The Ghosts from BMF Still Haunt Malaysians

Currency speculation is best left to those with suicidal tendencies or deep pockets or both. We need to make a distinction between currency speculation or hedging that may be necessary if you have borrowed money in foreign currencies.

For a country, it may be prudent to hedge your loan repayments so that when the time comes to pay, your position has already been covered and there are no surprises.

Let’s take an example of a man who takes all his family’s savings, mortgages his house and then proceeds to take part in a game of shooting craps. Most of you will say, “He must be crazy!”
We all know that gambling is a high-risk adventure and most people who play the stock markets lose their money.

Currency speculation by a central bank should be a capital offence as it means a few people are betting away the nation’s reserves and no one knows about it until it is too late.

Unfortunately Malaysia appears to have been gambling on currency futures for many years and even after having lost billions no one has been arrested for jeopardising our future.

There is a good article on BNM’s forays in currency markets here.

It seems that the BMF scandal in the early 80s did not have any lessons for the Malaysian government and the lack of accountability seems to have only encouraged more reckless activities as mentioned in the MAS blowup.

Here are two interesting articles for those unfamiliar with the BMF scandal that catapulted Malaysia onto the world stage for the wrong reasons.

From the Asian Journal of Public Administration entitled:
“Levels of Corruption in Malaysia”


The second article is more from the human perspective on how Lorrain Osman was jailed in the UK for many years without trial as he fought extradition to HK to face trial over there.

If you are interested in more info, just google “Lorrain Osman”. Please share with us any other interesting details you discover.

Graphics: http://www.mpimages.net/mp/compressed/promotional/Haunted_Mansion-Ghosts.jpg