Look ma, no hands!

Everywhere else in the world, people cringe over fear of economic backlash due to the global financial crisis, but not this blessed nation of ours. Our leader’s assurance after assurance with regard to the future of nation economically is pretty assuasive to the ears. Tonight while having my dinner I overheard the calming voice of Finance Minister 2 in Buletin Utama. Listening to him saying, "we have no reason to worry, our fundamentals are strong and no recession is going to hit us not this year or next year," makes me want to laugh and, at the same time, cry. When facing a crisis, to keep the people calm is obviously the way to go. It will work if the people are oblivious of what is happening elsewhere in the world. While pretending everything is okay, the act of reaching for the "forbidden" cookie jar in the middle of the night, insinuate other things. By the way, to which counters will these cookies be handed to? Will they come with milk & lullaby too?

Talking about current economic trends due to the global crisis, we actually do not have to go that macro. What's happening around us currently should send shivers down the spine of any right-minded business person, especially those small ones that do not have the privileges of EPF money coming to their rescue, but instead must keep contributing to EPF on behalf of their employees without fail. If you are in the service line the trend currently is leaning towards bad more than good. For instance, there are more bad paymasters than the good ones currently. Money is not coming into businesses as projected and as what is shown on paper, on the invoices. Nowadays, from what I gather, most business owners are more prone to dig into their reserves at the end of the month just to make ends meet for the same. When your business can't afford to pay itself at the end of the month, there's your red alert. This you can't afford to ignore. To make matters worse, your staffs will still be relentlessly asking for that yearly pay raise and year end bonuses. You can't help but to oblige given the circumstances currently.

It's also no secret that most institutional and governmental clients are planning to drastically cut costs and expenses next year, meaning a lot less money for your business. Clients are also becoming overly conscious when it comes to discounts, to a certain extend merciless. They'll be doing their window shopping to several of your business competitors before choosing yours. You can't always depend on loyalty anymore. Well, who can blame them? Everyone is looking for the best bargain due to increasing costs in everything (Well not everyone apparently, not when it comes to buying helicopters). And sadly due to all this, especially in the service sector, incessant under-cutting will be fair game. That maybe good for the clients but not for the business owners. Incomes steadily shrink while the overheads climbing up the ceiling. That's the harsh reality of most small businesses today. Mind you, this is now, the time the oracles of the MOF are saying that "the economy is in good shape, the economic fundamentals are strong ...yada, yada, yada".

Looking at those increasingly unhealthy trends, albeit from simpler point of view, I can't help to wonder are we really, as a nation, economically unassailable as proudly proclaimed over and over again by the these MOF soothsayer?

“The finance portfolio has been handed over to me by the Prime Minister at a time when the country’s economy is in good shape. The economic management is stable and our fundamentals are strong so Malaysia is not in a crisis. God willing, we are not heading towards a recession next year,” he said in his speech at the ministry’s appreciation ceremony for Prime Minister Datuk Seri Abdullah Ahmad Badawi here yesterday.

I don't know why but when I read the news or listening to them, I just can't shake off these particular images from my head. An image of a kid riding a bicycle while letting go both of his hands off the handles, unmindful of a car coming straight at him, yelling proudly at the terrified onlooking mother, "Look ma, no hands!".