Two scariest (or rather amazing) things are to be remembered as we entered the month of Mar 2009. First – the Dow Jones Industrial Average has finally breached the 7,000-level when it closed at 6,763.29; a loss of almost 300 points. The Dow hadn’t traded below 7,000 since Oct. 28 1997 – 11 years ago. It was selloff right from the beginning of trading bell thanks to American International Group Inc.’s (NYSE: AIG, stock) after it reported a staggering losses of $61.7 billion in the fourth quarter, by far the biggest quarterly loss in the United States corporate history. The government said it would give American International Group Inc. another $30 billion in loans, in addition to the $150 billion it has already given the insurer. Sometimes you wonder if it was a mistake to rescue this AIG as the debt-hole could be bottomless.

New York-based AIG said it lost $22.95 per share in the last three months of 2008 and its revenue fell to negative $23.8 billion. It’s true that AIG is holding the U.S. government hostage at gunpoint. This beast will continue to suck up many more billions of taxpayer money and the President Obama can’t even lift a finger because AIG is simply too huge to be killed. With over 74 million customers worldwide and operations in more than 130 countries AIG can basically relax while asking for tens of billions more whenever the need arises. It’s a never-ending parasite that has so far consumed about $173 billion of taxpayer money. Now people who rubbished the “Depression” but adopted the “Great Recession” word are now worrying about “depression” (smaller “d” to mean mild depression, if that will make you happier).

I’ve wrote about the potential of depression months ago and why you should not enter the stock market yet (unless you’re a swing trader who knows how to scalp for fast profit) so I’m not going to nag about it again, lest your hobby is to catch a falling knife so that you can show the trophy to your grandchild of your achievement *grin*. By now you should know that one of the rules in stock investing is not to follow the crowds especially the wrong crowds during such moment. Stay sideline, preserve cash and wait for the right moment to make the killing. Of course if you’re into U.S stocks then you should be laughing all the way to the bank with Put Options, Writing Covered Puts, Short-Selling, Spreads and etc. Tips: KLSE still has a long way to go *down*.

Second remembrance of the month – fresh state election could be around the corner in Perak state. In a historic move an emergency meeting of the Perak State Assembly was convened this morning with three motions passed, under a tree about 200 meters from the state secretariat building:

• First motion: confidence in Mohammad Nizar Jamaluddin as the legal Perak mentri besar;
• Second motion: an agreement to seek Royal consent for the dissolution of the state assembly
• Third motion: the adoption of the suspension of Zambry Abdul Kadir as the menteri besar and six executive councillors he appointed.

I believe after this many gamblers and 4-D punters will build a shrine under this tree hoping to strike it big as this is the first time in the country’s 50-year of independence that a state assembly is being held under a tree. The writing is on the wall and constitution that the Speaker (the person they forgot to buy over) of the Legislative Assembly of Perak is entitled in law to convene the Legislative Assembly for today, March 03, 2009. However the police who only serve the present government that is tainted with corruption has proven to be a reliable business partner yet again *applause* – desperately set-up road blocks and barred the main entrance of the state secretariat building to prevent the proceedings by state representatives voted by the people.

The shivering and probably the shortest-term serving menteri besar (if you think he’s the legal one), Zambry Abdul Kadir, who rushed his team to London seeking professional advices and assistance from the Queen Counsels (QCs) was at lost on how to salvage the situation mainly because his path to the chief minister-ship was being architected with haste and consists of many loopholes. Besides the biggest flaw in buying over the wrong person (Deputy Speaker instead of Speaker) it also did not understand the concept of prorogued and adjourned. In another words if it was prorogued (dissolved) then only the Sultan of Perak (Ruler) can summon the Assembly else if it was adjourned (postponed) then the Speaker can convene.

And according to constitutional expert Tommy Thomas since the Third Sitting of the First Session of the 12th Legislative Assembly of Perak was actually “adjourned” (postponed) sine die in November 2008, the Speaker has the right to recall the assembly into session. Hey, don’t blame the constitutional experts and the written laws because it was the previous BN government that granted the Speaker with such power. So why play the pathetic childish dirty game of crying for the police to block the proceedings and dragging the Ruler into the picture? Thankful they didn’t asked the same street gangsters UMNO Youth to set-up road blocks and take over the state secretariat.

It’s not game-over yet for the powerful BN government, mind you. Rest assured that the BN government will be using the controlled-Judicial from now onwards to the fullest to frustrate its opponents. With the police (and army?) at its disposal the desperate government could easily invoke Internal Security Act (ISA), State of Emergency or Operasi Lalang (Part II). However the old and obsolete method of using the Operasi Lalang may backfire judging from the Hindraf case-study. People are more connected nowadays thanks to technology such as hand-phones and blogs. Also it would be foolish to choose a State of Emergency strategy since it would send foreign investors packing. You don’t think foreign investors do not follow on such developments, do you? Nevertheless the ball is not in the court of the Sultan of Perak now.

This episode may be the new model of democracy to be adopted by the current federal government of BN but it definitely raised many U.S. Republican and Democratic eyebrows of how advance this country is. United States may have the most sophisticated, highly trained and technologically advanced military force in the world but Malaysia has the most sophisticated, creative and best democracy model the world had ever seen. There’re certainly many more other innovative creations that the western and the world should learn from this country called Malaysia. By now the world should know that Malaysians do not live on trees but instead conduct State Assembly under the tree and this alone would take others centuries to learn *proud, grin*.

Other Articles That May Interest You …

• Can the Street Gangsters face Recession Alone?
• Ahoy there, Dow is sinking below 7,000-level
• UMNO begging QC’s help in London – a Mistake Coup?
• Wild Swing to continue as long as the Worse is Not in Sight
• It’s all about Stimulating the Right Way on the Right Part
• Forget about rate cut, AIG may Crash the Stock Markets again
• Nightmare on Dow Street & the shadow of Deep Depression

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March 3rd, 2009 by financetwitter

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