Big news for small wallets; Malaysians of the Year 2014 will be the working class who survive the price hikes

Updated: Monday January 6, 2014 MYT 7:36:49 AM

Big news for small wallets

BY PHILIP GOLINGAI

The issue is unavoidable. Everybody is talking about the various price hikes. And the joke is that the only thing that is not going up is our salary.

SIX days into the new year and it is obvious that the newsmaker for 2014 will be …(drum roll, please)… price hikes! Barring any major sex video scandal or street protests, price hike stories will top the news this year.The issue is unavoidable. Everybody is talking about electricity tariff hike, sugar subsidy withdrawal, lower fuel subsidy, higher toll rates, GST and higher prices, water tariff hike and transport hike.

The joke is that the only thing that is not going up is our salary.

I welcomed the new year with the worrisome thought that my purchasing power has shrunk. Whenever I think about it, I’m reminded of what my mum used to complain about in the 1980s.

Nokonini noh limo nohopod ringgit (RM50 has shrunk),” she would complain after her weekly shopping at the Donggongon tamu near Kota Kinabalu.

“I use to be able to buy everything (a week’s shopping budget for a family of six) for RM50 in the tamu (weekly farmers’ market in Sabah) but now RM50 can’t buy you anything.”

Whenever she complained, I would roll my eyes.

Now, 30 years later, I’ve become my mother. Lately, I’ve been complaining that RM100 can’t buy you anything.

Actually, RM100 can buy me a tankful of RON95 for my Proton Exora. But that would probably last me for four or five days of driving from home to office and back, and weekend drives.

For sure, RM100 can’t buy me much when I go for grocery shopping for a family of four. The other day, I was in an upmarket supermarket in Subang Jaya. My wife bought our normal weekly supplies and the bill came up to RM470.

Shocking, as our weekly grocery bill in that supermarket was usually around RM300.

“Must be the (three packets of) imported tortilla chips,” my wife told me.

The grocery bill shocker made me think that I should stop my middle-class thinking. In this tough year, I need a working class mindset.

That means goodbye Australian beef, hello beef from India.

Where can you find beef from India that is cheaper than the beef imported from Australia?

The hypermarket.

“I might change where I go for my grocery shopping,” I told a colleague of mine.

“I do my grocery shopping at a hypermart in Kuchai Lama (in Kuala Lumpur). This place is even cheaper than the branded hypermart. It sells things at wholesale prices. The vegetables and fish are affordable,” said my middle-class colleague.

“If you want even cheaper prices, go to this hypermarket in Sri Sentosa (in Kuala Lumpur). This is where the hawkers go for their shopping.”

“But how is the place? Comfortable kah to go shopping there?” I asked.

“If you want ‘glamour’ (If you want some place fancier), then you don’t go. The hypermart in Sri Sentosa doesn’t have air-conditioning. But it is bearable, especially when you are in the frozen food section,” he said.

“I might go,” I said.

But at the back of my mind, I knew that times are not that bad and at the most, I’ll shop at hypermarts like Giant and Tesco.

I also thought, “OMG, Kuchai Lama and Sri Sentosa really sound working-class. I want to shop in Bangsar and Subang Jaya.”

Actually, I grew up in a middle-class family that spent money like a working-class one, so it should not be a problem for me to switch my mindset. (That’s in theory.)

Growing up in a frugal family should have taught me a thing or two about saving.

My late dad cut my hair to save money. Wonder what he would think if he knew I paid RM58 (plus shampoo) for my five-year-old daughter Apsara’s back-to-school bob hairstyle.

When I was a student, it was “first to Bata then to school” but for Apsara’s school shoes, I bought her a pair of RM159 Stride Rites (children’s footwear from the United States).

Eating out was a big event for the family. We ate at a Chinese restaurant once a month. Back then, ordering a Coca Cola was a special treat for me. Now, it is Japanese dinner once or twice a week.

My parents (and some families in my middle-class neighbourhood at Taman Kinamount in Kota Kinabalu) raised chicken in their backyards. It was traumatic for me to eat the family pet, especially after witnessing how daddy slaughtered it with a kitchen knife.

I, however, don’t think I’ll ever rear my own chicken and slaughter them just to save a few ringgit.

With the electricity tariff hike, I’ve noticed I’ve become my mother. She nagged us to switch off electrical appliances when we were not using it. Again, I would roll my eyes, thinking what was the big deal; it was only electricity.

Now karma has struck back. I get nervous when the two air-conditioners are switched on. I also try to cut unnecessary electricity usage.

(Oops! as I’m writing this article, I just noticed that the 42-inch television is on and nobody is watching. I’ll go and switch it off.)

If I – a middle-class person – feel the price hikes, I wonder how the working-class is coping.

Perhaps, my Malaysians of the Year 2014 will be the working class who survive the price hikes.

Unknown's avatarAbout bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

Leave a comment