i maybe older than you.......

That peak was short and sweet.........i cleared my property investment loan that year.
Some years they go down as low as presently........2%
We are looking for the data on interest rates from 1970......do you have them?

---

Added on September 16, 2011, 10:38 pmFound this table from 1980...the average from 1980 to 2009 was 6.1%....its even lower from 2010 to 2011
Showed that during interest rates peak in 1997-98, the FD rates did not follow upwards

I don't need to look at the chart to know,
because I placed it before.... 
It was more like promotion campaign.
Just like now interest rate is 3%, but you can find 3.5%, 3.6% FD out there.

You can see 1997 the rate is 9.3% for 1 year.
But the 10-11% I mentioned, is for 60 months FD, and with this FD, they even gave you free Astro decoder + subscription for 1 year.
At that time, banks were hunger for money/deposit.

Why I remembered? because it was a double digit FD rate, and first time I had Astro. 

If 1997 listed interest rate for 1 year is 9.3%, what is so surprise with there were banks gave 10%? Just a 0.7% difference.

Remember also the rate published generally is an average, because interest rate was fluctuation a lot during that time.
Yes, after Malaysia shut the door aka capital control 1998, our interest rate become stagnant throughout generally.

Now with low interest rate + cheap money environment, interest rate is 3%, yet there are banks give 3.5% for 6 month, 4.5% for 2 years.

As compared 1997-1998, when there was credit squeeze time and chaotic in financial market, with as significant higher SRR and money flowing out non-stop during that time.
So a 0.7% extra is not something "surprise" or huge, when banks were "fighting" their survival during that time.

The bank/finance company (there were plenty of finance company at that time) name start with "A..

I reckon you are old enough to experience the situation back then, or no?

I don't need one to believe me or not. The fact, it was happening before and placed it before.

Sorry to interrupt. Felt the need to clarify "the blast from the past". I can remember the CRUNCH during 1997/98 as I was working with one of the largest investment banks (or rather merchant banks at that time) in Malaysia. Let me refer to a few articles to help you understand better why it is possible to have 60 months for 10%-11% F.D. during 1998.

1) http://mrem.bernama.com/viewsm.php?idm=1000
15/04/1998: refers to the Astro promotion

2) http://mrem.bernama.com/viewsm.php?idm=999
15/04/1998: refers to the AM 50 Plus promotion - "During the promotion period customers will enjoy an additional 0.3 percent on top of AM 50 Plus normal interest rate of 11.20 percent p.a. for the tenures of six and nine months and 11.50 percent p.a. for 12 months and above."

3) http://www.themalaysianinsider.com/busines...s-for-car-loans
“During the 1998 financial crisis, the interest rate for hire purchase loans for cars was around 8.0 per cent. "

4) http://www.bnm.gov.my/index.php?ch=12&pg=6...h=12&EndYr=1998
KLIBOR during Sep 1997 to Dec 1998 - please note the sharp increase in KLIBOR during end-1997 and Jan-Aug of 1998 before capital controls were imposed.

During the 1998 financial crisis, there was a LIQUIDITY crunch in Malaysian banking system (local financial institutions were hit badly, people were withdrawing $$$ from local banks/FIs and depositing $$$ into foreign banks). If I recall correctly, there was even a 'bank run' on a local finance company (M--). Although your FD rates does not indicate such a high FD, FD rates of more than 10% were offered during 1998 before capital controls were implemented (note your FD rate is across banks/FIs over the whole year).

Why the finance company is willing to pay such a high interest for such a LONG period (60 mths)? Valid question...
Please refer the articles in 3) and 4) to get an idea why. AmFinance was the largest car financier at that time (HP rate of 8% translates to an effective rate of 14+% for a 5-yr car loan). Someone mentioned on asset-liability management for financial institutions (in this case, duration matching) - it can make sense for the finance company to give such FD rates for such a duration to support its HP loans during the period. During that period, the liquidity crunch was BAD and finance  companies were trying their best to ATTRACT as much as longer-term FDs as possible.

-deleted - aiyamak, seeing things this morning, pre-caffeine ingestion period.
my apologies 

Ok Guys/girls, let say the situation is twisted.

Instead of recession, we have hyperinflation.

Q.

1. What happen to our RM500k cash saving / epf?

2. Existing loan? Let say RM500k, Islamic fixed rate.
I manage to work as a cleaner in a restaurant during hyperinflation and they pay me RM1 trillion per hour. Can I pay my loan? If no, is there are specific bank's t&c that allow them to restrict us to pay?

Can someone enlighten me?

Hm.. methinks people who havent been in war (me included) are just extrapolating based on investing logic.

When sh*t hits the fan and REAL WAR (even between 2 countries) happens here in Malaysia, investing logic would most probably be thrown out, replaced by survival & security.
ie - concentrating on saving our ass, rather than assets 

Just an armchair logic thought.

I like u statement.
Poor/middle class people are always being the one who suffer(which form the majority of population).
Sad to say that rich people still haven't realized/acknowledged it.
The classic example is GST...

it is due to the mismanagement of money that malaysia is now in deficit. That is why GST will be introduced in the future, hopefully can fill up government's coffers so that the gomen can misuse the money again..

Hhehe - yup yup, be frugal and save. Hey, that's a good idea EVEN when there's no down turn leh

dont lar re-enact the Japanese occupation bro
Frugal AND healthy lar - throw into bubur an egg + some roughage/fiber  - walla, all the macro-nutrients there, carbo, protein & fiber, else cant survive to see the investment grow 

LOL..if global recession does happen, standby lah to makan those day n night. xD

besides that, i wanna share sumtg. my colleague is getting RM1.6k when he 1st join.he got a degree in Marketing and afta 3 months he now earns rm1.8k. im holding a diploma and earning more than him. its wierd dun u think.

Yup yup - i agree. My buddies migrated to AU, NZ and Canada - like 8 out of 10 came back to do biz heheh.

Germany slams 'stupid' US plans to boost EU rescue fund
Germany and America were on a collision course on Tuesday night over the handling of Europe's debt crisis after Berlin savaged plans to boost the EU rescue fund as a "stupid idea" and told the White House to sort out its own mess before giving gratuitous advice to others.

German finance minister Wolfgang Schauble said it would be a folly to boost the EU's bail-out machinery (EFSF) beyond its €440bn lending limit by deploying leverage to up to €2 trillion, perhaps by raising funds from the European Central Bank.

"I don't understand how anyone in the European Commission can have such a stupid idea. The result would be to endanger the AAA sovereign debt ratings of other member states. It makes no sense," he said.

Mr Schauble told Washington to mind its own businesss after President Barack Obama rebuked EU leaders for failing to recapitalise banks and allowing the debt crisis to escalate to the point where it is "scaring the world".

"It's always much easier to give advice to others than to decide for yourself. I am well prepared to give advice to the US government," he said.

The comments risk irritating the White House. US Treasury Secretary Tim Geithner has been a key driver of plans to give the EFSF enough firepower to shore up Italy and Spain, fearing a drift into "cascading default, bank runs and catastrophic risk" without dramatic action.

The danger for Germany is that America will lose patience, with unpredictable consequences. The US Federal Reserve is currently propping up the European banking system in a variety of ways, including dollar swaps.

Markets across the world ignored the mixed signals about the true scope of EU rescue measures, convinced that EU leaders have a "grand plan" up their sleeves and will unveil the details after the Bundestag has voted on Thursday on the earlier July deal to revamp the fund.

France's CAC-40 surged by 5.7pc, led by a 17pc rise for Societe Generale. Germany's Dax was up 5.3pc. The FTSE 100 jumped 4pc in London, the biggest one-day rise this year. Oil jumped almost $4 in New York to $88 a barrel.

In Berlin, Chancellor Angela Merkel was fighting for her political life as the rump of lawmakers from her coalition vowed to reject the EFSF package, though the latest tally suggests she may squeeze by with her own majority. Angry dissidents suspect that secret plans are being withheld until after the vote.

Greek premier George Papandreou told German business leaders that his country would honour its austerity pledges, but also issued a veiled warning. "The persistent criticisms levelled against Greece are deeply frustrating, not only at the political level, where a superhuman effort is being made to meet stringent targets in a deepening recession, but frustrating also for the Greeks, who are making these painful sacrifices."

"Drastic measures have had a dramatic impact on the living standards of our citizens. Many Greeks feel they have little left to give. If people feel only punishment and scorn, this crisis will become a lost cause," he said.

Mr Papandreou's Pasok party passed a crucial vote on Tuesday to raise property taxes, but at a high political price. The party's approval rating has fallen to 15pc in the latest Mega poll.

However, Greece was confronted with a new threat as it emerged that several eurozone members are demanding the private sector absorb bigger losses than originally agreed as part of a second bail-out.

A deal struck in July would see creditors taking 21pc losses on their Greek debt holdings, adding around €45bn to the €109bn proposed second rescue. However, more than a third of the 17-member single currency bloc are now said to be demanding bigger haircuts for the private sector. Talk of revisions to the second bail-out may renew default fears as the IMF has yet to re-engage with Greece over the latest €8bn tranche of its initial €110bn rescue. Greece is at risk of running out of money by October 8, though analysts say the payment is almost certain to be made whether or not Greece has complied fully with the terms.

Greece has a trump card in rescue talks with the IMF-EU "Troika". If it opts for a "hard default", it could set off a chain reaction. Lorenzo Bini-Smaghi, an ECB board member, said those arguing that Europe's banks could withstand a Greek default are misguided. "Similar views were held before Lehman. Those who say this have no idea how contagion works," he said.

Analysts say the Troika will have to approve the next €8bn tranche of aid for Athens in October whether or not Greece has complied fully with the terms. It cannot risk a showdown before Europe's banks have beefed up their capital base, or before the EFSF is fully equipped to defend the rest of the system.

Like a forced marriage, Europe and Greece must kiss and pretend.

— Malaysia’s largest lender urged authorities today to step up monitoring of personal loans, saying that it was becoming a cause for concern.

This comes as the nation’s household debt increased from 66.7 per cent in 2004 to 76 per cent in 2009, which is uncomfortably close to US levels prior to the 2008 financial crisis.

Malaysians are facing increasing financial pressures as salaries have not kept up with inflation and many turn to personal loans and credit cards to help fund living expenses.

The size of the money lending industry is reflected by the extent of advertising of personal loans, many with the interest rate of one per cent a month.

Some vernacular newspapers carry two to three full pages of advertisements for personal loans and stickers promoting money lending vendors also appear frequently pasted on lamp posts, vacant shoplots and the boots of taxi cabs. 

Figures provided by Bank Negara in March show that personal loans made up 15 per cent of the overall household debt composition.

“We need stronger enforcement on personal loans,” said Maybank CEO Datuk Seri Abdul Wahid Omar in a press conference following Maybank’s AGM here today.