Malaysia pension fund watch: Tabung Haji spotlight, assurance deposits safe

Editor's note: I've always had this topic as something to cover, but never settled down to it. Will start to gather some links on this now.

27 Jan 2016: Tabung Haji spotlight, assurance deposits safe

Editor's note: some indicators compiled from TH annual reports here:

Note: Just to share research info. Not all info has been put in - bonus rates. Please check TH annual reports for most accurate info. 

Tabung Haji confirms Bank Negara’s warning, says deposits safe BY ANISAH SHUKRY 26 January 2016; ....Lembaga Tabung Haji today confirmed Bank Negara had warned it in a letter that its liabilities outweighed its assets, but assured contributors that their deposits were safe and that the pilgrims' fund was not facing any financial difficulty. It said Bank Negara's evaluation had not taken into account the pilgrims fund's investment portfolios, such as the shares of its subsidiaries, its plantation assets and property. - See more at: http://www.themalaysianinsider.com/malaysia/article/tabung-haji-confirms-bank-negaras-warning-says-deposits-safe#sthash.1OAmfgeQ.dpuf


Bank Negara lauds Tabung Haji’s bolstering of finances BY ANISAH SHUKRY 26 January 2016; ...nearly nine million depositors... Meanwhile, Bank Negara today said it issued advisories to non-bank financial institutions such as Tabung Haji to ensure they continued to be well managed and performed their roles effectively. - See more at: http://www.themalaysianinsider.com/malaysia/article/bank-negara-lauds-tabung-hajis-bolstering-of-finances#sthash.weQzDPr0.dpuf


Tabung Haji reserves in the red, warns Bank Negara BY ANISAH SHUKRY 26 January 2016; ....Tabung Haji reportedly has only 98 sen in assets for every RM1 in liability. Bank Negara says its predicament is because of the practice of declaring higher dividends than it can afford... Tabung Haji’s deposits were highly concentrated among a small number of contributors – 5% of whom owned 75% of the total deposits. This exposed the pilgrims’ fund to the risk of a mass withdrawal of deposits, should contributors lose faith in it, she said....Last year, Tabung Haji courted controversy when it purchased 0.64ha land in Tun Razak Exchange (TRX) for RM188 million from 1Malaysia Development (1MDB) to develop a residential tower. It paid 43 times the price the debt-ridden 1MDB had paid for the plot, which it bought from the federal government five years ago.  Following public backlash, Tabung Haji in May vowed to sell off the land at a profit, but until today, there has been no news of the sale. - See more at: http://www.themalaysianinsider.com/malaysia/article/tabung-haji-reserves-in-the-red-warns-bank-negara#sthash.2U5fumU0.dpuf

Tabung Haji 2014 Annual Report info and link here: 

https://cms-th.s3.amazonaws.com/Lembaga+Tabung+Haji+Annual+Report+2014+%28small%29.pdf

Long cycles: Mulling a posting in Linkedin by Jeffrey Tian, on bean stocks in 25 year commodity cycle

25 Jan 2016: Mulling a posting in Linkedin by Jeffrey Tian, on bean stocks in 25 year commodity cycle

source: https://www.linkedin.com/pulse/does-anybody-do-super-long-term-commodity-cycle-analysis-jeffrey-tian?trk=hp-feed-article-title-publish

Editor's comments:

• Thanks for sharing. It is great to see on a stock basis the long term c. 25 year cycle for commodity. 
• I like to look and wonder (but never really taken time to analyse) current price against long term trend price trends. These have been mean reverting! But this is a rather historical perspective as you remain an observer of how long it takes to revert to trend. Maybe interesting to chart short vs long term price with standard deviation overlay (for equities, I think +/1 2 SDs was usually pretty interesting). 
• In previous career, I spent time on equity market price indicators and looked at relative price of companies in different parts of the value chain (but price history often not long enough): commodity trading, production, consumer goods (e.g. Unilever, Mcdonald's - which is still really high) and the billionaire owners buying of property and paintings. 
• On long cycle issues, a) the terms of trade trend against commodities was one of the things learned in development economics course - did biofuels and bankers/traders impact this indicator a lot? And/or can we see any positives from agro-tech from Monsanto etc? b) Now, it seems we have to cope with capacity build up in oil & gas + renewables thanks to low interest rates. c) At same time, what is future impact of "4th industrial revolution" going forward or is agro still the same?

4 July 2014: In researching commodity economics, the long cycles are often of interest. 

Editor's note: I was talking to a senior commodity economist last night on how far prices have reached above the mean; notably palm oil, well supported by crude oil prices (with the significant usage of palm biodiesel; it would be good to look at how many SDs above mean commodity prices are running right now). He also thought that the often cited USD70/barrel cost of production might be overstated (only some offshore new fields face such costs; and they would keep pumping if cashflow positive, no?). Just prior to the late 2000s run up, reports from onshore Canada and USA on shale gas (and fracking?) indicated costs in the mid-USD20s.

What will happen when interest rates get off the floor? Here's macrotrends.net's LIBOR rates since the mid-1980s: http://www.macrotrends.net/1433/historical-libor-rates-chart


Here's a chart of oil prices from 1869-2011 (2010 prices) from wtrg.com:

100 year on gold and silver (Jan 2012 base): http://www.macrotrends.net/1333/gold-and-silver-prices-100-year-historical-chart

30 year charts here:
soybean oil: http://www.indexmundi.com/commodities/?commodity=soybean-oil&months=360
palm oil: http://www.indexmundi.com/commodities/?commodity=palm-oil&months=360
sugar: http://www.indexmundi.com/commodities/?commodity=sugar&months=360
rubber: http://www.indexmundi.com/commodities/?commodity=rubber&months=360
................

Talking about cycles, on the wealth-gap cycle, it appears we are back to the 1920s, a period of very buoyant market and commodity prices... The Richest Rich Are in a Class by Themselves By Peter Coy April 03, 2014; http://www.businessweek.com/articles/2014-04-03/top-tenth-of-1-percenters-reaps-all-the-riches#r=rss; The richest 0.1 percent of the American population has rebuilt its share of wealth back to where it was in the Roaring Twenties. And the richest 0.01 percent’s share has grown even more rapidly, quadrupling since the eve of the Reagan Revolution.... These figures come out of a clever analysis by economists Emmanuel Saez of the University of California at Berkeley and Gabriel Zucman of the London School of Economics, who is a visiting professor at Berkeley. The Internal Revenue Service asks about income, not wealth, which is the market value of real estate, stocks, bonds, and other assets. Saez and Zucman were able to deduce wealth by exploiting IRS data going back to when the federal income tax was instituted in 1913. They figured out how much property different strata of society owned by looking at the income that was generated by that property, such as dividends and capital gains.....

Researching Southeast Asia commodity business: In contact with Shakila Yacob and Benoit Henriet, hoping to meet Lesley Potter and Noboru Ishikawa on peat and smallholder economy

As part of my research work for my book (in drafting) on "the business of the palm oil boom" I have been delving into various literature to understand more about the context and background of the commodity business in the region. Also, interest in palm oil history extends to other regions!

It is wonderful to get in touch with other researchers in this process. I'll start to list some of them here, as I get in contact them! Thanks to friends for referrals too!

For some of my own publications and presentations, you can check here: http://independent.academia.edu/YulengKhor
 

6 January 2016: In contact with Shakila Yacob and Benoit Henriet, hoping to meet Lesley Potter and Noboru Ishikawa on peat and smallholder economy

Noboru Ishikawa, http://www.cseas.kyoto-u.ac.jp/en/about/staff_all/division2/ishikawa-noboru/, where he writes: "...My project is a multi-sited, multi-disciplinary empirical study, a strategic combination of field sciences. To understand the transformation of biomass society in the tropics, the research seeks to examine the articulation points between social systems and natural systems....The development of Bornean plantation field is morally endorsed and financially backed up by the international community in search of a sustainable development path for human society. Planted forests of oil palm and acacia mangium as a potential energy source are regarded as good for carbon emissions, and people on Wall Street produce products for the securitization of tropical biomass under the newly proposed REDD (Reducing Emissions from Deforestation and Degradation) initiative. The threshold between nature and non-nature is now being arbitrarily manipulated by capitalists, the states, and international organizations. Articulating the field study of local peoples, cultures, and landscapes, namely anthropology, geography, history, political economy, environmental economics, plant and animal ecology, hydrology, soil science, area informatics, and forest ecology, a research team is organized for examining the multi-dimensional driving forces of change in human/non-human interactions in a heterogeneous landscape consisting of oil/acacia plantations, primary and secondary forests, and swidden fields...."


Lesley Potter, https://crawford.anu.edu.au/people/visitors/lesley-potter, where she writes: "My research has been on two fronts: a) historical analysis of forests, grasslands and land-use change in Southeast Asia, especially Indonesia, examining colonial and postcolonial impacts of government policies on small farmers; and b) current ethnographic studies at village level in Indonesia, particularly in parts of Kalimantan and Sumatra. The recent focus has been on smallholder producers of tree-based commodities such as oil palm, rubber and coffee, with oil palm presently receiving the most attention. A desk study of alternative pathways for oil palm smallholders in Latin America and Central Africa was undertaken for CIFOR, which was followed by fieldwork on the ground in Cameroon, Colombia, Costa Rica and Ecuador. This work is currently being written up, together with some detailed updating of the Indonesian scene, especially impacts of the new transmigration program."


Shakila Yacob, http://www.researcherid.com/ProfileView.action?returnCode=ROUTER.Unauthorized&queryString=KG0UuZjN5WnikDkr0zr0q7nC1qMZMZWKeZV3lwCTVuw%253D&SrcApp=CR&Init=Yes, with papers including:

• Bridges to new business; The economic decolonization of Indonesia
• The 'Unfinished Business' of Malaysia's Decolonisation: The Origins of the Guthrie 'Dawn Raid'
• The Thief at the End of the World: Rubber, Power, and the Seeds of Empire
• Ford's Investment in Colonial Malaya, 1926-1957

Benoit Henriet, http://usaintlouis.academia.edu/Beno%C3%AEtHenriet, with papers / presentations including:

• “Elusive natives”: escaping colonial control in the Leverville oil palm concession, Belgian Congo, 1923–1941, in Canadian Journal of African Studies/ La Revue canadienne des études africaines, 2015
• 'Deglobalizing' the Postcolony? The changing faces of palm oil labour around Kikwit (DRC), 1911-2015, at Conference Empire, Labour, Citizenship. Current Research on Globalization. Brussels, 18-20 November 2015.
• “Biopower in the Rainforest. Managing worker’s bodies in the Leverville oil palm concession (Belgian Congo, 1910-1940)” at 4th congress of the European Network in Universal and Global History (ENIUGH), Paris, 6 September 2014.
• « Bleeding the Rainforest. Lever’s Palm Oil Concessions in Belgian Congo, 1910-1940 », at « Legal History PhD Day », Centre d’Histoire Judiciaire de l’Université Lille-2, Lille, 11 March 2014