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What will Trump do with China?

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The US – China trade negotiations are right now at a very critical point. If things go well, markets may rally a little bit more, if things go bad, expect a 1,200 point sell off on the Dow Jones Industrial average.

For those trading with China, the impact of an increase in tariffs to 25% could be much more damaging. This is because international trade is conducted based on a set of conventions called Incoterms. If a US buyer bought goods based on any other term either than Delivery Duty Paid (DDP), they risk having to pay 25% more for their goods as the responsibility to pay the custom duties falls on the buyer. If a Chinese seller sold their goods based on DDP, they may not even clear the goods through customs as it would have cost 25%.

That is why there is currently unprecedented port congestion in the at the Los Angeles-Long Beach port complex, having bled into intermodal rail operations and drayage to regional warehouses. Every logistic firm shipping goods from China to US is under pressure to get the goods cleared by customs before March 01.  Interestingly, since the voyage from China to US takes approximately 20 days, all these goods which are clogging up the US ports would have been shipped out of China in January.

Thus, those claiming that China’s economy is not in bad shape are kidding themselves, export growths of 10% was skewed higher due to the Chinese New Year holidays as well as the potential impact of President Trump raising tariffs to 25%. Next month’s trade data from China should show what The Rembau Times has called – a marked slowdown in Chinese industrial production.

While logistics supply chains are currently treating the risk of tariff increase with some degree of seriousness, financial markets are currently treating March 02, 2019 as a non-issue. Of course, financial markets have the additional benefit of being able to react to the expected probability of the final outcome closer to the deadline date. We question why financial markets are not taking President Trump’s threats seriously when those in the real economy had actually done so.

We reviewed 7 pronouncements, including President Trump himself and let’s see how they stack up:-

Analyst and personality calls. Click here for full document

Of the sample, Kenneth Rapoza from Forbes seems to be the outlier as he predicts that tariffs will increase to 25% come Mar 02, 2019 or in about 14 days time. As fate has conspired, Mar 02, 2019 falls on a Saturday.

From a financial perspective, this creates unprecedented volatility around options expiring on Friday March 01, 2019. Now imagine if there is no deal by then? I would certainly be buying as much portfolio insurance as required, called puts, as these contracts are rather cheap at the moment.

So where do we go from here?

From a negotiation analysis point of view, China is projecting strength and Dr. Michael Ivanovitch, an independent analyst, figures that President Trump overplayed his hand because he reached for something that China was not willing to accede to. He feels that President Trump will want to settle for any deal, no matter how rotten it is just so that he can claim a victory. The President’s tweets on 16-Feb seems to confirm this view as he was talking enthusiastically about the “China trade deal.” If there is a deal done before March 02, then President Xi wins and President Trump loses.

Currently, at the time of writing, President Trump is railing against Andrew McCabe, the ex-FBI Deputy Director and trade does not seem to be on his mind.

The entire premise of this is that President Trump will be unwilling to do anything to cause the stock market to sell-off. With the Dow Jones at 25,900, President Trump may be tempted to see how far he can juice the market to go past its all time high of 26,900.

Conversely, what if Trump figures out that markets go up and markets go down and the only time it will actually matter will be come November 2020, which is still 20 months away. Settling for an empty deal at such an early stage will make him look weak politically since the US public sentiment, both among Democrats and Republicans is to sock it to China.

That leaves us with two alternatives, either take the deal or go for the kill and raise tariffs to 25%?

So how will President Trump react?

President Trump’s decision making is nothing like President Obama. President Obama was easily read from a mile, but President Trump keeps his detractors guessing on what is his next move.

We know from the Apprentice that Trump’s decision making is largely influenced by on the spur arguments. He can be persuaded to make tough calls, after all he has just declared a national emergency in order to build the border wall.  We believe that there are only two viable options on the table – either Trump takes the deal or Trump calls China’s bluff and raise tariffs to 25%.

Given that China is now only offering a crap deal, what would you do if you were President?

The answer is obvious, you will kick China in the teeth, raise tariffs to 25% and keep the issue alive so that you can get a better deal towards the end of December 2019. China will then have two options – continue to negotiate with the US or break off negotiations.

China will probably break off negotiations to save face for President Xi. However, he will face a huge problem on his hand as rural workers who migrated to the coastal city centers may be laid off, leading to social instability in China.  This will force President Xi to do one of two things. Either re-enter negotiations with the US or divert the issue by making claims on Taiwan. We think it is more likely for China to make a military play, but President Xi himself may come under increased pressure within the Chinese ruling establishment who would be angry that President Xi overplayed his hands.

So we are then left with two scenarios.

Scenario 1 – China Re-enters negotiation.

At that point the US markets will have sold off and reached a bottom since earnings expectations for 2019 are very low. The only way to secure re-election is to time a deal in 2020. That will give the markets plenty of juice to rally into 2020 with expectations of corporate earnings to increase in 2021.

Scenario 2 – China prepares to take over Taiwan?

This scenario is probable as well, and then President Trump enters 2020 election cycle on the back of a potential military conflict with one of the world’s largest superpowers.

Updates: Feb 19 , 2019

Ok there is a big change on our call based on Trump’s latest tweet. It is obvious that he is a slave to the market and is going to accept whatever President Xi is throwing at him. Our modified call is Xi Jinping wins, tarrifs are off. We hate to this but the tweet is the tweet!

 

US – China negotiation reality TV show

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President Xi briefing the US negotiators on the importance of a win-win solution aka. don't lose face.

Financial market participants interpreted the headlines which came out when the latest round of negotiations between the United States and China which concluded on Friday to mean that the gap between the two world superpowers was narrowing, or at  least not widening. The Wall Street Journal screamed “Chinese, U.S. Trade Negotiators Inch Toward a Broad Agreement” when the South China Morning Post had only a day earlier likened the negotiations to “pulling teeth.”

The markets had gone into the negotiations hoping for a breakthrough but in the end was happy to settle for anything that appeared vaguely positive. Surprisingly, the markets looked the other way when two crucial economic data points which were released over the week was decidedly bearish: the collapse in US Retail sales in December, which was the largest on record since the great recession in December 2008 and the contraction in US Industrial production. Last week was all about trade and the markets decided that a deal was in the offering and tariffs will not increase to 25% come March 01st.

On Friday, President Trump himself gave the markets too much optimism when he gave an upbeat assessment at the conclusion of the latest round of trade negotiations. Speaking at a Rose Garden news conference about his national emergency declaration, he mentioned “We’re a lot closer than we ever were in this country with having a real trade deal.”  He also conceded that the current proposed deal was very limited and far below what he had hoped for.

The obvious question is whether market participants were correct in their understanding? After all, the President himself seemed to hold out some hope of a negotiated settlement. Going into the latest round of negotiations, he seemed to give every indication that this was the final round and he wanted to see a settlement.

Judging by the speed asset prices rose since the start of this year, it is not wrong to suggest that hundreds of billions are at stake. Not only in asset prices but in supply chains and logistics as well. If the US goes ahead to escalate tariffs on Chinese imports to 25% on March 1st, it will disrupt global supply chains and the globalists will argue it will cause a collapse in the stock market.

However there is a risk to those who trade on Trump’s state of mind today risk being disappointed tomorrow because as Malaysian Prime Minister, Tun Dr Mahathir Mohamed, famously said of Trump that he changes his views even in a manner of hours.”

And true enough, President Trump’s off the cuff remarks over the outcome of the trade negotiations was followed by the only authoritative source of US National Policy: The Presidential Tweet.

Official US Foreign Policy as of Feb 17, 2019 @ 8:17 am (New York Time) was …..

Official US Foreign Economic Policy as of Feb 17, 2019 @ 8:17 am, followed by:

 

So what the official US Foreign Economic Policy as of Feb 17, 2019? The Presidential tweet gives market bulls optimism because he characterized the talks as “very productive.” But the Presidential tweet was silent on whether or not he has decided to extend the Mar 01st deadline. And the Presidential tweet was supportive of tarriffs.

This was followed later on with a change in language – from Trade negotiations to trade deal.

So now we are at a crucial point with three options, with only 13 days left before Trump’s 25% tariffs are set to be imposed :

a) Will the US agree to a deal in principle and cancel all tariffs?
b) Will the US leave tariffs as it is and give the negotiations a bit more time? or
c) Will the US increase tariffs on Chinese imports to 25% come March 1, 2019 ?

Currently, this is what the market is pricing. The market thinks option a) is possible and option b) is probable. Trump tweets recent announcements do strongly hint at option b) so there is rational expectation of that.

Rembau Times however thinks going by our propietary Trump model option c) is possible to happen closer to the deadeline because Trump may change his mind again, we call it the STARCH ( Simplified Trump Autoregressive Conditional Heteroscedatic model) aka Trump changes his mind . With Vice Premier Liu He due to visit Washington Trump may hardened his stance this week. For example, Trump could issue a Presidential order banning Huawei’s 5G network infrastructure from US followed by renewned threats to escalate the duties on Chinese imports to 25%. That should catch China by surprise!

This is because China has offered virtually nothing substantive to the United States. It is perhaps a bit good to understand the context of this negotiation so as to understand what will be ultimate outcome.

China’s approach to Trump dealing

The Chinese approach is governed by traditional Chinese philosophies of Confucianism, Taoism, and war stratagem. In this case, China views the tariffs as an act of aggression and has taken a purely defensive stance. So far China has been very careful not to escalate the situation and has been playing a game of strategic patience thinking that President Trump’s fervor for a fight is merely for political theater and that he will have to settle as the Presidential elections are only 20 months away. For China is all about not losing face to Trump by agreeing to anything that gives the impression that China was pressured into making concessions.

President Xi for his part has always stressed on a “win-win solution” and so far has offered nothing in light of the US tariffs. For China, it is all about saving face. If President Xi gives the impression that he had caved in to US demands then he will have lost face among China’s elite. China, which was initially taken back by President Trump’s aggressive style of negotiations may have figured that Trump’s Achilles heel was the financial markets. If tariffs rise to 25% then the US Stock Market crashes, public disapproval with President Trump increases so there is no point in conceding anything and losing face because Trump will weaken his stance as he is afraid that markets will crash. Alternatively, if Trump does increase tariffs to 25%, the Chinese reason thar US markets will crash and then Trump will weaken his stance and settle for a face saving agreement. In the meanwhile Chinese consumers are helping the cause by boycotting US made goods, leading to disappointing sales by Coca-Cola and Apple.

How Trump actually works

However, currently it is possible for US to impose the 25% tariffs rather than agree to a big negotiated settlement. This is also contemplated by China as being possible but not probable. However, the financial markets view this as not conceivable given that prices are so high with the deadline only 2 weeks away.

This is perhaps possible as Trump works on the principle of who speaks to him last will likely influence his views. Until Friday morning, Trump was talking to the negotiation team, namely Robert Lighthizer and Steve Mnuchin, so they had a chance to influence the President’s views.

The US Trade Negotiators may appear to be weak in the eyes of the US economic nationalists like Wilbur Ross and Peter Navarro.

Both individuals had a vested interest to show some progress and to strike a deal as that is what negotiations are all about. If not they will look bad because President Trump had dispatched them with orders to win a deal, or any sort of deal to sell to the stock market.

In this regard, they accomplished their mission as the Dow Jones Industrial index, which is the only index which matters to President Trump, rallied a massive 777 points this week, from 25,106 at the close on Friday 8th Feb, 2018 to 25,883 on Friday 15th Feb, 2019.

However President Trump does not work in a reflexive way with respect to market expectations. The financial markets expect President Trump to not escalate tariffs to 25%, but will he play along?

The counter view goes like this: When markets are strong, it gives him optimism to pursue a hawkish trade policy. When markets are weak, it gives him the fear to pursue a negotiated settlement.  President Trump is a made for TV President and settling too early before the March 01st deadlines takes trade away from the national consciousness and thus TV ratings.

Moreover, The Economic Policy team advising the US President consists mostly of avowed economic nationalists like Peter Navarro. Since China has offered the US nothing, and since the markets have been doing well recently and the Federal Reserve is under control, this gives Trump all the support he needs to accomplish the above objectives.

The objectives of the hawks at the US economic team at the is

  • a) do as much economic damage to China as possible and
  • b) make Trump look good by winning as much concessions as possible, and
  • c) repeat a) and b) as much as possible to the US public.

And one of the few benefits the US President can do without having to get support from Congress is the ability to unilaterally impose tariffs.  After all, the US has a further fight with the EU on vehicle imports and defense spending, so right now it will be way too easy to give in without accomplishing any of the above objectives. That is why President Trump could at least give the impression that the 25% tariff increase is still on the table and will be imposed. Perhaps markets reacted too early to Trump’s mood on Feb 15th, which could change dramatically by Feb 23rd.

By the way, the US official policy on the media was as of Feb 17, 2018 was

 

 

Umno di Mersing tergendala buat sementara waktu

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Rakyat hari ini dikejutkan dengan berita sedih bahawa Ahli Parlimen bagi P154 Mersing, Datuk Dr Abd Latiff Ahmad hari ini menyertai Bersatu dan dengan itu kerusi Parlimen Mersing telah jatuh kepada gerombolan Pakatan Harap(an).

Walaupun ini bukan kali pertamanya kerusi UMNO dilarikan oleh wakilnya, tetapi Mersing ini bukan calang-calang tempatnya. Daerah Mersing ini seluas 2,838 km persegi , malah hampir 5 kali lebih besar dari Singapura. Tempat ini terkenal sebagai kawasan memancing udang galah dan jeti untuk pelancong ke Pulau Tioman. Pengaruh UMNO di tempat ini amat kuat dan jikalau kita berlalu di jalan – jalan kampong, seperti Kg Air Papan, Kg Tenglu Besar dan Kg Tanjong Genting, pastilah kita akan melihat bendera UMNO berkibar dengan megahnya di kediaman ketua-ketua cawangan UMNO di sana. Lainlah kalau ianya kerusi seperti di Jeli yang berada di negeri Kelanatan yang telah lama dijajah oleh PAS, tetapi kerusi Mersing ini unik sedikit.

Mersing terkenal sebagai kawasan untuk nemancing udang galah yang besar. Ianya telah kekal sebagai kubu BN sejak zaman kemerdekaan.

Malah semangat pro UMNO begitu menebal di tempat ini dan UMNO boleh menang walaupun kayu, batu atau selipar diturunkan sebagai calon. Akan tetapi, UMNO tersalah pilih calon dan dari memilih kayu, batu ataupun selipar, UMNO telah memilih seorang yang akhirnya menikam UMNO dari belakang,

Tetapi apa yang begitu memeranjatkan kami ialah keputusan Datuk Dr Abd Latiff ini bukannya keputusan mementingkan diri sendiri tetapi keputusan yang kurang siuman. Undi UMNO – PAS di Mersing ini lebih 2.5x ganda lebih besar dari undi yang diterima oleh Bersatu. Itupun diperolehi oleh UMNO versi lama, bukannya UMNO 3.0 yang begitu kuat menonjol sejak kebelakangan ini.  Lagipun, The Rembau Times telah memberi ramalan bahawa kerajaan yang ada sekarang ini hanya dapat bertahan sehingga bulan Ogos 2019 sebelum ianya jatuh. Maka kenapakah YB Mersing ini sanggup mengorbankan nama baik beliau khususnya dikalangan penyokong UMNO dan melompat masuk ke dalam sebuah bot yang sudah mula kelihatan tandan-tanda retak menuggu belah.

Apakah beliau tidak membaca ramalan The Rembau Times ataupun menghiraukan sahaja pendapat kami?

Maka itulah hak masing-masing. Hak untuk menikam UMNO dari depan ataupun dari belakang. Tetapi, janganlah terperanjat nanti parti UMNO yang kini ditikam, ditendang dan dipandang enteng oleh golongan-golongan tertentu tidak rebah tetapi membuka langkahnya di peti undi tidak lama lagi.

China’s floodgates of bad debt bursts open

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Mersing terkenal sebagai kawasan memancing udang galah yang hebat dan besar .

In the case of 1MDB, most of the headlines concerned the allegations of embezzlement and the cover up. Few actually considered the actual business model i.e. is it possible for a sovereign debt fund to function in the first place.

Surprisingly, this concept of a debt funded investment is quite common in China. In fact, the amount of debt in China, as reported as ““Total Social Financing” an appropriately Communist sounding title, was RMB 200.75 trillion as of end Dec ’18 (USD $29.7 trillion).  That is a lot of debt!

For years, economists have predicted that the great day of reckoning will one day come and China will find itself in a banking crisis the likes the world has never seen. And this year certainly looks like a year where this prediction could come true.

Already, the default rate tripled in 2018, with 119 corporate bond defaults versus 35 in 2017. If 2019 was going to be any better, the market has been severely disappointed as one of the most famous private investment vehicles, China Minsheng Investment Corp, has defaulted on a bond that was due to be paid on Feb 1. Currently, China Minsheng Investment has RMB 232 billion in debt or USD$ 34.19 billion. Another borrower, Wintime Energy is unable to pay up 20% of principal on its debt, and it has RMB 63.2 billion or US$ 9.3 billion in debt.

So what happens now?

To give you some perspective, things can go very bad, very quick. This is because retail investors may be tempted to pull money away from the debt market, which makes it difficult for other debt zombie companies to find financing. So then these companies start to default, which makes more people pull money away from the debt market. Quite quickly, you can see how things can go out of control.

For China, the corporate bond market is about RM 20.13 trillion (US $2.97 trillion). The GDP of the country is $12.24 trillion. So is this bad? Is this comparable to the sub-prime crisis in the US?

In 2008 , the total CDO (“toxic debt”) outstanding in the US market was $1.04 Trillion. US GDP was $14.72 trillion at that point, so in a like-for-like comparison, China is in a much worse state as it has a smaller GDP base and a larger potential debt problem. This is because we have not even included the other elephant in the room – bank loans of RMB 134.69 Trillion (or USD $19.9 Trillion) or the other shadow banking loans – trust loans and entrusted loans of RMB 20.21 trillion (US $2.98 trillion).

As of 2018, China’s Commercial bank NPL ratio climbed to a 10 year high of 1.89% and total bad debts was RMB 2 trillion (USD $296.5 B). We can expect this ratio to double to 3.90% by end of 2019, meaning that total bad debts on commercial banks would have doubled to RMB 4 trillion, corporate bond default rate would have gone up three to five times, with over RMB 2 – 3 trillion of corporate debts in the bankruptcy court and another RMB 2 – 3 trillion of entrusted loans / trust loans blowing up.

Add all these together and the problem credit is of the order of RMB 6 – RMB 10 trillion (USD $0.9 Trillion – USD $1.9 Trillion).

This is sufficient to send China to a severe recession, perhaps similar in intensity to what the US experienced in 2008.

Najib’s humanitarian mission

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This week will mark an important chapter in Dato Seri Najib’s journey as a politician as his court case concerning 1MDB goes to trial. But rather than moan, Dato Seri Najib continues to perform his duty as a “man of the people” and visited an old friend who was suffering from diabetes. The Rembau Times is not afraid to say that we are not so secretly rooting for Najib’s acquital as Najib is a moden day Robin Hood, has been a strong personality in social media and has even sung songs that made fun of PH, complete with backup singers. (Remember the GST song anyone)

Najib’s remix of a blues 1970s song making fun of Pakatan’s unfulfilled promises should see BN prevail in Semenyih.

Politically however though Umno benefits tremendously from Najib’s role as King of Troll, the Umno ship is now begining to consolidate around the Acting President and Umno Youth Chief. Together, they are begining to forge stronger ties with Pas and so lock up the Malay vote as early as possible. With Najib grabbing all the headlines, Tok Mat and Asyraf are quite free to perform their work.

However this cooperation between Umno and PAS will be face some scrutiny. The MACC has identified 9 PAS leaders who will be subject to investigation as they had bought new cars and bungalows during Najib’s time in power. It will not be difficult to trace the transactions and source of wealth – and if it came from  accounts linked to 1MDB then  individually they may fall, but PAS will be strong enough to still maintain their vote share and mind share. Nik Abduh political career could be reduced to dust if he is entangled in this affair, though it is probably not likely.

Of course, the missing piece in this is the Government : Pakatan Harap(an).  Well, for the first time in 8 months the Government seems to be trying to address the key issues we raised months ago. Mazlan Aliman recently announced a pilot scheme for Felda settlers to switch to cultivation of vegetables and fruits. The Minister of Agro-Industries, Datuk Sallehudin Ayub also came out with a programme to help B-40 segment. And there are bits and pieces here and there.

Of course all of this increased activity is with a view towards the Semenyih by election, which The Rembau Times has predicted will be won by Umno. These activities are a bit too little too late to affect Semenyih as the issues in that by election is the Number One issue facing Pakatan Harapan : A referendum on Prime Minister Tun Dr Mahathir and the failure to deliver key promises, esp when it comes to the status of the Prime Minister(in waiting) Dato Seri Anwar Ibrahim.

This wil also be a key test for Tun’s chosen protege, Dato Seri Azmin Ali to see whether or not he can help Bersatu win in a small state constituency in Selangor, something that should be considered a walk in the park as Selangor is firmly under Pakatan rule. But we maintain our call that Semenyih will fall not because of weakness in Selangor, such as water problems (which coincidentally has all but disappeared since the Federal Government fell) but because even Pakatan voters want to send a clear signal to Tun Dr Mahathir:

*(Please) Resign and make way for Anwar Ibrahim.

Long live Anwar Ibrahim!

*Added out of polity

See UMNO is so humble now

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A roundup of all the news making headlines yesterday and today.

The news of the past few days has to do with Deputy Minister Marzuki’s mis-education at University Cambridge (Antarabangsa).  This has been picked on by members of Pakatan Harapan as well as being turned into jokes in the media, both locally and overseas. Surprisingly, Umno is rather quiet about this, as perhaps many Ketua Bahagians are fellow alumni from this prestigious sounding university.

However, Deputy Minister Marzuki’s educational qualifications are the least of his undoing. The bigger self inflicted goal will have to do with the decision for Bersatu to expand its wings to Sabah. That is the suicidal move as it will surely anger Dato Seri Shafee Apdal. The electoral map has been redrawn post GE14 and Sabah is Shafee Apdal country. We will wait to see this explode. UMNO President Zahid Hamidi himself has said something big is currently brewing.

The second point to discuss was Acting UMNO President Dato Seri Mohamed Hassan’s use of the term “bodoh sombong” (foolish arrogance) to describe the attitude certain Umno leaders possessed in abundance prior to GE14; an attitude he felt led subsequently to UMNO’s downfall. Interestingly only a few days earlier, the Raja Troll Malaysia @ BOSSKU aka. ex Prime Minister of Malaysia aka #MO1, Dato Seri Najik Razak revealed that he was personally very confident that UMNO would win big at the GE 14 elections because of the 3 way contests. It is presently not clear whether these two statements are related.

However credit must be given to Tok Mat for using such a strong term to describe UMNO leaders, but at the same time Tok Mat needs to make clear which leaders he is referring to so that he does not hurt the feelings of non-foolish arrogant leaders.

To me, most of those who were clearly less than intelligent and more than proud at the same time were found in the ex-PM’s inner circle, especially those who ran the GE14 campaign. Not all of them were politicians, some where members of think tanks, others were mysterious businessmen, with initiala sharing the two of the three letters in the honorific “His Royal Highness.” Some of the politicians who were in charge of Information and Communication at that material time have , whose arguments defending that scandal were sprouting arguments that were so intelectually repulsive that they were defeated in their own hamlet and to add insult to injury, have already abandoned UMNO’s ship after helping to run it aground. There were also those involved in other bovine related (aka lembu) scandals which weakened the party’s wing, especially Wanita Umno to such an extent that it could no longer function. Those are some of the culprits behind UMNO’s historic loss but if Tok Mat continues on his “Ole Gunnar Solskajer” revival,  UMNO will be back in power in no time and can perhaps form a white paper committee to look into the issue.

 

Berita baik bagi UMNO

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Lembaga Pengarah The Rembau Times yang telah bersidang petang tadi mengumumkan tarikh UMNO dijangka akan kembali berkuasa di Putrajaya telah dipercepatkan dari May 2020 ke Ogos 2019.

Ini bermakna The Rembau Times menganggap kerajaan Pakatan Harapan yang sedia ada hanya akan dapat bertahan selama 6 bulan lagi sebelum retak dan terus berpecah.

Mengulas berkenaan ramalan tersebut, Ketua Pengarah Rembau Times, Sir Wenger Kheri berkata:” Isu – isu yang melanda gerombolan Pakatan Harapan ini sudah menarik perhatiaan agensi antarabangsa seperti Fitch Solutions. Mereka menganggap kemungkinan besar PH akan menghadapi masalah dalaman dan kami juga berkongsi pandangan tersebut. Masalah dalaman inilah yang mungkin akan membawa kepada undi tidak percaya dan akhirnya keputusan ditentukan oleh rakyat. Jikalu rakyat diberi peluang mengundi buat kali kedua PH akan kalah teruk di Semenanjung Malaysia. Najib jugalah yang mengenal Maniam.

Najib jugalah yang rajin turun bawah ke padang sambil menyebabkan kerajaan PH kepanasan kerana tidak tahu cara melawan Najibnoma.

Beliau juga menambah bahawa pucuk pimpinan yang ada dalam UMNO amat berkaliber dan membuat perbandingan dengan kelab Manchester United. “Dahulu bawah pengurus sebelum ini, United asyik kalah ataupun seri sehingga pernah ketinggalan jauh dari menempah tempat dalam kejohanan  Liga Juara Juara Eropah.  Solskajer  yang sebelum ini tidak banyak menunjul dibawa masuk dan disitulah kita lihat kebangkitan Manchester United. Sama seperti UMNO – kebangkitan UMNO dibawah Tok Mat ini sudah pun bermula. Ahli UMNO perlu menyahut tren ini dan sama-sama mula menggerakan usaha kerana UMNO bakal kembali berkuasa dalam masa yang amat singkat sekali. Jangan terlewat kerana selepas pekara ini termakbul, pastinya orang  akan bertanya dimanakah engkau ketika UMNO nazak tidak lama dahulu. 

What it will take for PH to survive past Dec 2019

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Credits: New Straits Times

Today we address a topic that PH supporters (yes they still do exist) should be concerned with, namely what will it take for PH to survive past December 2019.

(This is based on the likely outcome of PH losing the Semenyih by election, so if they do win, PH fans are welcome to come here and point this out to The Rembau Times. No)

  1. Tun Mahathir needs to step down

The number one factor is that the Prime Minister, who is now touching 93 years old, needs to step down. This is because the methods used when he was in power from 1981 – 2003 just does not work in the era of social media and a very complex economy. Furthermore, Tun governed from the benefit of near total hegemony politically,  as he could count on a strong man image and 2/3 support from Barisan Nasional. Today, PH is a collection of parties with differing ideologies and most importantly – untested in running a complex Federal and State machinery. Risks emerge on a weekly basis and need to be anticipated. No matter how well experienced he is, experience alone does not count.

Look at how Dato Seri Mohammed Hassan, who was considered an inexperienced leader managed to turn things around 2 months after he assumed leadership from Dato Seri Ahmad Zahid Hamidi. From a marketing strategy point of view, he executed a perfect plan. He focused relentlessly on developing the alliance with PAS, portrayed a relatively modest image and whacked PH consistently on Race, Religion and Royalty. He could do this because PH was literally taking things to easily – remember the picture of the Dewan Rakyat being empty?

2. PH needs to control and coordinate the news flow.

PH currently is extremely disjointed. After last week’s by-election defeat in Cameron Highlands, many Ministers held press conferences on a Sunday. There was a PC held by the Minister of Rural Development and a PC held by the Minister of Primary Industries, a boycott of Israel athletes (yeah blame Israel…sigh) but little follow through. Fast forward today and the news cycle is no longer dominated by what the Government plans to do but the hero’s welcome Dato Seri Najib got in Langkawi followed by news that PPBM lodged police reports against Dato Seri Najib’s selfie sessions. In one word, LAME!

To control and co-ordinate the news flow is perhaps the biggest challenge of this Government because it requires 1) A tactical genius to actually be able to articulate the media strategy in coordination with Government policy  and 2) PH Ministers to be disciplined and not run off their mouths. This should be housed within the Prime Ministers Department and must have command sufficient respect from both the Ministers and the Government Machinery – lets call it Strategic Government Control Unit (SGCU).

Item 1) and 2) is lacking in PH’s government right now.

The key thing about the SGCU is they need to be able to formulate strategy very quickly and have a solid understanding of how the Malaysian economy works.  It is very difficult to find a group of individuals who can understand political strategy, marketing, news control and economics. But you need this sort of group to be provide a rudder for the Government.

3. Cabinet Reshuffle

The Cabinet needs to be reshuffled. Ministers should realise that they only came to power because on the 14th time of trying and not overstep their supposed importance.  They are just too many Ministers who should be dropped so I won’t even dare say who should be dropped. But I can say who should be retained based on performance: Dato Azis Jamman (Deputy Minister, Home Affairs), Dr. Dzulkefly Ahmad (Minister of Health).

(Yup I could only come out with 2). It was that bad!

Now what is required to be a Minister. Number one, be able to pull in long hours. Number two, be able to stick to the script. Number three, be very humble. Number four, learn how not to use the excuse, “the BN government did this” but to start a sentence with these words, “Your concern is valid and we will investigate. We will get back to you with an answer
by such and such a date” and actually get back with an answer!

4. 555 Management style

A hallmark of Tun Dr Mahathir’s earlier stint as Prime Minister was the feared buku Tiga 5,  or 555 notebook. This allowed the Prime Minister to keep tabs on the ministers and reprimand them when things started to go out of order. What is probably required is a modernised version of the 555 notebook, perhaps an ipad app, with linkages direct to respective Government Ministries.  Ministers must meet KPIs which includes visits to constituencies as well as acting on the small and big issues that are revealed. Core issues can then be data-mined and together with the Strategic Government Control Unit.

5. Ignore Najib, Focus on the plan

The silliest reaction the Government has made to date was to get sidetracked by ex-Prime Minister, Dato Seri Najib’s social media status. Najib is popular because PH messed up the first 9 months of Government by ditching their promises too early without even trying to fulfill key promises to 2 very important voting groups: Youths (aka PTPTN and better jobs) and Felda Settlers. So people who now have a lot of anger, felt cheated and have no outlet to express their frustration gravitate to Dato Seri Najib’s Facebook page. PH did not pay attention to the growing voices of discontentment that appeared.

6. Close the Seafield Temple issue

Basically, they lost the public after the Seafield Temple issue. This issue is what is called the casus belli behind the dramatic loss of support among the Malay electorate. This issue needs to be closed. Period.

Now what are the chances of PH achieving items 1 to 6 before it is too late?

In probability terms, zero or near zero.

 

The Road To Putrajaya: Part 1 Pakatan shudders as D-Day approaches

1

Tuesday, June 06, 1944. The Allies assemble the largest naval force the world has ever seen off the coast of Normandy, France with one aim: to liberate France from the oppressive occupation of the Nazi Empire and deal a crushing blow to the ambitions of Adolf Hilter.

Saturday, March 02, 2019. Less than two months after UMNO was considered dead, buried and consigned to be an exhibit in Museum Negara, Barisan Nasional attempts to do the impossible: Liberate the ex-UMNO stronghold of Semenyih from its occupation by the Axis of Harapan powers.

For many UMNO members and supporters, the last 8 months have felt like an occupation. Not only did UMNO fall in the Federal capital, but Malaysia was renamed to “New Malaysia” or “Malaysia Baru.” Not only this hurt the feelings of UMNO grassroots, but angered many of them as they are now afraid that they may not have been granted full citizenship of “Malaysia Baru” as what happened to the poor Orang Asal of Cameron Highlands.

Citizenship of rakyat in Malaysia Baru is now in question.

However, this does not mean that UMNO members will cave in, and instead will fight to continue to be recognized as full citizens of Malaysia as clearly written on the Identity Card: Kad Pengenalan they carried which was issued by the BN Government, the only Government of Malaysia accepted by the people in Gerik, Sementa, Pendang and Pekan.

Umno has over 20,000 branches throughout the country including at Kg. Tandop in Northern Malaya.

For this impossibility, BN will need to overturn an almost 10,000 vote majority earned by the Axis of Pakatan in the last general election, which was still recent as it was held less than a year ago.

To accomplish this, BN needs to generate a vote swing of in excess of 20%. One out of every 5 voters who rebelled against UMNO in 2019 must now repent and vote the Dacing symbol of Barisan Nasional. The demographics do not look favourable: Malays 68% and Non-Malays 32%. If the Axis Pakatan can get 100% of the Non-Malay vote, it seems impossible for UMNO to prevail this important fight as the Axis will only need 26% of the Malay vote, or one out of every four Malay votes to prevail.

Think it is impossible? Think that this occupation of Putrajaya will be tolerated any longer by the voters, especially the Malays? Think that the Axis of Harapan will get 100% of the Non Malay vote? Think that the B40, who were denied their right for RM 2,000 BRIM will be so forgiving to the economically insane policies of  Pakatanism.

No, no, no, no, no.

On this day in history, 31 Jan 2019, The Rembau Times installs UMNO as the overwhelming favourite to seize the enemy stronghold of Semenyih from the Axis of Harapan. After defeating DAP, the elder brother of this alliance, UMNO now sets its sight on teaching the little brother, Bersatu, that everybody in Malaysia, maybe even in the world, knows that only UMNO can protect the Malays against the DAP Hindraf.

UMNO is recognised globally as the defender’s of the Malays. One day it may even feature on a Google Doodle.

So you have heard it today. The paper which predicted Trump, predicted Brexit, predicted GE 14, predicted Cameron Highlands and now predicts Semenyih will be won back by BN.

We urge members of the Pakatan Harapan cabinet to either heed the voice of the voters, resign their posts and return back to their rightful place on the Opposition bench of His Majesty’s Parliament.