RPK, Daiso & Conspicuous consumption

January 12, 2009

daisoRead that the Malaysian government announced the end of their austerity drive today, which means all spending, special projects that were previously frozen because of the worsening economy are now unfrozen.  Government departments are now cleared to spend. The report was just that, only a few lines longer than my statement.

I did my part for the economy I guess-  got into deeper debt by taking a delivery of my new car last week, a Volvo S60. To me it was timely decision, the maintenance bills of my old S40 was piling up and its resale value was dropping – I’ve reached and surpassed my shutdown point.  But to get another Volvo was an emotional decision – Never as reliable as a Japanese car, nor passionate or drivable as the Germans or the Italians, but I have always felt safe in my Volvos, and its clean and sleek lines appeal to me in its scandinavian oeurve of form and functionality. 

While driving back from Kuantan last week, the topic of conversation between PL, Waka and me was on our financial futures. PL was in the market for an apartment in Singapore, and asked for my advice.  I started on lecturing about the need to knowing the full picture; our targets on how we want to live, our responsibilities (children’s education and ensuring their futures etc), our retirements & beyond.  On knowing the tools in which to do it, the various ways of savings and investing, the planning & organization, the timing & execution.

The key to wealth creation – a moderate salaryman’s guide – is a combination of austerity & savings, wise investment and the timing of your debt.   On this last point, I just have to make sure that I can manage my debt, that some of my investments generate revenue now, that some of them have future earnings, that some of them act to shelter me from unforseen circumstances.  I have to time it such that when I retire and draw my last fixed pay, my debts are cleared.  If I can do it early, I live like my last post.

Went to Daiso in the Curve today, the famous Japanese 100 Yen shop (in Malaysia it’s RM 5). The business model is that the store sources 90,000 products from around the whole, but most of the time OEMs its own products, on a range from products from canned food to stationery, crockery to cleaning supplies, party favors to toys, gardening tools to fishing equipment, mostly for 100 Yen retail.   I shopped at Daiso IMM in Singapore for years, as did my mother in Japan.  The emergence of the Daiso-style retail, at least in Japan, stems from the 90s, when the bubble burst, and conspicuous consumption frowned upon, many co-operatives started up sourcing and packaging cheaper, no-brand products and goods, at the same quality.  Acceptance of this meant the proliferation of over 2,500 stores in Japan, and 500 overseas.  It has been called the Wal-mart of Japan.

Malaysia is now in the midst of campaigning for the by-elections in Kuala Terengganu, for a seat in Parliament, and the incumbent party and the opposition are waging the war by proxy, for its results may indicate the people’s will to push out the current corrupt and inefficient government.  RPK’s latest post in his iconic “news” portal contains photos of the houses of various high level civil servants, whose government salaries including allowances should not exceed, say, RM 10,000 a month (USD 2,800) – (but I should find the source for actual data). These homes are multi-million dollar houses.  I suppose RPK went around Kuala Terengganu creating something similar to celebrity maps of Hollywood.

Which brings me to my original source of concern.

Our rather corrupt and inefficient government has issued a blanket thawing of spending in all its equally corrupt and inefficient departments, without an actual blueprint of action nor explanation in objectives. I can only guess that the message is economic stimulation, in which case should target the most pressing, timely and far-reaching agenda.  I assume identification of needs have been done already, and our finance guys have made impact studies on return (I hope?). Perhaps spending on infrastruture and other forms of stimulus will trickle down to the real economy, but do we know by how much? How does it balance with how our real economy is actually going to fare in the coming year? Will there be a tangible return, or will there be too much lost in translation in our corrupt and inefficient ways? How will our politicians call it?

Where is the message of austerity & wise investment?


One Response to “RPK, Daiso & Conspicuous consumption”

  1. Toyota Wish Says:

    austerity – Severe and rigid economy: wartime austerity : could have use simpler word …difficult times…..need to search meaning 1/2 the time….chim

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