sense to include them as the govt is now liable for their borrowing.

    On Japan, and developed countries - they can have high debt and that is less worrisome because

    1) They have more assets too
    2) They have a much higher and wider tax base, so they have the cashflow to be able to service their debts - this is the critical - Msia simply does not have this

  14. Moody's to pay $864 million for pre-2008 ratings deception

  15. With all the jokers running around managing the country no wonder all Malaysians are watching the comedy of errors.
    Prof Kangkung

    1. Pros Kangkang,

      While others have facts and figures, you have nothing of substance to say.

      I think you should sue the University of Cicak Go for doing such a poor job of educating you.

      Prof Sawi

    2. Prof kangkong, PH is doing a much better job managing the country and economy than jibby and his 40 thieves ever did.

    3. Don’t be so cocky. It’s only been a month. Ringgit just went above RM4 to USD. What happened? Give lah more subsidy. Petrol 1litre RM1.50 best - oil producing country mah. Can’t argue with that logic.



    This is how people made money... that the names are exposed, they must all be prosecuted.

  17. Annie, janganlah bengap sangat. Kenapa banding dgn negara maju dan hebat macam Jepun. Hutang banyak tak apa sebab income mereka pun besar.

    Jom banding kan dengan negara yg sama taraf dengan kita lah:
    Indonesia 33.1%
    Philipinne 41.9% Cambodia 28.2%
    New Zealnad 32.0%
    Turkey 29.6%
    India 50.1%
    Ada faham kah?

    1. Ok lah. Macam tu kita compare dgn Zimbabwe je;
      Officially Zimbabwe's debt is $7 billion, or over 200% of the country's GDP. However, this figure is disputed, with figures as high as $11 billion being quoted, once debts to other African countries and China are included.

    2. Compare Malaysia with Zimbabwe? Annie dear, that is not the way to answer your critic. Zimbabwe got no standing in the world economic just like venezuela with their inflation top 1000 %.

      Our Malaysia is much better. I think the comparision made by Mat Muar is reasonable.

    3. Err...last time people said Malaysia like Zimbabwe, almost bankrupt. Also not true? Ok lah like that.

    4. Oh dear..
      Annie, r u really hurt by election result?

      Your expertise is just mass comm annie. Stick to that. Your writing n comment on economy just make u sound childish and ignorance

  18. "Well, compared to Japan's, I think Malaysia's debt is not so bad."

    Actually Annie, the comparison is a bit misleading.

    Japan's debt is mainly "internal" - a very significant amount of Japan's debt is owned by the Bank of Japan. That's why Japan is not like Greece. Most of Japan's money is owed to itself, and in Yen. So if the value of the Yen falls...the debt is still basically the same. And it's Japanese banks that own most of the debt. In effect one branch of gomen in Japan owes the others debt.

    Greece had debts in Euro currency. Its debts were controlled by foreigners. The Greek economy went bad, and it was German and French banks that wanted money back. The economy went downhill fast.

    Japan is also an innovator, and hence it's not a bad thing for us to take loans from them - I would much prefer this than taking loans from China.

    Chinese banks are deeply corrupt.

    The ERCL project was signed with a company that was BANNED by the World Bank.

    But Jibby knew the "under the table" would fill the 1MDB hole.

    Japanese loans are going to be cleaner and more professional.

    And good for Tun to rebuild ties with Japan.

    It can really benefit us, over the next 5, 10, 20 years.

  19. japanese public debt is internal financing or held by japanese & why not Msia seek local credit or internal loan from epf unless epf dah dikosongkan oleh Bankrupt Nasional sigh

  20. Hutang..macam mana punya jenis contingent pun tetap hutang dan kena dibayar balik.

    Official reporting can be uniformedly excluding the contingent liability. In the case of Malaysia its contingent debt is about 50% of its offcial national debt (300+ bil againt official 686 bil). Bila kena bayar, kena tak masukkan dalan buku ? supaya esok bila bayar boleh debit appropriate account. Accountability lah ni ! Dunia kata tak betul reporting, dia orang punya pasal. Malaysia MOF wants to be prudent. Biar la.

    We did not hear Japan having trouble paying its national debt. Maybe they are ģood at hiding it or they have a brilliant way to raise cash to repay Japan's debt or maybe the national debt consists of mainly Yen denomination thru bonds held by Japanese corporations. So it may not be external debt after all.

    Malaysia very "smart" to have accumulated debt in USD.

    1. "Official reporting can be uniformedly excluding the contingent liability. In the case of Malaysia its contingent debt is about 50% of its offcial national debt (300+ bil againt official 686 bil). Bila kena bayar, kena tak masukkan dalan buku ? supaya esok bila bayar boleh debit appropriate account. Accountability lah ni ! Dunia kata tak betul reporting, dia orang punya pasal. Malaysia MOF wants to be prudent. Biar la."


      Prof Sawi

  21. Annie,

    These Pakatan supporter and sympathizers all are smart-smart one.

    Like this, how BN going to survive.?

    Prof Kangkong also cannot argue. Difficult laa like this.

    1. BN still around ka? I thought it died already.

  22. The bottom line of our discussion is whether our debt is 1 trillion ringgit or RM600b.
    The different figures quoted are using different definition of debt.The crux of the matter is,do we consider 'contingent liabilities' as debt?
    Let me explain what is a contingent liability in a very simple way.
    Let's us say 'Prof Kangkung' has a lot of debt.Among his debts are housing loan,car loan and credit card loan.At the same time he acts as a guarantor for his son's study loan worth RM200k.
    My question is,in calculating Prof Kangkung'debt do we take into account his guarantee of RM200K.
    That RM200K is a contingent liability that should not be taken as debt unless his son doesn't finish his study and the poor prof kangkung has to bailout his son like what Tun did when Mirzan was in trouble.Haha.
    Prof Kangkung

    1. Prof Kangkung
      you must be a Bogus Nasional prof, ask yourself this question mana revenue & income to pay all these housing, car & credit card loans + RM200K (eg 1mdb no income but songlap & jolly spent saja), this Bogus Nasional is very worrying aduhai

    2. Anonymous13 June 2018 at 21:19

      Don't worry.

      Pros Kangkang is living proof that human beings can suffer brain damage with excessive dedak.

      Prof Sawi

  23. Sweeetheart, in simple words when the 1MDB goes kaput the gov hv to paid those loan interest on their behalf. So wat do u think ?


  24. As the Malays like to said dun compare an apple with an orange juz as comparing a blackcurrant to an apple. Compare it to the same league.


  25. Annie,

    I am not an economist but this is how I see things.

    Let's say I make RM5000 per mth.

    I go to the bank to borrow money for a new car.

    The bank asks me for my financial commitments.

    I tell them I need to make RM2500 mthly repymts (50% of my mthly income) for my rent, Astro, my new smart TV, my motor bike, utilities, etc.

    I also have discretionary spending of about RM1500 on food and clothing and other incidentals.

    So, I have abt RM1000 (RM5000 - RM2500 - RM1500) left from my salary to service any bank loan.

    Should I mention the fact that I am also gambling addict who spends RM2000 a mth on horses, football, 4ekor, 12 sticks, 13 cards, etc?

    Should I mention that I have to pay the Ah Long RM1000 a mth?


    1. Literally speaking....that was what Najib, Rosmah & their band of coyotes were doing during their 10 years' tenure.

  26. To appoint that fucking young punk in Muar to be the Sports Minister? I didn't vote for that shit.

    1. I'm pretty sure that absurd lewd gesture came from Ptofessor Pekong.

  27. so moody's was 'right' too when they designated triple A to subprime mortgage junk bonds :( sigh

    1. You know what is barking up the wrong tree? You know what is non-sequiter? They may have been wrong about subprime but the financial markets still trusts their ratings. If they down grade Malaysia we will have to pay higher interest rates (aka higher Spread over Libor) whatever your LGE et al thinks about them.

  28. Dear Ann,
    You should not write about things you don't understand. Lease debts are not required to be shown in the balance sheet but are explained in the notes to the accounts as legal debts, payable when due. That is why they are classified as off balance sheet financing. As for financial guatantee, if a borrower cannot repay the loan thus guaranteed, the guarantee is called upon to pay off the debt when installments become due. The entire loan crystallised into a debt. So both the lease debts and guaranteed debts become part of the national debt. Kindly please stop in your criticism of our Finance Minister.
    As for Moody, why bother about them? A nation's future does not depend on their unsought analysys or comments.

    1. Anon 2228
      Let me ask you one simple question.How was the practice of categorizing debt during Mahathir first tenure as the PM?(1981-2003)
      Prof Kangkung

    2. Prof Kangkung,

      Someone earlier questioned you and you leave it dangling.......

      "you must be a Bogus Nasional prof, ask yourself this question mana revenue & income to pay all these housing, car & credit card loans + RM200K (eg 1mdb no income but songlap & jolly spent saja), this Bogus Nasional is very worrying aduhai".

    3. Why bother? You talking cock bro! We still borrow from the international financial markets do we not? The markets rely on rating agencies and if they downgrade us we will have to pay a higher interest rate to borrow money (higher spread over Libor).

  29. Dear Ann,
    Just for your info.
    Lease debts are not required to be shown (in the balance sheet) but are explained as committed debts in the notes to the accounts, payable whenever due. As for financial guarantee, when the borrower cannot repay the loan because of insolvency, the guarantee is called upon to repay any installment when due. The defaulted loan then becomes an obligated debt of the guarantor. Then the lease debts and the guaranteed debts become the national debts.
    As for Moody, why bother about them? The future of our nation does not depend on its unsolicited analysis and comments.


    "Lim said the government decided to classify those congenital liabilities and government guarantees as direct debts because of the involved parties inability to service the debts which had to be borne by the government".

  31. Remember the subprime crises of 2008
    The three rating agencies caused some banks in Americs to close shop
    A time bomb in our back yard
    Mega projects based on inflated land value with each ownership changed
    Its only make believe - song by Conway twitty


  32. hi annie!why till now still defend ajib?terhutang body ke...he is just diverting attention..I know U know...

  33. "Everything was rigged. Thanks to major lawsuits by the San Diego-based law firm Robbins Geller Rudman & Dowd, documents revealed that the U.S.’ two top ratings companies – Moody’s and S&P – have for many years been shameless tools for the banks, willing to give just about anything a high rating in exchange for cash."

    The above reporting was from Financetwitter....relevant to our current discussion of how these rating agencies work.

    "Between 2000 and 2007, Moody’s doled out AAA ratings to 30 mortgage-backed securities every day. When the 2008 subprime crisis finally hit the United States, 83% of those first class securities became junk – they were downgraded. The funny part was – Lehman Brothers’ own debt still had an investment grade rating when it filed for bankruptcy protection.

    But Moody’s Investors Service wasn’t alone in scamming investors. Together with Standard & Poor’s and Fitch Ratings, the big three credit-rating agencies were all guilty for not only failing to warn investors of the dangers of investing in many of the mortgage-backed securities at the epicentre of the financial meltdown, but benefiting by not pointing out deficiencies.

    In fact, S&P (Standard & Poor’s) was sued by the U.S. Department of Justice over its despicable role. Those credit-rating agencies were working hand-in-glove with investment banks in the marketing of risky mortgage-backed securities, also known as collateralized debt obligations, which helped bring the U.S. financial system to its knees 10 years ago."

    For those who are interested to know more, go to :

    1. You can say all that to defend your finance minister but we still need the ratings as otherwise Malaysia will not be able to borrow from the international financial markets. The cost of borrowing will go up if our rating is lowered. Please let you Minister know. He not stock broker ma.

  34. Dear Annie,
    If I am a guarantor for friends buying a house , a car and personal loan.
    Does these considered as my loan?

  35. @ 11:52
    You are a fucking idiot acting as guarantor for "friends", if that were true.
    So don't think you're smart by using that kind of argument.

    1. Is that a counter argument or a fuckwit remark?