QUOTE(AVFAN @ Aug 17 2020, 01:50 PM)
ya, read that.
there was another one this morning crticizing maybank for its "necessary" article on windfall tax.
not sure if it is from him.
https://www.thestar.com.my/business/busines...r-some-pressureperhaps too many are trying to kill this goose that lays golden eggs!
Nope it's from him.
Remember the other posting you highlighted to me?
http://malaysiafinance.blogspot.com/2020/0...-prognosis.htmllet me post here.................. >>>>>>>>>
NOTE TO FINANCE MINISTRY
While it is speculative at the moment, the powers to be SHOULD NOT stamp out the current market momentum. For one, the last 3 months have more than INJECTED SUFFICIENT STIMULUS, MONEY VELOCITY into the economy to more than cover the contractions owing to the prolonged ill effects of Covid19/MCO.
This will not only save the government coffers billions of ringgit in unnecessary stimulus packages but will help "redivert government funds" to other affected sectors not benefitting from the market boom.
Let's just see how much "money" has or can flow to the economy. Let's just look at the glove related sector. Let's just assume 20% of shares were traded by retail and gains were pocketed.
CAREPLUS 540m shares 20% x 5.10 = RM550m
HLT 525m 20% x 2.30 = RM241.5m
SUPERMAX 1.3bn 20% x 21.00 = RM5.46bn
TOP GLOVE 2.7bn 20% x 22.00 = RM11.88bn
HARTA 3.4bn 20% x 13.00 = RM8.84bn
That's just a few, and that's like more than RM28bn ... imagine a stimulus program announced to inject RM28bn. Coupled with the run on small caps, we are looking at an approximate figure of RM35bn thus far. It doesn't stretch the government's coffers of debt burden.
That conservative RM35bn has a velocity of money factor into the real economy. Depending on which economist you ask, its 5x-8x value to the real economy. Simply said, the monies will be primarily used in the economy and spending flows, it trickles down the line.
Hence it is totally silly to even think of imposing a windfall tax on glove makers. How much can the government get? Assume they make RM3bn this year, taxing 10% is only RM300m ... but you will impact gravely on the market run. Collectively they have already "injected" RM28bn into the real economy, and even more in coming months ... do you really want to derail all that for RM300m. What can you do with RM300m a year? They are doing R28bn stimulus thus far. So think properly.