Hence do you think the majority of the Malays, like my family, are too concerned whether the stock market goes up or down? The government will make sure that those who invest in Amanah Saham will not lose. The government will guarantee that the returns will be higher than the bank interest. Boom or bust, those who invest in Amanah Saham do not face any risk. (We also have that secured investment scheme here in the UK).

NO HOLDS BARRED

Raja Petra Kamarudin

Chua: Bursa will plunge if PR wins

(The Star) - Bursa Malaysia will drop 500 points if Pakatan Rakyat wins the coming general election, said Datuk Seri Dr Chua Soi Lek.

The MCA president said any change in the government would bring political uncertainty and would have a direct impact on the national economy.

He said the impact of Pakatan Rakyat rule would be adversed as its dominant partner, PAS, had little or no interest in the economy.

He said PAS was bent on implementing its brand of hudud law and setting up an Islamic state.

“PAS has also mentioned that it will close Genting (Highlands) and the Bursa. All these will frighten investors, be they locals or foreigners,” he said after opening the 64th anniversary celebrations of the Federal Territory MCA here yesterday.

Dr Chua urged voters to assess the country's situation in a rational manner, taking into consideration its future before making a decision.

He said under the leadership of Prime Minister Datuk Seri Najib Tun Razak, the national economy experienced an upward trend with foreign direct investments at RM34bil in 2011 against RM5bil in 2009.

Dr Chua, who is a member of the National Economic Council, said Pakatan's populist policy of pledging to abolish tolls and PTPTN loans, providing free education and a RM4,000 minimum monthly household income for 3.8 million families, would cost the government RM200bil a year.

“If and when this is implemented, it will bankrupt the country within two years,” he cautioned.

Dr Chua thanked Najib and his deputy Tan Sri Muhyiddin Yassin for the mutual recognition for 157 tertiary institutions in Taiwan and 121 tertiary institutions in Malaysia as announced by the Higher Education Ministry on Thursday.

“This has opened up more avenues for Chinese-educated students to further their studies and return home to serve the country,” he said.

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Chua Soi Lek was probably targeting a Chinese audience when he made that prediction above.

I am not going to generalise and speak for all Malaysians. I am not even going to speak for all the Malays. I will just speak for my immediate family. And when I say immediate family I mean my wife, my five children, my son-in-law and daughter-in-law, and my five grandchildren. That would make 14 of us altogether.

If I were to include my entire family then it would probably run into tens of thousands considering my great-grandfather had ten wives and scores of children, my grandmother being one of them. So allow me to speak on behalf of just the 14 of us.

Would it concern us if the stock market collapsed? Not likely. You see, we do not speculate or gamble on the stock market. What we do is we invest in unit trusts, specifically the government backed and government run Amanah Saham.

Each of us can invest RM250,000 or RM500,000 if we include both Amanah Saham Bumiputera (ASB) and Amanah Saham Nasional (ASN). And that would mean our family can invest a total of RM7 million, if we happen to have that much money in our pocket.

Even if we did not have that much money it does not matter. We can always borrow the money from the bank -- and considering the interest we will be charged is lower than the dividends and bonus we will receive, it becomes viable to borrow the money to invest in Amanah Saham.

And we do not need any security, as the Amanah Saham itself is good enough as collateral. Hence we can practically borrow for nothing and the Amanah Saham can help pay back what we owe, at least after the third year or so. Hence we only need to worry about repayments for, say, the first three years of that, say, 15-year loan period.

Hence do you think the majority of the Malays, like my family, are too concerned whether the stock market goes up or down? The government will make sure that those who invest in Amanah Saham will not lose. The government will guarantee that the returns will be higher than the bank interest. Boom or bust, those who invest in Amanah Saham do not face any risk. (We also have that secured investment scheme here in the UK).

And if the government changes it will still be the same. Whether Barisan Nasional or Pakatan Rakyat runs the federal government it is not going to change anything. Amanah Saham will still guarantee a good return no matter which government is in Putrajaya.

Do you think Pakatan Rakyat can afford to let millions of Malays lose their pants? There will be riots on the streets. There will be a revolution. Blood is going to flow. The government, no matter which government it is, must make sure that Amanah Saham stays profitable and pays at least 8% or 9% (or at the very least 7%) returns every year until the end of time.

Of course, if you were Chinese, then the collapse of the stock market would probably hurt you and hurt you bad. And that is why this statement is coming from the President of MCA and therefore targeted to a Chinese audience. Chua Soi Lek knows that the Chinese would vote based on financial and economic considerations. The Chinese would never vote for any government that will mess up the economy even if that government is the most democratic government in the entire world.

I first met the current Selangor Menteri Besar, Khalid Ibrahim, back when he was the CEO of PNB about 30 years ago. In fact, the first Amanah Saham was launched about 32 years ago, three months before Tun Dr Mahathir Mohamad took over as Malaysia’s Prime Minister. Hence it was Tun Hussein Onn who mooted this idea.

It was actually a brilliant idea, from the political angle, of course. According to the 2012 financial figures, PNB has assets of about RM120 billion. It also manages a total of ten unit trusts comprising 79 billion units of shares and involving nine million investors, Malays and non-Malays included.

ASB, for example, earned about RM6 billion in 2010 and paid out about the same to the nine million investors. In 2011 it saw a 21% increase in gross income. And it has consistently paid an average of 6%-7% every year for more than 30 years, in good times or bad.

If I were Malay, and if the economy was the factor that influences my decision who to vote for, then I would vote for the government that can ensure I will continue to receive a good payback every year for the rest of my life, as it has been doing since the days before Dr Mahathir became Prime Minister.

And I would not worry about the ‘danger’ of changing governments and whether this change of government is going to trigger a collapse of the stock market because the government, whoever it may be, will ensure that my Amanah Saham investment will stay secure and will continue to pay good dividends and bonuses every year -- even if DAP, PAS and/or PKR takes over the federal government.

But that would be something Chua Soi Lek can’t say because he is talking to a Chinese audience and to the Malays that type of talk does not carry any weight.