Posted by Ooi Teik Bee > 2013-07-31 15:34 | Report Abuse

It is very important for a government to be prudent in spending money. It is the same as our current account, we cannot survive on Overdraft. We must have money in our account before we issue cheque.

Posted by iafx > 2013-07-31 15:40 | Report Abuse

it's about balance, Fitch sees M'sia shown sign of loosing balance, e.g. as PETRONAS div make up 30% of gov income but: http://www.reuters.com/article/2013/07/31/fitch-revises-outlook-on-petronass-lc-id-idUSFit66566420130731

has Fitch overstated? let's c soon how PM and BNM response to this.

Posted by Buy & Sell Sell & Buy > 2013-07-31 18:21 | Report Abuse

our gov will always short of monies. How to get good rating frm Fitch??? Sooner than later, our gov will make GST compulsory to get more monies frm rakyat. Bcos gov will never has enough monies.

Posted by Jonathan Keung > 2013-07-31 18:23 | Report Abuse

BNM will not react to Fitch's downgrade. BNM is only answerable to the government (not to Fitch). with Petronas we are still OK compare to other countries without natural resources. Malaysia is a country of abundance but but somehow where does all our exports (eg. crude oil, CPO, rubber ) money goes to. you need to find the answer yourself

Posted by KC Loh > 2013-07-31 18:53 | Report Abuse

The Govt is spending. That is keynesian! And its taking domestic loans instead of external ones in an effort to insulate our economy from capital flight and more so speculators. This we can thank the 1998 Asian Crisis. So, nothing strange with Fitch's current rating! If indeed anything, GST will be made possible because of this! Im not saying I like it, but its necessary!
I can only see post-GE hangover from some comments! Those who do not remember history, are condemned to repeat it!

Posted by iafx > 2013-07-31 19:56 | Report Abuse

well commented guys! juz to add that corruption remains as 1 of the top issue draining our economy, only today macc reported shortage of diesel is cause by ganging up of suppliers, distributors, retailers & corrupted gov agencies in stealing subsidied diesel for huge profit in black market!!

Posted by yktay1 > 2013-07-31 21:23 | Report Abuse

To all the doomsayers out there, do you think the foreign investors do not already know what Fitch just reiterated? When doing a top down analysis of Malaysia, which I think most funds do, they already know what they are getting themselves into. Debt to GDP, shadow banking, government guarantees, personal loans, high corporate borrowings, etc. They already take these into consideration when investing, a report by Fitch downgrading Malaysia's outlook is no surprise. It only gives them a chance to invest more. Plus, the Ringgit is cheaper too. Now, let's see what Bernanke does!

Posted by Frank Soweto > 2013-08-01 00:33 | Report Abuse

yep agreed with what yktay1 said above - when US was downgraded sometime back and the knee jerk reaction was a SELL and now where is the US Market :) - u fellas here always complaining of high prices - no more cheap shares and now this sell down is an opportunity to look for some good counters that has been beaten down the past 3 days :)

Posted by iafx > 2013-08-02 10:01 | Report Abuse

BNM finally sound: http://www.theedgemalaysia.com/business-news/248633-dont-overreact-to-bonds-sell-off-says-zeti.html