Stimulating The Masses – unpacking the package

Wondering how you will benefit from the recently announced RM60 billion economic stimulus proposals unveiled by the DPM in the mini budget? Art Harun explains.

Yes. Finally. And it is never too late to introduce a stimulus, says the DPM cum Finance Minister cum PM-in-waiting. And so, here we are. The economic viagra which is supposed to turn our already flaccid economy into a turgid and erect powerhouse is now out of the box. Yes sir. And if all of you clueless people feel clueless as to how this stimulus package (yes, it comes in a package, no less!) works towards achieving an economic erection, well, just don’t change the channel, because, yes, more than clues are needed to understand the true extent, latent and patent, of this stimulus package. You won’t get stimulated just by reading about it. No, this stimulus is not like an erotic story. You need to do more than that.

But, don’t worry. I am here. I have set out on a mystique journey for a stimulating enlightenment. And I had sat to ponder. And I have squatted to find the key to this puzzlement. I have meditated – although it is not yoga I must hasten to add – to understand. And now, after the rain has all gone – though the SMART tunnel is still closed – there is nary a blot of cloud in the horizon. I am in complete understanding. This 60 billion stimulus is a great one. It is going to work.

Only a few enlightened ones are to understand this thing. Because, like any great work, it takes a lot to understand. I must proudly confess that I am one of those who do. Probably because I was taught Maths and Science in English. Or probably too, because I don’t read NST and the Star. But understand I do. And here is my guide to all of you clueless people. To the detractors. To the oppositions. To the closet economists. This is it. The defining guide towards reaping the highest, biggest and stonkiest benefits out of the recently announced 60 billion ringgit “mini-budget” aka economics stimulus package aka Christmas-comes-in-March-albeit-spread-over-two-years economics thingy.

First of all, there will be RM480 million worth of compensation which is proposed to be paid to toll operators for their gracious agreement not to increase toll. Yes folks. Read my lip. Be grateful. There shall be no toll increase this year. And that means you all don’t have to pay more for using the highways. Not a single sen more than what you are all paying now, although of course, in a better and more responsible scheme of things, you all are not supposed to pay anything at all for using the highways. And because you all are not going to have to pay more than what you are paying now, the Government will pay “compensation” to the toll operators in the sum of RM480 million. Folks. You don’t have to pay. But your good and benevolent Government will pay for you.

The thing is though, the Government is going to pay the compensation from your money which you pay the Government every year and every day of your life in the form of taxes. Ooops…but that means we are all paying anyway, does it not? Yes, it does. But you see, you don’t have to pay directly. You pay the Government and the Government pays the toll operators. But doesn’t that mean we are all paying anyway? Well, don’t be a pedant, okay!

So, the question is, how do we all reap benefits from this payment of RM480 million to the toll operators. Simple. If we divide (that’s “bahagi” for those who are taught Maths in BM) RM480 million with 27 million people, we would get about RM18 each. But assuming there are only 10 million highway users in Malaysia, the Government is in effect giving away RM48 to each of us, the highway users. Yes my friends. With a stroke of the pen, all of us highway users are now richer by RM48. Think of what we all can do with RM48. That is equivalent to 25 loafs of Gardenia bread my friends. So, you all should go and buy 25 loafs of Gardenia. That is the benefit from this RM480 million compensation. See. This stimulus is so clever. Aren’t you all stimulated yet?

Secondly, if you have a car which is at least 10 years old, go and sell that darn old hag! No, I don’t mean your wife. Or your hubby, as the case may be. I mean your 10 year old car that is. Then, you all should buy a new Proton car. Never mind if your 10 year old car is a BMW, Porsche, Mercs, Honda or what have you. Just sell it. And buy a new Proton. Instantly, you will be RM5,000 richer. Yes my friend. That is 5,000 bucks to spend! Eezeee peezeee money penny.

Who will give you 5k just like that? Are you all nuts? But of course, you have to bear in mind one thing lah. They won’t give you 5k in cold hard cash. They will give you a 5k discount on the new Proton car you are buying. But hey, that would mean you save 5k right? And that means you are now richer by 5k. Get it?

At this time, as a responsible man, I need to register a caution. If you buy a Proton Perdana as part of this initiative, it would be prudent for you to provide a maintenance budget of about RM58,000 per year. And on top of that a sum of RM30,000 every 2 years or so to change the gearbox. Ok? Don’t say I didn’t tell you. And of course, with all the stress of the Perdana having to go to the workshop every now and then, you might as well provide a sum of RM60,000 for a by-pass at IJN (this is on the assumption that IJN is not taken over by Sime Darby, UEM, Khazanah Nasional, TNB or whatever. Because if it is, then the provision for your by-pass should be double as I am quite sure the by-pass fees would increase in that event).

Now, back to reaping the benefits from the stimulus package. And so, we would now be RM5,048 richer. 48 bucks from the highway compensation. Plus 5,000 bucks from the new Proton. What’s more. We have a spanking new car. And of course, a new hire-purchase agreement which we would have to repay in the next 5-7 years. But hey, no pain no gain. Don’t be greedy la. For those of you who can’t get a hire-purchase facility, well, tough!

Third. To those who are about to graduate and become a part of the Malaysian unemployment statistic. My message is simple. Don’t look for a job. Don’t try to do business. Just stay as a student. But not just any student. Be a post-graduate student. Do your Masters and if applicable to you, do your PhD. By doing so, you instantly earn RM10k and RM20k respectively. You would be instantly richer, though notionally lah, by either RM10k or RM20k. And that’s not all guys and gals. By doing so, you also would not be called an unemployed person. Hah…you see. RM10-20k richer and not unemployed. Clever or not this stimulus? I think it’s brilliant!

So, by now, if you are a highway user, and you sell your 10 year old car and buy a new Proton, and you register for your PhD course, you are now richer by a whopping RM25,048!!! Whoa…which Government gives that amount of money to its people? You tell me!

Fourthly, if you have a bit of cash and are in a position to buy a house or two, there is another way of making money under this stimulus package. But you must be tax paying to gain this benefit. Firstly, you have to go and buy a house (or two) (or three even). But you have to take bank loans to get this benefit. So, don’t you go out and buy the house in cash lah. Take a loan (or loans, if applicable). From CIMB ker, Maybank ker, aper aper lah. You see, in doing so, you can claim RM10,000 in interest payment for your housing loan as personal relief from your income taxes for the next 3 years. That means guys and gals, if you are in the 29% tax paying bracket, you would instantly save RM2,900 per year for the next 3 years for every house that you purchase. That would also mean you are richer by RM2,900 every year for the next 3 years my friend! That’s a total of RM8700! But not in cash lah. But still, you save what. And every penny saved is a penny earned. Consequently you are richer by RM8,700 no?

But of course, do remember to repay the housing loan too lah. If you cannot take a loan, than, again, tough lah. But if you can, and you are also a highway user and a new Proton owner, and a PhD student and a new house buyer, whoaaa…by this time ah, you are richer by RM33,748! Bloody hell! That’s a lot man.

After that, to those of you who already have a business and your company’s capital is below 5 million ringgit, you can now instantly increase your nett worth by applying for the Government’s assistance to increase your company’s capital. So, say your company’s capital is now RM200,000 with you holding 50% of the shares. You can now increase your company’s capital to RM2.2 million by applying for a loan. Don’t worry. The Government will guarantee this loan. Sure hebat one. And sure dapat one. After that, your company would have a capital of RM2.2 million. Your 50% shareholding will now immediately be worth RM1.1 million instead of the meager RM100,000. By now, your nett worth, because of the stimulus, would be RM1,133,748! That is one million odd my friend. You are now a millionaire. Just imagine!

Then, if your company has 8 or 10 staffs (or even 50 for that matter), there is another sure fire way to benefit. You can go and employ the retrenched workers as cheap labour. But they must have been retrenched after 1st July 2008. Once you do that, your company can claim double tax deduction on their remuneration. Hmm…what if you already have enough workers and you don’t want to employ anymore than what you have now but you still want to get this benefit. Easy. You can retrench all your current workers. Then you re-employ them. I tell ya…you all should thank me for this. After that your company can claim double tax deduction for employing retrenched workers. Depending on the number of workers you have and how much you pay them, your company might save, I would presume, a hell of a lot. Say about RM10,000 lah, conservatively. That would mean you are now richer by RM1,143,748.

Next is the RM2 billion smackeroonies which the Government is going to spend on a new LCCT.

Hmmm…how ah? They just announced that the second LCCT by Air-Asia and Sime will not be built. But now, the Government itself is going to build a new one. If the Government has no money, so much so that our budget deficit is now 9% of our GDP, why wouldn’t it just let Air-Asia and Sime to build this new LCCT themselves?

Anyway, to reap the benefit from this new LCCT initiative, you all must, from the completion of this new LCCT, fly only budget airlines. So, I will assume this new LCCT will cater for 3 million people a year. That means, if you fly budget airlines, you will be richer by RM666 per year for the next 3 years after the LCCT is completed. That is RM2 billion divided (that’s “bahagi” in BM, for those who were taught Maths in BM) by 3 million LCCT users every year. Why did I limit to 3 years? Simple. Because after 3 years, I am sure another and newer LCCT will be built. LOL!!! With that, you are now worth a majestic RM1,144,414.00!

Another RM2 billion will be spent to “improve facilities” in 752 schools. Hooray yippiya yeay! People, make sure you all enroll your kids in one of these 752 school for this benefit. Assuming again that there are 2000 school kids in each of this school, the benefit to every student would be RM1,329 per student. So people, send 2 kids each to one of this schools and you will be richer by RM2,658! If you don’t have kids or not enough kids, my advice is, go and adopt as many kids as possible. Now!

Anyway, assuming you send 2 kids to one of these schools, you are now worth RM1,147,072.00.

Woohoo…just imagine how good this would look like on your loan application form or whatever. Your asset value is one million one hundred forty seven thousand odd! Never mind how much your NET asset value is lah…what matters is what you are worth.

And we are not even talking about the 10 billion which the Government is going to use to buy equities. When this is done, the share market will fly to the moon, especially with the addition of the earlier 5 billion Valuecap injection. Howahhh…if you hold shares your worth will also increase after this. But our share market must be full of stupid punters and fund managers la…you know why I say so? Because so far, even after all these are announced, the share market hasn’t moved! Stupid or what?

Then there is RM15 billion of fiscal injection. That’s a lot of clams I tell you. But of course, at this moment we do not know how and into what (or into who) this 15 billion is going to be injected la. So we would have to wait. As for now, I have no comment on this.

So, that’s it folks. RM1,147,072.00 richer. You stimulated?

I am already ejaculating!