tag:blogger.com,1999:blog-19741162.post8668257346326179735..comments2024-02-22T02:33:21.869+08:00Comments on Another Brick in the Wall: MAS 1st Quarter Loss: Poor hedging decisions?A Voicehttp://www.blogger.com/profile/01780035743502972342noreply@blogger.comBlogger18125tag:blogger.com,1999:blog-19741162.post-90234108818136005442009-06-27T01:40:06.925+08:002009-06-27T01:40:06.925+08:00The losses are on paper since MAS started adopting...The losses are on paper since MAS started adopting FRS 139 which requires all financial instruments to be MTM. The fuel hedges have yet to unwind hence the cash reserves of over RM3 billion.<br /><br />If you're not from the oil and gas fraternity in Malaysia, you would not understand Idris' reputation prior to his arrival at MAS. He rose up the ranks in Shell, an organization that promotes employees based on merits and not by the color of your skin. Idris turned around the SMDS plant in Bintulu after the Christmas night explosion that destroyed the plant in 1997 (no, he was not running the plant when it exploded).<br /><br />Many only consider the Perwaja fiasco when judging Eric Chia. If it was not him, UMW would not be where it is today.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-19741162.post-60202038089707575562009-06-21T20:02:08.756+08:002009-06-21T20:02:08.756+08:00Agree that some of the loss has not materialised a...Agree that some of the loss has not materialised as we still have a ways to go for the MTM for the full year is realised.<br /><br />I'm just saying that when there is high volatility you don't take long term positions. You spread your risk by taking shorter positions anf buying on the spot market and continually monitor all the way. That why I think its a bad decision.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-19741162.post-55818450710143458092009-06-21T09:59:38.195+08:002009-06-21T09:59:38.195+08:00"People have to make decisions in business bu..."People have to make decisions in business but try to limit making bad ones and this is clearly a bad decision."<br /><br />There is still no actual loss. This is still MTM and not actual. To say it's a bad decision now before the loss has materialised is premature.<br /><br />You can see that it is June 2009 and the price has gone up to USD78, 20% from last month. How much would it be in 2 years time? If the price went up, Idris would be a genius and Tony would be a fool. If prices remains, it would be vice versa. I am sure there are a lot of people who can give a different view to the one I am making here. It's nice to get into what ifs and the potential outcomes.<br /><br />In business, I think, sometimes you can only make a decision based on experience and current info and hope for the best. The business must go on. It cannot wait for the most number of analyses before making a decision, at times.<br /><br />In this case, let us all hope for the best. Nobody is the winner if MAS loses money.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-19741162.post-68059623818630673752009-06-20T11:01:22.136+08:002009-06-20T11:01:22.136+08:00Nobody is saying you shouldn't hedge but when ...Nobody is saying you shouldn't hedge but when the oil price is volatile and is moving up or down very fast, there will eventually be a retracement. Therefore you should monitor everyday and hedge shorter positions rather than take long term hedge positions so that you are not stuck with bad decisions.<br /><br />People have to make decisions in business but try to limit making bad ones and this is clearly a bad decision.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-19741162.post-54621254967606195072009-06-20T00:22:36.105+08:002009-06-20T00:22:36.105+08:00A Voice,
"Do you really think it is competen...A Voice,<br /><br />"Do you really think it is competent to commit 50% of MAS fuel needs from 2009-2011 at US$100 per barrel?"<br /><br />Did anyone expect the financial crisis which brought down the fuel price? The price of crude just before the crisis hit USD150 with no sign of going down. Hedging at USD100 at that time would not have been such a bad idea.<br /><br />At times like these, even Warren Buffet lose money and he's the all time best investor in the world.<br /><br />I think the best and most competent person must be one which has hindsight as his guide :-)Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-19741162.post-34174400873970061772009-06-18T16:56:59.591+08:002009-06-18T16:56:59.591+08:00i personally hoped that idris would clarify these ...i personally hoped that idris would clarify these accusations ...as what tajuddin dit for uem.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-19741162.post-21157796452786418822009-06-17T21:40:00.893+08:002009-06-17T21:40:00.893+08:00Salam Voice,
Another case that convinces me that w...Salam Voice,<br />Another case that convinces me that when we have accountants & financial assholes running companies that have to excel operationally, we are going to have short-termism strategies that rely heavily on number-juggling that effectively produces time-bombs ready to explode... we are seeing this happening with Proton, UEM, MAS, TNB... heck! With all the GLCs!Dhahran Seanoreply@blogger.comtag:blogger.com,1999:blog-19741162.post-58766216855301799072009-06-17T21:05:26.184+08:002009-06-17T21:05:26.184+08:00Ya, betul tu pak. Di MAS, siapa yg banyak buat sil...Ya, betul tu pak. Di MAS, siapa yg banyak buat silap dan pandai bodek boss, lagi cepat naik pangkat. Jala pun bodek top mgmt untuk extension. MASwATCH.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-19741162.post-20829897139332959512009-06-17T18:42:08.931+08:002009-06-17T18:42:08.931+08:00The top mgmt screwed fuel management and now they ...The top mgmt screwed fuel management and now they are in Jo'berg discussing pay cut. <br /><br />Will they cut their pay????<br /><br />Nooo ... off course not. There is the contract.Tkt 4 MASnoreply@blogger.comtag:blogger.com,1999:blog-19741162.post-18532528781098841982009-06-16T19:44:14.811+08:002009-06-16T19:44:14.811+08:00Pek Moh is Arif Shah Oman Shah, his brother is Ami...Pek Moh is Arif Shah Oman Shah, his brother is Amin Shah<br />:)Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-19741162.post-12063874745968849112009-06-16T12:09:18.601+08:002009-06-16T12:09:18.601+08:00Anon 11:21 AM
The current problem in MAS was not ...Anon 11:21 AM<br /><br />The current problem in MAS was not created by his predecessor. <br /><br />Just becasue Dr M allegedly made mistake in appointing Eric Chia, Mirzan, Tajuddin Ramli, and Pek Moh's brother (I don't know who this person is), it does not make Pak Lah innocent. <br /><br />Wrong is wrong. Take it case by case. <br /><br />If you have a case agst Tun, go ahead to take issue with him. He has allowed himself to be questioned and he has answered.A Voicehttps://www.blogger.com/profile/01780035743502972342noreply@blogger.comtag:blogger.com,1999:blog-19741162.post-91601090310198413152009-06-16T11:21:11.026+08:002009-06-16T11:21:11.026+08:00Dear Voicey,
Please do not blame Pak Lah for this....Dear Voicey,<br />Please do not blame Pak Lah for this. Even his predecessor made a lot of mistakes hiring Eric Chia, Mirzan, Tajuddin Ramli, Pek Moh's brother to undertake positions in the GLCs or companies with huge government investment. But nobody seems to blame him. <br /><br />MAS managers just seem to agree and nod their heads. I hope maybe MM can bring this up in the Parliament.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-19741162.post-9505269341252583472009-06-16T10:05:33.991+08:002009-06-16T10:05:33.991+08:00Voice,
Lepas ni aku kena apply kerja jadi GM inch...Voice,<br /><br />Lepas ni aku kena apply kerja jadi GM incharge of bicycle rental operation kat Taman Botany Putra Jaya. Situ aku do not have to worry about hedging future fuel price increase.<br /><br />GM MAS Fleet ManagementAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-19741162.post-6620910230474642992009-06-16T09:05:18.964+08:002009-06-16T09:05:18.964+08:00That's why Allah has said it is haram to terli...That's why Allah has said it is haram to terlibat in gambling related activities. I guess I'll have to short my MAS shares now LOL!Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-19741162.post-77365592352935661672009-06-16T07:43:41.390+08:002009-06-16T07:43:41.390+08:00Anon 11:58 PM said:
I believe Idris Jala took tha...Anon 11:58 PM said:<br /><br /><i>I believe Idris Jala took that decision as it was the best at the moment.</i> <br /><br />You are giving an apologetic answer that has no strong argument.<br /><br />Think thoroughly.<br /><br />Do you really think it is competent to commit 50% of MAS fuel needs from 2009-2011 at US$100 per barrel?<br /><br />That is over commiting and risky. It shows MAS top management inexperianced and incompetence. <br /><br /><b>If market went further up</b>, then naturally airline prices can be upped or surcharge imposed? <br /><br />Did they think about <b>the downside and impact on capital base?</b><br /><br />The downside includes being saddled with high cost when market turned around and it was even obvious to an ex-trader not monitoring day to day.<br /><br />The impact on the company's capital is also determined. <br /><br />I know we did when trading those days. Limits and exposure is set based on shareholders capital of our counterparty. More so on the company capital base to determine exposure. <br /><br />This is basic asset liability management. How amateurish a mistake? <br /><br />Maybe we didn't have compuetrs as sophisticated as today then, but is there no more such needs with the advent of computers?A Voicehttps://www.blogger.com/profile/01780035743502972342noreply@blogger.comtag:blogger.com,1999:blog-19741162.post-76058021348022147942009-06-16T01:25:26.021+08:002009-06-16T01:25:26.021+08:00What is astounding is that the KLSE did not enforc...What is astounding is that the KLSE did not enforce its PN17 rule for MAS's shareholders' funds moving by huge numbers into the Negative Zone. It was waived on the grounds that MAS had cash reserves!!??<br /><br />But if the hedging losees continue, then the shareholders' funds will move further into the Twilight Zone!<br /><br />Once again, we have 1 rule for the small fry and 'national interest' rules for companies whose 'project cannot, must not, ever fail!!'Donplaypuks®https://www.blogger.com/profile/14885751307558636916noreply@blogger.comtag:blogger.com,1999:blog-19741162.post-51599346382479222122009-06-15T23:58:28.525+08:002009-06-15T23:58:28.525+08:00I believe Idris Jala took that decision as it was ...I believe Idris Jala took that decision as it was the best at the moment. <br /><br />Imagine if the JetA1 price goes higher. I am sure we would pay more to travel and again, being malaysian, we will fret about it. <br /><br />The downfall of the fuel price cannot be predicted. Thus, I believe Idris Jala is one competent CEO. <br /><br />When he turnaround MAS, what credit did he get?<br /><br />When hedging goes north, the brickbats and boohoo boys came in. <br /><br />Such a pity and discouragement to a stellar CEO, pure talent of Malaysia.<br /><br />Shame on you ungrateful bunch!Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-19741162.post-20693792944833342912009-06-15T21:47:58.209+08:002009-06-15T21:47:58.209+08:00Good one, voicey. Many heads must roll starting wi...Good one, voicey. Many heads must roll starting with black midas and amokh. These billions loss can be used to feed the poor millions.Anonymousnoreply@blogger.com