Two weeks ago, I profiled Umno MPs into three categories: the first, hard-core supporters of Prime Minister Datuk Seri Najib Razak, whom I counted at 26; those who were anti-PM, whom I counted as 8; and the middle ground, whom I counted at 56.
We can now update the numbers: those who support the PM are now down by 3, to 23 and those who are against the PM are up by 4 at 12.
The movement was a result of a shift in 3 formerly hardcore Najib supporters and 1 “on the fence” category to the anti-Najib category. The Bugis Warrior ship continues to leak support and the longer it continues, the easier it will be to separate those condemned to go down with the Bugis dingy and those who have made the smart choice to save Umno and themselves.
The issue is that the longer the 1MDB crisis goes on, the more ludicrous Najib’s position becomes. A few months ago he was trumpeting the “assets are greater than liabilities” scenario. Tan Sri Dr Zeti Akhtar Aziz then quipped and said that 1MDB did not pose a systemic risk to the Malaysian banking sector and the 1MDB CEO asked us to believe that the Cayman Islands investment was redeemed in cash because “he sighted the statement”.
Now we know all of that to be a pack of lies.
From rosy picture to meltdown scenario
The Cayman Islands investment has not been redeemed and is currently held as ownership interest in illiquid “units”. The second finance minister says that the risk of 1MDB failing is so severe that in order to prevent a meltdown of the Malaysian financial sector, the Cabinet needs to approve an emergency bailout through the GLCs such as Tenaga Nasional and other parties.
Tellingly, the central bank governor is quiet as a mouse as she had said that 1MDB does not pose a systemic risk to the banking sector. The PM on the other hand has changed tack from singing about 1MDB’s balance sheet to talking more about his heritage as a Bugis seafarer.
Interestingly, many of the ancient Bugis seafarers were known to be bloodthirsty pirates. Talking too much about this heritage is tantamount to admitting to being the “Pirate of Putrajaya”.
About to explode
It seems that 1MDB is running out of time. Rather than “wait for the auditor-general’s report”, the second minister of finance is busy putting the finishing touches to a comprehensive bailout of the sovereign debt scheme.
The plan calls for TNB to purchase 1MDB’s already inflated power assets at even more inflated prices. No doubt given the huge sums being talked about, such an action could lead to a downgrading of TNB’s credit rating and a huge selloff in the stock.
Once again, the public would be the losers due to their holdings in collective investment schemes such as Tabung Haji, KWAP, EPF which invest heavily in the Malaysian stock exchange.
I expect the bailout plan to be opposed at the Cabinet. As I said, the PM is now heavily relying on Datuk Seri Ahmad Zahid Hamidi to prop him up but Zahid’s political strength is being wasted in supporting Najib.
The video of Tan Sri Muhiyiddin Yassin’s call for the board of 1MDB to be sacked has received over 300,000 views and is being echoed by other members of Parliament and Umno supreme council members. From my calculation, the PM would not be able to pass the Handzalah bailout plan through as opposition to the PM's handling of the 1MDB crisis gets louder. - TMI
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