Archive for October, 2008

I am prepared to go under the draconian ISA (Internal Security Act) detention to expose this crime … ” says Matthias Chang.

He also says that should the truth be withheld further this may “cause the people to be unprepared for the crisis, (and) thereby suffer immense losses….” 

Read below to see why he is so mad…..

Missing the Big Picture – It is the US Sovereign Default and the Unilateral Substitution of the US Dollar with Another Currency that is The Impending Crisis Which Will Devastate The Global Economy

–  By Matthias Chang
Sunday, 26 October 2008 04:25

Badawi – Off Tangent

Badawi in Beijing still cannot get it right. No doubt that the leaders in Beijing at the ASEM meeting did discuss the global food crisis as a consequence of the total bankruptcy of the US based financial system. However, the main thrust of the ASEM meeting was, and the Washington Summit in November 15, 2008 will be, the decision (already made by the US ruling elites) that the US will go into default and the US dollar will be replaced with another currency. This decision will be imposed either by the Bush regime in its remaining months or by the victor of the Presidential elections in November, 2008 when he assumes office in January, 2009.

Even when in Beijing, the idiotic Badawi still maintained the position that Malaysia somehow will not be affected much by the global financial tsunami because of Malaysia’s strong fundamentals and there will be no recession. Malaysia the mighty will be the lone survivor!

This idiotic and deceitful statement was echoed by the Deputy Prime Minister, who is also now the Finance Minister. If the “heir apparent” does not change his tack and confront reality, he is not fit to succeed and he should be booted out together with Badawi. This is his last chance. This is the final warning – stop the nonsense and tell the truth. Prepare the country for the devastation. The people are mature and resilient enough to face the truth as they had done in the 1997/1998 financial crisis.  Don’t you dare insult our intelligence.

How utterly idiotic can Malaysia get – two political buffoons dancing to the same tune when even local (now just awakening) newspapers blasted in their pages, the grave and impending disaster?

NST – 25th October, 2008 states in the front page:

“Spectre of Recession rings alarm bells around the world.”

The Star – Business Section in the front page:

“World markets take a tumble – Weak economic data and recession fears fuel selling.”

And at page W37:

“RM286 Billion to save currencies. ASEAN plus 3 agrees to set up ‘war chest’ to tackle financial crisis.”

At page B5:

“Malaysia unlikely to escape backlash of financial crisis …”

Malaysia Will Have A Banking Crisis

The Ministry of Finance and the Central Bank have been denying that there will be a banking crisis in Malaysia, harping that Malaysian banks are adequately capitalised for banking operations. Additionally, the banks are not exposed to the fraudulent investment instruments marketed by the US and European global banks.

I had exposed this “half truth” repeatedly in my sms and e-mails to friends all over the world and in my two books, The Shadow Money-Lenders and the Global Financial Tsunami and Will Barisan Nasional Survive Beyond 2010?

It is half-truth because the banks are not directly (i.e. on balance sheet) involved in such fraudulent marketing of the toxic wastes. They have been doing it via Structured Investment Vehicles – off balance sheet.

Thus, technically speaking, such transactions will not show up in the balance sheets of the Malaysian banks until and unless they have exploded into losses. Even then, they can delay somewhat in transferring the losses and will even find ways and means to hide these losses when they do transfer them to the banks’ balance sheet.

Fundamental rule in business, and more importantly in banking (by banking regulations) is that all assets must be marked-to-market (a requirement of Basel II i.e. international banking requirements) – in accordance with true values and or of prices, and not some fictitious values or prices.

However, when these assets were in the books of the fraudulent off-balance sheet investment vehicles, they were all marked-to-model. That is to say, they were given fictitious values or prices. These values were created by the trader subjectively by the simple and fraudulent method of typing the value in the computer screen which is then reflected in the balance sheet of these fraudulent investment vehicles.

Warren Buffet has referred to the method of marking-to-model as “marking-to- myths”, because all the values are myths – self-created values not reflective of reality and real time market values!

Following the collapse and bankruptcy of Bear Stearns and Lehman Bros, the world at large discovered that all these fraudulent investment instruments were worth (when marked-to-market) no more than ten cents to the dollar. In the case of Bear Stearns, it was zero! All worthless!

How do these crooked bankers avoid the exposure of this ongoing scam?

The FED under Bernanke and Treasury Secretary Henry Paulson (hired guns of the bankers) devised the fraudulent method of accounting when they allowed the banks (who must transfer the losses back to their balance sheet) to mark these fraudulent assets in the banks’ balance sheet in accordance to the fraudulent mark-to-model/myth method and even allow them to differ the declaration of such losses by posting such “assets” as “long term assets” i.e. their values to be taken in account only on maturity. They think we are all stupid. If the toilet papers are now worth less than ten cents how could the same toilet papers be worth more at maturity – in three or five years time – when there is no underlying security to back-up these fraudulent papers?

Caught Them By Their Dumbells Telling Lies

No one can carry on telling lies indefinitely. Truth will finally catch up because in business, losses and bankruptcy cannot be hidden.

In the front page of the Business Section of the STAR newspaper on the 25th October, 2008, Yap Leng Kuen inadvertently or otherwise let the cat out of the bag when Yap reported:

“Mark-to-market rule for banks relaxed”

“Mark-to-market rule no longer applies to the trading portfolios of banks in the country once they move these trading accounts to their long-term books…”

Here is an outright confession that Malaysian authorities have carbon-copied the fraudulent valuation con-games of the discredited Federal Reserve and the US Treasury!

Adding insult to injury, the news report went on to say that because Singapore (the puppet of US financial institutions) is doing it, we should follow them as well. We are thought to believe that one should only learn from good examples but not bad and or fraudulent practices. This is so typical of assholes in Malaysia who are now running the country under the leadership of the bodoh Badawi.

I shall quote at length the news report:

“The relaxation of the mark-to-market rules in Malaysia followed a similar relaxation in Singapore sometime in the middle of this week according to sources. Mark-to-market practices require banks to regularly adjust the value of their assets based on the actual transacted prices.

“In the current credit turmoil, the rule required banks to book huge losses on assets, depleting their capital even though some of their assets have yet to default.”

What is the reason for this relaxation?

When losses are booked in the accounts, capital will be depleted and unless the banks inject additional capital (shareholder funds), they will be insolvent and will not be able to maintain current banking operations which stipulate that they must have certain amount of capital in relation to the amount of loans extended etc.

The Ministry of Finance and Bank Negara was only telling half-truths when they said that Malaysian banks are adequately capitalized for normal banking operations. However, when these losses are taken into account, the capital reserves will plummet and the banks will not be able to maintain the capital requirements under the existing banking regulations. Under the Banking and Financial Institutions Act 1986 (BAFIA), it is an offence if this requirement is infringed!

If, as alleged, the banks are adequately capitalized, there is no reason for the relaxation of the mark-to-market rules. The banks’ capital would be more than enough to cover these losses. It must therefore be otherwise. Our banks are in fact under-capitalised if such assets are marked-to-market.

One would have thought that these losses should be written off, so that the bank’s balance sheet would remain clean and stable and if need be additional capital injected to bolster the confidence of the public in the bank’s integrity.

Additionally, if Malaysian banks are not exposed to these toxic waste and have not suffered losses, why is there a need to bring these “trading accounts” (i.e. derivative toxic wastes) back onto the banks’ balance sheet?

Is this not another confession that our banks did indulge in these fraudulent activities and got burn as did the banks in Singapore?

Central banks the world over are now complicit in this fraudulent scheme.

A crime is being committed by central bankers.

We do not have to commit this crime. There are other legitimate ways to resolve this issue albeit with economic pains.

Surely, our morals demand that we do not commit a crime to solve a problem for to do so is to condone the thief or murderer who rob and or murder because he needs to feed his poor family. Robbing and murdering is the easy way out in solving one’s poverty. But it is still a crime.

Looking for a job and maybe the need to work double shift may be painful, but it is an honest living!

Malaysians must decide whether to allow crimes to be committed to solve the banking problems, thereby allowing greedy bankers to get away with their frauds and cheating ways or to resolve the problems with legitimate means and bring to justice the crooks and charlatans in the banking industry.

God forbid that we choose the easy way out and commit a crime.

Let me say this here and now. I am prepared to go under the draconian ISA (Internal Security Act) detention to expose this crime which has already being committed. I will not compromise my principles as a lawyer and as a citizen.

It is utmost hypocrisy for all of us to talk about war crimes etc. and not condemn this global financial crime that has caused millions to die of hunger and malnutrition.

This is also war – economic warfare on a global scale to save the rich global bankers and elites at the expense of the poor and downtrodden.

I take it as a signal honour to speak and fight on their behalf.

We must all expose this insidious and heinous global crime!

To Badawi, Najib, and all the leaders of Barisan Nasional – tell the people the truth and prepare them for the crisis, and you might just win the next election, as we have to unite the entire nation to survive.

Continue to lie and cover up the crisis, and cause the people to be unprepared for the crisis, thereby to suffer immense losses – I shall do everything and rally the country to ensure Barisan Nasional’s defeat in the next election.

Diwali or Deepavali is the “festival of lights” a Hindu festival dating back to the Vedic perid 2000 years before the birth of Christ. It marks the triumphant victory of good over evil, victory of light over darkness.

The legend behind this festival is, Narakasura, a demon, ruled the kingdom of Pradyoshapuram with an iron fist. Under Narakasura rule, the subjects suffered a lot of hardship and suffering. Seeing the suffering of the people, Lord Khrishna set out to destroy the demon Narakasura. The day Narakasura was slayed by Lord Krishna was celebrated as Deepavali, the triumph of good over evil.

All Malaysians Hindus as well as all Malaysians regardless of race must unite on the occasion of the Deepavali this year to combat and overcome the “darkness” in the Malaysian society, particularly the marginalisation of the Malaysian Indians, whether because of poverty, economic injustice, educational deprivation, social degradation and other forms human rights violations, specially the detention of Raja Petra and others under the ISA.

Lets UNITE as Bangsa Malaysia and triumph over all evil and darkness on this auspicious day.

Happy Deepavali and don’t forget all our 75 brothers detained under ISA in Camp Kamunting.


(Picture courtesy from Susan Loone’s Blog without her permission)

Police arrested 6-year old Vwaishhnavi the niece of ISA detained HINDRAF leader P Uthayakumar when she and a group of 11 “concerned Indians” attempted to submit a letter to the Prime Minister asking to release her uncle and all other ISA detainees. Vwaishhnavi also had a letter inviting the Prime Minister to attend the family’s open house for this coming Deepavali.

Malaysia is really famous for the wrong reasons and this is one more.

Why arrest a 6-year old?

Why not just accept the letter and show some compassion?  Is this so difficult?

Now Pak lah looks so bad when its not Pak Lah to be blamed but some goons linked to Botak Syed Hamid who is trying to show that Pak Lah has no compassion.

I too dont like the idea of getting kids involve in the first place. This is obviously using children as a human shield but the police could have handled this better. There is no justification in bringing the kid to police station.  Why can’t the police be more intelligent and show some compassionate?  Is this so difficult or the police just dislike Indians? Afterall, those present did not bring any weapons or had intent to create havoc or damage.

I know Pak Lah is a goodman but its the others around him who are making him look as though he is heartless and lacking in compassion.

As far as I can see, this is just a bailout exercise. The 5 billion from EPF via Valuecap Sdn Bhd is to bailout UMNO link corporations in the KLSE which has taken a real beating the last 6 months after March 6th. They are putting wool into our eyes by using our hard-earned EPF contributions trying to solve their problems.

There should be NO BAILOUT! Besides, greed got them into trouble. Bad money practices got them into trouble. Corruption got them into problems. They don’t have financial prudence’s and they are all overrated. They know now to make money by only selling assets . Let them get themselves out of it. They did not pay any taxes on the excess profits that they made getting themselves into trouble. They dug their own grave. Let them claw their way out on their own. They got into trouble trying to justify their high priced executive packages with risky financial instruments back by imaginary money.

I really feel sorry for them that they can no longer make payments on their Bangsar Apartment and London escapades and the shopping sprees in Hong Kong. 

These fellows are running the country down so fast down the slippery slope and its getting more and more cloudy.  We are in a mess.

Malaysia needs help!

The letter I wrote to Late Datuk Haji Malik Chua Vice President of PBS in 1999.

28th September 1999

Dear Tuan Haji Malik,

Greetings and best wishes Tuan Haji. Sorry could not speak much at the airport in KL. Always enjoyed talking to you. Also cannot forget the “Udang Galah” and the fanastic dinner in your house in Sandakan with Pairin and the rest of the gang.

I want to take this opportunity to pen my thoughts on the directions I believe is needed for PBS to face the new millennium. Please bear with me and do share your thoughts.

PBS must become involved and take a leadership role in the reform process. The reform movement in its broadest sense is fighting for change – as distinct for support for Anwar Ibrahim.

The PBS has so far failed to make the distinction.

The PBS perceives the conflict as Anwar vs Mahathir.
It perceives the conflict as a “family affair in which we should not get involved.”

The PBS has apparently failed to perceive the fact that the conflict is much wider and much deeper than they think.

It is not Mahathir vs Anwar. Many of the groups that are leading the campaigns for change do not endorse Anwar Ibrahim as their leader. These group include the DAP, the PAS and other political parties. They include professional organisations and NGO’s who would vehemently deny they were involved in partisan politics.

It is not Malay vs Malay. The mass movement for change in Malaysia now encompasses basically all Malaysian racial groups – people who have been galvanised by the wholesale abuse of the legal system in pursuit of political advantage by the government, ordinary citizen who just somehow believe the the government has lost it’s way. Others who are still in a shock at the revelations of how the government really works; the brutality and lawlessness of the police, the malleability of the court system, the discosures of massive monetary corruption at the highest levels of government.

The Malaysian peoples’ faith in the government has been shaken as never before.

The PBS policy of silence appears to be safe one. Although it is not without risks. The PBS risks being percieved as a party that stands for nothing.
It is opposed to the BN and yet it does not support the BN’s greatest threat – the movement for change in MALAYSIA.

Does this mean that the PBS is also not in favour of the forces for change?
The PBS appears to be against the status quo but in favour of the forces of change?

The PBS appears to be against the status quo but not in favour of changing it.

This is too glaring a contradiction.

In any event it is a policy that fails to grasp the opportunity in front of us. To be a positive agent for change, possibly a leading advocate, in what has become almost a national cause.

Thank you Tuan Haji for you time to hear.


Selvaraja Somiah

November 25th 2007 Hindraf Rally


The Hindu Rights Actions Force (Hindraf) has been declared an illegal organisation by the Malaysian Government from today, 16th October 2008, and I thought it was good if I revisited the Hindraf Rally on 25th November, 2007.

When next month 25th comes it will be exactly one year since the Hindraf Rally.

Need to relate what happened that day 1 year ago so that all could see the core of my experience which was AWESOME!

I left at 6 am by LRT from Kelana Jaya. At 6.30 am I was at the Ampang LRT station and got on foot around Jalan Ampang.There was police block near Jln Ampang and plenty of cops everywhere. There were many people congregating along the road. Never saw so many Indians gathered together in one area. Had teh tarik at a restaurant nearby KLCC.

At 7am I moved to KLCC park, there were a lot of people gathered here. Suddenly there was tear gas in KLCC park and the FRU canon had moved and was placed at the far end that leads towards Jalan Ampang and thus blocking the way.

There was was no way ahead so I went to the opposite entrance of the Twin towers. A very big group had gathered here by then.

I got a Mahatma Gandhi’s poster by someone I didnt know. This was nice because a sense of power of truth, nonvoilence and peaceful assembly was encouraged.

At 9 the FRU started to spray water laced with INSECTICIDE (smelled like malathion) towards the crowd , people just sat down and were very calm, the next moment tear gas cannisters started flying into the crowd and all hell broke lose and people started screaming and running towards the opposite direction.

I saw some people got trampled by the crowd. I myself was choking and was looking for water to wash my eyes and luckily someone gave me a bottle of mineral water to wash my eyes. By now the crowd had pulled back. I was telling some in the crowd not to leave as I was right infront and I could see people were getting angry and were throwing back at the police the gas cannisters.

I walked again towards Jln Ampang with some lawyers, I think, and behind us was another big group marching.

The FRU allowed us to pass until the junction, but suddenly, without any warning they attacked us again with the water cannon, spraying laced insecticide. I felt itchy all over my body and knew it was definitely a strong dose of malathion and maybe some carbamates mixed. By now the whole group had split into 2 with most of them in Jln Ampang.

In Jln Ampang, the FRU truck moved into KLCC and pushed the crowd further back and stopped in the middle. The group in front of KLCC had to retreat.

I was pushed back from public bank to BSN and further back to The Zouk by about 10.

By now the crowd had got bigger and bigger all around Jalan Ampang towards Jln Raja Chulan. There was full of people here. The FRU in the meantime, was getting trigger happy and was firing volleys of teargas cannisters after cannisters.

By 11.30, a helicopter was hovering above us and it was impossible to hear anything as the helicopter was so close to the ground. People were jeering at the helicopter while they were taking photo shots from the air.

By 12.30 we dispersed and while dispersing, the FRU still continued to chase the peaceful crowd all the way to Jln Raja Chulan.

Today 25th November, 2007, I saw the Indians in Malaysia finally waking up from slumberland.

The proof of the pudding is in the eating!


A woman shops for vegetables in a Beijing market.

I am deeply troubled by the Chinese milk scandal which is making waves around the world and thus has created increasingly food safety paranoia, with many countries banning or restricting melamine tainted milk products, fruits and vegetables imported from China.

So, what is this melamine thing which is causing so much havoc, misery and death and has received so much attention around the world in so short a time?

Melamine the word, was coined by combining the names of 2 chemicals – Melam and Amine. Melamine is the chemical name. Melamine was first synthesized by a German chemist by the name of Justus von Liebig in 1834. Melamine is a white crystalline compound C3H6N6.

Melamine is an industrial chemical use for making plastics, foam, cleaning products, fabrics, glues and is one of the major components in “Pigment Yellow 150” which is a colourant in inks and plastics.

Melamine when mixed with watered-down milk can make the milk appear richer in protein acting as a decoy protein enhancer. It is said that if 1 liter of milk with melamine is added with water, it can produce 4 liters of milk and the protein test will show that the milk is high in protein and it will surely pass the milk test.

Melamine is also used as a fertiliser for crops because of its high nitrogen contents. Melamine is also used as a pesticide and this is going to ring alarm bells for sure.

Cyromazine is a derivative of melamine. Cyromazine is a pesticide which metabolises into melamine in animals and plants. In simple language, melamine is formed in the body of mammals who have ingested the pesticide cyromazine. And in plants, cyromazine is converted into melamine after being sprayed with cyromazine pesticide.

Cyromazine is a systemic poison which means that if insects feeding on a plant to which a systemic poison has been applied will die soon after ingestion. Cyromazine pesticide is used to control leaf miners in vegetables and fruits. In china, cyromazine is used commonly as a foliar spray to control leaf miner insects in star fruits, guava, mandarin oranges, melons, tomatoes, lettuce, broccoli and Chinese cabbages.

So the presence of melamine in fruits and vegetables imported from China is high. That’s why the South Korean government recently highlighted the usage of the pesticide cyromazine by Chinese farmers.

Now the million dollar question is: DO OUR FARMERS IN SABAH also use the pesticide cyromazine? The answer is YES.

Remember the article in Daily Express on 6th July, 2008, “Sabahans Still Being Poisoned“, where I mentioned that banned pesticides are available and is used by the farmers in Sabah, and I specifically mentioned a product called NEPOREX.

Well, this product Neporex contains cyromazine a derivative of melamine. This product is used extensively by the farmers in China and due to the usage of this product the South Korean government discovered melamine contents in the vegetables and fruits imported from China.

Sets new alarm bells ringing? Sure it does!

And what are the symptoms and signs of melamine poisoning other than stone in the kidney? Irritability, blood in urine, little or no urine, kidney infection, high blood pressure and constant pain in the stomach are the signs of melamine poisoning.

The Health Minister Liow Tiong Lai, in Kota Kinabalu recently, said that the level four check will be applied at all food products including vegetables and fruits imported from China, whereby samples will be taken for safety analysis before it is released in the market. He said this after the South Korean government found melamine contents in vegetables and fruits imported from China.

While it may be reassuring that certain preventive steps have been taken by the Health Ministry, the public also knows that the scope of imported food stuff is so vast and therefore effective public safety is doubtful.

And if cyromazine is used as a pesticide locally by our farmers, which we know they are, then, the contamination spread of melamine could be severely underestimated.

And the Health Minister, saying that melamine screening is only done on imported food from China and not saying anything on the local fruits and vegetables does not make sense at all. Comprehensive safeguards are needed not only for imported food originating from China but also vegetables and fruits from here, which is also a suspect.

And perhaps, the Health Minister should also let the public know if we actually have enough screening facilities/laboratories to test melamine/cyromazine, other than the Chemistry Department in Kota Kinabalu.

The Health Ministry must be on the top of the situation and remain constantly vigilant and should work more closely with the public and let the public know of the real situation and don’t hide the facts. The Health Ministry should be pro-active and lead in the drive for public safety and awareness and not just wait for complaints and medical casualties before acting, as damage would have already been done. If there are any weaknesses in the delivery system the Health Ministry should admit it and try to rectify it.

Malaysia must also not be too dependent on foreign health institutes to obtain findings for us, instead, we should work for a credible research of our own and it must be available everywhere in Malaysia, especially, Sabah and Sarawak. A competent state-of-art food research agency is a must for Sabah and Sarawak and check and test should be mandatory.

Perhaps, it is high time Malaysia takes a serious view on consumer health protection.

Selvaraja has been involved in the pesticide industry for 20 over years and he can be contacted at or 

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