Failure of A country: The leader is a non-economist.

 If we have 2 country. 

First country is run by an economist Mr. Don from Savor and second country is run by a philosopher Mr. Andes from Mildova.

The settings of the country is in 1990. We will also set the country on ceteris paribus or all thing equal under normal circumstances.

However, they have different goals and leadership from 1990s.

Savor was run by Mr. Don an economist and Mildova was run by Mr. Andes a political activist. 

Mr. Don set the economy with right institutions, reducing cost of doing business, cheaper infrastructure, make life easier for the masses and business by lower utilities bill as well as cost of living and promoting free education. 

Mr. Andes on the other side, increase tax for the rich, increase cost of doing business and many type of taxes for the masses, while, promoting massive welfare program for his country and worldwide. He also increase the minimum pay for the poor without increase in productivity. He is of the opinion that it is a sin to be rich in his country. He has the concept of equality for all and be champion of the world. 

As a result, the productive and rich people move to Savor from Mildova and Mildova experiences brain drain and low productivity. Mr. Andes need to increase taxes from time to time to cover his burgeoning budget. 

In 20 years time, Savor GDP grows from 100 to 1000 while Mildova GDP grows from 100 to 150. The currency of Savor gets stronger while the currency of Mildova weaken. The rich all move to Savor from Mildova. Savor become a developed country while Mildova become a third world economy as the rich lived in Savor and the poor moved to Mildova as Mildova is a welfare state. 

Why? 

Because, there is a principal in economy that Mr. Andes does not understand, which is the invincible hands and multiplier effects in economy.

In economy, if we support productivity, productivity will give rise to multiplier effects and multiplier effects will activate the invisible hands that leads to better economy and living conditions for the masses. 

On the other hand, Mr. Andes concept of welfare society is good initially but this promote his society to be unproductive and depends on government handouts attracting those that loves welfare to his country. Making his country more and more unproductive as time goes by. 

In order to maintain his welfare state, he needs to increase his tax more and more on the productive segment of his country, making his people becoming unproductive and looking for welfare handouts and the productive ones will move elsewhere to country like Savor. Soon, his country suffer from negative growth and turned into socialist and eventually communist country as the poor will demand more and more welfare and the institutions in his country collapse. 

Political country will move through cycle of capitalist to socialist and communist before moving back to capitalist from time to time. 

There is a saying that a fish rot from his head and how true it is. You can see that many capitalist country become socialist and eventually communist because of welfare economy.

Therefore, there is no other way to developed a country, other than making it more productive with good institutions that promote fairness and equality for all with low debt that can be service by the people's income making it sustainable. 

While, income must be lower than productivity to make it competitive. 

I hope to be wrong as I believe that every country should have a good ruler and prosper with time. 

Moral of the story: Make sure that the debt of your country is less than the income of your citizens and their income is less than their productivity, so that the country will be able to growth with time. 

Productivity matter, 

Dr. Lion. 

Survivability in Malaysia

 To navigate Malaysia's challenging economic landscape—marked by **rising inflation** (projected 2%-3.5% in 2025), **subsidy rationalization** (especially RON95 fuel), and **expanded taxes** (e.g., Sales and Service Tax/SST revisions)—proactive financial adjustments are essential. Based on current policies and economic trends, here’s a structured survival guide:

---

### 🛠️ **1. Optimize Budgeting & Spending**

- **Prioritize Essentials**: Focus spending on needs exempt from new SST hikes (e.g., basic foods, healthcare). Reduce non-essential purchases like luxury imports (salmon, avocados) and discretionary services (beauty, private healthcare) now taxed at 5–10%.  

- **Leverage Government Aid**: Apply for **Budi Madani** (fuel subsidies) and **Sumbangan Tunai Rahmah** (cash aid). Budget 2025 increased direct assistance to RM13 billion for 9 million low-income Malaysians.  

- **Energy Efficiency**: Offset fuel subsidy cuts by using public transport, carpooling, or switching to electric vehicles (EVs), which qualify for tax relief.  

*Table: Key Expense Adjustments*  

| **Category**          | **Action Item**                                                                 | **Potential Savings**              |  

|------------------------|---------------------------------------------------------------------------------|-----------------------------------|  

| **Food**               | Buy untaxed staples (rice, vegetables); avoid SST-hit imports                  | 10–20% monthly grocery bill       |  

| **Transport**          | Use public transit; monitor targeted RON95 subsidies (mid-2025 rollout)        | RM100–300/month if eligible       |  

| **Utilities**          | Reduce electricity/water usage; phased subsidies exclude high-income households| 5–15% on bills                    |  

---

### 💼 **2. Boost Income & Employment**  

- **Negotiate Wages**: The **minimum wage rises to RM1,700/month** (Feb 2025). If eligible, request raises aligned with this benchmark.  

- **Upskill Strategically**: Pursue training in sectors with tax incentives (e.g., green tech, AI, vocational skills). Tax deductions exist for employers hiring women returnees or sponsoring tech upgrades.  

- **Side Hustles**: Explore freelance/digital nomad roles benefiting from new tax compliance simplifications. Export-oriented sectors (e.g., electronics) face tariff risks, so prioritize locally resilient gigs (e.g., tutoring, repair services).  

---

### 📊 **3. Tax Mitigation Tactics**  

- **Maximize Reliefs**: Use expanded deductions:  

  - **Housing**: Up to RM7,000 interest relief for first-time buyers (properties <RM500K).  

  - **Family Care**: Child/eldercare allowances (newly extended to grandparents).  

  - **Green Spending**: EV purchases, solar panel installations.  

- **Restructure Investments**: Dividend taxes (2% above RM100,000) exempt foreign-sourced income. Shift portfolios to tax-free options (e.g., pioneer-status companies).  

- **SST Compliance**: For microbusinesses, register for SST to claim input tax credits. Penalty waivers apply until Dec 2025 for new registrants.  

---

### 🏦 **4. Long-Term Financial Resilience**  

- **Emergency Fund**: Aim for 3–6 months of living expenses. Inflation may spike post-subsidy cuts (e.g., RON95 reform could raise transport costs).  

- **Debt Management**: Avoid high-interest loans. Rising OPR (currently 3%) may increase borrowing costs in 2026 if inflation rebounds.  

- **Invest in Inflation-Hedges**: Consider assets like:  

  - **Real Estate**: REITs with exposure to logistics/healthcare (tax-efficient).  

  - **Dividend Stocks**: Banks (e.g., Public Bank, 6% yield) benefit from steady rates.  

  - **Commodities**: Gold/agricultural commodities to hedge against ringgit volatility.  

---

### 🤝 **5. Leverage Community & Policy Resources**  

- **Community Support**: Access food banks, cooperatives, or shared-services networks to pool costs (e.g., bulk buying).  

- **Government Programs**: Monitor **Progressive Wage Policy** (2025) for career advancement paths and **MySIP internships** (tax-deductible for employers).  

- **Disaster Preparedness**: Annual floods cost RM6 billion. Ensure insurance covers climate risks; use government flood aid if affected.  

---

### 💎 **Key Takeaways**  

Malaysia’s reforms are **necessary but painful**. Success depends on:  

1. **Adapting early** to subsidy targeting (e.g., verify RON95 eligibility).  

2. **Exploiting tax reliefs**—e.g., RM2.4 billion allocated for green tech incentives.  

3. **Diversifying income** beyond trade-vulnerable sectors (semiconductors, palm oil).  

> ⚠️ **Monitor Risks**: U.S. tariffs (24% proposed), oil price swings (<USD75/barrel squeezes Petronas dividends), and political shifts could worsen conditions. Stay informed via MOF/Customs channels.  

**First Steps Today**:  

- Audit expenses using apps like **MySejahtera** (integrated with subsidy schemes).  

- Apply for **Budi Madani** if fuel costs >15% of income.  

- Consult a **tax advisor** for personalized relief planning.  

By combining fiscal discipline with strategic use of state resources, households can not only survive but position for recovery as Malaysia navigates this transition.

Malaysia survivability.

 Malaysia's ability to sustain its welfare state amid subsidy cuts, tax reforms, and persistent governance challenges involves complex trade-offs. Based on current policies and structural issues, here is a systematic analysis:

---

### ⚖️ **1. Welfare Commitments vs. Fiscal Reforms**

- **Targeted Subsidy Rationalization**:  

  Malaysia has phased out blanket subsidies (diesel, electricity, chicken) in favor of targeted programs like **Budi Madani** and **Sumbangan Tunai Rahmah**, saving billions for welfare redirection. Fuel subsidy reforms for RON95 (mid-2025) aim to exempt 85% of citizens while cutting costs by **RM8 billion annually** .  

- **Social Spending Increases**:  

  Despite subsidy cuts, welfare allocations remain robust: **RM13 billion** for direct cash aid in 2025 and a higher minimum wage (**RM1,700/month**) to offset inflation .  

- **Tax Base Expansion**:  

  New taxes on luxury goods (5–10%), sugary beverages, and expanded Sales and Service Tax (SST) are projected to boost revenue by **5.5% in 2025**. However, reliance on Petronas dividends (**RM32 billion**) persists .

---

### 📉 **2. Fiscal Imprudence Risks**  

- **Deficit Reduction vs. Debt Burden**:  

  The fiscal deficit narrowed from **5.5% (2022) to 3.8% (2025)**, but government debt remains high (**62.6% of GDP, Q1 2025**). Debt servicing costs consume **16.1% of revenue** (2025), straining welfare budgets .  

- **Operating Expenditure Dominance**:  

  **80% of the 2025 budget (RM335 billion)** funds operating costs (e.g., civil servant wages), leaving only **RM86 billion** for development. Wage hikes for 1.6 million civil servants may crowd out welfare investments .  

- **Oil Dependency**:  

  Declining oil prices threaten revenue, yet broad-based consumption taxes (like GST) remain unaddressed, creating fiscal vulnerability .

---

### 🕵️ **3. Corruption and Governance Gaps**  

- **Resource Leakage**:  

  Studies show patronage systems enable **subsidy diversion** to elites, with **20–30% of welfare funds** misallocated. This undermines poverty programs and worsens inequality .  

- **Institutional Reforms**:  

  Initiatives like the **Public Finance and Fiscal Responsibility Act (2023)** and anti-corruption task forces aim to enhance transparency. However, centralized political control weakens oversight, allowing **"selective implementation"** of welfare policies .

---

### 📊 **Comparative Fiscal and Welfare Metrics (2023–2025)**

| **Indicator**               | **2023**      | **2024**      | **2025 (Projected)** |  

|-----------------------------|---------------|---------------|----------------------|  

| Fiscal Deficit (% GDP)      | 5.0%          | 4.3%          | 3.8%                |  

| Govt Debt (% GDP)           | 64.3%         | 64.6%         | 64.2%               |  

| Subsidy/Social Aid Spending | RM81 billion  | RM61.4 billion| RM52.6 billion      |  

| Debt Service/Revenue Ratio  | 15.8%         | 16.1%         | >16%                |  

| Social Assistance           | RM10 billion  | RM12 billion  | RM13 billion        |  

*Source: *

---

### 🔮 **4. Survival Prospects: Conditions and Risks**  

- **✅ Sustainable If**:  

  - Tax reforms **diversify revenue** beyond oil/GLCs.  

  - Targeted subsidies **protect vulnerable groups** (e.g., BR1M recipients).  

  - Anti-corruption measures **reduce leakage** by ≥15%.  

- **❌ Crisis Triggers**:  

  - Global oil prices **below USD75/barrel**, forcing austerity.  

  - **Debt servicing** exceeding 20% of revenue.  

  - **Political resistance** to subsidy cuts inciting unrest .

---

### 💎 **Conclusion: A Fragile Balancing Act**  

Malaysia's welfare model hinges on **executing reforms without fiscal or governance failures**. While subsidy rationalization and tax expansion fund welfare, **corruption and debt inertia** remain existential threats. Success requires:  

1. **Institutional credibility** to ensure efficient welfare delivery.  

2. **Broad-based taxation** (e.g., GST revival) to replace volatile oil income.  

3. **Strict debt ceilings** to free resources for social spending.  

Without these, even robust growth (**5.1% in 2024**) cannot prevent welfare erosion . The next 3–5 years will determine whether Malaysia can reconcile its welfare aspirations with fiscal reality.

Beginning of a new Era: The rise of China dragon and fall of Uncle Sam.

 US is buyer, China is seller. So, US will buy from other country with a higher price to replace China. China will sell to other country at lower price to replace US. So, the world profit and the loser is US and China. How long can US dollar that is akin to toilet paper survive in this market of increasing price and inflation. US dollar will demise soon. How long will the world be affluent to a debaucy currency that is of no face value. 

Adam Smith coin it that a thing is worth, how much a buyer willing to pay. 

China can still sell to Asean, Europe, Middle East, North Africa, South America, South Asia and Oceania and also russian. Chinese people will need to be more creative to replace US and it is timely that China be independent and stand on its own 2 feet rather than kowtow to US hagemony and life dictated by Emperor Trump.

In economy, there is a theory call invincible hands. In this case, the invincible hands will bleed US dollar to oblivion. Gold and silver will be testament of US dollar failure. While, bringing China to be more productive, creative and most importantly more resilient to end times.

Moral of the story: Every 500 years the power of the world shift from east to west and vice versa.

When 2 superpower fight are we ready to collect the spoilt?

Investment from a Doctor's Perspectives

 If you give a Doctor a technical chart, he would said it is an ECG reading. That is why Doctors is known as the worse investor. 

So, if a Doctor would diagnose the health of the stock market. He would have to see the symptoms and signs of the stock market.

Symptoms is what the patient's complain and signs is what the Doctor illicit or found out. 

The symptoms would be world and local news whether it is an act of God, big brothers' action or corporate announcement of individual stock as well as news and actions taken by competitive and complementary competitors in the industry. 

The sign would be volume-price action at international macro and local macro as well as microeconomics of individual  stock or commodity.

So, if the symptoms and sign shows uptrend or bull. We should increase our investment and buy high, sell higher. 

If they show downtrend or bearish, we should decrease our investment and sell low, buy lower. 

Both ways we make as long as we preserve our capital and winning and let it compounded.

Just remember, if we lose and our portfolio enter ICU or casualty ward just stop digging and remember to live and fight another day at another more favorable set of economic conditions. 

Stock market is the world's most cruel game. The stock market does not care whether you make or lose as the stock market have a life of it's own. 

Stock market is the fastest route to untold richest or the poor coop house as millions were won or lose in the stock market in the past and it will exist for many more years as long as capitalism exist. 

Moral of the story: Faith favored those who are prepare.

In God we trust, 

Dr. Lion

A fictional memoirs of a Day Trader

 The following is a fictional story from the memoirs of a day trader in bursa malaysia. 

Let us go back to the year 1996. The stock market boom in bursa with the second board counter reaching new high. We had stock such as Repco and Hwatai that reach 200  and 180 ringgit per share respectively. 

Everyone was joyous, cheerful and many millionaire was make overnight.

Alas, good time never last forever. In 1998, repco was last traded at 2 ringgit and Hwa Tai drop to 80 cents per share. If the king of stock drop up to 98 percent of its value what about the rest of the stock in second board?

There is total wipeout for stock participants and many speculator and pools suffered from bankruptcy. 

If you think this is the worse? Forward another 10 years to 2008. Share such as mkland drop from 4 ringgit to 10 cents. Still another 98 percent wipeout.

Is this the worse? No. Forward to 2020 during the covid crisis in March 2020, alot of mesdaq counter such as Fintech and Asiaply drop from 50 cents to 1 cents and share such as Puncak drop from 4 ringgit to 10 cents. Nearly another 98 percent wipeout.

So, how can we withstand a 98 percent wipeout every decade?

A 98 percent wipeout means a million invested in the stock market will be worth only twenty thousands. 

Share market is the fastest way to be millionaire or billionaire. However, it is a double edge sword, either you become rich or end in the poor coop house especially those who rely on tips. The end game for a failed speculator is either bankruptcy or suicide. 

Just ask any stock investor in 1998s, 2008s or 2020s, most of them would have retire from the stock market. 

Speculation in the stock market is akin to gambling and speculation or gambling is never safe or foolproof. 

Every once or then there is a killer wave that flush out or dried up every drop of blood that the punters have. If you want to see flushing, you can try trading in the forex and derivatives market. 

Honestly, if you take care of your losses your winning will take care of itself. 

I hope to be proven wrong, however history tend to repeat itself. Therefore, it is better to be safe than sorry when we speculate with our hard earn money.

Moral of the story: Gambling or Speculating is never safe as it is always better to be ten years earlier than one day late preparing our ark in this uncertain times. 

May your trading life be producrive. 

God bless you, 

Dr. Lion. 

Allocating our Finite resources to the test of times.

 Since time immemorial mans have unlimited needs and wants. This makes us desire for everything. However, our desire is limited by the amount of finite cash we have. Therefore, we should allocate our limited cash to fulfill our needs and wants at the optimum level and overcome the opportunity cost involve. Opportunity cost here would mean the loss of opportunity on other asset class as we allocate to one particular asset class. 

I would like to suggest an asset allocation that can withstand the test of time whether it is boom, bust, depression or disaster that will be able to grow with time and conservative in nature as well. Just remember that the dark days are many. 

Therefore, i would allocate my asset class as follows:

1. House and Lands and cash which include insurance policy, foreign cash and retirement saving 30 percent.

2. Stock, bonds and derivatives 30 percent

3. Cars and Collectible 20 percent

4. Gold and Precious metal 10 percent. 

5. Crypto 10 percent

This would make sure that we can withstands the ups and downs of the economy and rebalance our asset class as one asset class outperform the other or when one asset class underperform.

It is better to be ten years early than one day late.

Moral of the story: Fate favors those who are prepared and Murphy law state that calamity that we are prepared for in advance will not come to fruition.

Teach a wiseman and he will be wiser. 

In God we trust, 

Dr. Lion.