Friday, October 12, 2012

Is Kit Siang senile too, Tony Pua? (Part 2)

This blog will not hold back our resentment and demand for the resignation or dismissal of Tan Sri Nor Mohamed Yakcop from cabinet.

He is corrupt and practise nepotism extensively, destructive in his management of GLCs and policy formulation, and an outright law breaker.

It does not matter that he is the Division Head for Tasek Gelugor. He is bad news and should not be a "winnable" candidate of BN. After all, he got that seat by dishonouring a gentleman's agreement with Dato Sharif Omar who gave way the MP seat for him.

However, Nor Mohamed, the Minister today is not the same person as Nor Mohamed the Foreign Exchange Trader.

He may have made a loss that deserve a place in the Guiness Book of Worlds Record and any book on financial scandals, but he was a dedicated man, works hard and smart, and honourable. How he plays poker then was a reflection of him as a gentleman.

Why didn't Anwar also be accountable for the loss and resign?

In 1994, Nor Mohamed and his then boss, BNM Governor the late Tan Sri Jaafar Hussein were gentlemen enough to accept responsibility for making that mother of all losses in the spot currency market.

The market practitioner then justify such activities as taking an active reserve management over a passive reserve management. Before BNM, it was the Russian that steamroll against any market trend.

The person responsible to monitor this activity was the then Finance Minister, Dato Seri Anwar Ibrahim. He gets various reports on reserve, activities and development of program regularly. Lim Kit Siang identified Anwar as also responsible for the loss from putting together his official statements. [Read previous posting here.]

Anwar should resign for his negligence. Why didn't he resign?

Why didn't Kit Siang kept demanding on him till today?

Perhaps he is too old and senile to remember he said those words, and to repeat and make ruckus over the same issue. Or perhaps he conveniently senile at the right time and political opportunity.

Anwar always 'main belakang' dan refuse responsibility

When Wong Choon Mei-led Malaysia Chronicle reported an attempt to deviate responsibility from Anwar to Tun Dr Mahathir, that is wrong. Right is right even if it involves Nor Mohamed. The then Nor Mohamed, I mean.

The except of the report here, below:
Opposition Leader Anwar Ibrahim dropped a bombshell on Monday revealing that the central Bank Negara not only lost RM30 billion trading in the currency markets but that it was former premier Mahathir Mohamad who had ordered him not to punish Nor Mohamed Yakcop, who was then in charge of the bank's treasury. 
Anwar's revelation bolsters the view that Mahathir had knowledge of and even encouraged Nor to gamble in the global markets, racking up enormous losses that made Malaysia vulnerable to the sharp slowdown of the mid 1990s. 
“Dr Mahathir ordered, ‘don’t touch him (Nor)’. The prime minister at the time did not agree with taking action because he said, ‘If we make profits, you praise him (Nor), when we make losses, you want to torture him’,” Anwar told a press conference in Parliament today. 
Nor Mohamed had indeed shocked the international markets with his huge deals and buy-sell orders in the 1990s. In his book Malaysian Maverick, author Barry Wain had also written that Mahathir knew of and encouraged Nor to speculate. 
Nor Mohamad has never pointed the finger at Mahathir or implicated the older man. However, the fact that Mahathir has consistently refused to punish Nor has stirred suspicion. 
He even promoted Nor to Special Economic Adviser and gave him a key role to play in Malaysia's controversial implementation of currency control measures during the 1997-98 Asian financial crisis.
Tun Dr Mahathir did not bother to reply or is delaying in order to give a snap back at Tony Pua first for calling him senile. There is an answer to it without him having to say anything.

A typical day in a trading room

He is right.

When Nor Mohamed or any dealers make money, the bosses are fast enough to claim credit and loudly say, "We just made so much so much!"

First to leave before you can say Cik Mat
But when you are in a losing position with cold sweat coming out your palms and what is left was only hope for the market to turn back in your favour, the bosses are first to leave the room before one can say, Cik Mat or Cik Amir.

In the market where selling and buying USD1 million of foreign currencies is a freshman traders play, the market daily turnover runs into trillion and more than 95% of it is all speculation.

Positions on the dollar shifting by the billions from the mere expectations of economic numbers.

From being a believer of the Purchasing Power Parity (PPP) theory to esoteric Chaoss Theory or Genetic Algorithm or any analytical and trading methods that is available in the thousands, it finally comes down to making a judgement call.

Politicians like Anwar, whose every words is filled with caveats, will never be get confirmed as junior trader in three to six months months or if not, get thrown out in the first week itself.

Everytime is crunch time. Either you buy or you sell or do nothing. If you wanna earn your keeps, the last thing you do is do nothing. It means you do not have a view or not doing your homework.

Back then, yours truly was quoting and giving two-way quotes that sometimes position is not made but given to you buy other traders or customers.

Jack be nimble and Jack must be quick. Before someone load on you, you must be sure to be in the right position with the trend. Sometimes one can read where the other is going. When they load you, you can square out or carry it.

But it is when you are in a bad position that sometimes you have to fight it out to change sentiment before getting out. At times, with smart feint and manouvre, you can fool the market to come your way and clear out the loss position profitably.

The character Gordon Gecko in the movie Wall Street

It takes guts, it takes instinct and it takes cool composure. But to reach the level of Nor Mohamed then, it was more than that.

He was in a different league. Back then, it was said he could have a drink with Andy Kreiger of Banker's Trust at a sidewalk cafe in Paris. Kreiger was legendary for betting against the high interest and expensive trading cost pound sterling. He broke the Bank of England before George Soros did!

Nor Mohamed was doing reserve management. It involves balancing the nation's immediate and forecasted foreign exchange requirement and knowing major market trend. It is no more about making prediction on the next one or two economic data but a bigger range of issues.

No econometric analysis can give you an answer. By the time they can put together a reasonable R2 of equations of exogenoeus and endogenous variables, the weight factor changes. And how do one quantify political risk factor and other non-quantitatives.

The problem with managing reserves is the size. It is too big to not be noticeable when one moves in and out. Most of the build-up in position or switching of positions are done over a time so as not to upset market.

The cumbersome nature of reserve management raises the idea for active reserve management. Rather than leaving ones reserve to get stuck to perpetuity, one moves some of it in and out more actively to make profit for on the passively held currency holdings.

It was still not a developed area and no method was established yet. No risk management and no specific accounting of profit and loss was figured out yet. But it had to be explored because foreign exchange was too volatile to risk the national reserves at the market's whim and fancy.

At the end, when one makes money then, Anwar Ibrahim will the first to say, "We made money" although he can't figure out between spot or forward and over spot or over tom. Most likely he may have mistaken cable, ozzie and suzie as a threesome of homo and bisexuals.

He was not on the job and didn't monitor and set guidelines for institutions under his purview

However, as then Finance Minister, who flucked out of Malay Studies at University Malaya, he should be asked the question whether he prepared a risk management exposure guidelines like limits, spot and forward limits, country risk, counter party risk, etc.

He couldn't understand what was happening and yet did not assign anyone to look into the matter.

Ah ... please don't use Dr Rosli Yaacob of BNM as reference. His position of Deputy Manager is hardly anything. What nonsense is he talking of losing USD5.5 billion on the pound?

BNM initially made a bit in 1992/93 and that made them bolder to do it bigger. That initial success made a name for them and many of their traders were taken up by UBS Singapore. Dr Rosli is talking crap. By the way, read it in Freddie Kevin's latest here.

So how is Anwar to charge Nor Mohamed in the first place. On what law? ON what guideline?

Did Nor Mohamed benefited himself by trading currency on the side and go in before BNM goes in and move the market, then cash out? It wasn't difficult.

If you got the name, reputation and kaki in Singapore, all you need to do was to put in 5% or even as low as 2% and you can get trading limits up to 20 to 50 times of the deposits. He is clean or else market would have talked.

Nor Mohamed never did all that then. He may have slept in the BNM trading room to trade into the American and London hours and had his toileteries in his room, but he was doing it all for BNM.

So don't talk cock, Anwar. Why didn't he resign? BNM was under his watch and not Dr Mahathir's!

Anwar and Rahim Ghouse at Jalan Duta Court on his birthday 

After resigning from BNM, it wasn't too long that Nor Mohamed joined Abrar and part of Abrar's corporate plan was to take over Mun Loong.

Abrar was an outfit of Dr Wan Hasni and Dr Rahim Ghouse, both Anwar's boys till today. Wan Hasni was a MCOBA and Rahim was an ANSARA Pengkalan Chepa. Wan Hasni don't have to even try to deny the link in Malaysiakini here. The link goes back to their establishment days in Connecticut, US.

Many believed it was Anwar's way of shutting up Nor Mohamed's mouth. He was given a role in Abrar Unit Trust and what happened was he couldn't resist and changed back to his bad trading habit. He load up the Unit Trust with Mun Loong's shares and broke the Securities Act. [Read KKamdias here]

What did Anwar do?  Nothing!

Anwar and Pak Lah are basically the person who made Nor Mohamed for what he is. Dr Mahathir did not appoint him as Senator or Minister but merely Adviser. For Anwar to attack Nor Mohamed, he has no shame. It was he who spoilt Nor Mohamed from the gentleman he was to what he is today.

Come 1997/98 and reformasi, government was faced with the currency crisis. There was no experience in the world in dealing with such financial crisis, except for an experience in Chile. Nor Mohamed understood and knew of this. Few in the market remembered it but not sufficiently well.

He managed to send his feeler to Dr Mahathir. He said to be flown to Buenos Aires in one of many of Tun's overseas trip and he explained foreign currency to him over breakfast. He had some ideas but not concrete yet to solve the problem.

Dr Mahathir took him in to advise because he was the only one who knows. It takes a thief to catch a thief. One player knows the style of another player.

The Ringgit fall didn't started by George Soros but by some hedge fund manager in the UK, one Chris something. He was pounding and pounding hoping in would trigger another Mexican Pesos or Thai Baht crisis but it was not happening. Funding cost was expensive due to the squeeze on the currency swap market.

That was until Soros came in. His signature was to talk the market. He did it on in Russia and many other places. He had a reverse psychology method of sensing the changing critical factors. Sometimes it is not economics.

This Jew boy from Hungary and studied at LSE created an impression of himself as a market clairvoyance by talking a lot in public. But in the market, we call it bullshiting.

What he was doing is nothing more than gang up behind the scene to move the market. At a certain point, every other spot traders and trend followers will jump on board to create a tsunami that will bulldoze past any critical support or resistance. Usually it works by breaking the critical levels and trigger the stop losses.

Dr Mahathir need to get Nor Mohamed to help him understand the game.

Back then pee in her baju kurung
Dr Zeti may be going around as an expert on the crisis these days but at that moment, she was peeing in her baju kurung and not knowing what to do. None of her theoretical economics training like PPP and all that crap prepared her for what is to come.

Nobody knows what to do. All the members in the committee that meets daily does not know the solution but they are willing to learn and figure things out together. That should be the Malaysian way.

That was how the Selective Currency Control came about. All holes were plug from allowing any chance of shorties to fund their short Ringgit positions. No more speculation on currency. Full stop.

A later theorist say it is a Marxian theory of  plugging leakage in system. On hind side everybody pretend to be clever.

Stopping the float killed Soros as he was unreported to have lost USD1 billion and shrank three funds into two.

See you at 5?

Sure, it was Dr Mahathir who had the last laugh. He can even meet his "enemy". But for Tony Pua to claim that the opposition never met George Soros, oh pleazzzz ...[Read MI here]

Lokman Adam and Ezam can vouch that Azmin, Wan Azizah and Tian Chua met George Soros in Washington to ask for money. You want picture?

Ask Tian Chua, what is he doing? Autograph?

Dr Mahathir never believed what Soros said to him. He is not dumb to not know what Soros have been doing everywhere including Russia and being a carpetbagger after the fall of the USSR.

All he said as a host was Soros told him he was not involved and he said to just take his words for it. But he does not have to believe it.

Did Dr Mahathir undertake any program with Soros with Perdana Leadership Foundation? Nothing! Soros was polite too. That Jew won't scold Israel even if he see the atrocities right in front of him.

Losing cognitive ability already?
For Tony Pua to claim Dr Mahathir as senile, he should ask why Kit Siang is keeping quiet? Ask Guan Eng why is DAP sleeping with Anwar?

One can bet the excuses they will give is as unclear as any senile old man.

A senile old man will not know when not to talk yet and when to talk. They go gaga all the time. But not Dr Mahathir.

His memory is as sharp as anybody. His thinking is as sharp as any young man.

No one can catch Dr Mahathir sleeping in public like Pak Lah, Nik Aziz, or even Tengku Razaleigh. Ask any photographer if they can ever get a picture of Dr Mahathir on wheelchair, even when he was then sick. Steady ...

Tony Pua can be the man to watch in DAP and merely playing dumb on the outside. But, he will have a tough time to go the distance in the same manner Dr Mahathir had done.


Anonymous said...

A Voice ... you sure know what you are talking about on the forex market.


How about if I invest in you? Split 50:50?

Anonymous said...

Anwar was in UMNO. When in Rome do as the Romans do. What can he do? He also has to obey Mathathir. When Mathathir said "Don't touch him", how can Anwar touched him. Mathathir is Anwar's boss. Anwar is not above Mathathir. Now that Anwar is not in UMNO, he does not need to toe the line of UMNO.

Anonymous said...

Kan main forex tu macam berjudi?

Negara Islam ke kalau TDM dan BNM main forex?

Dah kalah main forex dengan Soros, patutlah marah sangat Soros tu.

Yang keluar fatwa main forex tu haram kalau tak de lesen BNM, apa terjadi?

Anonymous said...

Anwar should give retire. He is not good enough to lead Malaysia.
Unfortunately for us, looks like there is not one person of calibre that is qualified.
Many more years of humpy dumpy economics until the messiah emerges.

Anonymous said...

Sheikh Anwar allowed it under his watch. Padanlah hari ini dia Islam liberal dan plural. Apa dia peduli halal haram asal dapat jadi PM?

Anonymous said...

In Syria it's the minority Alawites, in Saudi it's the minority Wahabis, in PAS it's the minority Erdogans, and, in DAP it's the minority Evangelists, in PKR it's the minority NeoCon Turks, and, and in UMNO it's the minority Mamaks who rule the waves....

Salleh Telegu
(Belakang Rumah Kadiaq)

Anonymous said...

Anwar tau apa? Tulis bajet pun celah kangkang chinadoll.

anamas said...

It is easy to excuse someone of wrong doing when you yourself are guilty of the same crime but you realized it not.

Please do not tarnish someone's image just because you do not get something from him.

Anonymous said...

Anon 3:46

And only reveal 15 years later?

Obviously a big a lie as Dr Rosli's claim of 5.5 bil sterling loss in early 90s. Too big to not be noticed and picked up by the market.

Anonymous said...

he got that seat by dishonouring a gentleman's agreement with Dato Sharif Omar who gave way the MP seat for him...

Nope! Pak Lah ask sariff to give way to him cause Pak Lah promise Sharif that he will be walking tall as Penang gavenour

Anonymous said...

Future market is for you to hedge, not for speculation. Therefore, someone should be liable for it. You have more excuses to reason than using reason to justify what is right or wrong. Talk cock!!

Anonymous said...

Anon 11:13

Whose talking of future market?

You think all the organised Future Market can absorb Central Banks hedgings ka without repeated mark downs and mark ups?

I take it that you know what mark downs and mark ups are.

The only way is to do spot market and swaps.

Which kindergarten taught you future market is only hedging? Talking like a real novice.

Without trading and arbitrage at work, there is no liqyidity for hedging.

You think all those future contracts on Simex. COMMEX, HKFE. etc are hedgings ka?

I m telling what is happening which you hardly have NO idea off of what is happening.

Akubas86 said...

I don't think I can agree with the idea central banking making profit out of Forex. They should function as a regulator and their action is an atrocities...Imagine for example if SEC involved in insider trading. Even if they claim the activities do not profit individuals, it is still a corrupt of power...

To those other anon:

On the other hand, even if Nor Mohamed is protected by TDM, why in the world would DSAI bring him into Abrar group...wait, don't tell me. I guess TDM ask DSAI to take him since he just lost his job...oh DSAI couldn't bear the thought that he lost his job and out of kindness and pure altruism he offer him another job...

Anonymous said...

Must be some novice trader to talk about futures only for hedging.. this guy probably just passed or barely passed his/her PPKM exams..he is the one is talking cock and knows little about FX and markets.

Kudos to the author who definitely knows a lot about FX trading. I am very impressed and curious as to who he is but he definitely knows the mechanics of FX. I hv been in this market for more than 20 years and know very well that Anwar cant simply point finger to Nor Mohamed as his 4 other fingers are pointing back to himself.

Anonymous said...

bangangnye tony pua ek?

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