VRF (2)

Read here from previous posting for context.

Quoting from Forbes, an article on 9th July, which most major newspaper in Malaysia failed to pick up:

Malaysia's central bank chief said Wednesday that recent fuel price hikes may push inflation above 6 percent in June, nearly double May's rate and the highest in 26 years.

"This adjustment (in fuel prices) would be reflected in the consumer price inflation in June, which is expected to exceed 6 percent," Bank Negara Malaysia Gov. Zeti Akhtar Aziz told a banking seminar.

Inflation reached a 22-month high of 3.8 percent in May. The last time inflation crossed 6 percent was in May 1982 when it touched 6.1 percent.

The government raised gasoline prices by 41 percent and diesel by 63 percent last month to curb a runaway subsidy bill. It also raised electricity tariffs from July by 18 percent for households and an average 26 percent for commercial and industry users.

Yes, i think we're pretty much sodomised by the government. Now, where is that dubios Malaysian Book of Records?

VRF

If you know the acronym for WTF, figuring out VRF shouldn't be difficult.

Reuters reported that Malaysia's yearly inflation rate will be averaging out 4.5%, well above the central bank's previous forecast of 2.5%-3.0%. In the same context, AFX news reported that official data by the central bank shows that would be the highest inflation for any year since 1998, during the Asian financial crisis, when inflation averaged 5.3%. The central bank governor, Zeti Akhtar Aziz saw inflation rising above 5%in June and peaking around 5.3%early in 2009. The latest official figures showed inflation hit a 15-month high of 3%in April. But she said there was no rush for the central bank to consider raising the policy rate of 3.5%. At its last review on May 26, the central bank left rates on hold. The central bank projected that the inflation in the first half of 2009 would be around 5%, and peaking early in 2009, she said.

In short, since the revise for petrol price, inflation rate will hold on to an average 5% or more from now till next year 2009 June. That's one year for you.

Before the announcement of the revision for petrol price, inflationary rates was already in a 13-mth high at 3% in March 2008 and soared further to 3.5% in April 2008.

Bleak?

A standard fixed deposit interest rate in any local Malaysian banks only provides 3% per annum for 1mth's deposit. If we keep it for 12mths, the bank will give us a 3.5% p.a interest rate.

EPF for the year 2007 announced a dividend payout of 5.8%.

Now, what does all this means to us?

If we keep our money in the bank's FD, we're actually losing at least 2% of our money's worth. In another words, to keep the money with the bank, we're actually giving the bank back with 2%. Which also means, all the hard earned money kept in the bank are almost 'worthless' as these money are losing it's real values.

What about EPF? For all the 'hard work' done by EPF, they're actually earning 0.8% for us.

The last time we had a 5.3% inflationary rate was when the country suffered the 1998 Asian Financial Crisis, and the central bank has projected that early next year 2009, we're going to be hit with that 5.3% inflationary rate.

What does all this means? In short, VRF!


* FD rates in New Zealand & Australia are around 7-9%.

EPF office at 9.45am

I was having some problems with EPF where rightful two months contributions amount was not debited to my account accordingly. The issue when unresolved for one year. Calls after calls that went on for few months to the EPF customer service do not seems to solve my problem nor there was any accurate update on the status of my complaint. Hence I decided to drop in to EPF headquarters at Jalan Raja Chulan. As usual, after being directed from point A to point F in 45minutes, I ended up with the right department. I stepped in the office, and this was what I saw.
It astound me! The office was almost empty. I can't help it but to take these two pictures!

It was almost 10am, on a mid-weekday and there was not even any public holidays in that week! I waited for someone to attend to me and there was, after another a 10minutes wait. I explained my dilemma to this person, and she went off to do some checking on her PC. Another 10minutes's wait, she came back and told me that she can't resolve my problem and ask me to call back!! I told her that I have called numerous times and it has been a year already, and I'll like to know what are the next action to be taken and who is in charge of these problems. What she told me next, I really felt like I want strangle that person. She told me she was new!!! She has the guts to tell me she was new but not to try asking for help from her colleagues!! Helooo, I am sure Alexander Graham Bell invented telephone a century ago. I think that was not really a good excuse to say, "I am new and now please bugger off" because I think she's running away from responsibility.

Anyway... my conclusive point upon his horrendous experience was... now I know why EPF is paying a freaking low 5.8% dividends for year 2007 !!! Mind you, LTAT is paying 16% dividend for the same period. That's way more doubled of what EPF is paying! A bunch of people in EPF should just get fired and put the LTAT guys at EPF. Honestly, we're talking about our retirement funds!

Employees Plundering Funds

Lembaga Tabung Angkatan Tentera ("LTAT"), the company that manages the Armed Forces Superannuation Fund recently declared a dividend of 16% for the year 2007. EPF, however, declared a dividend of 5.8%.

Check this out.

Dividend Year 2007; EPF 5.80%, LTAT 16%
Dividend Year 2006; EPF 5.15%, LTAT 15%
Dividend Year 2005; EPF 5.00%,
Dividend Year 2004; EPF 4.75%, LTAT 15.75%
Dividend Year 2003; EPF 4.50%, LTAT 10%
Dividend Year 2002; EPF 4.25%

I cant find some of the years where LTAT declared their dividends, but you'll get the picture.

Result speaks for itself. Which of these two fund managers are more efficient, profit-driven and acts for the benefit of their beneficiaries? Yeah, I personally thinks that LTAT fund managers should be managing our EPF too. Don't you want to retire comfortably?

*EPF used to be consistently giving out dividends of 8.5% between 1983-1987 and highest dividend payout before the dip was 6.84% in 1999. If you have not known, EPF is only obligated to provide 2.5% dividends (as per Section 25 of the Employees Provident Fund Act 1991).

Employees Poverty Funds

The year is 2008. EPF dividend for year 2007 was announced at 5.8% on the 22nd of January 2008.



I logged on to my EPF online account today. The date is 14th February 2008. Still no sight of 2008 EPF statement account. The webpage held up with a notice 'Statement for 2008 will be made available after dividend 2007 has been declared". (click on the picture).

It's almost a month since it was announced yet I cant get hold of my 2008 Statement to date. Billions of money spent on IT infrastructure yet same lousy service, same sh*t. They might as well put up a notice "We are in dire need of 5.8% donations to make this happen." to put some humor in it or at least "Since we have declared 2007 dividends,we are now 5.8% short of budget to make 2008 statement available."