The Ringgit Will Continue Falling Here S Why


 

The ringgit falls; the public outcry starts; the opposition starts blaming the government for the ringgit’s fall; the government says the ringgit’s performance is out of its control.
Rinse and repeat ad infinitum.
No matter who is in power, this cycle repeats itself every few years. And every time it repeats, the ringgit hits a new low against the US dollar. Just look at the abysmal ringgit to US dollar chart below:

(Graphic courtesy of xe)In the past 10 years alone, the ringgit has collapsed by 31% against the US dollar, most recently hitting RM4.80 per US dollar. Sure, this is bad, but it’s not just the ringgit that has met this fate. Every other currency is also collapsing against the US dollar.
Within the same 10-year period, in relation to the US dollar, the Chinese renminbi has depreciated by 15%, the Euro by 21%, the Singapore dollar by 6% and the Indonesian rupiah by 26%.
Sure, you could argue that the ringgit has depreciated the most among the currencies I’ve listed above. And you’d be right. You could provide very legitimate reasons for this – loss of investor confidence in Malaysia, brain drain, slowing productivity, neighbouring countries besting us, etc. And again, you’d be right.
But you’ll only be answering the question of why the ringgit is depreciating faster than other currencies, not why it’s depreciating in the first place.
Why are we competing to have the currency that depreciates the least against the US dollar, when the US dollar itself has been depreciating? A fantastic illustration of the loss of the US dollar’s purchasing power over time is shown below:
(Graphic courtesy of Visual Capitalist)We’re using a broken barometer – the US dollar – to measure the ringgit’s performance. And so we’re asking the wrong question. The US dollar is simply the least bad fiat currency. Every other fiat currency is worse, to varying degrees.
What befuddles me is the fact that we have taken our inflationary reality as a fact of life. We have come to terms with the fact that our money, our life savings, and the fruits of our hard labour will inevitably lose much of its value over time.
But this isn’t a fact of life like gravity or the irreversibility of time.
The primary reason for the dastardly inflation we experience is money printing by central banks. Just look at the incredible graph of the ringgit’s money supply below:
(Graphic courtesy of Trading Economics)Since 1970, we’ve gone from having RM4.1 billion in circulation to RM2.4 trillion now. This is an eye-watering 580-times increase in money supply in the span of 54 years.
That comes up to an average of about a 10% increase in money supply every year. This means our base annual inflation rate, excluding any extenuating factors that might cause the prices of goods and services to increase, is 10%.
This means if you had RM100,000 ten years ago, that money can only buy RM38,500 worth of goods in real terms today. Almost two thirds of your money has been wiped out in a mere 10 years.
So no matter who controls the government, what the government does, how effective its initiatives are or how attractive it makes Malaysia to investors, as long as the profligate money printing continues, the ringgit will continue to depreciate, both relative to the US dollar and in absolute terms.
And as terrible as this sounds, the reason no one bats an eye is because every central bank in the world does this – everyone dilutes their currency, inadvertently making their populations poorer over time.
Inflation via money printing is the most insidious form of taxation – because most people either don’t know about it or don’t realise how it’s affecting them on a day-to-day basis.
Central banks, with their embrace of Keynesian economics-inspired loose monetary policy, will likely never stop printing money out of thin air. So fiat currencies, including the ringgit, will continue getting debased and inflated away.
As Professor Hans-Hermann Hoppe of the University of Nevada says: “The second source of funding for the ruling elites, besides the money extorted from the public in the form of taxes, comes from the central bank. Central banks are allowed to create paper money out of thin air. This reduces the purchasing power of money and destroys the savings of average people.”
So it’s pointless blaming the government for the poor performance of the ringgit.
All it can do – even in a best-case scenario – is make the ringgit marginally less inflationary. And in the long-run even this won’t matter; it’ll only delay the inevitable and irreversible decay of our purchasing power.
The only way out is for us to take personal responsibility for our financial security. The only way out is to own hard assets – assets that can’t be inflated away by the whims and fancies of those in power.
The government can’t save you. Save yourselves. - FMT
The writer can be contacted at [email protected].
The views expressed are those of the writer and do not necessarily reflect those of MMKtT


Artikel ini hanyalah simpanan cache dari url asal penulis yang berkebarangkalian sudah terlalu lama atau sudah dibuang :

http://malaysiansmustknowthetruth.blogspot.com/2024/03/the-ringgit-will-continue-falling-heres.html

Kempen Promosi dan Iklan
Kami memerlukan jasa baik anda untuk menyokong kempen pengiklanan dalam website kami. Serba sedikit anda telah membantu kami untuk mengekalkan servis percuma aggregating ini kepada semua.

Anda juga boleh memberikan sumbangan anda kepada kami dengan menghubungi kami di sini
Why Is The Ringgit Falling

Why Is The Ringgit Falling

papar berkaitan - pada 24/2/2024 - jumlah : 236 hits
The Malaysian ringgit has fallen 4 8 this year and we have not even reached the end of February The ringgit briefly touched 4 80 to the US dollar the lowest since September 1998 when it reached 4 8850 to the dollar and a fixed exchange rate...
The Anwar Mahathir Feud Is A Factor In The Ringgit S 26 Year Low

The Anwar Mahathir Feud Is A Factor In The Ringgit S 26 Year Low

papar berkaitan - pada 26/2/2024 - jumlah : 179 hits
The leaders of the ancien r gime will likely be retaliating against Anwar s action by selling off their assets in Malaysia in order to trigger a loss of confidence in the ringgit Nehru Sathiamoorthy This week by touching RM 4 80 to the doll...
Why Didn T Cabinet Discuss Ringgit S Decline Asks Hamzah

Why Didn T Cabinet Discuss Ringgit S Decline Asks Hamzah

papar berkaitan - pada 27/2/2024 - jumlah : 223 hits
Opposition leader Hamzah Zainudin urged Prime Minister Anwar Ibrahim to be responsible and take the bull by the horns instead of putting the blame on others KUALA LUMPUR Opposition leader Hamzah Zainudin has questioned the government s comm...
Opinion Why Did Hassan Karim Say That The New King Is Out Of Line

Opinion Why Did Hassan Karim Say That The New King Is Out Of Line

papar berkaitan - pada 3/3/2024 - jumlah : 109 hits
Nehru Sathiamoorthy After hearing the Agong s speech during the opening of the Dewan Rakyat Pasir Gudang MP Hassan Karim has called out the new Agong by saying that the Agong has crossed the line Does Hassan Karim s statement have any merit...
Hold Steady On The Ringgit

Hold Steady On The Ringgit

papar berkaitan - pada 29/2/2024 - jumlah : 196 hits
The recent comments by Bank Negara Malaysia governor Abdul Rasheed Ghaffour that the ringgit should be higher based on fundamentals is correct This is not a shift in policy or position because his predecessor Nor Shamsiah Mohd Yunus made si...
Bnm Unlikely To Hike Opr To Strengthen The Ringgit

Bnm Unlikely To Hike Opr To Strengthen The Ringgit

papar berkaitan - pada 7/3/2024 - jumlah : 270 hits
BNM governor and MPC chairman Abdul Rasheed Ghaffour is unlikely to use monetary policy measures to strengthen the ringgit say economists PETALING JAYA Bank Negara Malaysia is expected to prioritise supporting economic growth rather than pr...
E Testing Will Put The Brakes On Corruption

E Testing Will Put The Brakes On Corruption

papar berkaitan - pada 6/3/2024 - jumlah : 130 hits
PETALING JAYA The e Testing system is a step in the right direction to fight corrupt practices say experts Persatuan Institut Memandu Malaysia president Mat Aris Bakar said other than eliminating the problem of corruption e Testing will als...
Digging Up The Truth Why Precast Concrete Septic Tanks Are A Game Changer

Digging Up The Truth Why Precast Concrete Septic Tanks Are A Game Changer

papar berkaitan - pada 5/3/2024 - jumlah : 117 hits
For years homeowners have been relying on concrete septic tanks They have imagined work intensive processes as well as disruptive excavations The precast concrete tank has transformed the system of septic and brought an age of efficiency an...
What Will Taib Mahmud S Death Mean For Sarawak And The Federation

What Will Taib Mahmud S Death Mean For Sarawak And The Federation

papar berkaitan - pada 23/2/2024 - jumlah : 176 hits
Now with Taib gone and the power structure in Putrajaya weakened by internal fighting it is a question mark as to whether the Melanau Putrajaya agreement to control Sarawak will still hold Nehru Sathiamoorthy Taib Mahmud This raises a lot o...
Duit Aku Hidup Aku Oleh Faiz Azmi

Iron Filters For Well Water On A Budget Affordable Options That Work Your Comprehensive Guide Pen Spark

Your Guide To Using Paymaya For Online Casinos In Ph

Isu Rosmah Disaman Usd 346 Juta Daripada 1mdb 10 Pihak Lagi

Lelaki Bengang Staf Stesen Minyak Terima Tip Netizen Tanya Kenapa Bitter Sangat

Uitm Apartheid Akmal Ingatkan Jangan Jadi Si Kitol

2024 Sustainability Report Our Pledge For The Planet

Pergi Utem Untuk Ujian Peningkatan Taekwondo 2024



5 Kumpulan Muzik Terkenal Dengan Suara Vokalis Yang Annoying

10 Drama Melayu Terbaru TV3 Best Mesti Tonton 2024 Juga Tersedia Online

5 Sisi Gelap Perangai Guru di Malaysia Yang Kita Takut Nak Perkatakan

Info Sinopsis Kutipan The Experts Filem Malaysia 2024

10 Fakta Biodata MK K Clique Pelakon Drama Berepisod Aku Bukan Ustazah TV3 Gandingan Erysha Emyra Yang Beristerikan Siti Hajaar Syeikh Nordin


April Birthdays

Combat Allergies With Electrostatic Pleated Air Filters

Tular Video Warga Asing Kena Jerkah Beli Minyak Masak Subsidi You Malaysian Ke

Adun Sungai Bakap Meninggal Dunia

Politik Melayu Utamakan Parti Dan Bukan Perpaduan

Ulasan Sennheiser Momentum Sport Lightning Kenyamanan Lebih Utama Daripada Kepentingan Kualiti Suara