Malaysia Export and Imports Chart

We previously warned that whilst there will be some sporadic spurts of stronger exports, they may not signal a meaningful recovery yet. Our view is that exports may not recover to levels seen in mid-2008 for another 2-3 years.

The YoY fall in Aug-09 exports computed continued to be led by a collapse of manufactured goods exports, weakness in commodity prices and a lower volume of commodity exports.

US workers facing record periods of unemployment, negative personal income growth in 4 of the last 6 quarters, and a sharp fall in wealth, will cut spending on the so many discretionary spending items that have formed the core of Asian exports, cannot anchor a global recovery. Restocking by businesses and

public sector spending can only provide a temporary bounce in output that must be rejoined by a consumer spending revival. A revival with conviction of investment spending by businesses is also out of the picture at this juncture with low capacity utilization globally at this juncture.

Weakening of exports accelerated in major markets. ASEAN exports accounting for 25.7% of total, fell a steeper 24.4%YoY (Jul-09: -20.1%YoY) on lower exports of electronics products, refined petroleum products and transport equipment.

Asia Export Growth League Table

Exports to China rose +0.9% YoY (Jul-09: -16.9% MoM), the first increase YoY in 10 months on gains in exports of electronics and crude oil. Exports to China were also 10.3% higher MoM. The positive YoY growth was due to a lower statistical base in Aug-08, the month when severe drops in exports to China began to be recorded in 2008. Exports to the US dropped (-26.7% YoY vs -29.0%YoY in Jul-09), also falling 7.8%MoM on lower electronics exports. The pace of drop in exports to Japan slowed (-25.0% YoY in Aug-09 vs -32.7% YoY in Jul-09) on gains in LNG and crude oil exports. The pace of drop for exports to the EU at -25.9% YoY was however, steeper compared to Jul-09’s -23.9%YoY due to palm oil as well as chemicals and chemical products exports letting up as the recession in major Euro zone economies particularly Germany.

Exports of Electronics were a shade lower MoM at RM20.57b in Aug-09 after rising for the 6th month in a row to RM20.63b in Jul-09 from RM18.6b in Jun-09 and constituted 43% (Jul-09: 42.2%) of exports although still down -13.1%YoY vs -15.6% YoY in Jul-09. Palm Oil exports making up 6.2% of exports (Jul-09: 8.1%) were down a sharper -35.3%YoY (Jun-09: -33.5% YoY) after a major MoM drop. Oil and Gas exports making up 12.5% of exports (Jun-1 09: 12.0%) fell 50% YoY, still amongst the most affected of export categories.

Chemicals and Chemical Products which contributed 6.1% of exports (Jul-09: 6.2%) fell -19.0%YoY (Jul-09: -26.3% YoY). Machinery and Appliances which made up 3.1% of exports (Jul-09: 3.6%) fell at a faster clip of -12.3%YoY (Jul-09: 10.2%YoY) and Timber Products adding up to 2.6% of exports(Jul-09:2.6%) fell

15.1%YoY(Jun-09:-16.0% YoY).

Imports at RM38.26b (Ju-09: RM40.98b) dropped by 6.6%MoM and were sharply off by 18.6%YoY (Jul-09: -16.0%YoY). Jan-09’s -30.4%YoY remains the fastest pace of annual contractions ever on record. Imports of intermediate goods made up 69.4% (Jul-09: 68.7%) of imports, and its fall on a percentage change YoY basis dampens somewhat hopes of a strong recovery, thus continuing the strong trend in preceding months that reflect the recovery in imports of raw material needs for goods to be processed for re-export. On the other hand, capital goods imported amounted to 14.3% (Jun-09: 14.8%) of imports, reflecting weaker capacity-boosting investment plans by domestic corporations that support future growth. Consumption goods made up 7.1% of imports (Jul-09: 7.2%), reflecting lower consumer spending. Consumption accounted for 65.3% of Malaysia’s real GDP in 2Q-09.

The Trade Surplus expanded again to RM9.58b (Jul-09: RM7.8b), a 22.2% jump MoM despite the MoM drop in exports. The widening of the trade gap left Aug-09’s surplus at exactly the mean YTD monthly surplus of RM9.58b. whilst it is still sharply off a peak at RM15.5b achieved in Jun-08 it is a healthy level. Whilst the trade balance dropped in Jul-09, it was read as a sign of some strength rather than weakness.

The Aug-09 data thankfully continues to hint at a V-shaped rebound after the exports slump hit a trough (see charts below). The current scenario does not yet rule out an L-shaped recovery for Malaysia although the possibility of a W-shaped recovery or a double-dip recession in the West appears small. The anchor for Malaysia’s export recovery appears to be China, but the sustainability of this source of exports recovery is thought unreliable whilst it is rising under conditions of a massive stimulus. The global economic turmoil may continue to drive further deterioration in the domestic environment.

Domestic sources of demand remain the key and steady implementation of the Stimulus Spending package is key. Our chief worry is the possibility the economy will fail to respond in a sustained manner and dismal private sector growth is observed way past the phase of aggressive public sector stimulus spending at a time when US consumers appear to be veering towards permanent frugality and Asian consumers are not ready to fill the void.

The meltdown resulted in the collapse of several large banking and financial institutions in the United States and Europe due to weakness originating from the mortgage and mortgage backed securities markets.

However in Asia, many were not too worried about the property market due to the regulated control of the banking system by their country National Bank and the well-established and matured property developers.

As a result of planned developments and sale of property, the Asian property market has remained healthy, despite the country’s Gross Domestic Product (GDP) contraction of 6.2 % in the first quarter of 2009.

As an indication of the strength of the property sector, the National Property Information Centre (NAPIC) recorded higher transaction volume of some 4.0% compared with a decline of 17.8 percent in 4th quarter of 2008.

In its study, NAPIC also recorded 79,149 transactions valued at USD 4.701 billion in 1H 2009 with the Residential property sub-sector being the most dominant. Total transaction volumes were 63.8% while total transaction value was 55.1%.

The development of residential property remained promising with upward trends in the completion and starts category but dwindling numbers in new building plan approvals.

Currently, by 1H 2009, the residential property sector recorded an existing supply of 4,230,328 units with and incoming supply of 544,926 units. Planned residential supply is recorded at 669,554 units.

In the demand scenario for the residential sales performances there were lesser units that were launched into the market in the past quarters. However, sales performances during the nine months were between 70% and 85% since the first quarter of 2007.

There were also signs that the Asian property market was affected by global economic and financial crisis but the market has remained healthy overall.

Every 5 hours somewhere in the world a new “McDonald’s” fast food franchise is opening. Can you imagine a business which opened its door in 1955 is still so strong today? Well, its founder Ray Kroc, sure did. Kroc, was no inventor. But he knew a great idea when he saw one. After all, Kroc’s entire life thrived on discovering just the right idea that would live on well after the man himself. From a paper cup salesman, to real estate broker, piano player, and finally, milk shake mixer salesman, he always had an incredible amount of faith in himself.

Finally, at the young age of 52 his biggest idea (McDonald’s) was about to emerge. However, Kroc had to muster enough courage in his new idea to once again mortgage his home and borrow lots of money to get it going. He wasn’t a picture of health either. He’d been plagued by years of arthritis, diabetes, lost his bladder and most of his thyroid gland. But, he never lost the courage to persevere and believe in himself. In fact, Ray Kroc was known to say:”The best is ahead of me,” according to those who knew him. The “McDonald’s” brand name is ill^, second most recognizable name in the world, next to “Coca Cola.” Not bad for 52 year old with health problems, huge debts, and tons of dogged determination! Ray Kroc was a simple man with a simple plan to achieve huge success.

Ray’s formula is:

1 Never give up. 2 Always persevere. 3 Don’t forget (No.1) .

Impressed by a small chain of hamburger restaurants based in San Bernardino, California that used the multi-mixers, Ray acquired franchising rights from the owners, the McDonald brothers. He then founded McDonald’s Corporation in 1955. In 1961, he bought out the McDonald brothers for $2.7 million and borrowed at interest rates that eventually made the cost $14 million. It turned out to be a bargain, as McDonald’s grew into the world’s largest quick-service restaurant organization.

In 1963, Kroc’s firm had sold 3 billion burgers, opened its 500th store, and, in a somewhat cynical attempt to target children, chosen Ronald McDonald as the icon of the firm. By 1965, the clown was more familiar to US children than the President.

Opening its 1000th restaurant in 1968, in 1971 Kroc moved the firm into Europe. Creating an enterprise of thousands of almost identical franchises throughout the globe, Kroc was respected in the business community for his high standards and effective leadership.

Under Ray Kroc’s leadership, McDonald’s set standards against which other chains were measured. He created an enterprise comprised of thousands of small businesses, run by independent franchisees that own and operate approximately 85 percent of McDonald’s restaurants. “If you work just for money, you’ll never make it,” Mr. Kroc often said, “but if you love what you’re doing and you always put the customer first, success will be yours.”

Ray Kroc served as chairman of McDonald’s Corporation from its founding in 1955 until 1977, when he was named senior chairman of McDonald’s Corporation in 1977.”We take the hamburger business more seriously than anyone else,” tidy Kroc, said, explaining McDonald’s success. His dedication to strict standards hi’, diligence in providing customers with consistent quality, service, cleanliness and value – and his innovative use of cooking techniques prompted a Harvard Business School professor to describe him as “the service sector’s equivalent Henry Ford.”

Kroc has been the recipient of many prestigious awards, including the Horatio Alger Award (1972),The Presidential Star (1972) and American of the Year (1973) presented by Lions International. He was inducted into the Advertising Hall Fame in 1988. Ray Kroc died on January 14, 1984, in San Diego, California.

Whatever it is you’re trying to achieve in your precious and valuable life, we are convinced Ray Kroc’s traits must be present. Especially, belief! If you don’t believe, you won’t achieve.

Root beer is a beverage made from a combination of vanilla, cherry tree bark, licorice root, sarsaparilla root, sassafras root bark, nutmeg, anise, and molasses among other things. Each root beer has a unique recipe. Root beer constitutes about three percent of the American soft drink market. Many local brands of root beer exist and home-made root beer is made from concentrate or (rarely) from roots.

In fact, even prior to this period, root beer was served, and it was then called ‘Black Cow Mountain’ inspired by a moonlit view of Colorado’s Cow Mountain with snow on top. Kids later shortened the drink’s name to Black Cow. For those not on a diet, recipes add chocolate syrup, whipped cream and a cherry on top. But for those on a diet, ice cream can be partially replaced by skim milk and root beer with diet root beer. Root beer itself has a history that relates to the ancient practice of brewing native plants (twigs, bark, roots) as healing herbal teas.

However, that fateful drink put a delighted smile on Allen’s customers’ face and put him into business. But Allen’s drink or mix was unique – blended from the juices of 14 herbs, spices, barks and berries – and it proved very popular with the thirsty public and in 1922, Allen started a number of outlets to sell it. With the success of his first root beer stand in place called Lodi, Allen soon opened up a second stand in nearby Sacramento. It was there that what is thought to be United States‘ first ‘drive-in’ featuring ‘tray-boys’ for curb side service opened up.

Later, Allen teamed up with Frank Wright, one of his employees, and the name A & W was born. New items were added to the menu and A&W became well. Known as a fast food restaurant offering good food at low prices, and served up fast. Before long, the chain restaurant had spread out beyond the boundaries of California and soon, there wasn’t a state in America where you couldn’t find an A&W restaurant. It had become part of the American way of life.

In 1924, Allen bought Wright’s share of the business to actively pursue a franchise sales program. He had the name, A&W Root Beer and the A&W logo legally trademarked with the U.S. Patent. By 1933, the creamy beverage was such a success that Allen had over 170 franchised outlets operating in different places. To ensure uniform quality for the namesake beverage, Allen sold A&W Root Beer to concentrate exclusively to each franchise operator. His profits were derived from the sale of the concentrate and a nominal license fee.

During World War II no new restaurants were opened. Despite governmental sugar rationing (this affected supplies of bottler’s sugar, a necessary ingredient of root beer) and employee shortages (also a result of the war) most A&W units remained successful. After the war the number of A&W restaurants tripled as loans were available for private enterprise to flourish.

In 1950, with over 450 A&W’s operating nationwide, founder Roy Allen retired and sold the business to an aggressive Nebraskan named Gene Hurtz who formed the A&W Root Beer Company. The post war era – the rapidly recovering economy and popularity of the automobile provided the right environment for Hurtz’s company to prosper. Drive-in was becoming increasingly popular and A&W had the privilege of being one of the few nationally established drive-in restaurant chains. By 1960 the number of A&W’s had swelled to over 2000.

The popularity of A&W soon spread to other parts of the world and Asians had their first taste of it in 1963 when Malaysia opened its first outlet at Batu Road (now known as Jalan Tuanku Abdul Rahman) where it still does brisk business today. In Malaysia, there are more than 26 A&W restaurants and the company has plans to open more. The opening of new stories not only brings the great taste to more Malaysians but also provides employment as well as management opportunities to people. In fact, A&W has become a household name among Malaysians and its menu offers a wide variety of items to suit every member of the family, including the refreshing A&W Root Beer, the ever popular Coney Dog, Waffle, Curly Fries, Onion Ring and Mozza Burger which are unique products of A&W.

It was the first food chain to be opened in Malaysia. It has also gained a mention in the Malaysian Book of Record to that effect. A&W (Malaysia) Sdn Bhd was awarded the “Golden Mug Award” in recognition of its achievement for being the best managed franchisee in the world in 1996.The award was presented by A&W International President/CEO in Las Vegas, USA.

America loved the taste of A&W Root Beer. So, in 1971, United Brands formed a wholly-owned subsidiary, A&W Beverages, Inc., for the purpose of making A&W Root Beer available on the grocery shelf. First introduced in Arizona and California, the cans and bottles of A&W Root Beer was an instant success. Retailers nationwide were soon carrying the product.

Several ownership changes took place during the sixties and seventies. In 1971, United Brands formed a wholly owned subsidiary, A&W Distributing Co., for the purpose of making A&W Root Beer available on the grocery shelf. In 1974, A&W sugar-free was born along with “The Great Root Bear,” a mascot that served as a goodwill ambassador for the brand. Though the purchases and mergers plagued the expansion efforts of A&W restaurants, the root beer remained the category leader.

In October 1993, the A&W brands, excluding the restaurants, became part of Cadbury Beverages Inc. Today, the A&W brands continue under the ownership of Plano, Texas-based Dr Pepper/Seven Up, Inc., the largest non-cola soft drink enterprise in North America and the largest subsidiary of London-based Cadbury Schweppes plc.

Much has changed since Roy Allen first sold root beer from his roadside stand on that hot summer day in 1919. Yet, the one thing that hasn’t changed in 85 years is that people over the world love the rich, smooth, thick-headed taste of A&W Root Beer. Clearly, A&W Root Beer has stood the test of time. And, all the credit for that goes to the genius of Roy Allen.

A clear violation below its neckline support at RM0.60 may see a downside breakout with a potential target to RM0.37 as measured from the distance between the recent high of RM0.825 to the neckline support. However it must overcome its strong support at RM0.47 which corresponds to a classical support and the 61.8% Fibonacci retracement from its Oct 2008 low to its recent June 2009 high. Immediate resistance now is at RM0.66 which also coincides to its 50-day moving average followed by a stronger resistance at RM0.715.

With annual revenues of more than $10 billion, the company is ranked 195 on ill^, Fortune 500 and was added to the Global 500 at number 441.

In fact, the visionary entrepreneur was not able to attend college. In 2000, Ii’ presented the University of St.Thomas with a gift of $50 million – the largest gift to the school’s 115 – year history and largest donation ever reported by a Minnesota College or University. Schulze has a special liking for this university; because this is the university he wanted to go but could not!

Schulze, grew up in the St. Thomas neighborhood and attended Nativity of Our Lord School, about a mile from the campus. He had intended to enroll at St. Thomas after schooling, but service in the Minnesota Air National Guard and work for his father’s electronics distribution company derailed his plans. Schulze, an entrepreneur, used all his assets to follow his dream and opened a small audio – components store, Sound of Music, in 1966. It expanded and evolved into what we know as Best Buy that today employs more than 60,000 nationwide through 354 stores in 37 states. Meanwhile, St. Thomas University awarded him an honorary doctor of laws degree in December 1998. It is Minnesota’s largest private university, and enrolls some 10,000 students.

The company is spending an estimated $80 million a year on what it is calling “customer centricity,” a massive effort to identify and serve its most profitable shoppers by rebuilding stores, adding staff and upgrading wares. Best Buy has little choice. It also has some experience in navigating through the most treacherous storms.

lo 1966, Schulze opened the Sound of Music, an audio specialty store in St Paul, Minnesota. The company grew over the following years, expanding to nine locations by 1980. In 1981, Schulze’s most successful store was destroyed by a tornado. The tornado ripped through its largest store, in St. Paul, resulting in a $200,000 loss for the year and a near – brush with bankruptcy. “We’d forgotten to buy business – interruption insurance,” says Schulze. The water – damaged goods were sold at a “best buy” sale. Not only ‘BEST BUY’ became the company’s permanent name, similar ‘Tornado Sales’ became an annual Sound of Music event. Best Buy’s first superstore opened in 1984, a carbon copy of Circuit City Stores, which was then nearly 40 times its size. A year later Best Buy went public and began a climb that sent it past its chief rival in 1995; it has enjoyed the lead ever since.

Then came the next calamity – a 1989 price war with Highland Superstores, which hurt Best Buy’s bottom line and shoved Highland into bankruptcy. Emerging from this victorious, Best Buy remodeled its stories: open ceilings, concrete floors, fluorescent tube lighting. Staff on commission gave way to hourly employees who did their best to make themselves invisible to shoppers simply wanting cheap electronics. Best Buy grew rapidly from sales of $240 million in 1987 to $7.2 billion in 1996.Who knew the digital revolution could be such a rush? Best Buy did – and it’s selling more pricey gadgets and hook up services than anybody.

It operates retail stores and commercial Web sites under the various brand names, such as Best Buy, Future Shop, Magnolia Audio Video, and Geek Squad, as well as an outlet store on e-Bay. As of July 15, 2004, the company had 619 United States Best Buy stores, 22 Magnolia Audio Video stores in the United States, 109 Future Shop stores and 19 Canadian Best Buy stores internationally. The company is based in Richfield, Minnesota.

Reporter from the authoritative department found the other day; already had the many enterprise state-owned shareholders to raise the objection to the public announcement content, the place state-owned shareholder’s objection are many.

The following stage, society will guarantee door to door to will propose that the objection company will carry on the checking. On June 19, four ministries and commissions have announced 131 To be listed 826 state-owned shareholder’s name lists which needs to fulfill the transfer duty, also pointed out that the state-owned shareholder to transfers the announcement like to have the objection, should, in the announcement issued that in the latter 30 working days feedback and opinion.

According to the authoritative department’s insiders said that in after public announcement one week, a central enterprise has not raised the objection. Because Yang business property right is quite defined, moreover the community responsibility is paid attention to the human. Up to yesterday, also only then the minority several central enterprises proposed the different opinions to the transfer fold of yarn, but does not have one to transfer the duty to propose the different opinions.

On June 25, the strength gathers the stock (quotation stock) to issue the announcement saying that to serves under somebody’s banner the subsidiary company to hold develops the nation electron (quotation stock) the stock to regard as state-owned shares processing to have the objection. This is the first to be listed guarantees the fund to the state-owned shares transfer society to raise the objection.

He said that the next stage, society will guarantee will act according to all levels of national capital committee the material, door to door to proposed that the objection company will carry on the checking, will confirm the name list and the transfer fold of yarn. According to the preliminary statistics, needs to transfer the state-owned stock which holds approximately 8,394,000,000, according to June 19 the closing price computation, the market value approximately is 83,550,000,000 Yuan.

Along with more State-owned business going on the market, will also have the stock to change over to the nation society unceasingly to guarantee the fund, society will guarantee the fund the scale also unceasingly to expand. But “Implementation Means” the 14th stipulation, after society guarantees the foundation extension holds the state-owned shares, enjoys the extension to hold the stock usufruct and the right of disposal, does not intervene to be listed daily management and operation.

The play brocade article believed that along with China Stock market entire circulation’s realization, to be listed stockholder’s rights’ dispersion degree becomes higher. Society guarantees the fund, even if only has 10% stocks, also possibly becomes to be listed biggest shareholder. But takes the biggest shareholder, if does not intervene to be listed daily management and operation, also how the guarantee society does guarantee the fund.

Especially regarding state-owned shares proportion originally not big to be listed, if society guarantees the fund not to participate in the management, possibly is unable to guarantee that society guarantees the fund the benefit not to invade by the non-state-owned shareholder. Recent years although the major stockholder pulled out the spatial to be listed phenomenon to have the reduction, but has not ceased.

If has this kind of situation, not only violates “Implementation Means” the original intention – enrichment society guarantees the fund, will create the state asset the outflow. Regarding this, Chinese Social Science Institute Economics institute Microeconomics Laboratory assistant director the play brocade article believed that in the transfer society guarantees in the question, the place State-owned business’s manner and the Local authority has the close relation.

At present, our country has two set of social security system: A set is the nation society guarantees the fund council, it is a preparation system, the fund raises by the Central authorities unified agreement; Another set is regional scattered society guarantees the bureau, the fund raises voluntarily by the Local authority.

The expert believed that present’s question is, the state-owned shares transfer society guaranteed, lets the place state asset delimit the central committee. Faced with the existing retirement and the unemployed people living cost allowance and so on realistic question, the Local authority needs certainly “to be calculating”. Four ministries and commissions once were clear in June 19, after the public announcement time had ended, already to be listed state-owned shareholder who freezes the stock, has not raised the objection to the supervision organization, will settle accounts the Limited liability company by the Chinese negotiable securities registration to implement the transfer.

This means that the state-owned shares transfer society guarantees the fund, soon starts to transfer the procedure. Also means that the nation society will guarantee will become A market biggest institutional investor. According to the preliminary statistics, needs to transfer the state-owned stock which holds approximately 8,394,000,000, according to June 19 the closing price computation, the market value approximately is 83,550,000,000 Yuan. Along with more State-owned business going on the market, will also have the stock to change over to the nation society unceasingly to guarantee the fund, society will guarantee the fund the scale also unceasingly to expand.

But “Implementation Means” the 14th stipulation, after society guarantees the foundation extension holds the state-owned shares, enjoys the extension to hold the stock usufruct and the right of disposal, does not intervene to be listed daily management and operation.

Should one refinance their home loans, the answer is simple — if there are net savings to lower monthly repayments and save money in the long run as well as flexibility in cash flow management.

Many are still hesitant to do so as they believe their loan is still within the 5-year or above lock-in period, they cannot go about refinancing their loans. However, the reality of the situation is the opposite; homeowners can still refinance their homes even during the lock-in period.

What homeowners need to know is that in view of the low interest rate and competitive home loan products on offer especially with zero moving cost, exploring refinancing is worthwhile even if within lock-in period. In reality, one could also generate savings by refinancing one’s home loan.

Should I Refinance My Housing Loan Now?

The next question is why should homeowners go through the motions of refinancing, which is something they rather not worry about after buying their dream home?

For one thing, they get interest rate reduction. By reducing the interest rates, one benefits from a lower monthly repayment to ease one’s financial burden. Alternatively, the lower monthly commitment enables one to maximize the money set aside for any investment opportunity. In addition to this, if your home market value has increased substantially, you may refinance and cash out to fulfill your current needs or consolidate your higher interest debts to save on interest.

The Best Option Available?

In order to maximize one’s benefit from refinancing a home loan, it is best to fully understand one’s short-term and long-term financial plans and to choose an option that gives maximum value and returns with minimum risks.

Homeowners are advised to always compare home loans on the features offered to have a better idea of what you will be getting. For instance, many banks have zero refinancing costs packages and flexible products, which allow you to deposit your savings to offset on interest with flexibility of withdrawal.

However, homeowners should always review and choose some loan that matches his or her financial plan or economic management of income against expenditures. One has to always bear in mind that a flexible product is beneficial only if one can utilize the facility of deposit to offset on the interest. Otherwise, it would serve as a conventional loan where it defeats the purpose and a person could be paying higher interest rate plus fees and charges.