Jail term for those forex trader who SHORTED the Ringgit and LONG US Dollar?

NeoMatrix

PETALING JAYA: The Government will act against those who are deliberately sabotaging the economy if such claims are true, said Prime Minister Datuk Seri Najib Tun Razak (pic).

"We have to obtain evidence first over what's being alleged," said Najib at the Umno Supreme Council meeting on Friday.

The Umno president added that he wanted the relevant government authorities to take appropriate action.

Allegations of a prominent businessman using his influence and position to manipulate the ringgit for personal gain had surfaced on blogs recently.

Bloggers claim the individual is cashing in on a short position on the ringgit which is akin to betting the currently would depreciate.


Despite the weakening ringgit, Najib said the economy was on the right track.

He pointed out Moody's Investors Service had affirmed Malaysia’s positive rating due to fiscal reforms and the country's fundamental credit strengths.  


Najib reiterated the country was not facing an economic crisis and the Government had taken mitigating measures including revising the budget.

PS: Forex trader beware!!!

NeoMatrix

Ringgit Falls to Five-Year Low as Oil Slump Cuts Revenue Outlook

Dec. 3 (Bloomberg) -- Malaysia’s ringgit fell to the weakest level in almost five years on concern a slide in oil will make it harder for the government to achieve its fiscal deficit target.

The currency depreciated 0.5 percent to 3.4435 per dollar in Kuala Lumpur, according to data compiled by Bloomberg. It earlier dropped to 3.4462, the lowest since February 2010. The price of Brent crude has declined 38 percent from its June high, cutting revenue for oil exporter Malaysia.

Credit Suisse Group AG lowered its three-month ringgit forecast today to 3.49 per dollar from 3.38, and said the central bank may be willing to accept currency weakness to boost exports and offset the impact on the economy from the drop in oil. Prime Minister Najib Razak is seeking to cut the budget deficit to 3 percent of gross domestic product next year from 3.5 percent.

Ringgit weakness is a “reflection of the absolute collapse in oil,” said Michael Every, Hong Kong-based head of Asia Pacific financial markets research at Rabobank International. “The government is already under fiscal pressure.”

Brent dropped below $70 a barrel last week for the first time since 2010 after OPEC’s decision not to cut production to shore up prices. The contracts traded at $70.94 today after falling 2.8 percent overnight.

Malaysia will be the sole loser among Asia’s emerging markets from the decline in crude and the nation may miss its 2015 fiscal deficit target, according to Bank of America Merrill Lynch. A 10 percent drop in prices will reduce the nation’s growth by 20 basis points, economists including Singapore-based Chua Hak Bin wrote in a Dec. 1 report.

One-month implied volatility, a measure of the ringgit’s risk, rose 22 basis points to 8.56 percent, data compiled by Bloomberg show. The gauge has climbed 123 basis points, or 1.23 percentage points, so far this week.

NeoMatrix

Ringgit Falls a Third Day on Oil Price Concern, Drop in Reserves

(Bloomberg) -- Malaysia’s ringgit dropped for a third day and is Asia’s worst-performing currency this month on concern the plunge in crude oil prices will hurt government revenue.

The oil-exporting nation could be the worst affected in the region, Ritesh Maheshwari, an analyst at Standard & Poor’s, said in a Bloomberg TV interview from Hong Kong today. Iraq, OPEC’s number two producer, plans to boost production next year while Saudi Arabia and the United Arab Emirates reiterated pledges to keep pumping the same amount of crude yesterday. Malaysia’s foreign reserves fell to the lowest level since March 2011 as of Dec. 15, central bank figures showed, indicating the monetary authority may have intervened to stem the ringgit’s slide.

“There is renewed concern that oil prices may fall further given the OPEC members’ commitment yesterday,” said Vishnu Varathan, an economist at Mizuho Corporate Bank Ltd. in Singapore. “That is why it’s hard for the ringgit to stage a durable rally. The nation’s falling reserves also don’t help.”

The ringgit retreated 0.2 percent to 3.4960 a dollar in Kuala Lumpur, according to data compiled by Bloomberg. The currency dropped to a five-year low of 3.5073 on Dec. 8. and is down 3.2 percent this month.

Brent crude has fallen about 17 percent since the Organization of Petroleum Exporting Countries chose to maintain a production target at a Nov. 27 meeting and is 48 percent off 2014’s peak reached in June.

Malaysia’s foreign reserves dropped to $120.7 billion from $125.7 billion at the end of November. The decline is probably a function of the central bank’s attempts to smooth out excessive ringgit weakness sparked by falling oil prices, said Sim Moh Siong, a currency strategist at Bank of Singapore Ltd.

NeoMatrix

Ringgit falls again, now Asia’s worst performing currency

KUALA LUMPUR, Jan 29 — Malaysia’s ringgit extended losses as this month’s worst-performing Asian currency on concern a protracted drop in crude will weigh on the oil-exporting nation.

The currency declined for a second day and reached a new 2009 low after Brent slid 2.3 per cent overnight on a report showing US oil stockpiles climbed to the highest level in weekly data going back to 1982. Malaysia kept borrowing costs at 3.25 per cent yesterday even as central banks around the world eased monetary policy amid slowing global growth and falling consumer prices. The nation’s 10-year government bond yields headed for the biggest monthly decline since 2008.

See more at: http://www.themalaymailonline.co ... thash.9sr3ItTk.dpuf

NeoMatrix

Malaysian Ringgit Weakens To 6-year Low Against US Dollar

KUALA LUMPUR (Alliance News) - The Malaysian ringgit weakened against the US dollar in the Asian session on Wednesday, as investors sentiment was hurt on weak commodity prices.

Against the greenback, the ringgit fell to a 6-year low of 3.5998 from an early high of 3.5735. At yesterday' close, the ringgit was trading at 3.5935 against the greenback.

If the ringgit extends its downtrend, it is likely find resistance around the 3.67 area.

BotakChinPeng

trader got $1.4 billion to bet?

allsparks

Kalau aku lah, aku letak jawatan dah sebab tak pandai mentabdir. Tak guna salahkan orang lain sebab ekonomi tu tanggungjawab kita. Sindrom rasa dianiaya ini memang banyak dalam masyarakat hari ini. Sedar2 lah sikit. Cukup2 lah rasa diri tu teraniaya, ubahlah diri sendiri ke arah lebih baik.

NeoMatrix

Bank Negara RM15.5 billion lost in forex market in 1992-1993

Former prime minister Dr Mahathir Mohamad gambled away Malaysia's foreign reserve in 1992-1993.

Former prime minister Dr Mahathir Mohamad is an ambitious man who believes in the theory of mega economics.

He believed and still believes that by adopting a mega-based economic model, Malaysia not only could become a developed country by 2020 but would also become a strong nation at par with the Western powers economically and politically.

Hence, he was prepared to go international and take on the Western powers.

One of the fields that he was keen on was the global foreign exchange (forex) market where there is big money.

In fact Bank Negara, under the Mahathir administration, was involved in covert global speculative activities as early as in the 1980s possibly to test the waters.
Throughout the period (1990 to 1992), Britain’s economy was in recession where national output began to slide and unemployment rose.

Domestic demand fell including demand for imports. In 1992, the exchange rate of the British pound sterling was fixed under the European Exchange Rate Mechanism (ERM).

Unlike the Asian economic crisis of 1997-1998 where their (Asian) currencies were weak or vulnerable, in the case of the British pound, despite the economic slump, the currency still commanded a comparatively strong exchange rate.

Greedy politician
However, pressure was mounting from many quarters for Britain to float its currency in line with the current (at the time) market situation.

Many quarters wanted Britain to adjust the value of the pound accordingly because the European countries believed the pound was overvalued.

Britain’s forex market appeared to be the focus of many speculators who wanted to profit from the market instability.

Speculators would make or lose in a “free-for-all” market situation.

A very greedy politician would think this opportunity was too good to be missed.

Mahathir, the then prime minister of Malaysia-cum-mega speculator, ordered Bank Negara to speculate on the British pound sterling.

George Soros, the global forex player, was also speculating on the same currency but for different reasons.

But both shared a common desire. They went for the kill. The battleground was the London foreign exchange market.

Both believed that they were going to make money from the British.

One believed he could make fast and big money, the other wanted to profit from the expected fall of the pound.

Smart Soros
The one that believed the pound would appreciate took billions of US currency from Bank Negara foreign reserves fund (actual figure unknown).

The “wiser” speculator who believed the British pound would fall was not using his own funds. He borrowed from British banks to the tune of 10 billon pounds and changed the money to German Mark.

The moment of truth came when on Sept 16, 1992, Britian left the ERM.

Unable to stand the economic and market pressure on its overvalued pound, Britian, instead of floating the pound, officially devalued its currency causing the pound to fall.

It was not what the European countries and Mahathir had expected. Luckily for Mahathir the currency did not crash.

The British government had a two-pronged strategy – firstly to devalue the pound to stimulate the economy through cheaper and hence higher exports and more costly imports thereby reducing imports in order to regulate the country’s general economic fundamentals.

Secondly after the devaluation, the sterling was automatically floated to regulate the market fundamentals.

Had Britain directly floated the pound, the erratic rise and fall would disrupt Britain’s plan to stimulate the economy although it may have helped the pound to appreciate which speculator Mahathir had expected.

Bank Negara losses never revealed

Consequently Soros, who took the loan from the British banks, repaid it in pounds which was then cheaper and pocketed the difference of more than US$1 billion.

While the Malaysian gambler, Mahathir, lost about US$4 billion.

Later in 1993, Bank Negara again lost another US$2.2 billion in speculative activities.

Malaysia’s total loss by this time stood at US$6.2 billion equivalent to RM15.5 billion (based on the exchange rate as at Sept 1992. US$1=RM2.5).

However, the actual figure for Bank Negara losses were never revealed.

Instead, the central bank, when put under scrutiny for its dubious activities, gave conflicting and confusing data to make it difficult for the opposition to get to the bottom of the mess.

Bank Negara had abused the foreign reserves which were meant to finance imports, stabilise the ringgit and pay off foreign debts.

The British government made the right decision.The devaluation made the pound cheaper thereby stimulating exports and made imports expensive.

Mahathir gambled away nation’s money
The fall based on devaluation is different from a fall by floating.

The former is an economic adjustment to regulate the macro-economic fundamentals such as national output, employment, among others, while the latter is a market adjustment to regulate market forces such as the exchange rate of a local currency vis-a-vis foreign currencies and the share prices in the stock market .

Hence, once the nation’s currency has been devalued, it can be floated without the possibility of a currency crash because the effect of devaluation has already stabilised the country’s general economic fundamentals.

Mega gambler Mahathir had committed a serious crime by secretly compelling Bank Negara to use its scarce foreign reserves for unethical and unauthorised purposes.

What was more serious was that he had gambled away the nation’s hard-earned money worth billions of ringgit in high-risk global speculative activities.
He should be held accountable for this squandering.

Malaysia did not have the expertise in global forex speculation the likes of global forex player Soros. What should Malaysians do to this mega crook who always denies any wrongdoing?

Bank Negara, in this case, was in cahoots with Mahathir.

Mahathir must pay
Bank Negara is supposed to be the regulator of the financial market, not player/speculator.

Bank Negara can use its own foreign reserves to go into the forex market in Malaysia in order to regulate and stabilise the ringgit, but it should not speculate in forex markets outside Malaysia.

As such, its action was unethical. Foreign reserves of a country is a crucial item to service imports, regulate the country’s currency value and to pay off foreign debts.

The Bank Negara governor at that time was Jaffar Hussein and the head of the forex trading unit was Nor Mohamed Yakcop. Both resigned after the speculation fiasco.

The golden rule is if any Malaysian wants to bet in any foreign exchange market he should use his own funds, not that of the nation.
Mahathir must be held accountable for his action.

Awang Abdillah is a political analyst, writer and FMT columnist.

Kilokahn

https://malaysianexpose.wordpress.com/2015/01/28/how-tong-kooi-ong-is-attempting-to-break-bank-negara-and-crash-the-rm-2/

hzln

bnm tak main spekulasi ker....kes kes kes

zjen

bodoh,   ko ikut la chedet kekal kan nilai ringgit dgn usd,   so org x dpt main la

sabbath_shalom

Org Islam yg makan duit forex ni memang x tahu ke bnda ni RIBA..mendagangkan wang utk manfaat tu haram.