Forget the NEP or NEM- learn from LTJ

 

Forget NEP or NEM- this is the way to be a high income earner.

It began with whispers that the Terengganu Investment Authority( TIA) was formed as a sovereign wealth fund on the advice of a certain Taek Jho, Low. This name was Americanized where we got it backwards. His name is Low Taek Jho. That sounds more familiar.

When the TIA was engulfed in all sort of brouhaha with rival political groups wanting their hands on it, it was decided that the Malaysian government will take over. It was renamed as 1Malaysia Develoment Berhad, 1MDB. It is now controlled by the federal government under the watchful eyes of the PM.

When it was the TIA, it was safe to assume the direct beneficiaries of the TIA are the Terengganu people. After all it is their oil royalty money. But we can't have the state handling the huge amount of money. State government doesn't have the mind to handle that amount. The Terengganu government is not sufficiently qualified to handle the oil royalty.

It could also be that the UMNO led government in Terengganu is not trusted even by the UMNO led federal government. The application of the oil royalties during the time when Idris Jusoh was the MB of Terengganu hasn't been explained fully and appeared to be swept under the carpet. The Najib administration thinks having the oil royalty money in the state government's hand is like entrusting the fox to guard the chicken coop. in addition, this is forward thinking too. What if the state government is a PAS government? It will have control over the fund then.

We also heard the whispers about this Low Taek Jho throwing a party for the PM's wife when she was in New York. This party wasn't the one, where the chubby Low was seen holding a large bottle of Champagne or something in a large bottle with the singer Usher. It was another one where no one has yet got any visual evidence. It seems that he hobnobs with the singing royalties. He was also the one who was rumored to throw another party at a leading hotel in Kuala Lumpur for the PM's wife. Again, no photos to show.

If the stories about him giving parties to the PM's wife are true, that means he enjoys a good business relationship with the PM. Low therefore joins a group of other young business people who are said to have good business relationship with the PM's wife.

It is also safe to assume that Low Taik Jho was the one who suggested the TIA be renamed as the 1MDP thus giving effective control over the fund by the federal government. Low and his associates were and are still probably influencing agents to the board of trustees of the 1MDB. I hear, the board has members from Tabung Haji, EPF and LTAT and probably others. It isn't clear whether Low and his associates are part of this group. What seems to be the case is, Low and his associates appear to exercise great influence over the running of the 1MDB creating much uneasiness on the part of older and wizened trustees of 1MDB  Sometime ago, I have written about some distinguished members of the board of trustees relinquishing their posts because of excessive interference from the Wharton trained Low. I am not going to say their leaving is bad because they may have left for the simple reason their own investment thinking wasn't dynamic enough.

When Low says he has nothing to do with the proposed development of the Sungai Besi air base, he may be speaking the truth, technically. He hasn't got direct involvement but that doesn't rule out indirect involvement.

1MDB is a prominent party in this project. Through 1MDB in which Low has persuasive powers, he can be said to have interests in that project. He may also be the deal maker behind the other parties involved in the Sungai Besi project.

We must remember that he is basically a deal maker- flipping deals here and there. He may have been the one given permission to package the project and sell it to another business group. In that way, 1MDB and others behind the Sungai Besi project do not have to do anything but enjoy receiving money by being owners of the project. It was said that when 1MDB and two other parties got the project, Low was the driving agent to flip a deal to sell the project outright to another party. Finally we hear, the owners and developers of KL's Pavilion were persuaded to develop the project. 1MDB and the others enjoy the benefits of being JV partners.

As in any JV partnership with land or projects, the owners will get a certain percentage in terms of development units and also enjoy some upfront premium. Or if the owners of the project want it, they can convert their share of development units into cash. The deal flipper who makes this deal possible then earns income as commissioned agents. Maybe we have to ask the owners and developers of Pavilion, what's involved.